Shares of Kinetik Holdings (KNTK) have traded higher following its 1Q25 earnings update, boosted by bullish CEO commentary. East Daley is focused on several key takeaways.
1. Growth Outlook
KNTK projects 10% CAGR through 2029. East Daley Analytics forecasts 8% G&P volumetric growth from 2024–28, driven by activity from APA, Permian Resources (PR), EOG Resources (EOG) and Chevron (CVX).
EDA tracks KNTK’s progress via plant inlet volumes, residue gas flows and rig activity in Energy Data Studio. Rig counts remain steady between 20–25 rigs on KNTK’s acreage. Clients can monitor KNTK’s growth through plant inlet volumes (gray line in graph), residue gas flow data (blue line in graph) and updated rig activity (not shown in the chart) in Energy Data Studio.
2. Opex Tailwinds
Kinetik has five high-cost NGL transport contracts expiring between 2026–28, including contracts on Targa Resource’s (TRGP) Grand Prix and Energy Transfer’s (ET) Lone Star pipelines. KNTK also uses Shin Oak Pipeline, where it holds a 33% stake. CEO Jamie Welch notes these above-market contracts could be recontracted at lower rates. EDA’s NGL Hub Model supports this view, projecting <75% utilization across 2026–28, which could drive competitive pricing.
What’s Unclear
The exact timing of the NGL contract roll-offs is unknown, but EDA estimates ~135 Mb/d of NGLs could be up for bid by YE28. These volumes are tied to plants launched in 2016–18 with assumed 10-year contracts. Plant in-service dates are included in Energy Data Studio.
Bottom Line
Rig counts and plant volumes will indicate whether Kinetik can deliver on its growth story. The new Bahia NGL pipeline from Enterprise (EPD) may allow KNTK to shift volumes to Shin Oak, reducing costs and impacting ET’s volumes.
In this regard, KNTK could be an interesting acquisition target for ET, in a bid to defensively protect the NGLs it currently transports through its infrastructure. EPD could also be a fit, in order to opportunistically capture more of KNTK’s NGLs through its legacy and new Bahia NGL pipeline systems. That said, all three incumbents (ET, EPD, TRGP) and the three emerging NGL companies (MPLX, Phillips 66 (PSX), ONEOK (OKE)) would love a crack at KNTK’s NGL production. – Rob Wilson, CFA Tickers: APA, CVX, EOG, EPD, ET, MPLX, OKE, PSX, TRGP.
NEW – The Burner Tip
Introducing The Burner Tip, East Daley’s weekly coverage of natural gas markets. Every Thursday, The Burner Tip brings you our expert perspective on drivers shaping prices and flows in North America — including production trends, infrastructure dynamics, and forward-looking fundamentals — all grounded in EDA’s proprietary data and models. Whether you’re trading, investing, or managing risk, The Burner Tip delivers the insights you need to drive smarter strategy. Subscribe now to The Burner Tip!
Data Center Demand Monitor - Available Now!
Introducing Data Center Demand Monitor by East Daley Analytics. This is your go-to source for tracking data center projects and demand. We monitor and visualize nearly 300 US data center projects. Use Data Center Demand Monitor to forecast demand, identify pipeline corridors and track data center projects. — Request your demo now of the Data Center Demand Monitor!
The Daley Note
Subscribe to The Daley Note for energy insights delivered daily to your inbox. The Daley Note covers news, commodity prices, security prices and EDA research likely to affect markets in the short term.
-1.png)