CBC News first reported in April that Obama had picked Heyman, who is also a top political fundraiser for the president, for the Canadian post. His choice was confirmed in a news release from the White House today.
"I am proud that such experienced and committed individuals have agreed to serve the American people in these important roles. I look forward to working with them in the months and years ahead," Obama said of Heyman's nomination and those of two others to key posts in his administration.
Obama also appointed Kathryn Thomson as general counsel in the Department of Transportation and Kevin Whitaker, as ambassador to the Republic of Colombia.
Today's announcement follows speculation over the summer that Heyman's complex investment portfolio may have disqualified him from the job during the vetting process or worse, led him to lose interest in the appointment.
It was also rumoured that pipeline politics were stalling Obama's top pick for U.S. envoy as all nominations must be approved by the U.S. Senate.
Two weeks ago, word came that Heyman completed diplomatic "charm school" training this summer
The controversial Keystone XL pipeline that would carry crude oil from Alberta to Texas is the dominant issue in Canada-U.S. relations right now.
Heyman will replace David Jacobson whose four-year term ended in July.