John Podesta will recuse himself from the decision about the Keystone XL oil sands pipeline in his new White House advisory role, a White House aide confirmed.
The move will come as a blow to environmentalists who viewed the arrival of Podesta, a noted opponent of the controversial Canada-to-Texas pipeline, as a potential scale-tipping moment for rejecting Keystone.
That means Podesta, the former chief of staff for President Bill Clinton and head of President Obama's transition team who most recently led left-leaning think tank Center for American Progress, instead will largely focus on the suite of environmental regulations pushed by the Obama administration.
According to The New Yorker, which first reported the news, a White House aide said Podesta suggested to White House Chief of Staff Denis McDonough that he remain a bystander in the Keystone decision because "the review is far along in the process and John's views on this are well known."
But White House deputy press secretary Josh Earnest disputed the suggestion that Podesta had removed himself from the debate because of a conflict of interest.
"Recuse is not the right word," Earnest told reporters Wednesday afternoon. He said that Podesta had only suggested to McDonough “that he should not work on the policy-making process for the Keystone pipeline."
Earnest said the decision was now primarily a State Department matter and that many aides had been working with the complicated issues for years to ensure the decision matched Obama’s views.
“His views on this are well-known,” said Earnest of Podesta. “But there are people who have been working on this for years.”
The State Department is finalizing an environmental report on the project, which will be used to decide whether Keystone is in the national interest.
President Obama will make the final call on the pipeline, the application for which has been on file at the State Department for five years. He said he would oppose the project if it "significantly exacerbates" carbon pollution — which a draft State review said Keystone wouldn't do.
But environmental groups say that review was flawed, noting the contractor that conducted it had done work for Keystone builder TransCanada Corp. The agency's internal watchdog is investigating those charges of bias.
Environmental opponents of Keystone argue the pipeline will facilitate growth of Canada's carbon-rich oil sands, in turn raising greenhouse gas emissions that cause climate change. They also have said the pipeline won't be the jobs booster its backers claim, and contend much of the crude it would ship is destined for overseas markets.
Obama also has questioned the pipeline's purported jobs benefits and whether much of the oil sands ittransports would stay in the U.S.
Keystone's supporters, though, argue that the pipeline would add more than 40,000 jobs, citing a State Department report. They also say it would enhance energy security, largely by importing Canadian crude and displacing shipments from Venezuela.
This article was first reported at 9:18 a.m. and has since been updated.