Kinder Morgan Inc. KMI has announced that its subsidiary, Tennessee Gas Pipeline, L.L.C. (“TGP”), has made a final investment decision to go ahead with the Mississippi Crossing Project (MSX Project). The MSX Project involves the construction of a pipeline network spanning approximately 2.6 miles and two new compressor stations for the transportation of up to 1.5 billion cubic feet per day (Bcf/d) of natural gas. The project has an estimated cost of nearly $1.4 billion.

Economic and Regional Benefits of the Project

TGP decided to proceed with the project after successfully signing long-term, binding transportation contracts with customers to use up the entire available capacity of the project. The president of Natural Gas Pipelines mentions that the project should provide benefits of increased access to natural gas in the Southeast region. Furthermore, this project is also expected to contribute toward the diversification of supply sources in the region, thereby lowering costs and meeting the rising energy demand. Additionally, the incremental supply should enable other energy providers to draw in new residential and industrial opportunities.

The company further mentioned that it has reached advanced discussions with KMI’s customers to secure more long-term commitments that would add up to 0.4 Bcf/d to the project’s total capacity. To support the additional capacity, the company would require increased capital for more horsepower.

Key Features of the MSX Project

The MSX Project will start near Greenville, MS and is expected to end near Butler, AL. The new pipeline shall be connected to TGP’s existing pipeline system and other third-party pipelines. This shall enable the pipeline project to provide access to a critical supply of gas from several supply basins. The well-connected pipeline project should reduce the risk of dependence on a single supply basin.

The project is pending all the necessary permits and clearances. Upon receiving the necessary approvals, the pipeline is expected to be in place to start operations by November 2028.

KMI’s Outlook & Strategic Investments

Kinder Morgan highlights that the outlook for the natural gas market remains bright. Over the next five years, the midstream company expects notable growth in LNG exports and power generation. The company also mentions that its exports to Mexico are also anticipated to grow. KMI has committed significant expansion capital, totaling $3.1 billion, toward two major projects, the SNG South System 4 Expansion and TGP’s Mississippi Crossing Project.