U.S. President Donald Trump has hinted at the revival of the Canada-U.S. Keystone XL pipeline project under a new trade agreement between the two countries. However, industry experts suggest that Trump’s statement may be more politically motivated than related to the petroleum sector.
Trump announced a trade “deal” with Canada and a temporary halt on new tariffs on Canadian goods just before they were set to take effect. He mentioned the Keystone XL Pipeline in a post on his social media platform, hinting that the project, previously halted by Joe Biden, could be resurrected.
Former executive Dennis McConaghy views Trump’s mention of Keystone XL as a strategic move to influence trade negotiations. Since imposing tariffs on Canadian goods in 2025, Trump has been vocal about the U.S. not needing Canadian products, despite some exceptions like oil and minerals.
Carlo Dade from the University of Calgary cautioned against premature excitement over the pipeline’s revival, citing potential political and environmental challenges. The prospect of reviving Keystone XL raises questions about its feasibility under changing administrations.
Valérie Beaudoin, an advisory committee member on Canada-U.S. economic relations, highlighted the complexities Carney may face in advancing the project, especially with uncertain future political landscapes.
South Bow Corp., the operator of the Keystone Pipeline System, remains silent on the potential revival of Keystone XL. The original project, proposed in 2008, faced significant opposition before being effectively abandoned.
Trump’s administration has shown support for reviving parts of the project in the U.S., emphasizing its benefits. Discussions between Carney and Trump have hinted at Canada’s renewed interest in Keystone XL, which is fully permitted by the Canadian government.
South Bow’s involvement in the Prairie Connector project, a collaboration with Bridger Pipeline, could enhance Canada’s crude oil exports to the U.S. Former TransCanada executive McConaghy sees potential value in this project, emphasizing the long-term demand for Canadian crude in the U.S. market.
Although the Prairie Connector project holds promise, South Bow is yet to finalize its investment decision. The company’s CEO, Bevin Wirzba, remains optimistic about the project’s potential amid global crude oil trade disruptions and the resilient demand for Canadian crude in U.S. refining markets.
