State Department gets mixed review on Keystone pipeline process

The State Department energy specialists in the eye of the political storm over the proposed Keystone XL pipeline conducted themselves with objectivity as they communicated with the relevant companies and the Canadian government, State’s inspector general said in a report made public Friday.

The IG, however, questioned whether State possesses the requisite technical expertise for approving a major energy project that has become a partisan issue in the debate over the environment and how to create jobs.

State deputy IG Harold Geisel was tasked by lawmakers with evaluating the legality of the communication between State officials and TransCanada (the company hoping to build the pipeline that would stretch 1,700 miles from Canada to the Gulf of Mexico) in selecting the contractor Cardno Entrix to perform the required environmental impact study. Legislators questioned whether TransCanada and some State employees had financial relationships with the contractor and whether State adequately consulted other government entities such as the Environmental Protection Agency.

The IG “found no evidence that TransCanada had improperly influenced the department’s selection of Cardno Entrix as the Keystone XL EIS third-party contractor,” the report said. The final impact statement “generally addressed and incorporated the views and concerns of federal agencies with expertise,” it said.

“However, some concerns, such as the manner in which alternative routes were considered . . . were not completely incorporated. . . and the department’s limited technical resources, expertise and experience impacted the implementation” of the National Environmental Policy Act process.

Geisel recommended that two State bureaus redesign the process for selecting third-party contractors to maximize the department’s control. And he recommended hiring a civil servant with experience in NEPA impact statements.

Sen. Bernie Sanders, I-Vt., who requested the report in November 2011 along with Rep. Steve Cohen, D-Tenn., said in a 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.”

The officers in charge of the review, he added, quoting the report, “had `little or no’ experience with environmental law ‘and had to seek training and learn quickly on the job.’ ”

Elizabeth Heyd, a blogger for the Natural Resources Defense Council, welcomed the report but expressed skepticism toward the process, saying State had “muddied the water” as to who was in charge of gauging potential environmental damage from the project.

“In a procedure that many would liken to the fox guarding the chicken coop, the applicant for a project, in this case, TransCanada, presented the reviewing agency with its choices for contracting out the review,” she wrote. “The IG report explained that that practice has evolved because the applicant pays for the contractor and because this allows reviews to be processed more quickly.”

Asked to comment, Jeff Ostermayer, spokesman for the National Association of Manufacturers, said: “We believe that the Keystone XL project is in the national interest of the country and will create thousands of jobs and provide an affordable source of energy for manufacturers. We are continuing to advocate for the approval of the pipeline.”