Kinder Morgan bullish on natgas demand; two new Permian pipes needed this decade

Kinder Morgan (NYSE:KMI) said Wednesday it remains bullish on natural gas demand to meet rising demand for liquefied natural gas export plants, a week after the company reported Q4 results which showed weakness in its natural gas pipeline operations.

“The future for U.S. natural gas is very bright, and that has positive implications both for our existing business and for our ability to expand,” CEO Kimberly Dang said during the company’s investor day.

The favorable economics and low nitrogen content of natgas produced in the Eagle Ford Shale will drive strong production growth in the basin out to 2030, Kinder Morgan (KMI) natural gas head Sital Mody said, according to S&P Global Commodity Insights.

Natural gas output from the Eagle Ford averaged 5.2B cf/day in 2023, according to S&P Global, which Wood Mackenzie has forecast will increase by 500M cf/day by 2030, but Mody said Kinder Morgan (KMI) anticipates 2.5B cf/day of growth.

Based on discussions with customers, Eagle Ford economics “probably rival that of the Haynesville,” and will be “a key focus of ours,” Mody said.

Kinder Morgan (KMI) may seek to add two pipelines to the Permian Basin by 2030, as it expects an increase of 7B cf/day to production during the decade, according to Mody, adding the company is in talks for a pipeline that could enter service in early 2026 or late 2027, with “probably another pipe needed, maybe a couple of years later.”