U.S. appeals court rejects TransCanada's bid to resume work on Keystone XL pipeline

TransCanada has lost abid to lift an injunctionblockingwork on the Keystone XL pipelinea development that could delay construction work on the $8-billion US project for another year.

The Calgary-based companyand the U.S. State Department hadfiled an "urgent" motion to try to lift theinjunction preventingpre-construction work.

But on Friday, the U.S. Ninth Circuit Court of Appeals denied the motion.

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In court documents, TransCanadahad said delays beyond March 15 could set the project back a whole year from its intended completion date in 2021, costing the company hundreds of millions of dollars in lost earnings.

Following the decision, TransCanada said in a statement that "we are currently assessing the decision and considering our options moving forward."

'Most important ruling'

Lawyer Stephan Volker, who represents the Indigenous Environmental Network and the North Coast Rivers Alliance, both opponents of the project, calledthe appealcourt's decision "pivotal."

"It's outstanding," Volker told CBCNews. "I think that it is the most important ruling in this case."

Volker considers the decision critical because he does not believe U.S. President Donald Trump will be re-elected and said no other administration would sign off on such an "ecologically disastrous project."

"I think it's highly unlikely the U.S. Supreme Court would overturn this ruling," Volker added.

The Keystone XL pipeline would carry 830,000 barrels of crude a day from Hardisty, Alta.,to Nebraska. The pipeline would then connect with the original Keystone that runs to refineries in Texas.

First announced in 2005, the project has been stuck in limbo afterbeing met with considerable political, environmental and Indigenous opposition.

The Obama administration denied Keystone XL's permits, but Trump breathed life back into the project after giving it hispresidential thumbs-up.

Last August, the project met another setback whenU.S. District Court Judge Brian Morris orderedthe U.S. State Department to do a full environmental review of a revised route for the Keystone XL crude oil pipeline.

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In November, Morris put a temporary halt on pre-construction work until the U.S. State Department completed its supplementary review, including potentialadverse effects onclimate change and wildlife.

The following month, the Montana court gave the company permission to continue some pre-construction work such as engineering, awarding contracts and taking meetings.

Still, according to one filing made to the court in January, TransCanada had to lay off about 650 contract workers from pre-construction activities such as pipe yard and workforce camp preparations.

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In February, the companyrequested the appeals court grant it relief from the injunction, asking for a decision by March 15.

'Very substantial harm'

In a legalfiling made earlier in the year, a TransCanada executive said the March date was key to startingconstruction byAugust. Failure to meet the deadline means it "will be unable to perform any construction in 2019."

"A one-year delay in the construction schedule would impose very significant consequences on TransCanada," Norrie Ramsay, TransCanada's senior vice-president of technical centre and liquid projects, wrote in theaffidavit in January.

Ramsay estimated aone-year delay would "result in lost earnings before interest, taxes, depreciation and amortization (EBITDA) of approximately $949 million US between March 2021 and March 2022, based on the minimum take-or-pay shipper commitment."

"In addition, a one-year delay in construction of the pipeline would cause very substantial harm to third parties, including United States workers and TransCanada's customers that are relying on the current in-service date of the project," Ramsay said at the time.