Now that the State Department has once again found that the Keystone XL pipeline will have little environmental impact, environmentalists are saying the government’s report is plagued by conflicts of interest with the oil and gas industry.
But the real conflict of interest lies between activists and federal officials who have conspired against the pipeline.
Environmentalists allege that the company hired by the State Department has ties to the oil and gas industry, therefore tainting the objectivity of the review. Some lawmakers and activists tried to get the pipeline decision delayed until the State Department investigated allegations of a conflict of interest, but the Obama administration has yet to release any findings on whether such a conflict exists.
While activists point the finger at the State Department’s contractor, emails obtained through a Freedom of Information Act request by the Energy and Environment Legal Institute show that environmentalists were working with federal officials to kill the Keystone XL pipeline.
In one email, Lena Moffitt of the Sierra Club — a major pipeline opponent — wrote to three senior policy staffers at the Environmental Protection Agency about a meeting they had where they discussed ways for the agency to inject itself into the Keystone debate.
“Thanks so much for taking the time to meet with us on Keystone XL yesterday,” she wrote to EPA officials in September 2011. “Let me know if I can be helpful in any way — particularly in further identifying those opportunities for EPA to engage that don’t involve ‘throwing your body across the tracks,’ as Michael put it.” Moffit is referring to Michael Goo, who was the EPA’s associate administrator for policy at the time after working for the environmental group, the Natural Resources Defense Council.
The Sierra Club also tried to push the argument that the Keystone XL pipeline would raise energy prices. Moffitt wrote in an April 2011 email to an EPA senior official in which she said that higher energy prices are “simply not in the national interest.” Environmental activists tried to even hire the consulting company the Brattle Group to provide some credibility to their economic claims.
Jurgen Weiss, a principal with the Brattle Group, raised concerns about pushing such a claim in an email to Ryan Salmon, Climate and Energy Policy Coordinator for the National Wildlife Fund (NWF).
“As you can tell, I am currently not convinced that the argument you are trying to make is really strong based on economics…” Weiss wrote in a January 2011 email.
The EPA did come out against Keystone last year, saying that the State Department’s draft report of the pipeline was “insufficient”. The agency said that the review did not properly encompass all of the environmental impacts of the pipeline. The State Department found that the pipeline would not have a significant environmental impact.
Environmentalists have also pushed the argument that Keystone XL pipeline would simply serve to enrich oil companies. But activists fail to point out that there are those who stand to gain if the pipeline is rejected — including the business partners of one major Keystone opponent.
San Francisco billionaire and environmentalist Tom Steyer has spent millions on green causes, including opposing the Keystone XL pipeline. His group NextGen Climate Action recently launched a petition to urge Secretary of State John Kerry to investigate the contractor that prepared the government’s review of the project.
Steyer founded a hedge fund called Farallon Capital that holds hundreds of millions of dollars in companies that make oil pipelines. According to SEC filings for the first quarter of 2013, Farallon had more than $300 million in companies that develop onshore and offshore U.S. assets and pipelines, including Halcon Resources, Kinder Morgan and Plains Exploration.
Kinder Morgan is a competitor of TransCanada, the company building the Keystone pipeline. Kinder Morgan is working on an expansion of an existing pipeline to take oil sands from Alberta to Canada’s west coast — construction of the pipeline expansion could take place in 2015 or 2016, according to the company.
Delaying the approval of the Keystone XL pipeline, which will bring Canadian oil sands to Gulf Coast refineries, would serve the interests of Kinder Morgan. Steyer has even admitted that his own investments with Farallon Capital could benefit from such action, but has promised to give any profits he made of such investments.
“I think it’s hypocrisy, quite frankly,” Louisiana Republican Sen. David Vitter told Fox News. “Who knows when he’s going to divest of these investments … maybe in a few months when his helping kill Keystone will boost them up to top value. … Who knows?”
Steyer told Vitter in a letter that his investments in Kinder Morgan are expected to generate between $1 million and $2 million in profits which he would donate to the victims of wildfires.
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