In a press release, the Center for Biological Diversity, one of the staunchest opponents of the project, noted that TransCanada had not yet made the final investment decision on Keystone XL and the latest court ruling might shake its belief that it is still a commercially viable project.
The Trudeau government says it's disappointed that a USA judge has halted progress on building the $10-billion Keystone XL crude oil pipeline.
Morris' order does not permanently extinguish hopes Keystone XL will go ahead, but it will require the administration to come up with a better explanation as to why it should proceed.
The privately financed pipeline is projected to stretch 1,179-miles (1,897km) from the oil sands of Canada's Alberta province, through Montana and South Dakota, to rejoin an existing pipeline to Texas.
The administration can appeal against the decision.
In 2015, on the eve of the worldwide climate talks in Paris, the Obama administration appeared to bring an end to the seven-year-long saga when it announced it was halting construction of the pipeline, arguing that approval would compromise the country's effort to reduce its greenhouse gas emissions.
Earlier: New Keystone XL pipeline route deemed safe for environment.
The State Department initially denied the permit under the Obama administration citing the potential environmental impact, but shortly after President Donald Trump took office he revived the project and the administration reversed the previous denial and allowed the project to move forward.
Palm Beach, Broward judges side with Scott
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Election officials in other Florida counties may have disclosed the identities of which voters cast provisional ballots, however. Media captionThe Democratic candidate in Georgia's gubernatorial race will not concede until all the state's votes are counted.
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"We have received the judge's ruling and continue to review it".
Western Canadian Select crude oil is selling at about $18 a barrel as its discount to USA benchmark West Texas Intermediate as a lack of pipeline capacity bottlenecks production in Alberta. "In response, the State Department is likely to take a two-track approach where it will appeal the court's order and simultaneously work on crafting a decision that satisfies the court's findings".
The ruling is a major victory for environmentalist groups that sued to stop the project and for the Native American tribes that have protested against it for years.
A shortage of export pipeline space to carry away growing oil production in Alberta has been blamed for recent steep discounts in prices for Canadian oil as compared to New York-traded benchmark oil.
A presidential permit is required for infrastructure projects that cross global borders.
After years of legal wrangling, Obama rejected a permit for the pipeline in 2015.
The order stems from a lawsuit filed by the Indigenous Environmental Network and North Coast Rivers Alliance, which alleges that the State Department and TransCanada violated National Environmental Policy Act, or NEPA, the environmental law described in the order as "the basic national charter for protection of the environment".
The company responded by seeking $15 billion in damages. He signed an executive order supporting its construction in March of past year.