The US Senate has narrowly rejected a bill that would have approved construction of the Keystone XL pipeline to bring crude oil to Gulf coast refineries from Canada’s controversial tar sands.
The vote means President Barack Obama will avoid the need to veto the legislation that several fellow Democrats supported.
It fell just one vote short of the 60 needed for passage despite last-minute lobbying by supporters.
The tally was 59 to 41 on TransCanada Corp’s $8bn, 800,000 barrels-per-day project, with all 45 Republicans supporting it.
Mr Obama is opposed to the Keystone bill and has insisted he would not approve the pipeline if it significantly raised greenhouse gas emissions.
The President raised questions about the project during a trip to Asia last week, saying it would not lower fuel prices for drivers but would allow Canada to “pump their oil, send it through our land, down to the Gulf, where it will be sold everywhere else”.
Republicans have vowed to keep trying to force approval of the project that the Obama administration has kept under review for more than six years.