Review of Keystone Contractor Won’t Be Complete Before January

The investigation of an alleged conflict of interest by a U.S. State Department contractor reviewing the proposed Keystone XL pipeline won’t be complete until January.

The State Department’s Office on the Inspector General announced today that it was reviewing whether recommendations it made in a separate February 2012 report into conflict questions about another Keystone contractor are being followed as the department conducts an environmental review of the $5.3 billion project.

That review won’t be completed until January, Douglas Welty, a spokesman for the watchdog agency, said in an e-mail. The inspector general’s office earlier this month said it opened an inquiry into allegations made by Friends of the Earth and other Keystone critics that ERM Group Inc., which is writing the supplemental impact statement, has financial ties to TransCanada Corp. (TRP), Keystone’s sponsor.

The results of this inquiry and the review on whether recommendations regarding the transparency of the permitting process will be released in one report, Welty said in an interview.

He referred questions about whether the review would delay a decision on the Keystone project to the State Department, which issued a statement saying it is “committed to a rigorous, transparent and efficient federal review” of the project.

The agency has jurisdiction over the proposed pipeline to link Canadian oil sands to refineries on the U.S. Gulf of Mexico because it crosses an international border.

To contact the reporter on this story: Jim Snyder in Washington at jsnyder24@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net

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