A proposed pipeline linking Alberta to Wyoming, spearheaded by South Bow Corp (TSX: SOBO) and its U.S. partner Bridger Pipeline, has secured commitments for at least 400,000 barrels per day (bpd), representing 72% of its initial 550,000 bpd capacity, as the project edges closer to the critical threshold needed to proceed.
The pipeline, which could boost Canada’s crude exports to the U.S. by over 12%, has drawn support from major producers like Cenovus Energy, Canadian Natural Resources Ltd, Tamarack Valley, Whitecap Resources, and Strathcona Resources. South Bow and Bridger are targeting long-term contracts for 450,000 bpd, a level that would meet the industry-standard 80% capacity benchmark for greenlighting construction. If fully realized, the project could eventually handle up to 1.13 million bpd, according to regulatory filings.
Spanning roughly 645 miles from Montana to Guernsey, Wyoming, the pipeline would also revive 150 km of idle infrastructure on the Canadian side originally built for the now-canceled Keystone XL project. U.S. President Donald Trump signed a cross-border permit for the initiative last Thursday, providing a significant boost after years of regulatory setbacks for similar ventures.
READ: Bridger Pipeline Gets Greenlight From Trump to Revive Canadian Crude Exports with Keystone XL Assets
Whitecap CEO Grant Fagerheim called the oil industry’s engagement with the project constructive, noting sufficient momentum to likely achieve the minimum thresholds. He also highlighted the importance of U.S. administrative backing in moving the proposal forward.
Canada, the world’s fourth-largest oil producer with output at 5.5 million bpd as of January, faces persistent pipeline constraints that have curbed export potential. Production could climb to 6.1 million bpd by 2030, amplifying the need for additional takeaway capacity. Beyond this project, rival operator Enbridge is expanding its Mainline and Flanagan South pipelines to add 150,000 bpd by 2027, with a potential second phase for another 250,000 bpd by 2028. Meanwhile, the Trans Mountain pipeline to Canada’s west coast is planning enhancements for an extra 360,000 bpd.
Analysts point out that Guernsey is not a final crude market, meaning further infrastructure to refining hubs like Cushing, Oklahoma, or the U.S. Gulf Coast would be necessary. Still, AJ O’Donnell of Tudor Pickering, Holt & Co. described the South Bow-Bridger project as one of the most economic options for increasing Western Canadian oil egress by decade’s end.
The project remains in early stages, with ongoing commercial and regulatory discussions. Its ultimate capacity and timeline hinge on finalizing shipper contracts and navigating stakeholder approvals.
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