So many dents, bad welds and "anomalies" have been identified along the southern leg of the Keystone XL pipeline in southern Texas that the U.S. pipeline regulator has issued Calgary-based TransCanada a number of blunt warning letters.

The $2.3-billion construction project, which crosses 631 rivers and streams in Texas, will ferry 700,000 barrels of oil from Cushing, Oklahoma to Nederland, Texas.

But it has also been a conduit for high controversy as landowners in two states have documented at least 125 excavations of newly planted pipe to repair dents, sags and damaged coatings.

According to a new report by the nonprofit group Public Citizen, one TransCanada representative confessed that there were as many as 70 anomalies in one 60-mile stretch alone.

On Sept. 10, the U.S. Pipeline and Hazardous Materials Safety Administration (PHMSA) warned the company that it had committed probable pipeline violations by carelessly installing a pipeline into a ditch and denting it in several locations during the construction of its Keystone Gulf Coast project.

TransCanada also "did not follow its written specification, specifically, protecting existing coating from damage due to welding." As a consequence the company dug up pipe in 98 different locations alone to repair damaged coatings.

A following Sept. 26 letter documented consistently bad welding on the pipeline as well as "unqualified procedures."

The letter also reported a number of weld failures on the project.

"From the start of welding, TransCanada experienced a high weld rejection rate," says the letter. During the first week 26.8% of the welds required repairs, 32.0% the second week, 72.2% the third week, and 45.0% the fourth week. On September 25, 2012, TransCanada stopped the Spread 3 welding after 205 of the 425 welds, or 48.2% required repairs."

The company also failed to use qualified welders on parts of the line.

The U.S. regulator issued the letter only after landowners raised concerns about the unprecedented number of excavations of newly planted pipeline. Last summer, pipeline expert and former TransCanada employee Evan Vokes later verified their concerns during a field visit to east Texas. Public Citizen released a report on what Vokes and the landowners discovered along the southern leg of Keystone this week.

TransCanada is one of the nation's most powerful lobbyists in Ottawa. After completing the first phase of Keystone in 2010, the pipeline leaked 12 times in its first year of operation, spilling 21,000 gallons of crude in North Dakota alone. Company models predicted only one 50 barrel leak in seven years.

In 2011 the company's Bison natural gas line exploded after six months of operation due to faulty pipeline placement. An internal company email exclaimed that "we are in trouble on the Bison project" due to bad welding practices.

Last summer Evan Vokes, a former TransCanada employee and pipeline expert, told the Canadian Senate Committee on Energy, the Environment and Natural Resources that the company executives suffered from a "culture of non-compliance."

Vokes, a materials engineer, blamed the company's culture on a "mix of politics and commercial interests that has resulted in false public claims of exceptional industry practice when the reality is that industry struggles to comply with code and regulation."

After working for TransCanada for five years, Vokes was fired without cause in 2012 after persistently raising concerns about the company's safety practices. Canada's National Energy Board later investigated and verified many of his complaints. PHMSA has yet to respond to his complaints.

Calgary-based TransCanada promises that the proposed $7-billion Keystone XL pipeline, now under scrutiny by the U.S. State Department "will be the safest and most advanced pipeline operation in North America."

If approved by President Barack Obama, Keystone XL would transport raw bitumen to coastal refineries owned by several multinationals, the Koch brothers, Venezuela and Saudi Arabia. These underutilized refineries could then turn the heavy crude into refined gasoline and jet fuel for export around the world.

Due to the shale oil boom and a steep decline in U.S. gasoline spending since 2008, very little of the bitumen reaching the U.S. coast would be used for domestic consumption.

TransCanada has also proposed to build a tar sands pipeline to eastern Canada, but is facing stiff opposition due to concerns about climate change, pipeline spills and the undue influence of pipeline companies on the dismantling of environmental science and regulations in the country.

The Public Citizen report concluded that given the costly and toxic nature of diluted bitumen spills, "it would be irresponsible for the federal government to allow tar sands crude to start flowing through the southern leg without ordering a complete hydrostatic retesting of the line and a thorough quality assurance review."

Andrew Nikiforuk is an award-winning journalist who has been writing about the energy industry for two decades and is a contributing editor to The Tyee.