As the U.S. Senate inches closer to a vote that could force the White House to make a decision on the Keystone pipeline, Canada may use the North American Free Trade Agreement to sue the U.S. over the issue, according to news reports.

The government of Prime Minister Stephen Harper is mulling joining forces with Keystone XL builder TransCanada and oil companies to challenge the Obama administration's repeated delays on a decision, the National Post reports, citing unnamed sources.

The U.S. State Department announced earlier this month it is delaying yet again a final decision on the controversial pipeline, until a Nebraska legal challenge is settled. Any decision on the pipeline was effectively pushed off past the U.S. mid-term elections this fall.

The news comes as the U.S. Senate inches closer to a vote on the pipeline that could potentially embarrass the White House.

Senate Majority Leader Harry Reid, a Nevada Democrat, is in talks with Republican and Democratic senators about putting the Keystone XL to a vote next week. The vote would take place in exchange for Republican support of a bipartisan energy efficiency bill.

According to news reports, Reid initially expected it to be a non-binding, symbolic vote that would likely show a majority of U.S. senators in favour of the pipeline. But the latest reports suggest it could be binding legislation that would require the president to make a decision.

Allowing vulnerable Democrats to vote on a bill approving Keystone could give them something to tout on the campaign trail, but approval of binding legislation could embarrass the White House,” The Hill reports.

The Post notes that former prime minister Brian Mulroney, who first signed a free trade deal with the U.S., is among those arguing Canada could successfully sue the U.S. over Keystone.

Mulroney and others argue that the delay amounts to a restriction on the export of Canadian energy to the U.S. Under NAFTA, the U.S. was given unfettered access to Canadian energy, including in emergencies, in exchange for which Canada was given full access to U.S. energy markets.

Under NAFTA, a bi-national arbitration panel has the power to make binding orders on member countries.

Derek Burney, a former Mulroney chief of staff who was instrumental in NAFTA negotiations, said Canada would have a strong case at the arbitration panel, but since the U.S. hasn’t rejected Keystone XL and only delayed a decision, the White House could argue it's simply following necessary procedures.

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  • The Syncrude oil sands extraction facility is reflected in a lake reclaimed from an old mine near the town of Fort McMurray in Alberta, Canada on October 22, 2009.

  • A disused mining machine on display in front of the Syncrude oil sands extraction facility near the town of Fort McMurray in Alberta on October 22, 2009.

  • The Suncor oilsands operation uses trucks that are 3 stories tall, weigh one million pounds, and cost 7 million dollars each.

  • Oil sits on the surface at a Suncor Energy Inc. oilsands mining operation near Fort McMurray, Alberta, Canada, on Tuesday, Aug. 13, 2013. Photographer:

  • A large oil refinery along the Athabasca River in Alberta's Oilsands. Fort McMurray, Alberta.

  • Oils mixes with water at a tailings pond at a Suncor Energy Inc. oilsands mining operation near Fort McMurray, Alberta, Canada, on Tuesday, Aug. 13, 2013.

  • Fort McMurray is in the heart of the world's biggest single oil deposit - the Athabasca Oil Sands, and the oil is extracted by surface mining and refined in the region. The oil production is at the heart of the economy.

  • In this Aug. 5, 2005 file photo, the Syncrude upgrader spreads out towards the horizon at the company's oil sands project in Ft. McMurray, Alberta, Canada.

  • This Tuesday, July 10, 2012 aerial photo shows a Nexen oil sands facility near Fort McMurray, Alberta, Canada.

  • This Sept. 19, 2011 aerial photo shows an oilsands facility near Fort McMurray, in Alberta, Canada.

  • This Sept. 19, 2011 aerial photo shows an oilsands tailings pond at a mine facility near Fort McMurray, in Alberta, Canada.

  • This Sept. 19, 2011 aerial photo shows an oilsands tailings pond at a mine facility near Fort McMurray, in Alberta, Canada.

  • The Syncrude extraction facility in the northern Alberta oil sand fields is reflected in the pool of water being recycled for re-use.

  • A night view of the Syncrude oil sands extraction facility near the town of Fort McMurray in Alberta Province, Canada on October 22, 2009.

  • Aerial view of a lake and forests in the vicinity of oil sands extraction facilities near the town of Fort McMurray in Alberta, Canada on October 23, 2009.

  • Workers use heavy machinery in the tailings pond at the Syncrude oil sands extraction facility near the town of Fort McMurray in Alberta , Canada on October 25, 2009.

  • Fort McMurray is in the heart of the world's biggest single oil deposit - the Athabasca Oil Sands, and the oil is extracted by surface mining and refined in the region. The oil production is at the heart of the economy.

  • A large oil refinery in Alberta's Oilsands project. Fort McMurray, Alberta.

  • Next: Alberta Oil Spills

  • CFB Cold Lake, CNRL

    A bitumen leak was reported at a Canadian Natural Resources oilsands operation in the weapons range part of the RCAF base in June 2013.

  • CFB Cold Lake, CNRL

    Company officials said the leak - at what it calls its Primrose operation - was caused by faulty machinery at one of the wells, affected an area of approximately 13.5 hectares and released as much as 3,200 litres of bitumen each day.

  • CFB Cold Lake, CNRL

    Preliminary tallies put the death toll from the leak at 16 birds, seven small mammals and 38 amphibians. Dozen were rescued and taken to an Edmonton centre for rehabilitation.

  • CFB Cold Lake

    As of early August 2013, more than 1.1 million litres of bitumen had been pulled from marshlands, bushes and waterways.

  • CFB Cold Lake, CNRL

    Although CNRL could not say when the leak may finally be stopped, it estimates it will likely cost more than $40 million to clean up.

  • <em>Click through for other recent spill in Alberta</em>

  • Plains Midstream

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  • Plains Midstream Canada

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  • Plains Midstream Canada

    Debris pushes up against a boom as it stretches out to contain a pipeline leak on the Gleniffer reservoir near Innisfail, Alta., Tuesday, June 12, 2012.

  • Plains Midstream Canada

    A boom stretches out to contain a pipeline leak on the Gleniffer reservoir near Innisfail, Alta., Tuesday, June 12, 2012. Plains Midstream Canada says one of their non-functioning pipelines leaked between 1,000-3,000 barrels of sour crude near Sundre, Alberta, on June 7 and flowed downstream in the Red Deer river to the reservoir.

  • Plains Midstream

    A boom stretches out to contain a pipeline leak on the Gleniffer reservoir near Innisfail, Alta., Tuesday, June 12, 2012. Plains Midstream Canada says one of their non-functioning pipelines leaked between 1,000-3,000 barrels of sour crude near Sundre, Alberta, on June 7 and flowed downstream in the Red Deer river to the reservoir.

  • Plains Midstream Canada

    A photographer snaps a boom stretching out to contain a pipeline leak on the Gleniffer reservoir near Innisfail, Alta., Tuesday, June 12, 2012. Plains Midstream Canada says one of their non-functioning pipelines leaked between 1,000-3,000 barrels of sour crude near Sundre, Alberta, on June 7 and flowed downstream in the Red Deer river to the reservoir.

  • Plains Midstream Canada

    A boom stretches out to contain a pipeline leak on the Gleniffer reservoir near Innisfail, Alta., Tuesday, June 12, 2012. Plains Midstream Canada says one of their non-functioning pipelines leaked between 1,000-3,000 barrels of sour crude near Sundre, Alberta, on June 7 and flowed downstream in the Red Deer river to the reservoir.

  • Plains Midstream Canada

    A worker slows traffic while a boom stretches out to contain a pipeline leak on the Gleniffer reservoir near Innisfail, Alta., Tuesday, June 12, 2012. Plains Midstream Canada says one of their non-functioning pipelines leaked between 1,000-3,000 barrels of sour crude near Sundre, Alberta, on June 7 and flowed downstream in the Red Deer river to the reservoir.

  • Plains Midstream Canada

    A no swimming sign along the banks of the Gleniffer reservoir while a boom stretches out to contain a pipeline leak on the lake near Innisfail, Alta., Friday, June 12, 2012. Plains Midstream Canada says one of their non-functioning pipelines leaked between 1,000-3,000 barrels of sour crude near Sundre, Alberta, on June 7 and flowed downstream in the Red Deer river to the reservoir.

  • Plains Midstream Canada

    Oil from a pipeline leak coats a pond near Sundre, Alta., Friday, June 8, 2012. Plains Midstream Canada says one of their non-functioning pipeline leaked between 1,000-3,000 barrels of oil.

  • Plains Midstream Canada

    Oil from a pipeline leak coats a pond near Sundre, Alta., Friday, June 8, 2012. Plains Midstream Canada says one of their non-functioning pipeline leaked between 1,000-3,000 barrels of oil.

  • Plains Midstream Canada

    Oil from a pipeline leak coats a pond near Sundre, Alta., Friday, June 8, 2012. Plains Midstream Canada says one of their non-functioning pipeline leaked between 1,000-3,000 barrels of oil.

  • Plains Midstream Canada

    Tracks pass through oil on the banks of the Gleniffer reservoir after a pipeline leak near Sundre, Alta., on Friday, June 8, 2012. Plains Midstream Canada says one of their non-functioning pipelines leaked between 1,000-3,000 barrels of oil.

  • Enbrige's Athabasca pipeline

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  • Lake Wabamun

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  • Lake Wabamun

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  • Lake Wabamun

    Wreckage and black oil from the August 3rd train derailment and subsequent oil spill are seen lining the shore and waters of Lake Wabamun on Monday, August 8, 2005, as clean-up continues.

  • Lake Wabamun

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  • Lake Wabamun

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