Dallas-based natural gas distributor Atmos Energy Corp. is earmarking $13-14 billion in planned spending over the next five years on system replacements, expansions and environmental upgrades, executives said on a recent conference call.


The Dallas-based natural gas-only distributor has more than three million customers in 1,400-plus communities across eight states, primarily in the South. The spending would support rate base growth of 11-13%/year through 2026, CFO Christopher Forsyth said.

The company invested $2 billion in fiscal year 2021, which ended in September. The funds principally were directed to replacing more than 930 miles of distribution pipe, 38,000 steel service lines and 175 miles of transmission pipeline. The company also installed about 230,000 wireless meter-reading devices for a total of 1.9 million wireless devices on the system. 

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In addition, Atmos is aiming to reduce methane emissions by half in 2035. The company now also delivers 8 Bcf/year of renewable natural gas across its system.

Executives said despite the pandemic, inventory levels increased. The utility coordinated with vendors and pipe mills to ensure it would have steel pipe requirements ready and available at job sites.

Atmos has completed about 60% of its third salt dome storage facility at Bethel, TX, in Anderson County. The storage project would have 5-6 Bcf of capacity.

The company is also building an additional pipeline to support growth north of Austin in Williamson County. A 22-mile, 36-inch diameter line would connect the APT system with the 42-inch diameter Permian Highway Pipeline, which runs from the Waha hub in the Permian Basin to Katy near Houston. The line is expected to be in service by December 2022.

As for rising natural gas prices, CEO John Akers said “we continue to look for diversification across our pipes” and “multiple basins.” The company tries “to blend in as much diversification and flexibility as we can within our systems. We have these annual mechanisms that tend to level out increases over time.”

Atmos estimated residential natural gas bills were about three times less expensive than the average electric bill through the end of September and represent about 1% of household income in the jurisdictions served by the company. The U.S. Energy Information Administration projects a 30% increase in natural gas expenditures this upcoming winter versus last winter.

In terms of the Biden administration’s massive infrastructure bill, “it’s very comprehensive,” Akers said. “We’re still working our way through, but some of the things that we’ve seen that we are focusing on are incentives in there for high-efficiency natural gas appliances, systems that regard hydrogen, hydrogen research and development.”

For the fiscal fourth quarter, net income was $49 million (37 cents/share), compared with $65 million (53 cents) in the same period last year.