Federal and State Officials Back Major Gasoline Pipeline to California
Federal and state officials are joining forces with the oil industry to back a massive pipeline project designed to transport gasoline from the Midwest to California through the planned Western Gateway pipeline, which could be the world’s largest fuel conduit.
The move aims at stabilizing energy supplies in California, a state facing a wave of refinery closures.
The Western Gateway pipeline, a joint venture between Phillips 66 and Kinder Morgan Inc., seeks to connect fuel-making plants in the interior U.S. to the West Coast, with the prospective customers facing the Friday deadline to formally declare their interest in shipping their fuel through the pipeline.
Phillips 66 CEO Mark Lashier told Bloomberg News on Tuesday that the project’s "open season"—the period where customers reserve shipping space—has "gone quite well" ahead of a Friday deadline.
"We will be a substantial shipper on it ourselves," Lashier said, noting interest from Midwest refiners, fuel retailers, and commodity trading houses.
The project aims to replicate the success of the Colonial Pipeline, which serves the Northeast, by moving gasoline, diesel, and jet fuel across Illinois, Oklahoma, Texas, New Mexico, Arizona, and Nevada.
California routinely faces the highest fuel prices in the nation, exacerbated by a shrinking local refining capacity.
Lashier has discussed the project with President Donald Trump’s National Energy Dominance Council, led by Energy Secretary Chris Wright and Interior Secretary Doug Burgum.
While pipeline projects often face fierce opposition from environmental groups and tribal nations, Lashier indicated that a planned new section in New Mexico has already gained support from the Mescalero Apache.
"I think they understand that we can operate these things safely, reliably and that it could be a source of income," Lashier said.
Much of the network will utilize existing Kinder Morgan infrastructure, though the project would require new construction through New Mexico to complete the link to California and its adjacent markets.