MPLX to Move Forward with Permian, Bakken Pipeline Expansion Projects

(Reuters) — MPLX LP plans to move forward with the expansion of a Permian Basin natural gas pipeline that will ease an expected lack of takeaway capacity from the top U.S. shale region, the company said on Monday.

MPLX said it would expand the mainline capacity on the Whistler pipeline by 500 million cubic feet per day (MMcf/d) to 2.5 billion cubic feet per day (Bcf/d), which will begin service in September 2023. 

The Whistler pipeline is an approximately 450-mile, 42-inch intrastate pipeline that transports natural gas from the Waha Header in the Permian Basin to Agua Dulce, Texas, providing direct access to South Texas and export markets. An approximately 85-mile 36-inch lateral provides connectivity to the Midland Basin.

The decision to move forward with the Whistler expansion comes after sufficient transportation agreements with shippers were secured, MPLX said, a sign that they expect volumes to increase. Producers were hesitant to sign contracts to move gas out of the Permian Basin as little as three months ago.

Natural gas output in the Permian Basin, spread across Texas and New Mexico, is slowing, with companies blaming lack of adequate pipeline infrastructure, despite prices near 14-year highs. The slowdown is also occurring as many countries look for new suppliers to help break their dependence on Russian gas after Moscow’s invasion of Ukraine.

In April, Kinder Morgan said it was working on plans to expand its Permian Highway Pipeline and Gulf Coast Express pipelines, expected to be in service about 18 months after they have contracts and a final investment decision.

The Whistler Pipeline is owned by Whistler Pipeline LLC, a consortium of MPLX, WhiteWater and a joint venture between Stonepeak Infrastructure Partners and West Texas Gas Inc.


During the earning’s call, the company also said it would continue to add crude gathering infrastructure in the Permian Basin as well as the Bakken, which is located primarily in North Dakota.

MPLX's total pipeline throughputs were 5.3 million barrels per day (MMbbl/d) in the first quarter, 4% higher than the same quarter last year, it said. Its income from operations for its gathering and processing segment increased for the quarter by $46 million, versus the same time last year.

Construction is continuing on the company's 200 MMcf/d Torñado-2 processing plant in the Delaware Basin, expected to come online in the second half of 2022, the company said.

In the Marcellus region, the 68,000 barrel-per-day Smithburg "de-ethanizer" is expected to come online in the second half of 2022 as well, the company said.


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