Does the consulting firm studying the environmental effects of the proposed Keystone XL pipeline have a conflict of interest?

For months, climate activists have been raising the alarm about Environmental Resources Management (ERM), the main firm contracted by the State Department to write the official environmental impact statement for Keystone.

Now State’s Inspector General is looking into allegations of improper ties and incomplete disclosures.

From The Hill:

The State Department’s internal watchdog has “initiated an inquiry” into whether the contractor Foggy Bottom used for a draft environmental analysis on the proposed Keystone XL pipeline had a conflict of interest.

The move is a response to allegations from several outside groups, Doug Welty, a spokesman with the State Department Office of Inspector General, told The Hill on Friday.

The development raises the possibility of another redo of the analysis assessing Keystone’s environmental impact.

Bloomberg Businessweek explains some of the allegations of improper behavior:

[Friends of the Earth] engaged in opposition research, as it is called during election campaigns, to turn up the evidence that ERM had worked with TransCanada on projects that it had failed to disclose to the U.S. State Department. …

Here, (PDF), for example, is a 2010 document, cached online, in which ERM lists TransCanada as a client. Does this prove that ERM has been biased toward TransCanada in its Keystone assessment? No. But unless this document is a forgery, ERM appears not to have disclosed all it should have to the U.S. government. (ERM declined to comment.)

Meanwhile, there’s another hiccup for Keystone, this one in Nebraska. From The Washington Post:

[A] little-noticed trial scheduled for next month in Nebraska could spell problems for [Keystone].

Despite two attempts by Nebraska’s attorney general to have the case thrown out, Lancaster County District Court Judge Stephanie Stacy has set a Sept. 27 trial date for arguments in a lawsuit that contends the state legislature unconstitutionally gave Gov. Dave Heineman (R) authority to approve the pipeline route.

A win for the plaintiffs — three Nebraska landowners who oppose the pipeline — would force TransCanada, the company that wants to build the 1,179-mile northern leg of the project, to go through the entire siting process again. Even supporters do not believe that would permanently block the project, but it could add years to the timeline.

No wonder TransCanada is now looking to build a big tar-sands oil pipeline that doesn’t cross the U.S. border.