Keystone XL: State Department cleared of conflict, not ineptness

An internal audit released Thursday cleared the State Department of major missteps and conflicts of interest in its three-year environmental review of the Keystone XL pipeline.

But the report faulted the agency for its lack of expertise in conducting environmental assessments and for not doing enough to consider alternate routes for the Alberta-to-Texas pipeline, issues at the heart of criticisms of the State Department’s review.

Last month, the State Department denied the Canadian company TransCanada its application to build Keystone XL, after determining that a 60-day deadline imposed recently by Congress on the permitting process would not let it complete a thorough review.

The Keystone issue has dragged on since 2008 in part because of criticisms of the State Department’s  environmental impact statement, which the Environmental Protection Agency found severely inadequate in early versions. The project underwent further delay after the State Department ascertained that it needed to consider alternate routes to the pipeline, a point the project’s critics had made for years.

The new report on the environmental review process was issued by the State Department Inspector General’s office, and conducted at the request of several members of Congress, including Sen. Bernie Sanders (I-Vt.) and Rep. Steve Cohen (D-Tenn). The Inspector General’s report punctured arguments by long-time critics that the State Department’s review was tilted in favor of TransCanada, and that its staff built cozy relationships with TransCanada lobbyists.

The report said: “OIG [Office of Inspector General] determined that the department did not violate its role as an unbiased oversight agency.”

But it made several observations and recommendations that support critics’ claims that aspects of the review were problematic.  In response to the congressional request, the Inspector General’s office looked into the relationship between TransCanada and Cardno Entrix, the outside contractor hired by the State Department to conduct the environmental impact statement. Last July, it emerged that Cardno Entrix considered TransCanada a significant client.

In its report, the Inspector General determined that there was no conflict of interest between Cardno Entrix and TransCanada. But it criticized the State Department for not performing “any independent inquiry to verify Cardno Entrix’s organizational conflict of interest statements.”

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Photo: The Keystone XL pipeline would have crossed the Nebraska Sandhills, which overlay the Ogallala aquifer. The aquifer provides water to eight states and is one of the nation's most important agricultural water supplies. Credit: Kim Murphy / Los Angeles Times

U.S. bans new Grand Canyon uranium-mining claims

Interior Secretary Ken Salazar announced Monday a final decision to impose a 20-year ban on new mining claims on 1 million acres surrounding the Grand Canyon, an area where uranium mining stakes have spiked 2,000% in the last seven years.

The ban "is the right approach for this priceless American landscape," Salazar said. "We have been entrusted to care for and protect our precious environmental and cultural resources, and we have chosen a responsible path that makes sense for this and future generations."

Environmentalists and some lawmakers praised the decision, saying it would protect the critical Colorado River watershed from possible contamination from uranium mining and would prevent the Grand Canyon panorama from being gradually industrialized. The Obama administration first indicated last June its intention to sequester the acreage from mining. Mines currently in operation would not be affected.

"People that hunt, fish and drink the water here are concerned about the risks of mining here," said Arizona Wildlife Federation board member Ben Alteneder. "Uranium has a toxic legacy. Why wouldn't we want Secretary Salazar to take precautions to protect our families and local wildlife?"

The mining industry and its congressional supporters warned that removing such a vast swath of land from industry risked jobs and economic growth.

"Safe and responsible mining of this land could have produced thousands of high paying, family wage mining jobs," Rep. Doc Hastings (R-Wash.), chairman of the House Natural Resources Committee, said in a statement. "The United States is already 90% dependent on foreign sources of uranium and this decision only exacerbates our foreign dependence by locking up our own clean energy resources."

The moratorium builds on a 2 /1/2-year hiatus on mining claims Salazar imposed in 2008 in response to the rise of mining claims along the edge of the Grand Canyon National Park.

Mining claims around the Grand Canyon are among the thousands filed by companies along the borders of numerous national parks and wilderness areas. In the last seven years, mining companies, many of them foreign firms, have filed claims to the rights to copper, gold, uranium and other metals on federal land around Mt. Rushmore, Joshua Tree National Park and other famous refuges at an increased rate because of rising global prices, according to a 2011 report by the Pew Environment Group.

Critics say an outmoded 1872 law is driving the increase in claims in such sensitive places. The law allows corporations to stake out rights to federal lands for mining without a competitive bid and to extract resources without paying royalties.

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Photo: The Colorado River cuts through Grand Canyon National Park. Credit: Anacleto Rapping / Los Angeles Times

President Obama implies he will rule on Keystone XL pipeline

President Obama inserted himself into the increasingly contentious fight over building the Keystone XL pipeline from Canada to the U.S. Gulf Coast, implying in a television interview that the ultimate decision about the pipeline’s fate would be his.

Keystone XL needs a so-called presidential permit from the State Department because it crosses a national border. Until now, the administration has said the department would decide whether to grant the permit, based in large part on an environmental impact statement and public comment.

But in an interview at the White House with Omaha’s KETV, the president said: "The State Department's in charge of analyzing this, because there's a pipeline coming in from Canada. They'll be giving me a report over the next several months, and, you know, my general attitude is, what is best for the American people? What’s best for our economy both short term and long term? But also, what's best for the health of the American people?”

As recently as Monday, White House spokesman Jay Carney tried to distance Obama from the decision-making on Keystone. “This is a decision that will be made by the State Department, or is housed within the State Department,” Carney said. 

The White House had no official comment on Obama’s remarks Tuesday. 

Environmentalists praised him for taking ownership of an issue that has increasingly alienated his base and for acknowledging their concerns about the pipeline.

For more than a year, Keystone XL has been mired in controversy. TransCanada, the oil industry and several labor unions have said the project would create thousands of jobs in the United States and reduce the country’s dependence on oil from hostile or unstable countries.

Environmentalists, including many Obama supporters, have argued that the extraction of the crude in Alberta lays waste to the land and increases greenhouse gas emissions. They caution that the proposed route would take the pipeline over the Ogallala Aquifer in Nebraska, the main source of drinking and irrigation water in the High Plains states, and argue that the number of jobs created would be far fewer than the project's backers project.