Kinder Morgan Advances with Roanoke Expansion Project

Zacks Equity Research
Post the open season, Kinder Morgan's (KMI) Plantation Pipe Line secures long-term volume commitment of 20,000 barrels per day (bpd).

Kinder Morgan, Inc KMI announced a successful open season for the Roanoke Expansion projects on the Plantation Pipe Line System.

Post the open season, the Plantation Pipe Line secured long-term volume commitment of 20,000 barrels per day (bpd). The company intends to invest about $49 million in the project.

Kinder Morgan Southeast Terminal’s (KMST) investment is estimated to cost about $9million. KMST has long-term committed volumes of about 10,000 bpd.

On completion of the successful open season, Plantation Pipe Line will submit the Petition for Declaratory Order (PDO) to the Federal Energy Regulatory Commission (FERC) for approval of commercial terms for the project. Subject to regulatory approvals, the project is anticipated to be fully operational by Apr 1, 2020.

The Plantation Pipe Line Roanoke Expansion will provide additional refined petroleum products capacity of about 21,000 bpd. The pipeline originates from the Baton Rouge, LA and Collins, MS to the Roanoke, VA area. The expansion will primarily comprise additional pump capacity and operational storage on the Plantation system. The KMST expansion will provide about 10,000 bpd of incremental refined product throughput capacity at the terminals.

The company has the largest network of natural gas pipeline in North America spread across almost 84,000 miles. Notably, the company’s midstream properties are linked to all the prospective plays in the United States that are rich in natural gas. These extensive networks of natural gas pipelines, for which the company has invested more than $32 billion to date, provide stable fee-based revenues.

Zacks Rank & Key Picks

Currently, Kinder Morgan carries a Zacks Rank #3 (Hold).

A few better-ranked players in the same sector are Cabot Oil & Gas Corp. COG, Enterprise Products Partners L.P. EPD and SunCoke Energy, Inc. SXC, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Houston, TX-based Cabot is an independent oil and gas exploration company with producing properties mainly in the continental United States. The company delivered an average negative earnings surprise of 5.7% in the last four quarters.

Headquartered in Houston, TX, Enterprise Products Partners is among the leading midstream energy players in North America. It pulled off an average positive earnings surprise of 9.3% in the last four quarters.

SunCoke acquires, owns and operates the coke making and coal mining operations. The company delivered an average positive earnings surprise of 302.6% in the last four quarters.

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