President Obama has rejected plans for a pipeline that would carry oil from Canada to the U.S.
The projected 1,700-mile pipeline would span six states en route to Texas refineries.
The White House said it wanted to delay a decision until after the election. But in December, Congress gave the administration 60 days to finalize its decision. The president said that's not enough time to study all the environmental and public safety concerns.
"This announcement is not a judgment on the merits of the pipeline, but the arbitrary nature of a deadline that prevented the State Department from gathering the information necessary to approve the project and protect the American people," Obama said in a statement.
He added that he's "disappointed that Republicans in Congress forced this decision."
Industry supporters and Republicans say the project would create thousands of jobs.
"President Obama is destroying tens of thousands of American jobs and shipping American energy security to the Chinese. There's really just no other way to put it," House Speaker John Boehner, R-Ohio, said. "The president is selling out American jobs for politics."
Rep. Allen West, R-Fla., called the decision "further evidence that President Obama is not serious about setting the conditions for job creation…nor working toward our energy independence as it relates to our national security."