Critics say review of Keystone XL pipeline is 'tainted'

CALGARY, Alberta, Aug. 8 (UPI) -- Pipeline company TransCanada said there is no potential conflict of interest in a U.S. assessment of the proposed Keystone XL oil pipeline.

Environmental campaigner Friends of Earth and watchdog group The Checks and Balances Project allege Environmental Resources Management, a company based in London, has ties to TransCanada by way of a joint venture with Exxon Mobil working on an Alaskan natural gas pipeline.

Ross Hammond, a campaigner with Friends of Earth, said a State Department review of Keystone XL is "tainted" because ERM was contracted by the government to help with an impact assessment.

"The review should be tossed out and the review process started again," he told Bloomberg News.

Critics of Keystone XL worry its oil sands product from Canada poses a major threat to the environment. The State Department's draft assessment said oil sands threats would be present with or without the pipeline.

The U.S. government needs to sign off on the section of the pipeline crossing the Canadian border. U.S. President Barack Obama said he'd weigh Keystone XL against its environmental footprint.

TransCanada spokesman Shawn Howard told Bloomberg the allegation is without merit.

"TransCanada has not entered into any contracts with ERM related to our partnership in the Alaska Pipeline Project," he said in a report published Wednesday.

A spokesman for the State Department's inspector general's office, Douglas Welty, told Bloomberg it would spend two months examining the claim.