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US Midstream Companies with the Largest Capital Spending Plans

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Part 10
US Midstream Companies with the Largest Capital Spending Plans PART 10 OF 15

Williams Partners among Top Capital Spending Midstream Companies

Williams Partners’ capital expenditure

So far in this series, we’ve looked at the top three US midstream companies—Energy Transfer Partners (ETP), Enterprise Products Partners (EPD), and Kinder Morgan (KMI)—in terms of their 2017 capital budgets. Now we’ll do a similar analysis for Williams Partners (WPZ), which is among the top US capital spending midstream companies.

Williams Partners’ capital expenditure fell to $1.9 billion in 2017 compared to $2.8 billion in the previous year, a YoY (year-over-year) fall of 30.0%. The fall was mainly due to the blockade of the Constitution Pipeline project, delays in other project permits, and low capital spending due to low producer activity. The company’s capital spending is set to recover in 2017. It expects to spend $2.1 billion–$2.8 billion on expansion projects by the end of this year.

Williams Partners among Top Capital Spending Midstream Companies

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More than 50.0% of Williams Partners’ 2017 expansion capital is allocated to natural gas–focused Transco expansion projects. It’s expected to spend $1.4 billion–$1.9 billion on the Transco expansion in 2017. Most of the remaining capital budget is expected to be spent on natural gas–gathering projects. WPZ expects to place a few key Transco Expansion projects in 2017, including the Dalton Expansion, Hillabee Phase 1, New York Bay Expansion, and Virginia South Side Phase II. It already placed the 1.2 Bcf/d (billion cubic feet per day) Gulf Trace project, which serves Cheniere Energy’s (LNG) Sabine Pass LNG terminal. A portion of Williams Partners’ Transco capital budget could be spent on the Atlantic Sunrise project. WPZ recent recently received FERC (Federal Energy Regulatory Commission) approval for the project.

Williams Partners’ expansion opportunities

Williams Partners continues to explore opportunities to expand its Transco pipeline network, considering the expected rise in natural gas demand. The company expects natural gas demand to increase 13.7 Bcf/d by the end of 2021. It currently has “$7 billion in interstate pipeline expansions inked and underway” according to its recent investor presentation. It recently announced a Transco expansion project to serve the natural gas demand in the Northeastern United States. Spectra Energy Partners (SEP), Boardwalk Pipeline Partners (BWP), Kinder Morgan (KMI), and EQT Midstream Partners (EQM) are among the midstream companies that are bullish on natural gas demand–based expansion projects.

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