Kinder Morgan Texas Pipeline (KMTP), a subsidiary of Kinder Morgan, is developing the Gulf Coast Express pipeline project (GCX Project) in the Permian Basin in Waha, Texas, US. Kinder Morgan holds 50% interest in the project, while DCP Midstream (DCP) and Targa Resources hold 25% interest each.
KMTP and DCP signed a letter of intent (LOI) for the development of the Gulf Coast Express pipeline in October 2017. Final investment decision on the project was taken in December 2017.
The pipeline will carry natural gas from the Permian production area to the hub near Agua Dulce, Texas. KMTP will develop the project with an estimated investment of $1.75bn.
Construction on the pipeline commenced in May 2018, while operations are scheduled to begin in October 2019. The project will enable exports to Mexico and LNG liquefaction terminals on the Gulf coast, while meeting the growing demand for industrial customers.
The project will generate 2,500 jobs for the local community during the construction phase and 15 full-time jobs after commencing operations. It will also generate $35m in tax revenue for the local counties and the state.
Gulf Coast Express pipeline design and route details
The GCX Project mainline will be a 447.5-mile (720km), 42in diameter pipeline beginning from Waha Hub, Texas, and terminating near Agua Dulce, Texas.
A 50-mile (80.4km), 36in diameter lateral pipeline will also be built, which will serve the gas processing facilities of Targa Resources in the Permian’s Midland Basin as well as facilities jointly owned by Targa Resources and Pioneer Natural Resources.
The pipeline will have an initial capacity of 1.98 billion cubic feet of gas per day (bcf/d) and an installed compression of 214,280hp.
“The pipeline will carry natural gas from the Permian production area to the hub near Agua Dulce, Texas.”
Civil and environmental surveys on the project were conducted between December 2017 and June 2018 respectively. Construction of the midland lateral began in May 2018, while that of the GCX mainline began in October 2018.
The established receipt points for the pipeline will be at El Paso Natural Gas (EPNG)/KMTP Mendoza Trails, EPNG Waha Header, DCP/Atmos Waha Header, ETC Trans-Pecos Header, Enterprise, Oasis, Transwestern, ONEOK Roadrunner, ONEOK West TX, Northern Natural Gas and WhiteWater Midstream.
The delivery points of the pipeline are at KM Tejas/Texas/Border, Enbridge Valley Crossing, NET Mexico, HPL and Southcross. In addition, multiple pipeline interconnections will be available at Agua Dulce, where the pipeline terminates.
Gas transportation agreements
The pipeline was initially launched with an available capacity of 220,000 dekatherms a day (Dth/d). Strong market demand, however, called for the addition of 60,000Dth/d of capacity.
By the end of 2017, 85% of the total capacity of the project was committed under long-term transportation agreements. The first transportation agreements were signed with Occidental Energy Marketing, a subsidiary of Occidental Petroleum Corporation, and Kaiser-Francis Oil Company.
DCP Mainstream, Apache Corporation, Pioneer Natural Resources, XTO Energy, and Targa are some of the companies who have already agreed for the shipment through the project. Apache Corporation owns rights to acquire 15% equity stake in the project, under the transportation agreements signed with Kinder Morgan.
ABN GROUP TEXAS GROUP was contracted to provide construction services for the project.
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