Permian Highway expansion clears FID
A final investment decision has been taken on expanding the capacity of the Permian Highway pipeline by around 550mn ft3/d, in a move that will bolster gas deliveries from projects in West Texas's Waha drilling hub to the US Gulf coast.
The operator Permian Highway Pipeline announced the FID on June 29, lending a boost to efforts to alleviate bottlenecks that have hindered Permian basin production growth. Additional capacity should also help gas producers reduce flaring. Pending receipt of regulatory approvals, the upgrade will be in service in November 2023.
US pipelines operator Kinder Morgan owns a 26.7% shareholding in the 2.1bn ft3/day Permian Highway pipeline, participating alongside US major ExxonMobil (20%) and integrated Permian midstream player Kinetik Holdings (53.3%).
Sital Mody, president of Kinder Morgan's natural gas midstream division, said: "We are excited to have achieved FID on this very important expansion. The project will alleviate transportation constraints out of the Permian Basin so as to further support meeting our domestic and global energy needs.”
Kinetik's CEO and president Jamie Welch says around 30 of its customers will be connected to "premium priced" gas markets once the new capacity is brought on stream.
"This expansion couldn't come at a more critical time, as it will foster future natural gas production growth and provide several liquefaction facilities along the Texas Gulf Coast with more affordable, reliable supply," Welch added.