The State Department reported no major environmental objections to the proposed $7 billion pipeline, which has become a symbol of the political debate over climate change. Republicans and some oil- and gas-producing states in the U.S. - as well as Canada's minister of natural resources - cheered the report, but it further rankled environmentalists already at odds with Obama and his energy policy.

The report stops short of recommending approval of the pipeline, but the review gives Obama new support if he chooses to endorse it in spite of opposition from many Democrats and environmental groups. Foes say the pipeline would carry "dirty oil" that contributes to global warming, and they also express concern about possible spills.