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Kinder Morgan and DCP to work together on Gulf Coast Express pipeline

Published by
World Pipelines,

Kinder Morgan Texas Pipeline LLC (KMTP) – a subsidiary of Kinder Morgan, Inc. (KMI) – and DCP Midstream, LP have announced they have signed a letter of intent for DCP to participate in the development of the proposed Gulf Coast Express pipeline project, which will provide an outlet for increased natural gas production from the Permian Basin to growing markets along the Texas Gulf Coast. The project is designed to transport up to 1 700 000 Dth/d of natural gas through approximately 430 miles of 42 in. pipeline from the Waha (Texas) area to Agua Dulce (Texas). The pipeline is expected to be in service in the second half of 2019, subject to shipper commitments.

A non-binding open season for firm natural gas transportation is currently in process. It is anticipated that DCP will be a partner and shipper on the proposed pipeline. KMI will build and operate the pipeline. DCP is the largest natural gas liquids producer and natural gas processor in the US and operates approximately 1.3 billion ft3/d of processing capacity in the targeted Permian supply area. DCP also operates Sand Hills, a natural gas liquids pipeline extending from the Permian area to the premier Mont Belvieu market. Sand Hills pipeline is currently being expanded from 280 000 - 365 000 bpd.

“This opportunity presents a welcome competitive alternative that adds diversity to the market and is complementary to our recently announced Sand Hills expansion,” said Wouter van Kempen, Chairman, President and CEO of DCP Midstream, LP. “DCP has a premier portfolio of integrated assets in the Permian offering a full range of services and solutions to our customers.”

“We are excited to be partnering with one of the larger natural gas marketers in the Permian Basin area, with DCP Midstream currently marketing approximately 600 million ft3/d of natural gas in that region,” said Kinder Morgan Natural Gas Midstream President, Duane Kokinda. “We believe DCP’s strong Permian position, when combined with the downstream market connectivity of Kinder Morgan’s Texas Intrastate network, creates a valuable project for both producers and markets.”

Kokinda added: “In addition to DCP’s role as partner and shipper on the Gulf Coast Express pipeline, we are pleased with the tremendous level of interest in our project during this open season.”

It is anticipated that natural gas supply will be sourced into the project from multiple locations, including existing receipt points along KMI’s KMTP and El Paso Natural Gas pipeline systems in the Permian Basin, a proposed interconnection with the Trans-Pecos pipeline, and additional interconnections to both intrastate and interstate pipeline systems in the Waha area. Deliveries of natural gas into the Agua Dulce area will include points into KMTP’s existing Gulf Coast network, KMI-owned intrastate affiliates (KM Tejas and KM Border pipelines), the Valley Crossing pipeline, the NET Mexico header, and multiple other intrastate and interstate natural gas pipelines.

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US pipeline news Kinder Morgan pipeline news Natural gas pipeline news