US President Barack Obama Vetoes Keystone Pipeline Bill

US President Barack Obama issued the most significant veto of his six-year presidency on Tuesday, blocking legislation allowing the Keystone XL oil pipeline to be built between Canada and the United States.

In defying the Republican-controlled US Congress, Obama made good on a long-standing veto promise and set the stage for a battle in the 2016 presidential election.

The 1,179-mile TransCanada-built pipeline would transport crude from energy-rich Alberta to a network of pipelines that reach across the United States to the shores of the Gulf of Mexico.

Obama says he is not against the project in principle, but accused legislators of trying to "circumvent longstanding and proven processes" for gauging whether Keystone is in the national interest.

The bill "has earned my veto," he said.

The pipeline is the subject of several governmental studies, some of which are ongoing.

Republicans - who are likely to try to get enough Democratic support to reach a two-thirds majority in the Senate and the House of Representatives needed to override the veto - accused Obama of hiding behind process and of killing jobs.

"The president's veto of the Keystone jobs bill is a national embarrassment," said House Speaker, Republican John Boehner.

"The president is just too close to environmental extremists to stand up for America's workers."

Many Democrats and environmentalists have warned the project has potential oil spill risks and would actually create very few jobs.

They also have broadly denounced provisions which exclude TransCanada from certain fees and taxes as a "giveaway" to a foreign company.

Canada's Minister of Natural Resources, Greg Rickford, said he still believed the pipeline would be built.

"This is not a debate between Canada and the US. It's a debate between the president and the American people, who are supportive of the project," he said.

"It is not a question of if this project will be approved - it is a matter of when."

TransCanada vowed to keep fighting to get Keystone XL over the line.

"Keystone XL is in the national interest of the United States and should be approved and constructed," the firm said in a statement.