U.S. President Donald Trump has hinted at the resurrection of the Canada-U.S. Keystone XL oil pipeline project, which was previously scrapped by former administrations. However, industry experts believe that Trump’s statement may have more political implications than actual intentions for the petroleum industry.
In a recent social media announcement, Trump revealed a “deal” with Canada just before the initiation of new tariffs on Canadian goods. He mentioned the possibility of reviving the Keystone XL Pipeline, attributing its cancellation to his predecessor, Sleepy Joe Biden.
Former executive Dennis McConaghy of TransCanada Corporation, now TC Energy, views Trump’s signal positively in terms of potential trade-offs for Canada. Since imposing tariffs on Canadian goods in 2025, Trump has consistently downplayed the significance of Canadian exports to the U.S.
Carlo Dade from the University of Calgary’s School of Public Policy cautioned against premature excitement over the project’s revival, citing the challenging political and environmental landscape. Valérie Beaudoin, an Advisory Committee member on Canada-U.S. Economic Relations, emphasized the potential challenges for Trump in advancing the Keystone XL project.
The Keystone Pipeline System, operated by South Bow Corp., delivers crude oil to U.S. refineries from Canada. Despite initial setbacks and cancellations, Trump’s administration has shown support for reviving parts of the Keystone XL project.
South Bow is currently collaborating with Bridger Pipeline on the Prairie Connector project, utilizing sections of the Keystone XL pipeline. This initiative could significantly boost Canada’s crude oil exports to the U.S., pending final investment decisions.
The company’s CEO, Bevin Wirzba, highlights the sustained demand for Canadian crude in the U.S. market. While progress has been made, challenges and uncertainties persist regarding the future of the Keystone XL project.
The potential revival of the Keystone XL project underlines the complex dynamics of Canada-U.S. trade relations and the evolving landscape of the energy sector.