Kinder Morgan Inc.’s (KMI) first-quarter 2024 net income increased to $746 million, up from $679 million in first-quarter 2023 and up from $594 million in fourth-quarter 2023.
Cash flow from operations totaled $1.2 billion. Free cash flow after capital expenditures was $570 million.
“The company got off to a strong start this quarter on increased financial contributions from our Natural Gas Pipelines, Products Pipelines and Terminals business segments, with Net income attributable to KMI up 10% versus the first quarter of 2023,” said chief executive officer Kim Dang in a release Apr. 17.
“The Natural Gas Pipelines business segment’s financial performance was up in the first quarter of 2024 relative to the first quarter of 2023, largely due to higher margins realized on our storage assets and higher volumes on our gathering systems, as well as additional contributions from our recent STX Midstream acquisition,” said KMI president Tom Martin.
“Natural gas transport volumes were up 2% compared to the first quarter of 2023. Natural gas gathering volumes were up 17% from the first quarter of 2023, primarily from our Haynesville and Eagle Ford gathering systems.
“Contributions from the Products Pipelines business segment were up compared to the first quarter of 2023 due to higher rates on existing assets and contributions from new capital projects. Total refined products and crude and condensate volumes were down slightly compared to the first quarter of 2023,” Martin said.
“Terminals business segment earnings were up compared to the first quarter of 2023. Increased contributions from liquids terminals expansion projects and higher rates on our Jones Act tankers were partially offset by lower petroleum coke volumes resulting from several refinery turnarounds and unplanned outages. The Jones Act fleet remains fully contracted under term charter agreements,” continued Martin.
“CO2 business segment earnings were down compared to the first quarter of 2023, primarily due to lower CO2 sales volumes, which were down 7% on a net-to-KMI basis compared to the first quarter of 2023. Price movements across our three primary commodities roughly offset one another,” said Martin. “Growth in NGL sales volumes was offset by lower crude volumes.”
Natural gas pipelines
Construction is nearly complete on KMI’s project to expand the working gas storage capacity at its Markham Storage facility (Markham) in Matagorda County along the Texas Gulf Coast. The project adds an additional cavern at Markham to provide more than 6 bcf of incremental working gas storage capacity and 650 MMcfd of incremental withdrawal capacity on KMI’s Texas intrastate system. Shippers have subscribed to all of the available capacity under long-term agreements. Partial commercial service began last November, with full commercial service expected in June 2024.
Construction activities continue for Tejas’ $97 million South Texas to Houston Market expansion project. The project will add compression on Tejas’ mainline to increase natural gas deliveries by about 0.35 bcf/d to Houston markets. The target in-service date is first-quarter 2025.
Construction is under way on a $180-million expansion of the KMTP system to provide transportation and treating services to lean Eagle Ford producers in Webb County. The expansion project, supported by a long-term contract, is designed to deliver up to 500 MMcfd of Eagle Ford natural gas supply into KMI’s intrastate network. The project is on track to be placed in service in November 2024.
Construction has begun on both phases of the Evangeline Pass project. The two-phase $673 million project involves modifications and enhancements to portions of the Tennessee Gas Pipeline and Southern Natural Gas systems in Mississippi and Louisiana, which will result in the delivery of about 2 bcfd of natural gas to Venture Global’s proposed Plaquemines LNG plant. Expected in-service for Phase 1 is July 1, 2024, while the expected in-service date for Phase 2 is July 1, 2025.
TGP has executed long-term contracts to support its approximately $63 million Muskrat project. The project is designed to deliver up to 225 MMcfd of supply to the Southeast markets. The project includes modifications to TGP’s existing compression and auxiliary infrastructure and is expected to be in service on Aug. 1, 2025.
