Houston pipeline operator Kinder Morgan plans to build the company’s third pipeline to move natural gas from the Permian Basin of West Texas to the Gulf Coast but the project may have to wait until more customers sign up.
Source: Houston Chronicle
Kinder Morgan brought its Permian Basin-to-Corpus Christi Gulf Coast Express Pipeline into service in September while construction continues for its Permian Highway Pipeline, which will move gas from the West Texas shale play through the Texas Hill Country to the Katy Hub near Houston.
The company’s CEO Steve Kean told the Houston Chronicle that Kinder Morgan remains in talks with producers to build the Permian Pass Pipeline, a proposed project that will move 2 billion cubic feet of natural gas per day from the prolific West Texas shale play to interstate pipelines and liquefied natural gas export terminals in East Texas and Louisiana.
“While we were in deep discussions mid-last year, that has cooled a bit as producers re-examine their capital commitments,” Kean said. “I still think we’re going to need it.”
Unlike the Permian Highway Pipeline, which still faces two federal lawsuits filed by opponents, the Permian Pass Pipeline will not go through the scenic and environmentally sensitive Hill Country.
Instead, Kean said the Permian Pass Pipeline will be routed through an area north of Austin and south of Dallas with a termination point in East Texas.
The project is not listed in the company’s backlog of projects but a company investor presentation listed the in-service date for the pipeline beyond 2022. Kean said the company remains in discussions to sign up customers.
“Our business is a function of being ready to do what our customers want to do when they want to do it,” Kean said. “If our customers are ready to sign up by the end of this year, which is possible, we could be proceeding. But again, it’s not in our backlog. We won’t go until it’s signed up.”
