With the fate of a controversial Keystone XL pipeline in his hands, it didn't take long for newly appointed U.S. Secretary of State John Kerry to pick up the phone and call Foreign Affairs Minister John Baird during his first weekend on the job.

Kerry, who was sworn in on Friday succeeding Hillary Rodham Clinton in the cabinet of U.S. President Barack Obama, made the call to Baird on Saturday.

The two agreed to work closely together on a broad range of issues and "agreed to stay in touch on the Keystone pipeline" — a $7 billion project that would run almost 2,000 miles from Alberta to Texas, the U.S. State Department told CBC News on Sunday.

Kerry's confirmation as U.S. Secretary of State comes at a crucial time in the relationship between the two countries and will have "significant implications" for Canada, says Jim Prentice, Canada's former environment minister.

Newly appointed U.S. Secretary of State John Kerry called Foreign Affairs Minister John Baird on Saturday and agreed to stay in touch on the proposed Keystone XL pipeline. (J. Scott Applewhite/Associated Press)

In an interview with CBC News, Prentice, who is now working as Vice-Chairman of CIBC, said Kerry's appointment represents an opportunity for Canada to engage the U.S. — not just on the Keystone XL pipeline but also on shared environmental and energy policies.

According to Prentice, these issues have been put on the back burner due to the global economic crisis but with Kerry now in a key role, Canada will have to do more — like tying the environment and economy together.

"Clearly there are implications for us in terms of our economy attached to social license and things like pipeline projects... so if you are in the energy business, you are in the environment business."

Prentice, who served as environment minister when he worked with Kerry in 2009, described the new U.S. Secretary of State as "experienced," "thoughtful," and "a good friend of Canada."

"I was struck by his intellectual honesty and his willingness to get to the facts," said Prentice.

The long-time Democratic Senator from Massachusetts is by-and-large seen as an environmentalist whose decision on the Keystone pipeline will be filtered through his views on climate change.

And while both pro-pipeline and anti-pipeline groups hope Kerry will be sympathetic to their cause, the new U.S. Secretary of State did not lead on which side he will come down on.

"I will be a passionate advocate on this not based on ideology but based on facts and science," said Kerry during his confirmation hearing before the U.S. Senate Foreign Relations Committee on Jan.24.

Pros and cons

Prentice said he is "hopeful" the U.S. will approve TransCanada's proposed pipeline.

Senate Foreign Relations Committee Chairman Sen. John Kerry, D-Mass., left, welcomes Environment Minister Jim Prentice, in this photo dated Monday, March 2, 2009, on Capitol Hill in Washington. (Haraz N. Ghanbari/AP Photo)

"I think Canada should continue to emphasize that this project is in the interest of North Americans on both sides of the border and that there's sound environmental stewardship behind it," said Prentice.

Prime Minister Stephen Harper once dubbed the pipeline a "no-brainer," but that was before Obama rejected TransCanada's application to build the pipeline citing domestic politics.

Since then, TransCanada submitted a new application and Obama was re-elected for a second term.

Two weeks ago, Dave Heineman, the Governor of Nebraska, approved TransCanada's application saying the new proposed route would avoid the state's environmentally sensitive Sandhills region.

With the final decision back in Obama's hands, Natural Resources Minister Joe Oliver said he remains "cautiously optimistic."

In an interview airing Saturday on CBC Radio's The House, Oliver touted the benefits of the proposed pipeline for both Canada and the U.S.

"This project is very positive for both our countries. It's a real win win. We're talking here about enhanced national security. We're talking about jobs, economic growth, revenues to government to support critical social programs," said Oliver.

But environmentalists are gearing up for a fight with the next anti-Keystone protest scheduled for Feb.17 outside the White House.

And now that the U.S. Sierra Club has reversed its long-standing policy against civil disobedience, Sierra Club Canada is consulting its members on whether it should follow suit.

"If government's aren't going to respond to the science, they're going to have to respond to major environmental campaigns. I don't think they've seen anything yet compared to what's coming," John Bennett, executive director of Sierra Club Canada, told CBC News.

With a growing debate and intense lobbying on both sides of the border, the next few months will be crucial for Canada-U.S. relations.

A final decision on the proposed Keystone XL pipeline is expected in the coming months.

With files from CBC's Margo McDiarmid