A report dismissing complaints about the U.S. State Dept.'s selection of Environmental Resources Management to prepare the final supplemental environmental impact statement for TransCanada's proposed Keystone XL pipeline has spurred calls for a new look at the department's contractor selection process.

The State Dept.'s Office of Inspector General said in a report released on Feb. 26 that the selection of ERM "substantially followed" the department's rules, despite complaints from Keystone XL opponents who said ERM previously had performed work for TransCanada and several other energy companies that would benefit from the pipeline's construction. The OIG also found, however, "that the process for documenting the contractor selection process, including the conflict-of-interest review, can be improved." Sen. Barbara Boxer (D-Calif.) said the OIG report underscores the need for more oversight in contractor selection and management.

The pipeline's supporters, including the American Petroleum Institute and the Laborers' International Union of North America, said they welcomed the report, which they believe removed another roadblock to project approval. In a statement, TransCanada said the report "confirmed the integrity and independence of the State Department's contractor hiring and review process." Spokesmen for ERM did not respond to a request for comment.

Rachel Wolf, spokeswoman for All Risk, No Reward, a coalition of Keystone XL opponents, says she is confident Secretary of State John Kerry will recommend the project be rejected. "There's no way Kerry can find this is in our national interest," she says. Also, she notes, a Nebraska judge on Feb. 26 struck down a state law transferring route-approval authority from the state's Public Service Commission to Keystone XL supporter Gov. Dave Heineman (R).