Pipeline Acquisitions and Expansions - Acquired STX Midstream pipeline system for 1,831millioninDecember2023,includingEagleFordTransmissionsystemandinterestsinNETMexicoPipelineLLCandDosCaminos,LLC[13]−PlacedTGPEast300Upgradeinservicein2023,providing115,000Dth/dcapacitytoConEdison′sdistributionsystem[16]−CompletedEagleFordtransportprojectinNovember2023,transportingupto1.88Bcf/dofnaturalgastoGulfCoastmarketsatacostof231 million[16] - PHP expansion project completed in December 2023, increasing natural gas deliveries by 550,000 Dth/d at a cost of 159million[16]−GreenhollypipelineexpansioncompletedinAugust2023,providing1.15Bcf/dcapacityatacostof125 million[18] - TGP and SNG Evangeline Pass project expected to provide 2 Bcf/d capacity to Plaquemines LNG facility, with first phase in-service date in Q3 2024 and second phase in Q3 2025 at a cost of 673million[19][20]−TVACumberlandprojectexpectedtotransport0.245Bcf/dofnaturalgastoTVA′sgenerationfacility,within−servicedateinAugust2025atacostof181 million[21] - KMTP system expansion expected to deliver 0.5 Bcf/d of natural gas to Texas Gulf Coast and Mexico markets, with in-service date in November 2024 at a cost of 180million[22][23]−DiamondMexpansionexpectedtoresultinpeakoilproductionofover5,000Bbl/d,withfirstphaseinlate2024andpeakproductionin2026atacostof180 million[24] - Central Texas pipeline project includes installation of 22 miles of 30-inch pipeline and is expected to be in-service by Q4 2024 with a cost of 115million[24]−TejasSouthtoNorthexpansionprojectaimstoincreasenaturalgasdeliveriesbyapproximately0.35Bcf/dtoHoustonmarkets,expectedin−servicebyQ32024withacostof97 million[24] - 3Rivers Offload Phase II project will construct 19 miles of 16-inch pipeline, expected in-service by Q2 2025 with a cost of 96million[24]RenewableNaturalGas(RNG)Facilities−ConstructedthreeRNGfacilitiesprovidingapproximately3.5BcfofRNGannually,withTwinBridgesandLibertyfacilitiesplacedinservicein2023atacostof153 million[16] - The company constructed three additional landfill-based RNG facilities, with Twin Bridges and Liberty placed in service in June and October 2023, respectively, and Prairie expected in December 2023, with a capital scope of 153million[16]−TwinBridgesRNGfacilityhasa1001.4 million per day per violation[75] - Environmental regulations, including the Clean Air Act and Clean Water Act, impose significant compliance costs and potential liabilities for the company[86][89][90] - The company is subject to CERCLA (Superfund) liability for hazardous substance releases, potentially requiring cleanup costs and natural resource damage compensation[88] - PHMSA pipeline safety regulations require the company to maintain integrity management programs, especially for High Consequence Areas (HCAs)[97] - Climate change regulations, including GHG emission limits, could increase operational costs and impact the company's financial position[93][94][96] - Compliance with environmental regulations could require significant capital expenditures[86] - The company generates hazardous and non-hazardous wastes subject to RCRA and state statutes[87] - Operations are regulated under the Clean Air Act, with EPA requirements for monitoring and controlling greenhouse gas (GHG) emissions, particularly from stationary sources[89] - The Clean Water Act imposes restrictions on pollutant discharges, with spill prevention and control measures required to prevent contamination of navigable waters[90][91] - EPA revisions to National Ambient Air Quality Standards (NAAQS) for ozone lowered the acceptable level from 75 ppb to 70 ppb, impacting compliance and potentially requiring retrofitting of facilities[91][92] - Pipeline safety regulations by PHMSA require integrity management programs, with recent rules expanding requirements for gas and hazardous liquid pipelines, including remote shut-off valves and corrosion control[97][98] - Cybersecurity regulations require the company to implement and maintain comprehensive cybersecurity plans, including incident response and vulnerability assessments[101][102] Financial Activities - In 2023, the company issued 1,500millionofnewseniornotesandrepurchased32millionsharesofClassPcommonstockfor522 million at an average price of 16.56pershare[25]−Thecompanyissued2,250 million of new senior notes on February 1, 2024, to repay short-term borrowings and fund maturing debt[25] - The company's share repurchase program has approximately 1.5billionofcapacityremainingafterrepurchasing522 million worth of shares in 2023[25] CO2 and Oil & Gas Interests - The company owns 45% of the McElmo Dome unit with a compression capacity of 1.5 Bcf/d, 87% of the Doe Canyon Deep unit with 0.2 Bcf/d, and 11% of the Bravo Dome unit with 0.3 Bcf/d[60] - The Cortez CO2 pipeline has a 53% ownership interest, 569 miles of pipeline, and a transport capacity of 1.5 Bcf/d[62] - The Wink crude oil pipeline is 100% owned by the company, with 434 miles of pipeline and a transport capacity of 145 MBbl/d[62] - The SACROC oil and gas field has a 97% working interest and 50,316 gross developed acres[63] - Oil and gas producing interests include 97% ownership of SACROC field with 50,316 gross developed acres and 50% ownership of Yates field with 9,676 gross developed acres[63] - Gas plant interests include 22% ownership of Snyder gas plant and 51% ownership of Diamond M gas plant[66] - LNG Indy has a 100% ownership interest with a production capacity of 2 Bcf[68] - Southeast Berrien GTE facility has a 100% ownership interest with a generation capacity of 4.8 mW/h[68] - CO segment contracts have an average remaining contract life of approximately seven years as of December 31, 2023[69] - The company's CO2 business competes with suppliers owning McElmo Dome, Bravo Dome, and Sheep Mountain CO2 resources[70] Employee and Safety Information - The company employed 10,891 full-time personnel as of December 31, 2023, including 891 full-time hourly personnel covered by collective bargaining agreements expiring between 2024 and 2028[103] - The company's 2023 company-wide Total Recordable Incident Rate (TRIR) was 0.8, with a goal to improve from 1.0 in 2019 to 0.7 by 2024[105] - Employee safety performance targets include achieving a company-wide TRIR of 0.7 by 2024, down from 1.0 in 2019[105] - The company’s compensation program is linked to strategic objectives, including environmental, safety, and compliance targets, with competitive base salaries and benefits[108] Land and Rights-of-Way - The company generally does not own the land on which its pipelines are constructed, instead obtaining and maintaining rights to construct and operate pipelines on other people's land under perpetual or renewable agreements[110] - Substantially all pipelines are constructed on rights-of-way granted by the apparent record owners of the property, with majority owner signatures obtained in most cases[110] - Permits have been obtained from public authorities to cross or lay facilities in water courses, roads, and highways, some of which are revocable or require periodic payments[110] - Permits from railroad companies to run along or cross lands or rights-of-way are also revocable in many cases[110] - In a few minor cases, the company has purchased property for pipeline purposes[110] Reporting and Disclosure - The company provides free access to its annual reports (Form 10-K), quarterly reports (Form 10-Q), and current reports (Form 8-K) on its website[111] - Reports are made available as soon as reasonably practicable after being filed with or furnished to the SEC[111] - The SEC maintains a website with electronic filings, reports, and information for issuers[111] - Information on the company’s website is not incorporated by reference into its Form 10-K or other SEC filings[111] Hedging and Market Risk - The company uses energy commodity derivative contracts to hedge market risks, subject to Dodd-Frank Act regulations on OTC derivatives[85] - The company uses energy commodity derivative contracts to hedge exposure to energy commodity market risk[85]
Kinder Morgan(KMI)2024-02-19 16:00