Report: Kinder Morgan explores El Paso pipeline expansion in Permian

|About: Kinder Morgan, Inc. (KMI)|By:, SA News Editor

Kinder Morgan (NYSE:KMI) could significantly expand the capacity of its El Paso natural gas pipeline system in west Texas, depending on the results of an open season that began yesterday, Argus reports.

The potential El Paso expansion underscores a steep increase in drilling in the Permian and growing demand for low cost gas on the Texas coast; the Permian rig count, a bellwether for where production is headed, rose last week to 319, more than double year-ago levels.

Waha spot gas prices in March were at a $0.25/MMBtu discount to the Henry Hub, expanding from a $0.13/MMBtu discount a year earlier, a sign of rising production.