The GOP's latest plan to link approval of the Keystone XL pipeline to President Obama's payroll tax cut extension is not sitting well with the president.

"Any effort to try to tie Keystone to the payroll tax cut I will reject," Obama said on Wednesday, adding that he didn't "expect to have to veto it."

The Keystone XL pipeline, which would bring oil from Canada's tar sands in Alberta down to refineries along the U.S. Gulf Coast, has been a hot button issue for environmentalists who scored a win last month when President Obama delayed a final decision on the pipeline until 2012.

But it's not just the pipeline House Republicans are trying to tie to the payroll tax cut extension. The bill will also include a provision blocking the EPA’s air-toxics rule for industrial boilers — a rule that many argue would actually stimulate job growth, not stifle it, as Republicans charge.

President Obama's remarks came during a joint appearance at the White House with Canadian Prime Minister Stephen Harper. Harper, a vocal supporter of the $7 billion Keystone XL Pipeline, stayed clear of the issue, declining to "comment on the domestic politics of this issue or any other issue in the United States."

While the Canadian leader may be staying out of the issue, at least publicly, the GOP is doing anything but. Ohio Rep. John Boehner responded to President Obama's Wednesday remarks via his spokesman Michael Steel, who said: “If President Obama threatens to veto it over a provision that creates American jobs, that’s a fight we’re ready to have.”

"This is a big project with big consequences," Obama said to reporters at the White House. "We've seen Democrats and Republicans express concerns about it."

While that is most definitely true, we've also seen Democrats and Republicans express support for it.

How the Obama administration will ultimately come down on Keystone XL is not clear by any means.  It may turn out that they were ultimately going to approve the project anyway, but to do so now under these circumstances would give the appearance of caving, and hand over a huge win to Republicans.

Sources: E&E News , Politico
Photo: Official White House Photo by Pete Souza