Phillips 66, Kinder Morgan move forward with Western Gateway pipeline with secured shipper interest
Phillips 66 Co. and Kinder Morgan Inc. have secured sufficient shipper interest to advance the proposed Western Gateway refined products pipeline project to supply fuel to Arizona and California, the companies said in a joint release Apr. 20.
Following a second open season to secure long-term shipper commitments, the companies will “move the project forward, subject to the execution of definitive transportation service agreements, joint venture agreements, and respective board approvals,” the companies said.
“Customer response during the open season underscores the importance of Western Gateway in addressing long term refined products logistics needs in the region,” said Phillips 66 chairman and chief executive officer Mark Lashier.
“By utilizing existing pipeline assets across multiple states along the route, we’re uniquely well-positioned to support a refined products transportation solution,” said Kim Dang, Kinder Morgan chief executive officer.
Western Gateway pipeline specs
The planned 200,000-b/d Western Gateway project is designed as a 1,300-mile refined products system with a new-build pipeline from Borger, Tex. to Phoenix, Ariz., combined with Kinder Morgan’s existing SFPP LP pipeline from Colton, Calif. to Phoenix, Ariz., which will be reversed to enable east-to-west product flows into California. It will be fed from supplies connected to Borger as well as supplies already connected to SFPP’s system in El Paso, Tex.
The Gold Pipeline, operated by Phillips 66, which currently flows from Borger to St. Louis, will be reversed to enable refined products from midcontinent refineries to flow toward Borger and supply the Western Gateway pipeline. Western Gateway will also have connectivity to Las Vegas, Nev. via Kinder Morgan’s 566-mile CALNEV Pipeline.
The Western Gateway Pipeline is targeting completion by 2029.
Phillips 66 will build the entirety of the new pipeline and will operate the line from Borger, Tex., to El Paso, Tex. Kinder Morgan will operate the line from El Paso to its Phoenix, Az., terminal and the remainder of its line as it will connect to its SFPP line.
Why is the Western Gateway pipeline needed?
California is on track to lose about 17-20% of its refining capacity by mid-2026, according to the US Energy Information Administration (EIA).
Read more about companies' plans to shutter refinieries in California.
Arizona and Nevada are heavily dependent on California barrels, and the existing pipelines into Arizona run near capacity, according to Kinder Morgan and Phillips 66, which note the Western Gateway pipeline could replace the roughly 125,000 b/d that Phoenix, Az., currently receives via Kinder Morgan’s SFPP pipeline from California, allowing those volumes to remain in California, thus increasing supply for in-state markets.