Kinder Morgan, EagleClaw reach FID on Permian Highway line

Sept. 6, 2018
Kinder Morgan Texas Pipeline LLC (KMTP), a subsidiary of Kinder Morgan Inc., and EagleClaw Midstream Ventures LLC, a portfolio company of Blackstone Energy Partners, reached a final investment decision to proceed with the Permian Highway Pipeline (PHP) Project.

Kinder Morgan Texas Pipeline LLC (KMTP), a subsidiary of Kinder Morgan Inc., and EagleClaw Midstream Ventures LLC, a portfolio company of Blackstone Energy Partners, reached a final investment decision to proceed with the Permian Highway Pipeline (PHP) Project.

“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,” said Sital Mody, president of Kinder Morgan Natural Gas Midstream.

The $2-billion PHP Project is expected to be in service in late 2020, assuming timely receipt of the requisite regulatory approvals. It is designed to transport as much as 2 bcfd of gas through 430 miles of 42-in. pipeline from the Waha, Tex., area to the US Gulf Coast and Mexico. KMI also is evaluating the economic and hydraulic feasibility of a 48-in. pipeline with increased transportation capacity (OGJ Online, June 26, 2018).

Committed shippers include EagleClaw, Apache Corp., and XTO Energy Inc., a subsidiary of ExxonMobil Corp., amongst others.

KMTP and EagleClaw will serve as initial partners with equal ownership. KMTP will build and operate the pipeline. Apache, who has been jointly developing the proposed project, holds the option to acquire equity from the initial partners, which it intends to assign to Altus Midstream, a C-corporation anchored by substantially all of Apache’s gathering, processing, and transportation assets at Alpine High in the Delaware basin (OGJ Online, Aug. 9, 2018). KMI’s and EagleClaw’s ultimate ownership interest may vary between 27% and 50%, depending on the outcome of ownership options held by anchor shippers.