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State Dept’s Keystone XL Contractor, ERM Group, Also OK’d Controversial Pebble Mine in Alaska

2:22 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

ERM has always been able to turn a blind eye to serious environmental impacts.

DeSmogBlog investigation has revealed Environmental Resources Management Inc. (ERM Group) — the contractor performing the U.S. State Department’s environmental review for the northern half of TransCanada’s Keystone XL tar sands pipeline — gave the greenlight to Alaska’s controversial Pebble Mine proposal in June 2013.

The proposed Pebble Mine, located in Bristol Bay in southwest Alaska, contains mineable gold and copper. It’s also a major hub for fishing and the seafood industry, leading the Center for American Progress to call the battle over Pebble Mine a “resource war.”

“Bristol Bay…is home to the world’s largest commercial sockeye salmon fishery,” explains a November 2013 EarthWorks blog post. ”The devastation caused by a massive open pit mine would linger in perpetuity affecting not just Bristol Bay, but the commercial fishing industry everywhere in the Pacific Northwest.”

Like the Pebble Mine review, ERM’s review for the northern half of the U.S.-Canada border-crossing Keystone XL pipeline concluded the pipeline would have negligible environmental impacts.

EPA Tackles Pebble Mine, Keystone XL

Another thread tying Keystone XL and Pebble Mine together: in both cases, ERM Group’s environmental assessment flew in the face of the U.S. Environmental Protection Agency’s (EPA) assessment. In April 2013, the EPA critiqued ERM Group’s Keystone XL environmental review, while the EPA published a damning environmental review of Pebble Mine on January 15.

“The report concludes that large-scale mining in the Bristol Bay watershed poses risks to salmon, wildlife, and Native American cultures,” explains an EPA fact sheet published summarizing the study. “Bristol Bay supports the largest sockeye salmon fishery in the world, producing nearly 50 percent of the world’s wild sockeye with runs averaging 37.5 million fish each year.”

ERM scolded the EPA for not taking a balanced approach on Pebble Mine, not looking into the “positive effects” it would create if it opens for business.

“[EPA did not take] into account the positive effects of cash income from employment on a community’s overall subsistence-gathering capabilities, as well as, harvest-sharing capabilities,” wrote ERM. “Overall, the Assessment lacks discussion of potential positive effects associated with industrial development.”

U.S. Sen. Mark Begich (D-AK) didn’t toe the ERM party line, though.

“Wrong mine, wrong place, too big,” Begich said in a January 19 interview with the Anchorage Daily News. “Too many potential long-term impacts to a fishery that is pretty critical to that area but also to Alaska, to world markets. I think it will harm the environment, harm the salmon, harm the jobs that are connected to the fisheries industry out there.”

“A Polluted Process”

As documented previously here on DeSmogBlog, ERM has also green-lighted other projects with ecologically unsavory track records. These have ranged from an explosive pipeline project in the Caspian Sea to a contentious LNG project in Peru to a toxic tar sands refinery in Delaware.

All of these projects were met with backlash from environmentalists, but eventually received the customary ERM rubber stamp.

Some members of the U.S. House of Representatives have called ERM’s Keystone XL northern half environmental review into question, though.

Led by U.S. Rep. Raul Grijalva (D-AZ), 24 House Democrats sent a letter to President Obama on December 12 saying he shouldn’t green light the northern half of the pipeline until the State Department’s Office of Inspector General finishes its probe into how ERM Group was chosen and why. It’s what Friends of the Earth has called a “a polluted process.”

“The Department of State apparently overlooked these conflicts when it accepted Environmental Resources Management’s (ERM) bid to perform the analysis,” reads the letter. “Because of the seriousness of the conflicts…we believe no EIS from the company – draft or final – should be accepted by the administration before these issues are resolved.”

One thing is clear as Secretary of State John Kerry and President Barack Obama head into decision-making time on Keystone XL’s northern half: ERM has always been able to turn a blind eye to serious environmental impacts. Now it’s up to Obama and Kerry to avoid falling into the same trap. Read the rest of this entry →

State Department Inspector General Investigating Keystone XL Contractor ERM’s Conflicts of Interest

2:31 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

The Checks and Balances Project has announced that the U.S. State Department’s Office of Inspector General (OIG) has launched a conflicts-of-interest investigation into dirty dealings pertaining to the contractor tasked to perform the environmental review for the northern half ofTransCanada’s Keystone XL tar sandspipeline on behalf of State.

Environmental Resources Management, Inc. (ERM Group) declared the northern portion of Keystone XL as environmentally safe and sound on behalf of State in March, in defiance of the U.S. Environmental Protection Agency’s assessment, among others.

The northern half of Keystone XL will connect to the over 75-percent complete southern half and – if built – will carry Alberta’s tar sands bitumen south to Texas refineries, with most of the final product shipped to the highest bidder on the global market. State and eventually President Barack Obama have the final say over the proposal because the northern section of pipeline crosses the international border.

The overarching problem with that ERM assessment, as first revealed on Grist by Brad Johnson: ERM Group was chosen not by the State Dept., but by TransCanada itself. Furthermore, as first revealed on Mother Jones by Andy Kroll, the State Dept. redacted biographical portions of the EIS that pointed to ERM’s ongoing close consulting relationship with ERM Group and TransCanada.

“The American public was supposed to get an honest look at the impacts of the Keystone XL pipeline,” writes Checks and Balances‘ Gabe Elsner. ”Instead…a fossil fuel contractor, hid its ties from the State Department so they could green light the project on behalf of its oil company clients.”

Instead of an honest look, the public got deception, perhaps not surprisingly given ERM’s historical contracting relationship with Big Tobacco, as first revealed here onDeSmogBlog. ERM seems to have blatantly lied to the State Dept. – which apparently did no homework of its own, or turned a blind eye at least – and answered “no” to when questioned if it had done business with anyone tied to TransCanada in the past three years.

ERM also told State it was not an energy interest, when the facts say otherwise.

“The State Department question defines an energy interest in part as any company or person engaged in research related to energy development,” wrote Eslner. “Yet, ERM has worked for all of the top five oil companies and dozens of other fossil fuel companies. In other words, ERM is clearly an energy interest.”

For these reasons, a dozen groups (including DeSmogBlog), ranging from environmental NGOs, faith-based groups and government accountability watchdogs called for the Inspector General to investigate why State allowed TransCanada to choose ERM Group.

OIG Special Agent Pedro Colon, Checks and Balances reported, confirmed OIG is “reviewing the matter” in a voicemail left with Elsner. Not satisfied with Colon’s oblique answer, Elsner followed up with OIG via email to ask for more details.

In a May 14 email, Elsner was told the following by Erich Hart, General Counsel to the Inspector General, that Hart can’t comment on an ongoing investigation – implying, of course, that an investigation is happening.

It is this email that led Checks and Balances to believe that OIG is engaged in a serious, methodical probe into ERM Group’s activities related to the Keystone XL SEIS environmental review. The group questions why the State Department didn’t recognize a serious conflict-of-interest in choosing ERM.

The question still remains: will it be a serious investigation or a public relations window dressing act? Time will tell.

ERM Group’s Sordid History

ERM Group has a sordid history of green-lighting ecologically perilous projects. Perhaps not surprising given that it is a dues-paying member of Big Oil’s lobbying powerhouse, the American Petroleum Institute (API), which spent $7.3 million on lobbying in 2012 and another $8.6 million on lobbying in 2011.

As covered here on DeSmogBlog, ERM declared the Baku-Tbilisi-Ceyhan (BTC) pipeline that traverses from Azerbaijan, to Georgia and eventually to Turkey as environmentally and ecologically sound – even though it has proven neither. As also covered here, ERM said the Peru LNG and accompanying pipeline project was also environmentally and ecologically sound - again, even though it has proven neither.

So, unless OIG acts on the investigation it says it has opened and tells State to abide by federal contracting conflicts-of-interest law, it appears Keystone XL will be déjà vu all over again for ERM Group and the Obama Administration.

State Dept. Keystone XL Contractor Also OK’d Explosive, Faulty Peruvian Pipeline Project

8:08 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

Macchu Pichu

The same consulting firm responsible for evaluating the Tar Sands Pipeline also worked on a troubled Peruvian project.

Environmental Resources Management (ERM), the State Department consulting firm that claims TransCanada’s proposed Keystone XL tar sands pipeline proposal is safe and sound, previously provided a similarly rosy approval for the expansion of a Peruvian natural gas project that has since racked up a disastrous track record.

On March 1, the U.S. State Department declared KXL’s proposed northern half environmentally safe and sound in its draft Supplemental Environmental Impact Statement (SEIS), part of TransCanada’s Presidential Permit application for the proposed tar sands pipeline.

KXL is a 1,179-mile tube set to blast 800,000 barrels of tar sands crude a day – also known as diluted bitumen or “dilbit” - from Alberta down to Port Arthur, TX. After it reaches Port Arthur, the crude will be sold to the highest bidder on the global export market. “XL” is shorthand for “expansion line,” named such because it would expand the marketability of tar sands crude to foreign buyers.

Because the Obama State Dept. has the final say on the project due to its crossing the Canada-U.S. border, clearing State’s EIS hurdle was crucial for TransCanada. Just days later, though, watchdogs revealed that State had outsourced the EIS out to oil and gas industry-tied consulting firms hand-picked by TransCanada itself.

One of those firms – Environmental Resources Management (ERM) Group - has historical ties to Big Tobacco; published a study declaring “safe” a Caspian Sea pipeline that ended up spilling 70,000 barrels of oil; and has a client list that includes Koch Industries, ConocoPhilips and ExxonMobil – corporations all with skin in the tar sands game. ExxonMobil’s Pegasus Pipeline recently spilled 189,000 gallons of tar sands crude into a Mayflower, Arkansas neighborhood.

An examination into the historical annals shows that ERM Group also green-lighted a major pipeline and liquefied natural gas (LNG) expansion project akin to KXL in Peru. The project in a nutshell: a 253-mile-long, 34-inch pipeline carries gas obtained from Peru’s Camisea field - located partly in the Amazon rainforest with the pipeline snaking through the Andes Mountains - to Peru’s west coast. From there, it’s exported primarily to the U.S. and Mexico.Camisea – described by Amazon Watch as the “most damaging project in the Amazon Basin“ - has created a whole host of problems. These include displacing indigenous people, clear-cutting forests that serve as a key global carbon sink to make way for the project, and major pipeline spills, to name a few.

Environmentally Sound…Except for Faulty Pipelines, Explosions

ERM performed the Environmental and Social Review Summary for Peru LNG on behalf of the International Finance Corporation (IFC), one of the tentacles of the World Bank Group. The Review lasted between Sept. 2006 and Jan. 2008.

Peru LNG, which went online in June 2010, is co-owned by an international consortium of corporations including the U.S.-based, Hunt Oil. LNG is a bit of a misnomer: the project is not only the LNG export terminal itself, but also an accompanying 253-mile pipeline carrying Camisea’s gas to Peru’s west coast and is sometimes referred to as “Camisea II.” In so doing, it traverses some of the country’s most pristine areas in the Andes and Amazon.

According to the IFC Corporation, ERM Group reviewed every aspect of the proposed project:

State Department’s Keystone XL Contractor ERM Green-Lighted BP’s Explosive Caspian Pipeline

9:09 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

The more things change, the more they stay the same. 

Map of BTC Pipeline

The BTC Pipeline, called the "New Silk Road" but also a "Time Bomb," reveals many potential flaws of the KXL Pipeline.

Almost 11 years ago in June 2002, Environmental Resources Management (ERM) Group declared the controversial 1,300 mile-long Baku–Tbilisi–Ceyhan (BTC) Pipeline environmentally and socio-economically sound, a tube which brings oil and gas produced in the Caspian Sea to the export market.

On March 1, it said the same of the proposed 1,179 mile-long TransCanada Keystone XL (KXL) Pipeline on behalf of an Obama State Department that has the final say on whether the northern segment of the KXL pipeline becomes a reality. KXL would carry diluted bitumen or “dilbit” from the Alberta tar sands down to Port Arthur, Texas, after which it will be exported to the global market

ERM Group, a recent DeSmogBlog investigation revealed, has historical ties to Big Tobacco and its clients include ExxonMobil, ConocoPhillips and Koch IndustriesMother Jones also revealed that ERM – the firm the State Dept. allowed TransCanada to choose on its behalf - has a key personnel tie to TransCanada.

Unexamined thus far in the KXL scandal is ERM’s past green-light report on the BTC Pipeline – hailed as the “Contract of the Century” – which has yet to be put into proper perspective.

ERM is a key player in what PLATFORM London describes as the “Carbon Web,” shorthand for “the network of relationships between oil and gas companies and the government departments, regulators, cultural institutions, banks and other institutions that surround them.”

In the short time it has been on-line, the geostrategically important BTC pipeline - coined the “New Silk Road” by The Financial Times - has proven environmentally volatile. A full review of the costs and consequences of ERM’s penchant for rubber-stamping troubling oil and gas infrastructure is in order.

Massive Pipeline, Massive Hype: Sound Familiar?

Like the Keystone XL, the BTC Pipeline – owned by a consortium of 11 oil and gas corporations, including BP, State Oil Company of Azerbaijan (SOCAR), Chevron, ConocoPhillips, Eni and Total – was controversial and inspired a bout of activism in the attempt to defeat its construction.

Referred to as “BP’s Time Bomb” by CorpWatch, the BTC Pipeline was first proposed in 1992, began construction in May 2003 and opened for business two years later in May 2005. BTC carries oil and gas from the Azeri-Chirag-Gunashli (ACG) Caspian Sea oil field, co-owned by Chevron, SOCAR, ExxonMobil, Devon Energy and others, which contains 5.4 billion recoverable barrels of oil.

Paralleling the prospective 36-inch diameter Keystone XL that would carry 830,000 barrels per day of tar sands bitumen through the U.S. heartland, the BTC serves as a 42-inch diameter export pipeline and moves 1 million barrels of oil per day to market.

Like today’s KXL proposal – which would only create 35 full-time jobs – the false promise of thousands of jobs also served as the dominant discourse for BTC Pipeline proponents. The reality, like KXL, was more dim. The Christian Science Monitor pointed out in 2005 that only 100 people were hired full-time in Georgia, the second destination for BTC.

“People were told that there would be 70,000 Georgians that were going to be employed because of this pipeline,” Ed Johnson, BP’s former project manager in Georgia told the St. Petersburg Times in 2005. “The (Georgian) government needed to sell the project to its own people so some of the benefits were overblown.”

Massive Ecological Costs and Consequences

Read the rest of this entry →