U.S. President Donald Trump has suggested that the Keystone XL oil pipeline project, which was terminated by previous administrations, could be revived under a new trade agreement with Canada. However, experts believe that Trump’s statement may be more politically motivated than related to the oil industry.
In a recent social media post, Trump announced a temporary halt on new tariffs on Canadian goods, mentioning a potential revival of the Keystone XL Pipeline that was previously halted by his predecessor, Joe Biden. Despite Trump’s remarks, Prime Minister Mark Carney did not comment on this statement.
Dennis McConaghy, a former executive at TransCanada Corporation, noted that Trump’s signaling of this project could impact upcoming trade negotiations between the two countries. Since imposing tariffs on Canadian goods in 2025, Trump has emphasized that the U.S. can do without Canadian imports, except for key resources like oil and minerals.
However, experts caution that reviving the Keystone XL project would face familiar challenges in today’s political and environmental landscape. While some view this as a response to previous administrations’ policies, others are skeptical about the feasibility of restarting the project.
Despite the uncertainties surrounding the Keystone XL project, there is renewed interest from Ottawa in advancing the pipeline. The project, fully permitted by the Canadian government, has seen progress with sections already installed in Alberta.
Additionally, South Bow Corporation, a Calgary-based company, is collaborating with Bridger Pipeline on the Prairie Connector project, utilizing parts of the Keystone XL pipeline. This initiative could significantly boost Canada’s crude oil exports to the U.S., pending final investment decisions.
South Bow CEO Bevin Wirzba remains optimistic about the project’s potential value and the long-term demand for Canadian crude in the U.S. market. The company has secured commitments from multiple customers for transportation services, but a final decision on the project is pending.
Overall, the potential revival of the Keystone XL project under the new trade agreement reflects the evolving dynamics of Canada-U.S. relations and the energy sector’s strategic importance in the region.