South Bow plan to revive parts of Keystone XL needs Trump approval, U.S.
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A proposal led by Canadian company South Bow to revive parts of the cancelled Keystone XL oil pipeline could increase Canada’s crude exports to the U.S. by more than 12 per cent, if it gets a green light from U.S. President Donald Trump and additional links to U.S. refining hubs are built.
The new proposal involves a different route through the U.S. than the previous Keystone XL pipeline project cancelled by former U.S. President Joe Biden in 2021, after years of Indigenous and environmental opposition.
South Bow, which was set up by former Keystone XL proponent TC Energy in 2024 to take over its oil pipeline business, is considering reviving some of the line that was already built in Alberta and already has all necessary Canadian permits.
Canadian Prime Minister Mark Carney brought up the pipeline’s revival in a conversation with Trump in October, and it could provide him leverage in upcoming negotiations around renewing the Canada-U.S.-Mexico (CUSMA) trade agreement.
Trump — whose tariff wars and annexation threats have strained relations with Canada — has repeatedly called for lower oil prices, and many U.S. refiners depend on the roughly 4.4 million barrels per day of exports that Canada sends south of the border.
South Bow’s potential U.S. partner, Bridger Pipeline, recently filed a proposal with Montana regulators that describes the construction of a 1,038-kilometre pipeline — capable of transporting up to 550,000 barrels per day — beginning near the U.S.-Canada border in Phillips County, Montana, and transiting to Guernsey, Wyoming.
But analysts say Guernsey is not an end market for crude oil, so additional links would need to be built to transport oil to refining hubs such as Cushing, Oklahoma; Patoka, Illinois; and the U.S. Gulf Coast.
Prime Minister Mark Carney raised the Keystone XL pipeline project during conversations with U.S. President Donald Trump on Tuesday, according to a source CBC News is not identifying because they were not authorized to speak publicly. The news has proponents wondering whether the more-than-once cancelled project could be revived again.
The most credible configuration would be a new pipeline spanning more than 680 kilometres from Guernsey to Steele City, Nebraska, where it could connect to the existing Keystone mainline system, said Matthew Lewis, founder of Plainview Energy Analytics. From there, the oil could move into underutilized pipelines running toward Cushing, Patoka and Wood River, Illinois.
It remains unclear, however, who would be willing to take on the risk associated with that leg of a project.
“The biggest challenge in this plan in a…
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