David Whitley, whose property contains the Keystone pipeline, took video of a section that was dug up. It had been laid on top of a massive rock and was labeled "Dented-Cut Out." / David Whitley/CBS News
(CBS News) WINNSBORO, Texas -- CBS News has found evidence of construction problems on the most controversial pipeline project in a generation. The Keystone XL is designed to bring crude oil from Canada to refineries in Texas. Supporters say it will create thousands of jobs and help energy independence. But opponents worry about damage to the environment.
Crews finished laying the southern half of the Keystone oil pipeline through David Whitley's Texas property last year. So he was surprised in May when a work crew began to unearth the pipe.
"I asked, 'Is there something wrong?' It's exactly what I said, 'Is there something wrong?' And they said, 'No, we just want to visually inspect a small section of the pipeline.'"
Whitley took video of the section they dug up. It had been laid on top of a massive rock and was labeled "Dented - Cut Out."
And what was his reaction when he saw it? "Well when I saw that, I thought they should have done a better job when they first laid the pipe about getting rid of that rock," said Whitley.
CBS News has obtained warning letters written over the past two months to TransCanada from the federal agency that regulates pipelines. A September 10 letter warned TransCanada it was "not following their Construction Specifications" because "dents on the pipe" were found at dig sites with "rocky terrain."
And in a second warning, regulators noted a "high weld rejection rate" on a section in which 205 welds -- nearly 50 percent -- required repairs. The letter said TransCanada "failed to use properly qualified welders."
On Tuesday, the watchdog group Public Citizen said it has documented 125 sites where pipe was dug up. Its report notes problems like dents or patches applied to coatings to stop corrosion -- issues that if not repaired can lead to leaks. TransCanada maintains the repairs are "normal practice."
"If they had done the job right in the first place, they would never have been doing digs," said Evan Vokes, who worked as an engineer for TransCanada from 2007 to 2012. He was fired after he formally complained to his bosses and Canadian regulators about what he said was substandard work on other pipelines, also called "right of ways."
"To have such a massive amount of patchwork along the right of way," Vokes said, "indicates that there might be something that's not quite right with the way the pipeline was put in the ditch in the first place."
TransCanada declined CBS News' request for an interview but said in a statement the repairs are "a sign that our inspection programs work" -- that the company found and voluntarily reported the problems cited by regulators, and replaced about 700 feet of pipe "as a result of construction impacts."
Some residents want new leak tests before the pipeline is filled with oil. But TransCanada says it's not needed -- that this pipeline will be the safest ever built.