TransCanada has formally filed a lawsuit against the US government, seeking $15bn in damages over the rejection of the Keystone XL pipeline project by the US President Barack Obama in November 2016.

Through arbitration under the North American Free Trade Agreement (Nafta), the TransCanada argued that there were reasons for the company to believe that it would win approval to build the pipeline.

The 1,897km, 36-inch-diameter crude oil pipeline was proposed to run from Hardisty, Alberta, Canada and extend south to Steele City, Nebraska, US.

The company also argued that the rejection violated Nafta’s broad rights for foreign investors by thwarting the company’s expectations.

Bloomberg cited TransCanada as saying: "None of that technical analysis or legal wrangling was material to the administration’s final decision.

"Instead, the rejection was symbolic and based merely on the desire to make the US appear strong on climate change, even though the State Department had itself concluded that denial would have no significant impact on the environment."

Rejecting the cross-border crude oil pipeline project in November, the US President determined that the project was not in the national interest.

In response to the rejection by the President, TransCanada vowed to use arbitration provisions in Chapter 11 of Nafta to recover costs and damages in January this year.

Environmental organization Sierra Club executive director Michael Brune said: "Today, we have a prime example of how polluter-friendly trade deals threaten our efforts to tackle the climate crisis, spotlighting the need for a new model of trade model that supports rather than undermines climate action."