Crews have already begun construction of portions of the pipeline in the US state of Texas
The US state department has raised no major environmental objections to the Keystone XL oil pipeline from Canada, according to a new report.
Crucially, it found the proposed pipeline was unlikely to accelerate the pace of Canadian oil sands development.
But environmentalists say the pipeline would lead to increased carbon emissions, contribute to global warming, and risk spills on its route.
President Barack Obama has yet to decide whether he will permit it.
On Friday, a spokesman said the White House would await further review from other US government agencies and the public.
“The president has clearly stated that the project will be in the national interest only if it does not significantly exacerbate the problem of carbon pollution,” Matt Lehrich said.
In an environmental impact statement released on Friday, the US state department said that approval of the project “is unlikely to significantly impact the rate of extraction in the oil sands or the continued demand for heavy crude oil at refineries in the United States based on expected oil prices”.