Midstream participants increase investment in Permian NGL infrastructure

US midstream participants are increasing investments in pipeline expansion plans, in line with the ongoing trend to enhance the logistics network in Mont Belvieu, Texas, an industry analyst said Oct. 2.

"The ducks are lined up in a row, and the US gas fractionation capacity is increasing and along with it is pipelines infrastructure, storage capacity and export capacity," said Edgar Ang, associate director for NGLs with S&P Global Energy.

As part of that overall growth process, VLGC and VLEC fleets will be significantly expanded in the coming years, Ang said, noting that pipeline expansion is essential to streamlining the overall export market infrastructure.

"There is no limitation on NGL pipeline capacity at the moment in the Permian Basin, unlike limited gas takeaway capacity," he said.

Ang's comments followed Targa Resources' announcement on Sept. 30 of plans to build an NGL pipeline connecting its assets in the Permian Basin to its fractionation and storage complex at Mont Belvieu. This initiative aims to support ongoing growth and meet the infrastructure needs of its customers.

The Speedway pipeline will consist of about 500 miles of 30-inch diameter pipeline and associated infrastructure with an initial capacity of 500,000 b/d, which can be doubled to 1 million b/d, it said.

The pipeline is expected to be in-service in the third quarter of 2027 and is estimated to cost $1.6 billion, Targa said, adding Speedway will transport NGLs from the company's existing assets and future plant additions to Targa's fractionation and storage complex in Mont Belvieu.

With nearly 1 million b/d of NGLs currently being transported on Targa's existing transportation system, including volumes from the Pembrook II plant that came online during Q3 2025 in the Permian Midland, capacity is currently running at high utilization, it said.

Unveils plans for next processing plant

To accommodate future growth on Targa's Permian Delaware system, the company is also moving forward with the construction of its next 275 MMcf/d gas processing plant, the Yeti plant, which is expected to be in service in Q3 2027, it said.

Including the Yeti plant, Targa is constructing five gas processing plants in the Permian that will be online over the next two years, with an aggregate inlet capacity of 1.4 Bcf/d and estimated NGL production of 175,000 b/d to 200,000 b/d, it said.

Targa also announced a new 35-mile natural gas pipeline that will enhance connectivity across several Targa plants in the Permian Midland and a 55-mile conversion of an existing Targa pipeline into natural gas service (together "Buffalo Run") that will connect Targa's Midland and Delaware intra-basin natural gas systems.

The combination of Buffalo Run and Targa's previously announced Bull Run Extension will enhance connectivity to multiple markets, including the Waha hub, and will add meaningful natural gas flow assurance and reliability for its customers, it said.

Including the pipeline conversion, Buffalo Run is expected to be completed in stages and fully complete in early 2028, the company said.