Phillips 66 to acquire remaining 50% stake in WRB Refining for $1.4 billion

HOUSTON - Phillips 66 (NYSE:PSX), the $52.6 billion market cap downstream energy giant with annual revenues of $133 billion, announced Tuesday it has entered into a definitive agreement to acquire the remaining 50% ownership interest in WRB Refining LP from Cenovus Energy Inc. for $1.4 billion in cash, subject to customary adjustments.

WRB Refining owns the Wood River refinery in Illinois and the Borger refinery in Texas, which Phillips 66 has operated since the joint venture was formed in 2007. The acquisition will add approximately 250,000 barrels per day to Phillips 66’s refining capacity. According to InvestingPro analysis, the company appears undervalued based on its Fair Value calculations, suggesting this acquisition could further enhance shareholder value.

The Wood River and Borger refineries have crude throughput capacities of 345,000 and 149,000 barrels per day, respectively. Both facilities can process heavy and medium sour crudes, as well as light sweet crudes, and produce a high percentage of transportation fuels.

"With full ownership of the Wood River and Borger refineries, we are strengthening our integrated business and expanding our position in a region where we lead the industry," said Mark Lashier, chairman and CEO of Phillips 66.

The company expects the acquisition to deliver operational and commercial synergies of approximately $50 million per year by enabling full integration of these assets with the broader Phillips 66 value chain. With an EBITDA of $3.8 billion and a solid Financial Health Score of 2.25 (rated as ’FAIR’ by InvestingPro), Phillips 66 appears well-positioned to execute this integration successfully.

The transaction is expected to close during the fourth quarter of 2025, according to the company’s press release statement.

Phillips 66 is a downstream energy provider with businesses in midstream, chemicals, refining, marketing and specialties, and renewable fuels sectors.

In other recent news, Phillips 66 reported robust earnings for the second quarter of 2025, with adjusted earnings reaching $973 million, or $2.38 per share. The company also generated an operating cash flow of $1.9 billion, excluding working capital, highlighting its strong operational efficiency and strategic initiatives. UBS responded to this performance by raising its price target for Phillips 66 to $143, while maintaining a Buy rating, emphasizing the company’s competitive business model. Similarly, TD Cowen increased its price target to $134, acknowledging the company’s strong refining performance and lowest operational expenses since 2021. These developments reflect Phillips 66’s high refining utilization and strategic shareholder returns. Both UBS and TD Cowen’s adjustments suggest confidence in the company’s financial health and future prospects.

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