Phillips 66 and Kinder Morgan have secured enough long-term shipper commitments to move forward with a proposed pipeline project to supply fuel to Arizona and California, they said on Monday.
The Western Gateway Pipeline project comes as companies race to build a major new fuel pipeline to the U.S. West Coast ahead of planned refinery closures in California, a relatively isolated fuel market with limited pipeline links to major refining hubs, leaving it vulnerable to supply disruptions and price spikes.
Phillips 66 and Kinder Morgan began seeking initial shipper commitments in October for the proposed pipeline system that would carry fuel from a Texas refining hub to Arizona and California.
The companies have not disclosed the cost of the project.
The refined products pipeline system is designed to link Midwest and Gulf Coast refinery supply to Phoenix, Arizona, and California markets, with connectivity to Las Vegas through Kinder Morgan’s CALNEV Pipeline.
The project includes a new pipeline from Borger, Texas, to Phoenix, as well as the reversal of Kinder Morgan’s existing pipeline between Colton, California, and Phoenix to allow east-to-west flows into California. Phillips 66’s Gold Pipeline, which currently runs from Borger to St. Louis, will also be reversed to supply the system.
The project is slated to begin service in mid-2029.
(Reporting by Dharna Bafna in Bengaluru; Editing by Sahal Muhammed)