U.S. President Donald Trump has suggested that the Keystone XL oil pipeline project, previously scrapped by past administrations, could potentially be revived as part of a new trade deal between the United States and Canada. However, industry experts and a former executive linked to the project believe that this statement may be more politically motivated than driven by actual energy considerations.
In a recent social media announcement just before the implementation of new tariffs on Canadian goods, Trump revealed a temporary halt on tariffs and hinted at the revival of the Keystone XL Pipeline, which had been discontinued during the tenure of former President Joe Biden. Although Trump’s post did not receive a direct response from Canadian Prime Minister Mark Carney, it sparked discussions within the industry.
Dennis McConaghy, a former executive at TransCanada Corporation (now TC Energy), noted that Trump’s mention of the Keystone XL project could have implications for ongoing trade negotiations between the two countries. Since early 2025, Trump has imposed tariffs on various Canadian goods, asserting that the U.S. is self-sufficient and does not rely on imports from Canada, except for certain commodities like oil and minerals.
Despite the potential revival of the Keystone XL project, experts caution that resuming the pipeline’s construction could face significant challenges related to environmental concerns and political opposition. While Trump sees this as a departure from the policies of previous administrations, analysts believe that the project’s feasibility remains uncertain, especially with the possibility of a change in government leadership.
Carlo Dade, from the University of Calgary’s School of Public Policy, emphasized that the road ahead for Keystone XL is complex, given the evolving political landscape and environmental considerations. Valérie Beaudoin, part of the federal government’s Advisory Committee on Canada-U.S. Economic Relations, highlighted the contrasting perspectives on the project’s revival, indicating potential complications in its execution.
Notably, the Keystone Pipeline System, managed by South Bow Corp. in Calgary, plays a crucial role in transporting Canadian and U.S. crude oil to American refineries. South Bow’s Prairie Connector project, designed in collaboration with Bridger Pipeline, aims to leverage sections of the Keystone XL pipeline to enhance crude oil exports to the U.S., demonstrating the company’s commitment to meeting long-term energy demands.
While the prospect of reviving the Keystone XL project raises economic possibilities, the project’s future remains uncertain, subject to regulatory approvals and market dynamics. Should the Prairie Connector initiative proceed, it could significantly boost Canada’s crude oil exports, contributing to the country’s energy sector growth and reinforcing its position in global oil markets.
