Canada is open to exploring a revival of the defunct Keystone XL pipeline project to the US as respective leaders met this week to negotiate trade, according to a member of parliament (MP).
"Keystone XL is one of those projects that's been kicked around for a long time," said MP Corey Hogan (Liberal) on 8 October in response to reports that prime minister Mark Carney and US president Donald Trump discussed the project in Washington a day earlier.
"Certainly, it could be another one of the levers that increases North American energy security and so it certainly warrants exploring," said Hogan, who also serves as the Parliamentary Secretary to the Minister of Energy and Natural Resources, Tim Hodgson.
Such a project would appeal to Trump, who in February expressed his desire to restart construction of the line "NOW!" and promised easy approvals. But South Bow, the company that was to build the pipeline said at the time it has "moved on from Keystone XL".
While Carney works to strike new trade deals with the US, he has repeatedly said the old relationship with the US "is over" and the country needs to pivot to "reliable trade partners".
Hogan, like Carney, said there are still benefits that Canadian pipelines not aimed at the US could provide, including "our desire to diversify" by giving more access to more markets. Alberta premier Danielle Smith earlier this month said her government plans to propose a 1mn b/d pipeline to Canada's west coast.
Carney this week was hoping to hash out sectoral deals in steel and aluminum and in the energy sector which is arguably one of Canada's largest bargaining chips in the ongoing trade war with the US. The US imports about 4mn b/d of Canadian crude and another pipeline connecting the two markets could benefit both sides, but it is unclear how either government could lure a proponent back to the table.
The 830,000 b/d Keystone XL pipeline was proposed in 2008 and was intended to carry western Canadian crude from Hardisty, Alberta, to Steele City, Nebraska. The project became a political lightning rod and got caught up in regulatory red tape and court battles. It was rejected by former US president Barack Obama in 2015, revived by Trump during his first term, and then rejected again by former president Joe Biden in 2021.
Calgary-based TC Energy officially cancelled the project in June 2021, taking a $1.7bn (C$2.2bn) after-tax impairment and unsuccessfully suing the US government for $15bn in damages.
TC Energy in 2024 spun out its oil pipeline business, including the existing 622,000 b/d Keystone pipeline system, to create South Bow.
