TransCanada says it’ll be filing a claim under Chapter 11 of the North American Free Trade Agreement – as a response to the American  government’s rejection of the company’s proposed Keystone XL pipeline.

The company says it has filed a notice of intent to begin the NAFTA claim – on the basis that the denial was unjustified and arbitrary.

TransCanada, based in Calgary says it intends to recover US$15 billion in costs and damages – as a result of what it says is “a breach of NAFTA obligations.”

It has also filed a lawsuit in the U.S. Federal Court in Texas – claiming  that President Barack Obama’s decision to deny construction of Keystone XL – exceeded his power under the U.S. Constitution.

The 1,900-kilometre pipeline has been in a deep-freeze for more than seven years – and has occasionally been an irritant in U.S.-Canadian relations.

The project would have shipped bitumen from Alberta’s oilsands through a pipeline hub in the Hardisty area – to U.S. Gulf Coast refineries.

TransCanada says it had every reason to expect the pipeline would be approved – since it met the same criteria as previous pipelines that were given the go-ahead.