Amanda Stephenson · Thomson Reuters

· Posted: May 29, 2026 1:30 PM EDT | Last Updated: 3 hours ago

Canada's South Bow will decide whether to proceed with its proposed partial revival of the Keystone XL oil pipeline by mid-2027, the company said on Friday, as it announced it has secured the shipper commitments it was seeking ​to advance the project.

The proposed 550,000-barrel-per-day Alberta-to-Wyoming pipeline, dubbed ​Prairie Connector, could increase Canada's crude exports to the U.S. by 12 per cent, adding much-needed Canadian pipeline capacity.

South Bow, working with U.S. partner Bridger Pipeline ​on the proposal, said it has secured 20-year binding contracts from oil companies ⁠through a process launched ⁠this year to gauge commercial interest.

Reuters reported ‌this month that South Bow was close to reaching its goal of securing 450,000 barrels per day, or 80 per cent of initial pipeline capacity, citing sources.

Pipeline partly assembled in Canada

South Bow spun off from former Keystone XL proponent TC Energy in 2024 ⁠to take over its oil pipeline business.

While the new pipeline does not follow the same U.S. route as an earlier project that was cancelled in 2021 when former president Joe Biden ‌revoked its permit, it would use some of the already-assembled Keystone XL pipe on the Canadian side of the border.

U.S. President Donald Trump has signed an order granting a cross-border permit to the new proposal.

But South Bow CEO Bevin Wirzba said on ​Thursday the company cannot proceed unless it has evidence that permit is "durable," and will not be revoked by a future ⁠administration.

While the successful open season to secure shipper commitments achieves a significant milestone, there is ⁠lingering risk about the U.S. permit, said TPH energy analyst AJ O'Donnell.

"Without assurances that a ⁠new ⁠U.S. administration would not revoke the ​permits in 2029, as Biden did with KXL, the project is likely to be stalled," O'Donnell ​said.

South Bow has not ⁠publicly put a price tag on its project, but ATB Cormark Capital Markets analysts said it could cost $3 billion and take two to three years to build after an investment decision.

Canada, the world's fourth-largest oil supplier, produces 5.5 million barrels per day. Forecasts suggest that could climb to 6.1 million barrels per day by ⁠2030.