Kinder Morgan and its partners are moving forward with the expansion of the Permian Highway Pipeline.
Permian Highway Pipeline, LLC (PHP) has made a final investment decision (FID) to proceed with its expansion project after securing binding firm transportation agreements for all available capacity, according to a statement from Kinder Morgan.
PHP is jointly owned by subsidiaries of Kinder Morgan, Inc. (KMI), Kinetik Holdings Inc. (KNTK), and ExxonMobil (XOM), with 26.7%, 53.3%, and 20% ownership, respectively.
The project will increase PHP’s capacity by approximately 550 million cubic feet per day (MMcf/d). The project will primarily involve additional compression on PHP to increase deliveries of natural gas from the Waha area to several major connections, Katy, Texas, and various U.S. Gulf Coast markets, according to a release from Kinder Morgan. The target commissioning date for the project is expected to be November 1, 2023.
“We are delighted to have reached FID for this very significant expansion,” Kinder Morgan Natural Gas Midstream President Sital Mody said in a statement. “The project will alleviate transmission constraints outside the Permian Basin to better meet our domestic and global energy needs.”
Jamie Welch, president and CEO of Kinetik, said in a statement that the expansion is particularly timely because it will support future growth in natural gas production in West Texas and supply several liquefaction facilities. along the Texas Gulf Coast a more affordable and reliable supply.
“In addition, approximately 30 Kinetik customers will have access to premium-priced markets and transportation flow insurance, which is critical to minimizing burnt volumes,” Welch added.
Kinder Morgan is one of the top 10 holdings in the ETF Alerian Energy Infrastructure (ENFR), which weights the title at 5.04% as of June 30. ENFR also owns Kinetik Holdings, weighted at 0.35%, according to VettaFi.
The largest holdings in ENFR as of June 30 include Enbridge (ENB, 10.55%), Enterprise Products Partners LP (EPD, 8.46%), TC Energy Corporation (TRP, 7.21%), Energy Transfer LP ( ET, 6.38%) and Cheniere Energy Inc. (LNG, 5.62%), according to VettaFi.
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vettafi.com is owned by VettaFi, which also owns the index provider for ENFR. VettaFi is not the ENFR sponsor, but the VettaFi affiliate receives index license fees from the ETF sponsor.