U.S. President Donald Trump has signed an executive order approving a plan to transport Canadian oil across the border, aiming to revive segments of the terminated Keystone XL pipeline project. South Bow, the Canadian firm formerly associated with Keystone XL, is collaborating with U.S. company Bridger Pipeline on this new initiative.
The proposed project may involve reactivating sections of the existing pipeline in Alberta and Saskatchewan. Bridger Pipeline intends to construct a 1,038-kilometer pipeline starting near the U.S.-Canada border in Phillips County, Mont., and extending to Guernsey, Wyo.
The White House Staff Secretary, Will Scharf, described the project to Trump as a trans-border pipeline akin to the original Keystone XL pipeline. Trump acknowledged the potential job creation from the project, expressing his approval.
If the project proceeds, it could boost Canada’s oil exports to the U.S. by over 12%. Unlike the previous Keystone XL route, this new proposal outlines a different path through the U.S., leveraging some existing pipeline infrastructure in Canada. South Bow is evaluating the Prairie Connector project, aiming to enhance market access for Canadian crude oil.
Established in 2024, South Bow emerged after TC Energy, the former proponent of Keystone XL, separated its oil pipeline business. Experts suggest that the project’s resurgence is driven by market dynamics and the need for increased oil production in Canada.
The proposed pipeline, with a capacity to transport approximately 550,000 barrels of Canadian crude daily to the U.S., has garnered support from industry stakeholders. While State regulatory permits are still necessary for the project’s advancement, both Canadian and U.S. authorities are focused on bolstering energy security and trade partnerships.
The timing of the presidential permit coincides with ongoing trade tensions between Canada and the U.S., as they gear up for new trade negotiations. The revival of the Keystone XL project was discussed during past high-level meetings between the two nations.
During the construction phase of the Canadian leg of Keystone XL, Oyen, located east of Calgary, hosted around 1,000 workers. The original Keystone XL pipeline, initially announced in 2005, was designed to transport 830,000 barrels of crude per day from Hardisty, Alta., to Nebraska, connecting to Gulf Coast refineries.
In 2024, TC Energy’s efforts to seek compensation of $15 billion USD from the U.S. government were unsuccessful, as they claimed unfair treatment.