August 12, 2026 [Storage Terminals Magazine]- Phillips 66, Kinder Morgan and HF Sinclair have finalised a joint venture agreement and taken a final investment decision (FID) to proceed with the proposed Western Gateway Pipeline system, a 1,300-mile refined products pipeline designed to establish a new fuel supply route across the western United States.

Under the joint venture agreement, Phillips 66 will hold a 49.9 percent interest in Western Gateway, while Kinder Morgan will own 35.1 percent and HF Sinclair will hold the remaining 15 percent.

The project is designed to connect refined products from St. Louis, Missouri, and expanded Gulf Coast supply points with markets in Arizona and California. It will have an initial design capacity of approximately 230,000 barrels per day (bpd), with provisions to increase capacity in the future without requiring new pipeline construction.

The development is expected to provide additional supply flexibility for fuel markets across the Western US while connecting refining and pipeline infrastructure operated or contributed by the three partners.

Phillips 66 Chairman and CEO Mark Lashier said the FID reflected the strength of the partnership and the potential for the project to improve fuel supply reliability and resilience across the region.

“By combining the capabilities of Phillips 66, Kinder Morgan and HF Sinclair, Western Gateway is expected to strengthen fuel supply reliability and deliver a more cost-effective, resilient path for growing markets across the West,” Lashier said.

The Western Gateway system will include approximately 900 miles of newly constructed 20-inch and 24-inch pipeline running from Borger, Texas, to Phoenix, Arizona. Phillips 66 will construct and operate the new pipeline.

Kinder Morgan will contribute its existing SFPP East Line pipeline between El Paso, Texas, and Phoenix and Tucson, Arizona, as well as its SFPP West Line pipeline between Colton, California, and Phoenix. The West Line is expected to be reversed to allow refined products to move east to west into California. Kinder Morgan will continue operating the contributed pipelines.

Additional supply will be provided through Phillips 66’s Gold Pipeline, which will connect with the Explorer Pipeline. The Gold Pipeline is also expected to be reversed to enable refined products to flow towards Borger.

Kinder Morgan CEO Kim Dang said the project combines existing infrastructure, supply access and the partners’ operating experience to improve fuel supply and affordability in western markets.

HF Sinclair CEO Franklin Myers said the company viewed the project as a significant development for the fuels markets of the Western United States.

Western Gateway has an estimated enterprise value of approximately $5 billion. Once the new-build pipeline from Borger to Phoenix is completed, Kinder Morgan’s existing SFPP East and West Line assets will be contributed to the joint venture at an estimated value of approximately $1.5 billion.

Kinder Morgan is also expected to contribute approximately $250 million in cash, while Phillips 66 will provide approximately $2.5 billion and HF Sinclair approximately $750 million.

The project is supported primarily by 10-year, take-or-pay contracts, providing a long-term commercial foundation for the new pipeline system. The companies expect the contracted volumes to support returns consistent with the project’s long-term midstream infrastructure model.

Western Gateway is targeting completion in 2029, subject to securing the required permits and regulatory approvals.

Once completed, the system will provide an additional refined products transportation route between major US supply centres and growing fuel markets in the Southwest and West Coast, while making greater use of existing pipeline infrastructure.