Phillips 66, Kinder Morgan and HF Sinclair have approved a $5 billion pipeline project designed to bring gasoline, diesel and other refined fuels from Midcontinent and Gulf Coast refineries into Arizona and California by 2029.
ABC15 reported the companies finalized a joint venture for the Western Gateway Pipeline, with Phillips 66 holding 49.9%, Kinder Morgan 35.1% and HF Sinclair 15%. The final investment decision moves the project into development, although construction still depends on required permits and regulatory approvals.
The proposed 1,300-mile system would carry up to 230,000 barrels per day. Its largest new component is approximately 900 miles of 20-inch and 24-inch pipeline from Borger, Texas, to Phoenix, built and operated by Phillips 66. Kinder Morgan would contribute its existing East Line linking El Paso with Phoenix and Tucson.
Kinder Morgan plans to reverse its West Line between Colton, California, and Phoenix, allowing fuel to move from Arizona into California. Phillips 66 would reverse its Gold Pipeline toward Borger and connect it with the Explorer Pipeline, creating a new route from St. Louis and Gulf Coast supply points to Western markets.
Arizona has no petroleum refineries and receives gasoline and other petroleum products by pipeline from Southern California and Texas, according to the U.S. Energy Information Administration. The companies say Western Gateway would diversify that supply as Arizona demand grows and California refining capacity declines.
Phillips 66 expects to contribute about $2.5 billion in cash, while Kinder Morgan would contribute roughly $250 million plus existing pipeline assets valued at $1.5 billion. HF Sinclair would provide about $750 million. The system is backed mainly by 10-year take-or-pay contracts and targets completion in 2029, but the companies have not promised lower retail fuel prices.
