KEY POINTS
- Trump says a US-Canada trade deal concept includes the Keystone XL pipeline.
- Carney says negotiators will work in the coming weeks to finish a deal.
- Canada sends more than 90% of its crude oil production to the U.S.
President Donald Trump said Sunday that his administration has the concept of a new trade deal with Canada, and that the agreement would include the long-stalled Keystone XL oil pipeline.
Speaking to reporters in Dubuque, Iowa, Trump said he had spoken again with Prime Minister Mark Carney the day before. He described the emerging pact as a win for American farmers and for the country, Reuters reported.
Carney, meanwhile, struck a more measured tone. In a post on X, he said the call built on recent talks about the outline of a trade deal that would create jobs, improve affordability and fully respect Canada’s languages, culture and sovereignty. He also said negotiators would spend the coming weeks working to deliver it.
Still, the road to an agreement has been rough. Both countries have slapped billions of dollars in tariffs on each other in recent months. And although Trump said last week that a deal was coming soon, Ottawa had reported limited progress, even as officials worked to ease tariffs on steel and autos.
The timing carries political weight, too. Tariffs on Canada have become an issue in northern border states such as Michigan and Maine ahead of Tuesday’s midterm elections.
Keystone XL back on the table
Trump said the pipeline would sit at the heart of the deal. “They’re going to build the Keystone Pipeline,” he said, adding that Canada would cover the cost while the U.S. supplied a route he called largely settled.
However, it was not immediately clear how the project would be revived. Former President Joe Biden revoked a key permit for the privately backed pipeline in 2021. Then in August, Trump suggested the project could come back from the dead.
As designed, the line would have carried 830,000 barrels of oil per day from the oil sands of northern Alberta to the storage hub at Cushing, Oklahoma, and on to Gulf Coast refineries. That matters because Canada, the world’s fourth-largest oil exporter, sends more than 90% of its crude production to the U.S.
A rival pipeline already in the works
Meanwhile, the industry has partly moved on. TC Energy, the Canadian company behind Keystone XL, lost billions when the project died. So it later spun off its crude pipeline business into a new company, South Bow.
South Bow has since proposed Prairie Connector, a 550,000-barrel-per-day pipeline from Alberta to Wyoming, with U.S. partner Bridger Pipeline. The project would reuse some Keystone XL pipe already installed on the Canadian side of the border. But the company has said it won’t decide whether to proceed until 2027.
South Bow did not immediately respond to a request for comment. A spokesperson for Canadian Energy Minister Tim Hodgson declined to comment, while a spokesperson for Dominic LeBlanc, Canada’s minister responsible for U.S. trade, offered nothing beyond Carney’s remarks.
