Canada Floated Keystone XL Revival in Tariff Discussion With Trump, Source Says

By Amanda Stephenson

CALGARY, Oct. 8 (Reuters) – Canadian Prime Minister Mark Carney raised the prospect of reviving the Keystone XL oil pipeline from Alberta to the United States during his Tuesday meeting with U.S. President Donald Trump, according to a source familiar with the discussions and a CBC News report on Wednesday.

Carney, who is under increasing pressure in Canada to address painful U.S. tariffs on steel, autos and other goods, asked Trump if he would be interested if the Keystone project were to be revived and had Canadian support, the source said.

The source emphasized discussions are at a very early phase, and declined to say whether the Canadian government believes there is a company willing to build the pipeline. Trump was receptive, and the idea is something negotiators will look at in follow-up discussions, the source said.

CBC News first reported that Carney and Trump discussed Keystone. The White House and Carney’s office did not immediately respond to requests for comment.

Keystone XL was a proposed crude pipeline, roughly 1,900-kilometres (1,181 miles) long, which would have carried 830,000 barrels per day of oil from the oil sands of northern Alberta to the major U.S. storage hub at Cushing, Oklahoma, and then on to Gulf Coast refineries.

TC Energy TRP.TO first proposed the project in 2008, but it quickly attracted significant environmental and Indigenous opposition.

The project was rejected by U.S. President Barack Obama’s administration and revived by Trump during his first term. Though construction work had started, the pipeline was never completed after U.S. President Joe Biden revoked a key permit for the U.S. stretch of the project in 2021.

Trump said in February that he would like to see the Keystone expansion built and pledged easy approvals for the project if the company that was building the pipeline were to “come back to America.”

But TC Energy, which lost billions on the Keystone project when Biden canceled its permit, spun off its oil pipeline business last October into a new company named South Bow SOBO.TO.

A South Bow spokesperson said the company is not privy to the ongoing discussions between the Canadian and U.S. governments but supports efforts to increase the transportation of Canadian crude oil.

The company said in February it had “moved on” from the Keystone project.

(Reporting by Amanda Stephenson in Calgary; Additional reporting by Jarrett Renshaw and Maria Cheng; Editing by Caroline Stauffer and Bill Berkrot)