Final Investment Decision Reached on $4.2 Billion Gas Pipeline With Kinder Morgan Stake
Key Facts
Kinder Morgan said in its results released on October 21, 2026, that NGPL had reached a final investment decision on the Permian Link natural gas transportation project, at an expected total cost of about $4.2 billion. The project aims to supply new power generation facilities serving a hyperscale computing customer, linking expansion of the gas transportation network to the customer's electricity needs. Kinder Morgan's expected share of the project cost is about $1.6 billion, out of total planned spending on the pipeline and its facilities. According to the company's statement, Permian Link is designed to transport about 2.8 billion cubic feet of gas per day once operational. The scope includes construction of about 434 miles of new pipelines, along with the supporting facilities needed for the project. The plan is underpinned by "long-term take-or-pay transportation agreements," as the company described them, to serve new power generation associated with the hyperscale computing customer. Kinder Morgan described the customer as having an A credit rating in its account of the commercial arrangements supporting the investment.
Permian Link comes alongside the South East Connector project, in which Kinder Morgan's expected share of the cost is $3.1 billion, according to the company's announcement. The parallel project is designed to transport up to 2.6 billion cubic feet per day, adding further gas transportation capacity under Kinder Morgan's announced expansion plans. Across the broader project portfolio, Reuters reported that the company's total project backlog stood at $14.4 billion when it announced its results. Natural gas projects account for $13.2 billion of that backlog, a record for those projects, according to the news agency. That value puts natural gas at the forefront of investments in the company's backlog, alongside the other projects included in the total. Kinder Morgan said more than 75% of its project backlog at the end of the third quarter was tied to power generation and local distribution companies, highlighting the role of those activities in its investment plans.
The investment announcements coincided with results for the third quarter of 2026, which showed net income attributable to Kinder Morgan of $764 million, according to the company's statement. Adjusted earnings per share for the period were 35 cents, according to Reuters' reporting on the results. Analysts had expected adjusted earnings of 32 cents per share for the same period, according to London Stock Exchange Group data cited by the news agency. Adjusted earnings per share thus exceeded analysts' estimates in the comparison between the reported result and third-quarter expectations. Following the release of the results after the market close on October 21, 2026, Kinder Morgan shares rose 2.7% in extended trading, according to Reuters.
The expansion timetable targets the start of operations at Permian Link in the third quarter of 2030, according to Kinder Morgan's announcement. Meeting that date remains subject to obtaining the necessary permits and approvals for the project, the company said. For South East Connector, the company expects a phased start of operations beginning in the fourth quarter of 2030, according to Reuters. The phased start of the parallel project falls in the quarter following Permian Link's target date, under the announced expansion schedule. On commercial interest in Permian Link, Reuters quoted executives as saying that "the project has attracted interest from additional customers beyond the main hyperscale computing customer," adding interested parties alongside the customer underpinning the project's arrangements.