Permian: Oil Pipeline Takeaway. Too Much or Just Fit?10/17/2017
Midstream key regional players continue to plot new pipelines to take all the petroleum from West Texas to refineries, export hubs and petrochemical plants.
However, even with production from the Permian Basin being up 24% since the year began, the capacities being built may not find their customers.
Almost a two-fold increase in takeaway will mean lower margins. Production will ot keep up with such growth soon enough.
No operator abandons exisitng projects. Yet, a hunt for partners has begun.
Among the players involved are Kinder Morgan Inc. (NYSE: KMI), DCP Midstream LP (NYSE: DPM), and also Targa Resources Corp. (NYSE: TRGP) not to mentione others.
Some analysts say output can accommodate many of the new transportation lines. Permian production should rise through 2026 but it may peak sooner.
The competition for deals to fill the pipelines is so fierce that margins for operating the lines are likely to be thin without consolidation.
Nuevo Midstream will add 100 miles of gathering pipeline in Gonzales, Lavaca, and Dewitt counties to its Eagle Ford assets.
NGL Energy Develops Its Portfolio of Wholesale Propane Business Assets. Bought From DCP
Midstream companies seek partnerships, connect their most robust assets to the fastest growing markets. Let us see what they did this past February