By Anne Steele

The Trump administration has signed a presidential permit for TransCanada Corp. to build Keystone XL, bringing the mammoth oil pipeline a step closer to fruition more than a year after former President Barack Obama blocked its construction.

In addition to resistance from environmental groups, the Keystone project faces state-level legal challenges in Nebraska and South Dakota that could cause further delays. If completed as planned, it would send up to 830,000 barrels of oil a day, mostly from Canada's oil sands, to Steele City, Neb., where it would link to existing pipelines to Gulf Coast refineries.

TransCanada said Friday it will continue to engage key stakeholders and neighbors along the pipeline's planned route throughout Nebraska, Montana and South Dakota to obtain the necessary permits and approvals.

Environmentalists have urged the rejection of the pipeline as part of a commitment to fighting climate change, while fossil-fuel companies argue such projects are essential for energy security and the economy.

"This is a significant milestone for the Keystone XL project," TransCanada Chief Executive Russ Girling said in a press release. "We greatly appreciate President (Donald) 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."

Write to Anne Steele at Anne.Steele@wsj.com

(END) Dow Jones Newswires

March 24, 2017 08:19 ET (12:19 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.
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