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Phillips 66, Kinder Morgan, HF Sinclair Approve Western Gateway Pipeline Project

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Phillips 66 (PSX), Kinder Morgan (KMI), and HF Sinclair (DINO) have made a positive final investment decision for the 1,300-mile Western Gateway Pipeline system that will supply refined products from Missouri and the Gulf Coast to Arizona and California, according to a joint statement on Tuesday.

The three companies have also finalized a joint venture agreement, where Phillips 66 will own 49.9% of the system, while Kinder Morgan will own 35.1% and HF Sinclair 15%, according to the statement.

The project is valued at $5 billion and has a design capacity of 230,000 barrels per day, the companies said. It includes a 900-mile new-build pipeline from Texas to Arizona, the east and west networks of Kinder Morgan's Santa Fe Pacific Pipeline, and Phillips 66's Gold Pipeline.

"This project will connect our Central Corridor and Gulf Coast refining assets to our West Coast and Southwest Marketing assets and demonstrates the value of our integrated business model and the opportunities it creates," said Phillips 66 chairman and chief executive Mark Lashier.

The pipeline is expected to be completed in 2029 and generate returns from 10-year take-or-pay contracts.

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