Kinder Morgan Texas Pipeline LLC (KMTP), EagleClaw Midstream Ventures, LLC (EagleClaw), and Apache Corporation have announced that Exxon Mobil Corporation (XOM) has signed a letter of intent to support the proposed Permian Highway Pipeline Project (PHP Project). Under the letter of intent, ExxonMobil subsidiary XTO Energy may contract for up to 450,000 dekatherms per day (Dth/d) of capacity on the pipeline.
The approximately USD 2B PHP Project will provide an outlet for increased natural gas production from the Permian Basin to growing market areas along the Texas Gulf Coast. Itis designed to transport up to 2 billion cubic feet per day (Bcf/d) of natural gas through approximately 430 miles of 42-inch pipeline from the Waha to Katy, Texas, areas, with connections to the U.S. Gulf Coast and Mexico markets. The PHP Project is expected to be in service by late 2020.
KMTP and EagleClaw will be the initial partners, each with a 50% ownership interest in the project. Apache and EagleClaw will both be significant shippers on the proposed pipeline, with each entity planning to commit up to 500,000 Dth/d to the project. Apache will also have the option to acquire equity from the initial partners. KMTP will build and operate the pipeline.