Kinder Morgan(KMI) - 2024 Q4 - Annual Report

Infrastructure and Capacity - As of December 31, 2024, the company owned or operated approximately 79,000 miles of pipelines and 139 terminals, with a working natural gas storage capacity of about 700 Bcf[22] - The company plans to acquire a natural gas gathering and processing system in North Dakota for approximately $640 million, expected to close in Q1 2025[24] - The KMTP system expansion project, placed in service in October 2024, included a new 30-mile pipeline with a capacity of 0.4 Bcf/d, costing approximately$158 million[24] - The South System Expansion 4 (SSE4) project aims to increase capacity by approximately 1.2 Bcf/d, with a total capital scope of $1,659 million, expected to be completed in two phases by 2029[24] - The Trident Intrastate pipeline project is designed to provide approximately 1.5 Bcf/d of capacity, with an expected in-service date in Q1 2027, costing around$1,650 million[25] - The TGP and SNG Evangeline Pass projects will provide a total of 2 Bcf/d capacity to the Plaquemines LNG facility, with a combined capital scope of $672 million[25] - The Diamond M expansion project is expected to achieve peak oil production of over 5,000 Bbl/d, with a total capital investment of$185 million[25] - The Mississippi Crossing project is designed to transport up to 2.1 Bcf/d of natural gas, with an estimated cost of $1,637 million and an expected in-service date in November 2028[25] - The company operates approximately 41,000 miles of wholly owned natural gas pipelines, providing access to major supply areas and consumers across North America[32] - The company owns and operates natural gas pipelines with a total design capacity of 6.41 Bcf/d for EPNG/Mojave and 6.00 Bcf/d for CIG, contributing significantly to its revenue streams[34] Financial Performance and Strategy - The company issued$3,500 million of new senior notes in 2024 to repay short-term borrowings and fund maturing debt[26] - The company focuses on stable, fee-based energy transportation and storage assets, aiming to enhance shareholder value while controlling costs[30] - The company is actively considering potential acquisitions and divestitures, with no current unannounced agreements but open to significant transactions[28] - Approximately 76% of sales and transport margins from Texas Intrastate natural gas pipeline operations are derived from long-term transport and sales contracts[36] - The profitability of the refined petroleum products pipeline transportation business is driven by the volume of products transported and the prices received for services, which are influenced by population and economic growth trends[45] - The average remaining contract life for the liquids terminals business is approximately two years, providing a buffer against short-term supply and demand fluctuations[50] - The company’s CO2 business segment includes ownership interests in McElmo Dome unit (45% interest, 1.5 Bcf/d capacity) and Doe Canyon Deep unit (87% interest, 0.2 Bcf/d capacity), supporting enhanced oil recovery projects[55] - The company does not rely on any single external customer for more than 10% of its total consolidated revenues, indicating a diversified customer base[63] Regulatory and Compliance - The company operates under extensive federal, state, and local regulations, which may impact operational costs and project viability[64] - The FERC has authority over the rates charged and terms of service for interstate natural gas pipelines, with potential civil penalties exceeding $1.5 million per day for violations[68] - The company is required to comply with EPA regulations under the Clean Air Act, which include monitoring and reporting emissions of greenhouse gases[84] - The EPA lowered the National Ambient Air Quality Standards (NAAQS) for ground-level ozone from 75 parts per billion (ppb) to 70 ppb, impacting compliance requirements[87] - More than one-third of U.S. states have begun implementing legal measures to reduce greenhouse gas emissions, which could affect the company's operations[90] - The company is subject to pipeline safety regulations issued by PHMSA, which require the development and maintenance of pipeline integrity management programs[92] - The company must comply with cybersecurity directives from the Department of Homeland Security, including mandatory reporting measures and vulnerability assessments[95] - Environmental regulations may lead to significant operational disruptions and cleanup costs in case of leaks or spills, impacting financial performance[80] Workforce and Safety - The company employed 10,933 full-time personnel as of December 31, 2024, including approximately 883 full-time hourly personnel under collective bargaining agreements[99] - The company aims to improve its company-wide total recordable incident rate (TRIR) from 1.0 in 2019 to 0.7 by 2024[100] - The company supports equal opportunity employment and has policies in place to prevent workplace harassment and discrimination[102] - The company’s compensation program is linked to strategic financial and operational objectives, including environmental and safety targets[104] Environmental Impact - The company generates both hazardous and non-hazardous wastes, subject to the Federal Resource Conservation and Recovery Act (RCRA) standards[81] - The company anticipates that greenhouse gas regulations may increase demand for carbon sequestration technologies, which could positively impact its markets[91] - The company is subject to increasing compliance costs related to environmental and safety regulations, which could limit the return on capital projects[2]