Kinder Morgan Expects Eagle Ford Shale Growth

Kinder Morgan expects future growth in its Eagle Ford Shale pipeline gathering and transport assets. The company expects the acquisition of Petrohawk by BHP to only enhance value across the Haynesville Shale and Eagle Ford Shale.

“On July 1, we closed on our agreement to buy Petrohawk’s 50% interest in KinderHawk Fuel Services, and a 25% interest at Petrohawk’s Gathering and Treating business in the Eagle Ford Shale in South Texas.  Now we own 100% KinderHawk, which has over 400 miles of pipeline in the Haynesville Shale play and approximately 2 Bcf a day of capacity. We have throughput that is now above 1 Bcf a day and growing. And we think this is just a tremendous long-term asset. We believe its value has been enhanced by the pending purchase of Petrohawk by BHP. And if you look at the BHP’s presentation, we saw some pretty significant ramp up in dollars they expect to spend on their drilling program. Now that drilling program embraces Haynesville and Eagle Ford together with smaller position in the Permian. But we think this bodes very well for our assets, both in Haynesville and Eagle Ford.””We now own also the 25% of what’s called EagleHawk Fuel Services in the Eagle Ford. That’s 280 miles of gas gathering lines and 120 miles of condensate gathering lines. And we think the Eagle Ford Shale is an area that where throughput will grow dramatically as drilling down there continues to expand.”

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Kenneth E. DuBose

Kenneth E. DuBose

Kenneth DuBose is the past President of Cheyenne Minerals Inc., an independent oil and gas operator. He began his energy industry career with ARCO Oil & Gas. Mr. DuBose then directed development of natural gas storage projects with Tejas Power Corp. He was a founding member of U.S. Minerals, (acquired by Torch Energy in 1999) a provider of internet based education for America’s mineral owners. Mr. DuBose holds a BS in Petroleum Engineering from Mississippi State University. He has served on various industry steering committees, non-profit boards, and is an active member of the Society of Petroleum Engineers, the National Association of Royalty Owners, the American Association of Professional Landmen, as well as being a Registered Investment Advisor. He writes on topics of oil and gas investing, wealth management and personal finance, having appeared in the Wall Street Journal, Kiplinger’s, Kiplinger’s Personal Finance, Houston Business Journal, Financial Advisor and various radio and TV outlets.