Creator fails to execute git on mac

bettdhcp167177:testing billking$ which git
/usr/local/bin/git
bettdhcp167177:testing billking$ env | grep PATH
PATH=/usr/bin:/bin:/usr/sbin:/sbin:/usr/local/bin:/usr/X11/bin
bettdhcp167177:testing billking$ git --version
git version 1.7.3.5

File->New Project->Project from version control->Git repository clone

Executing in /Users/billking/testing: git clone git@scm.dev.nokia.troll.no:bm/mainline.git bm

Unable to start git: No such file or directory