U.S. President Donald Trump signed an executive order on Thursday approving a new initiative to transport Canadian oil across the border, aiming to resurrect sections of the defunct Keystone XL pipeline project. South Bow, the Canadian firm initially behind the scrapped Keystone XL venture, is collaborating with U.S.-based Bridger Pipeline for this revived endeavor. South Bow is exploring the possibility of revitalizing portions of the already constructed pipeline in Alberta and Saskatchewan.
Bridger Pipeline is actively pursuing the construction of a potential 1,038-kilometre pipeline that would originate near the U.S.-Canada border in Phillips County, Montana, and extend to Guernsey, Wyoming. As Trump endorsed the order, White House Staff Secretary Will Scharf briefed the president on the project, describing it as a cross-border pipeline akin to the former Keystone XL pipeline. Trump acknowledged the potential for job creation, expressing his approval of the initiative.
This new proposal could enhance Canada’s crude oil exports to the U.S. by over 12% if it materializes. Unlike the previous Keystone XL route, which was terminated by former President Joe Biden in 2021 amid prolonged opposition from Indigenous groups and environmental activists, this revived project would follow a different path through the U.S. Nevertheless, it plans to utilize existing pipeline infrastructure on the Canadian side, where the Keystone XL line has already obtained full permits, with approximately 150 kilometres of pipe having been installed in Alberta in 2021.
South Bow, established in 2024 following TC Energy’s separation of its oil pipeline operations, is evaluating the Prairie Connector project, which would expand its Canadian assets to enhance market access for Canadian crude oil by leveraging existing infrastructure and permitted corridors, according to company spokesperson Solomiya Martoiu. The Prairie Connector project is still in its early stages, subject to further commercial negotiations, stakeholder discussions, regulatory procedures, and assessments.
Energy law expert James Coleman from the University of Minnesota highlighted the rationale behind the project’s resurgence, pointing to the increasing oil production in Canada and the global energy crisis triggered by geopolitical tensions. North America’s diverse energy resources, including heavy oil, light oil, refining capabilities, and natural gas, position the continent to address the ongoing energy challenges effectively. However, Coleman cautioned that legal obstacles akin to those faced by the Keystone XL project could emerge for this new proposal.
The proposed pipeline could transport around 550,000 barrels of Canadian crude oil daily to the U.S., potentially bolstering Canada’s energy exports to its southern neighbor. The Canadian Association of Petroleum Producers voiced support for any commercially viable capacity expansion that ensures reliable movement of Canadian energy. While the project has received a presidential permit, it still necessitates state regulatory approvals to advance.
The issuance of permits to Bridger Pipeline coincides with Canada and the U.S. navigating bilateral trade tensions and preparing for upcoming trade negotiations. Last year, during discussions at the White House, Prime Minister Mark Carney broached the topic of reviving the Keystone XL pipeline with Trump, emphasizing the mutual benefits of integrated energy infrastructure between the two countries.
Amidst the construction of the Canadian segment of the Keystone XL pipeline, which engaged approximately 1,000 workers in Oyen, located east of Calgary, TC Energy faced setbacks in its attempt to seek compensation from the U.S. government after claiming unfair treatment. The original Keystone XL pipeline, first proposed in 2005, was designed to transport 830,000 barrels of crude oil daily from Hardisty, Alberta, to Nebraska, eventually linking with the existing Keystone pipeline leading to Gulf Coast refineries.