East Daley Analytics – Dissecting the Energy Value Chain
Energy Insights and News

Midstream Spends $10B on Gas Projects in 2024: CAPEX Dashboard

Comments: 0

Energy companies plan to spend the lion’s share of midstream budgets on natural gas this year, investing over $10B to upgrade and expand gas infrastructure in 2024, according to investment data compiled by East Daley Analytics.

Most midstream budgets will target natural gas assets, comprising 67% of planned capital expenditures in 2024, according to East Daley’s CAPEX Dashboard (see ‘CAPEX by Commodity’ figure). Clients can use the CAPEX Dashboard in Energy Data Studio (link here) to review companies’ spending by commodity, asset type or geographic region.Picture1-Mar-05-2024-01-09-15-2010-AM

On the natural gas side, capital in the Lower 48 will be evenly split between G&P ($5.0B) and pipeline projects ($5.1B). Most G&P growth capital will be focused on the Permian Basin, attracting an estimated ~$2.6B in 2024. Unsurprisingly, Enterprise Products (EPD) and Targa Resources (TRGP) are the main contributors as the companies build out 2.0 Bcf/d of new processing capacity through YE25. Between new plants and well connects, EDA estimates EPD and TRGP together will spend ~$1.6B, representing 60% of the total G&P spend in the Permian for the year.

TC Energy (TRP), Enbridge (ENB), Williams (WMB) and Kinder Morgan (KMI) dominate gas pipeline expenditures. About 40% of this capital is for modernization projects and regular maintenance capex. We estimate ~$1.0B will be directed toward the Northeast, including the remaining spend on Equitrans’ (ETRN) Mountain Valley Pipeline and WMB’s Regional Energy Access (Phase 2) projects (see ‘CAPEX by Geography’ figure from the CAPEX Dashboard).Picture2-Mar-05-2024-01-09-38-8604-AM

Another focus of investment is connecting more gas to LNG demand across the Gulf Coast. We estimate KMI will spend $300MM in FY24 on the Evangeline Pass project on the Tennessee Gas and Southern Natural pipelines. Evangeline Pass will supply 2 Bcf/d to LNG facilities such as Plaquemines. Phase 1 is expected to come online mid-2024, and Phase 2 in mid-2025.

Although natural gas prices have come crashing down in recent weeks, the long-term demand for gas infrastructure has not faltered. As Permian production and LNG demand climb higher, we expect Midstream will continue to add to its current slate of natural gas projects.

Please reach out to learn more about the CAPEX Dashboard in Energy Data Studio. - Ajay Bakshani, CFA Tickers: ENB, EPD, ETRN, KMI, TRGP, TRP, WMB, KMI.

New Webinar: Big Picture and Bottom Line – Q1 Market Update

Join East Daley CCO Justin Carlson on Wednesday, March 10 for a new webinar reviewing market developments from 1Q24. In “Big Picture and Bottom Line – Q1 Market Update,” EDA will look at market trends in crude, gas and NGLs since our Dirty Little Secrets report. Topics include Permian growth or slowdown, the big picture on Louisiana and ripple effects on gas, the LNG pause, and midstream M&A. Join us March 10 for the 1Q23 Market Update.

New EDA Product: West Coast Supply & Demand

The West Coast Supply & Demand report is your go-to resource for mastering the energy market from the California coast to the western Colorado Rockies. This dynamic product offers extensive regional coverage, precise production forecasts for key basins, and in-depth pricing analysis, specifically examining the Colorado pricing spread from CIG Mainline to NW Pipeline Rockies.

Stay ahead of the competition with strategic insights, ensuring you make informed decisions and capitalize on emerging opportunities. Elevate your business with unparalleled market intelligence – invest in the West Coast Supply & Demand report today.

New EDA Product: Houston Ship Channel Supply & Demand

The Houston Ship Channel Supply & Demand report allows users to dive deep in understanding, and monitoring Houston Ship Channel natural gas dynamics. The product contains monthly updates of relevant price spreads, pipeline flows, production and demand estimates affecting the South Texas market, with forecasts extending 5 years into the future. Learn more about the Houston Ship Channel Supply & Demand report.

Energy Data Studio

East Daley Analytics has launched Energy Data Studio, a platform for our industry-leading midstream data and commodity production forecasts. All clients have access to the new client portal. If you have not yet logged in, please fill out the form to request a registration email be resent.

Energy Data Studio leverages our G&P data set for insights into midstream assets across every major oil and gas basin in North America. Users can navigate detailed visual dashboards by region, pipeline, or individual asset to understand crude oil, natural gas and NGL supply at the most granular level.

Energy Data Studio is available through data downloads from the visual interface, in Excel files, or as a direct feed delivered into subscribers’ workflow via secure file transfer. To learn more about Energy Data Studio, please contact insight@eastdaley.com.

The Daley Note

Subscribe to The Daley Note (TDN) for midstream 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.

About the AuthorEast Daley Analytics