EagleClaw Midstream Ventures LLC (EagleClaw) announced a final investment decision to proceed with the Permian Highway Pipeline Project (PHP Project) after having executed definitive joint venture agreements and having secured sufficient firm transportation agreements with shippers. Nearly all capacity available on the system is subscribed and committed under long-term, binding transportation agreements. The remaining capacity is expected to be awarded shortly.
Shippers that have committed to the project include EagleClaw, Apache Corp., and XTO Energy Inc., amongst others. As previously announced, KMTP and EagleClaw will be the initial partners, each with a 50 percent ownership interest in the project. KMTP will build and operate the pipeline. Apache will have the option to acquire equity from the initial partners and has announced its intent to assign that option to Altus Midstream, a new company announced by Apache and Kayne Anderson Acquisition Corp. KMI’s and EagleClaw’s ultimate ownership interest may vary between approximately 27 percent and 50 percent, depending on the outcome of ownership options held by anchor shippers.
The approximately $2 billion PHP Project will provide an outlet for increased natural gas production from the Permian Basin to growing market areas along the Texas Gulf Coast and is designed to transport up to 2 Bcf/d of natural gas through approximately 430 miles of 42-inch pipeline from the Waha to Katy, TX, areas, with connections to the US Gulf Coast and Mexico markets. The PHP Project is expected to be in service in late 2020, assuming timely receipt of the requisite regulatory approvals.