Report: Keystone Contractor Followed Federal Rules

The State Department’s inspector general says a contractor that helped write an environmental review of the proposed Keystone XL oil pipeline complied with federal rules regarding a possible conflict of interest.

A report issued Wednesday said the contractor, Environmental Resources Management, fully disclosed its previous work with the pipeline operator, Calgary-based TransCanada. None of the work for TransCanada involved Keystone XL.

London-based ERM largely wrote the State Department’s Jan. 31 environmental report on the pipeline project. The report raised no major environmental objections to the pipeline, which would carry oil derived from tar sands in western Canada to the Texas Gulf Coast.

Environmental groups say ERM should be disqualified because of its previous work for TransCanada.

The report says the State Department followed federal guidelines regarding use of outside contractors.