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State Dept. Pipeline Study to Be Reviewed

The State Department’s inspector general will review the department’s handling of TransCanada Corp. (TRP)’s proposed Keystone XL oil pipeline, agreeing to a request from Congress to determine whether the process violated federal laws.

Senator Bernie Sanders, a Vermont independent, was among lawmakers who asked for an investigation in an Oct. 26 letter to the Office of Inspector General, questioning whether the State Department’s review has been “free of actual or apparent conflicts of interest.”

A memo from the inspector general’s office, released today by Sanders, said the agency was “initiating a special review” of the department’s handling of an environmental study and a pending determination of whether the $7 billion pipeline is in the national interest.

The State Department has denied assertions by environmental groups that its environmental review involved conflicts of interest and favoritism toward TransCanada. The company has said it didn’t try to shape the outcome of the report, which found the pipeline poses “no significant impacts to most resources” along its route provided that Calgary-based TransCanada complies with U.S. law and followed recommended safeguards.

To contact the reporter on this story: David Lerman in Washington at dlerman1@bloomberg.net

To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net

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