The 1,897km-long Keystone XL pipeline, which faced obstruction for eight years, will have a capacity to transfer over 800,000 barrels per day of heavy crude from Canada's oil sands in Alberta into Nebraska, US.
The project will link to an existing pipeline network to feed the US refineries and ports along the Gulf of Mexico.
The approval, however, reverses former US President Barack Obama’s decision to reject the project, which will run from Hardisty, Alberta, Canada and extend south to Steele City, Nebraska, US.
TransCanada president and CEO Russ Girling said: "This is a significant milestone for the Keystone XL project.
"We greatly appreciate President Trump's Administration for reviewing and approving this important initiative and we look forward to working with them as we continue to invest in and strengthen North America's energy infrastructure."
The Keystone XL pipeline project is expected to create 42,100 construction jobs for up to two years and also contribute approximately $3.4bn to the US GDP.
US President Donald Trump said: "TransCanada will finally be allowed to complete this long-overdue project with efficiency and with speed.”
TransCanada is due to secure financing and also acquire local permits for the project.
Recently, TransCanada has suspended its $15bn North American Free Trade Agreement (NAFTA) lawsuit which was filed against the US government for the Keystone XL pipeline project.
The suspension comes as the firm believes it would secure approval for the pipeline project from the US President Donald Trump.
Image: The Keystone XL pipeline can transfer over 800,000 barrels per day of heavy crude. Photo: courtesy of shannonpatrick17 from Swanton, Nebraska, U.S.A/Wikipedia.
