Kinder Morgan Texas Pipeline LLC (KMTP) has put everything ready in facilitating the continuation of the Permian Highway Pipeline (PHP) Project. Through its subsidiary of Kinder Morgan, Inc. (NYSE:KMI), the company confirmed having agreed on final investment. It will work together with EagleClaw Midstream Ventures, LLC (EagleClaw). The project is worth $2 billion. Its primary goal is to increase the production of natural gas and particularly along the Texas Gulf Coast.
However, despite all this progress, the project will only assume once it has received the requisite regulatory approvals from the relevant authorities. Nonetheless, speculations have it that It will be in service in late 2020.
The project will obtain the supply of Natural gas supply from multiple locations
Texas area, the US Gulf Coast and Mexico are some of the growing markets, which are high demand for natural gas. According to the president of Kinder Morgan Natural Gas Midstream, Sital Mody, the structure in place will offer unequaled market optionality for Permian producer. The company has already identified sources of the Natural gas, the main ones being KMI’s, EagleClaw’s and Apache’s existing systems in the Permian Basin.
In addition to this, Mody notes, “With a route identified and the project nearly fully subscribed, we expect to begin stakeholder outreach, environmental surveys, and right-of-way activities in the coming months.”
The project will support the growing infrastructure needs of Permian Basin producers
This is one the primary goals of partnership between Kinder Morgan and Apache. This is in addition to supporting the continued growth of the U.S. economy and in return create jobs for the Americans. It is also noting that there has been increased drilling activity in the Permian Basin. Thus the project will come in handy in providing key infrastructure for producers.
The Senior VP, Midstream, and Marketing at Apache, Brian Freed acknowledges that this is a tremendous project, which will benefit both companies. The 430 miles of 42-inch pipeline from the Waha will transport up to 2 billion cubic feet per day of natural gas.
Meanwhile, both Kinder Morgan and EagleClaw will each own 50 percent of the project. However, Apache will have an option of acquiring another 33 percent equity from the initial partners.