Phillips 66, Kinder Morgan and HF Sinclair said on Tuesday they have decided to proceed with the proposed US$5 billion Western Gateway Pipeline system and finalized a joint venture agreement for the same.<\/p>\n
Phillips 66 will own 49.9 per cent of the venture, Kinder Morgan 35.1 per cent and HF Sinclair 15 per cent.<\/p>\n
Companies have been racing 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 links to major refining hubs that leave it vulnerable to supply disruptions and price spikes.<\/p>\n
Western Gateway is a proposed 1,300-mile refined products pipeline system with a design capacity of 230,000 barrels per day that would establish a new fuel supply route from St. Louis, Missouri and Gulf Coast origin points to Arizona and California. The project is targeting completion in 2029.<\/p>\n
Phillips 66 and HF Sinclair\u2019s ability to move product west will be a major positive for their refining systems, UBS analysts said, particularly during the winter months when demand is softer in the mid-continent and Midwest regions.<\/p>\n
Phillips 66\u2019s Gold Pipeline, which currently runs from Borger, Texas to St. Louis, will be reversed to supply the proposed east-to-west system, as will Kinder Morgan\u2019s existing pipeline between Colton, California and Phoenix, Arizona.<\/p>\n
After the completion of a new pipeline from Borger to Phoenix, Kinder Morgan\u2019s existing SFPP East Line and West Line assets will also be contributed to the joint venture at a value of about $1.5 billion, the companies said.<\/p>\n
Phillips 66 will contribute nearly $2.5 billion in cash for the project \u2014 which has an estimated enterprise value of $5 billion \u2014 while Kinder Morgan will contribute about $250 million and HF Sinclair about $750 million.<\/p>\n
The new system will be underpinned by primarily 10-year take-or-pay contracts, the companies added.<\/p>\n
(Reporting by Pooja Menon in Bengaluru; Editing by Jonathan Ananda)<\/p>\n","protected":false},"excerpt":{"rendered":"Phillips 66, Kinder Morgan and HF Sinclair said on Tuesday they have decided to proceed with the proposed…\n","protected":false},"author":2,"featured_media":854766,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[712,45,49,48],"class_list":["post-854765","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-apple-news","tag-business","tag-ca","tag-canada"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/854765","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=854765"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/854765\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/854766"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=854765"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=854765"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=854765"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}