| West Texas Intermediate crude for August delivery lost $1.15 to $80.76 on the New York Merc, while Brent for September lost $1.12 to $83.73 (all figures in this para U.S.). Western Canadian Select traded at a discount of $12.70 to WTI, down from a discount of $13.50. Natural gas for August added three cents to $2.19. The TSX energy index lost 3.69 points to close at 287.10. A long-shot legal claim in a two-decade long pipeline saga is drawing to a close. TC Energy Corp. (TRP: $54.60), the company that proposed the controversial Keystone XL pipeline in 2005 and watched it become a political punching bag until dying at the hands of U.S. President Joe Biden in 2021, has lost its bid to recoup $15-billion (U.S.) from the U.S. government. The International Centre for Settlement of Investment Disputes (ICSID) has tossed out the company's argument that the U.S. government breached NAFTA (now USMCA) free-trade obligations. The decision comes three years after TC Energy submitted the claim. Interestingly, this was not the first time it started down this path. In 2016, after a prior president vetoed the pipeline, TC Energy filed a similar claim -- also for $15-billion (U.S.) -- arguing that the veto was "not based on the merits ... [but rather] was a symbolic gesture." That claim was never tested because a subsequent president revived the pipeline in 2017 and TC Energy dropped the suit. When Mr. Biden revoked the pipeline's permit in 2021, the whole rigmarole started up again. In between those filings, NAFTA was replaced by the USMCA (in 2020), but the replacement had a "sunset" period allowing for legacy NAFTA claims until mid-2023, hence TC Energy's use of that route for a second time. Few would dispute the pipeline's significance either symbolically or economically. Yet even fewer believed that TC Energy would emerge victorious, either after the filing in 2016 or the one in 2021. The company would essentially need to prove that it was treated differently because it is Canadian -- a difficult challenge, especially against a formidable opponent. The United States had never before lost a NAFTA battle. (This was true at the time of filing, although the U.S. government has subsequently lost some disputes under NAFTA's replacement, the USMCA.) Now the U.S. government has prevailed again. ICSID has rejected TC Energy's suit, claiming that (apparently in spite of the sunset clause) the legacy provisions are only for breaches that allegedly occurred while NAFTA was in force, whereas Mr. Biden's permit revocation took place afterward. TC Energy called itself "disappointed and frustrated" with the decision. "This ruling does not align with our expectations and views of the plain interpretations of the protections NAFTA and the USMCA were designed to offer," said executive vice-president and general counsel Patrick Keys in a statement. He reiterated the company's belief that it was treated "unfairly and inequitably" and that the revocation was "driven by political considerations." |