Kinder Morgan subsidiary Kinder Morgan Texas Pipeline (KMTP), EagleClaw Midstream Ventures, and Apache have teamed up to develop the proposed $2bn Permian Highway Pipeline Project (PHP Project).
The 430-mile PHP Project will enable transportation of excess natural gas produced from the Permian Basin to the market areas along the Texas Gulf Coast.
With a design capacity of up to two billion cubic feet per day (Bcf/d), the of 42-inch pipeline will transport the natural gas from the Waha, Texas, area to the US Gulf Coast and Mexico markets.
Kinder Morgan said it is also assessing the economic and hydraulic feasibility of a 48-inch pipeline with increased transportation capacity.
Kinder Morgan Natural Gas Midstream chief commercial officer Sital Mody said: “The PHP Project is structured to provide unrivaled market optionality for Permian producers.
“By contracting for space on KMI’s extensive intrastate systems, the project will offer seamless nominations to the Katy and Agua Dulce market hubs; pipeline headers into LNG export facilities on the Texas Gulf Coast; multiple pipelines delivering gas into Mexico, including Valley Crossing, NET Mexico, and KMI’s Border and Monterrey pipelines; and numerous other intrastate and interstate pipelines.
“Additionally, shippers on the project will be able to contract for additional transportation, storage and gas sales options with KMI, whose existing intrastate systems are directly connected to most end users along the Texas Gulf Coast.”
Scheduled to be commissioned in late 2020, the PHP project is subject to the signing of definitive agreements and the receipt of construction permits.
The pipeline will receive natural gas from multiple locations in the Permian Basin. It will have additional interconnections to both intrastate and interstate pipeline systems in the Waha area.
KMTP and EagleClaw will initially own 50% stake each in the pipeline project. Apache, however, will have an option to acquire up to 33% interest in the project from the initial partners. KMTP will construct and operate the pipeline.