courtesy Creative Commons

This announcement came after thousands protested at the White House Sunday.

The State Department ordered TransCanada Corp, the developer of the pipeline, to avoid an area in Nebraska that supplies water to eight states, according to the Associated Press. An environmental review that would probably take at least a year will also be required.

The $7 billion pipeline is meant to carry oil from tar sands in Alberta, Canada to refineries on the Texas Gulf Coast.

The decision will probably be delayed until after the 2012 election.

The project, reports USA Today, has become a “political trap for Obama.” Supporting it could anger environmental supporters. Rejecting the pipeline, however, could anger labor and business groups because rejecting it would prevent job creation.

Some liberal donors have even threatened to cut funds to Obama’s reelection campaign if he approves the pipeline, according to USA Today.

Supporters of the pipeline, however, say that it would reduce U.S. dependence on Middle Eastern oil and provide thousands of jobs.

Reach associate news editor Hannah Madans here.