"He emphasized that the process is being followed," Canada's finance minister told a media roundtable after he attended G20 meetings in the U.S. capital on Thursday.
"I emphasized that the State Department report indicates this is a very important project for both economies, particularly for employment in the United States — more than 40,000 well-paying jobs. And that environmentally, it is more beneficial to transport bitumen by pipeline than by rail."
Keystone XL would carry bitumen from Alberta's carbon-intensive oilsands through six U.S. states to Gulf Coast refineries. It's become a flashpoint for U.S. environmentalists, who are exerting intense pressure on President Barack Obama to nix the project.
Flaherty's meeting with Lew was the first between the two finance chiefs since Lew was sworn into his new job on Feb. 28.
"I'm stating a political fact — he's an influential person in Washington," Flaherty said of his American counterpart.
"He’s the fourth secretary of the Treasury with whom I’ve dealt .... I'm looking forward to a casual and cordial relationship with him like I had with (former Treasury Secretary) Tim Geithner."
The State Department held the only public hearing Thursday into its latest environmental assessment of the project, a document that essentially said there were no compelling ecological reasons to block Keystone XL. A State official said there have been 800,000 public comments submitted in response to the department's revised environmental analysis, released in March.
The eight-hour hearing in Nebraska was frequently raucous as construction workers, TransCanada executives and environmentalists tried to shout down one another while they took turns speaking.
Officials with the State Department, which has been assessing the project because it crosses an international border, tried to maintain order during the proceedings.
"There are a lot of strong feelings about this," Kerri-Ann Jones, assistant secretary of state for oceans and international environmental and scientific affairs, told reporters at the hearing.