Shale Daily / NGI All News Access

Kinder Morgan Shelves Permian-California Crude Pipeline

Following an unsuccessful open season, Kinder Morgan Energy Partners LP (KMP) has shelved plans for the Freedom Pipeline, which would have carried Permian Basin crude oil from Texas to California refineries.

KMP had said the pipeline would be the only westbound project from the Permian and would enable transportation of crude from the Wink-Midland, TX, area to anticipated interconnections with intrastate pipelines in California at Emidio and Pentland. An average daily capacity of 277,000 b/d was anticipated (see Shale Daily, April 5). The open season closed Thursday.

"At Kinder Morgan, we don't believe in the concept of build it and they will come," said West Region Gas Pipelines President Mark Kissel. "We stated at the outset that we would not move forward with the project without customer support, and we did not receive enough interest for us to commit to building the project at this time.

"Kinder Morgan's plan is to focus our attention in the short run on providing crude-by-rail at various West Coast and Texas locations, and we are committed to providing service into and out of these key markets in whatever form our customers wish. We are appreciative of the responses we received on Freedom, and will continue to work with those customers and within the broader market to see if sufficient interest develops in the future. Should the market indicate a willingness to commit to the project, the Freedom Pipeline work that Kinder Morgan developed can be utilized to revitalize the project."

KMP management had been talking about a project like Freedom since at least last fall (see Shale Daily, Oct. 19, 2012).

Comments powered by Disqus