The 2Q25 earnings season kicks off Wednesday (July 16) when Kinder Morgan (KMI) reports after the closing bell. East Daley Analytics has published updated models and Earnings Previews for KMI, Targa Resources (TRGP), Enterprise Products (EPD), ONEOK (OKE) and SouthBow (SOBO), with several others out for delivery. Here’s some of the interesting data points we’ve found so far.
1. Haynesville Volumes: Short-Term Pain, Long-Term Gain
Haynesville volumes are down Q-o-Q. We expect lower 2Q25 volumes through assets like KMI’s KinderHawk system and EPD’s Haynesville gathering and Acadian assets. While 2Q25 will be disappointing, we expect management teams will rightly point to the future as new demand emerges for LNG exports and data centers. We have already seen a strong uptick in Haynesville volumes on KMI’s KinderHawk beginning in June and especially in July (refer to the uptick in the blue line in the chart below for the KinderHawk system from Energy Data Studio).
2. Rig Declines Weigh on Permian Outlook
Permian rig activity is down from 295 at the end of 1Q25 to 255 rigs as the end of 2Q25 (see Rig Activity Tracker from Energy Data Studio below). The engine of US crude and NGL production growth will continue to grow, albeit at a slower pace. Economic uncertainty brought about by President Trump’s tariff threats and the changes to international trade have lowered WTI crude prices and affected producers’ spending plans in the Permian. The lower rig activity reduces East Daley’s forecast for Targa EBITDA by $260MM in 2027 when comparing the updated outlook to our pre-“Liberation Day” model.
While the declining rig count will weigh on the long-term outlook for Permian assets, we expect natural gas production from the Midland and Delaware to be up 1.5% and 1.0% in aggregate from 1Q25 to 2Q25.
3. ONEOK’s Bakken G&P Quietly Outperforms
Energy Data Studio data shows 6% Q-o-Q growth for OKE’s Bakken G&P system, based on two full months of volumes. This run rate beats the low-single-digit growth baked into OKE’s 2025 guidance and is in line with upbeat management commentary from the prior earnings call. OKE’s Bakken G&P volumes also are growing ahead of the basin average, according to our plant and residue sample data.
Watch out for East Daley’s updated Financial Blueprints and 2Q25 Earnings Previews to learn more. – Rob Wilson, CFA. Tickers: EPD, KMI, OKE, SOBO, TRGP.
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