OIG Report: State Department’s Keystone XL Environmental Review Flawed

WASHINGTON, DC, February 10, 2012 (ENS) – Several flaws in the State Department’s review of the proposed Keystone XL tar sands oil pipeline were revealed in a report released by the department’s Office of Inspector General on Thursday.

The special internal review faulted aspects of the department’s handling of TransCanada’s proposal to build the pipeline from the tar sands in northern Alberta to refineries in Oklahoma and in Texas on the Gulf of Mexico.

The review was conducted in response to a November 2011 request from Senator Bernie Sanders, a Vermont Independent, and Congressman Steve Cohen, a Tennessee Democrat. The lawmakers asked the inspector general to examine apparent conflicts of interest in the department’s handling of an environmental impact statement.

“The findings confirm once again why the project should not be rubber stamped for approval, despite efforts by Republicans in Congress to do just that,” said Sanders.

The State Department inspector general’s inquiry focused on the department’s use of the environmental consulting firm Cardno Entrix to perform an environmental impact statement for the department.

The same firm had extensive ties to TransCanada, the Keystone XL pipeline developer.

Despite acknowledging that the developer influenced the selection of the firm that studied the environmental impact of the project, the inspector general concluded that the relationship between the two companies was not technically a conflict of interest.

The inspector generally recommended and the State Department agreed to change its contractor selection process in the future.

“The more we learn, the less merit there is to this project,” Sanders said. “For those of us who are concerned about the consequences of global warming and the need to cut greenhouse gas emissions, the idea of producing oil that emits 82 percent more carbon pollution than conventional oil is indefensible.”

“We have better options for the American people that do not jeopardize the future of our country and our planet,” Sanders said. “These include increasing fuel efficiency standards for our cars and trucks, a step which would cut pollution and save up to three times as much oil as Keystone XL could ever deliver.”

The OIG’s report criticized the State Department for failing “to perform any independent inquiry to verify Cardno Entrix’s organizational conflict of interest statements.”

Moreover, the report added, the State Department did not, as required, ask TransCanada to view and certify Cardno Entrix’s organizational conflict of interest statements.

In another key finding, the inspector general said the State Department’s “limited technical resources expertise and experience” hampered the government’s environmental review process. The officers in charge of the review, according to the report, had “little or no” experience with environmental law “and had to seek training and learn quickly on the job.”

In addition, the report said the State Department did not adequately weigh concerns by the Department of Energy and the Environmental Protection Agency about the proposed route of the 1,700 mile pipeline project.

The State Department has authority to recommend to the President whether or not the pipeline would be in the national interest because it would cross an international border.

In January, department sent a recommendation to the White House to deny the project a Presidential Permit.

President Barack Obama on January 18 rejected the 1,700-mile pipeline project, saying it could not be adequately reviewed within a 60-day deadline set by Congress in an amendment to a funding bill.

Republicans in Congress, however, have continued to press for legislation that would authorize the pipeline.

Meanwhile, the state of Nebraska is working towards identifying a new route for the Keystone XL pipeline that does not impact the environmentally sensitive San Hills area of the state, which overlies the Ogllala aquifer, source of drinking and irrigation water for much of the Great Plains.

The Office of Inspector General made the following recommendations in its report:

  1. the State Department’s Bureau of Oceans and International Environmental and Scientific Affairs, in coordination with the Bureau of Administration and the Office of the Legal Adviser, “should redesign the department’s process for selecting third-party contractors by maximizing the department’s control of each step and minimizing the applicants’ role in the process.”
  2. the Department should fill at least one full time Civil Service position within the Bureau of Oceans and International Environmental and Scientific Affairs with staff who have experience and expertise in handling National Environmental Policy Act issues and the environment impact statement process.
  3. the Bureau of Oceans and International Environmental and Scientific Affairs, in coordination with the Bureau of Administration and the Office of the Legal Adviser, should redesign the department’s process for selecting and using third-party contractors in order to improve the department’s organizational conflicts of interest screening process.

Damon Moglen, climate and energy director at Friends of the Earth, said the OIG’s report raises fresh concerns about the process by which the department produced the widely criticized environmental impact statement for the pipeline.

“The report reveals that the department failed to follow even its own flawed procedures. It also contains the striking revelation that the contractor Cardno Entrix, which the department entrusted to manage much of the environmental review process, had a previously undisclosed financial relationship with pipeline firm TransCanada,” Moglen said.

Copyright Environment News Service (ENS) 2012. All rights reserved.