The Alberta Clipper pipeline -- which will run through Minnesota and the northeast corner of North Dakota from Superior, Wis., to Hardisty, Alberta -- will carry up to 450,000 barrels of crude oil a day. Enbridge currently moves 1.6 million barrels daily through an existing pipeline along the same route.

The State Department, in announcing the green light for the project, highlighted its economic advantages.

"Approval of the permit sends a positive economic signal, in a difficult economic period, about the future reliability and availability of a portion of United States' energy imports, and in the immediate term, this shovel-ready project will provide construction jobs for workers in the United States," the State Department statement said.

Because it crosses the U.S.-Canadian border, the Alberta Clipper project required a Presidential Permit from the State Department for the project to proceed, involving an environmental review "under applicable environmental laws and regulations," according to the State Department.

Environmental groups on both sides of the border have opposed the plan. Tar sand oil needs more energy to process and is high in carbon dioxide, they contend. Mining the oil from tar sands has also been responsible for scarred landscapes and polluted waters in northern Alberta, opponents say, and it damages the environment for native tribes in Canada.

On the processing end in the United States, refineries would be working with high levels of toxic chemicals, including mercury, nickel and lead contained in the tar sand oil. Environmentalists also said the pipeline will harm wetlands in Minnesota and Wisconsin.

"The tar sands pipeline connects U.S. refiners and consumers with the dirtiest, most carbon-intensive crude oil on earth," said Kevin Reuther, legal director for the Minnesota Center for Environmental Advocacy, the Financial Times reports.

An international coalition of environmental and native groups said they would challenge the permit in court to "make sure that all the impacts of this pipeline are considered."

However, the State Department said in its statement, "the United States is taking unprecedented steps at home to transform how we produce and consume energy. The president is committed to reducing overall emissions and leading the global transition to a low-carbon economy."

The reduction of greenhouse gas emissions, the statement said, is "best addressed through each country's robust domestic policies and a strong international agreement." The State Department said it "will continue to work to ensure" that both the United States and Canada "take ambitious action to address climate change."

"By approving this pipeline, we are committing to another generation of dependence not only on fossil fuels but on the dirtiest, most greenhouse-gas-emitting fossil fuels," said Sarah Burt, an attorney for Earthjustice, The Washington Post reported. "We thought that the Obama administration would walk the walk on this, but it appears that that's not happening."

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