Executive Summary: Rigs: The total rig count decreased by 5 for the week ending January 5, down to 521 from 526. Flows: Winter storm reduces pipeline samples by 15 Bcf, affecting nearly 20 Bcf of dry gas production. Basins across the US were affected, with the Haynesville avoiding freeze-offs. Infrastructure: KMI acquired Outrigger Energy II's Bakken G&P assets for $644 million, enhancing its NGL production, pipeline connectivity, and exposure to northern Missouri River producers while preparing for the Double H pipeline's 2026 NGL conversion.
Infrastructure:
The Deal: Kinder Morgan (KMI) will buy Outrigger Energy II’s Bakken G&P assets for $644MM, the company announced last Monday (Jan 13). The acquisition can support KMI’s Double H (NGL) and Bison Xpress (Gas) projects. Read more about Bison Xpress here.
The Outrigger system includes:
The map above shows an overview of Kinder Morgan’s Bakken assets after acquiring the Bill Sanderson system from Outrigger Energy.
The table above shows a detailed breakdown of KMI’s plants.
Double H NGL Supply: KMI’s gas processing plants are interconnected through a series of pipelines. The Watford City and Sidney gas processing plants directly connect to Double H (being converted to NGL service in 1Q26). With the Outrigger acquisition, KMI can provide access to Bill Sanderson, Roosevelt, and Norse NGL plant production.
KMI is producing 53 Mb/d of NGLs in the Bakken post-acquisition of the Outrigger system. If KMI could route all its NGL volumes to Double H, the pipeline would be 80% utilized. That only leaves 15 Mb/d of additional space for third-party shippers. We believe it’s likely KMI announced the timing of the 1Q26 pipeline conversion to coincide or follow any contractual commitments with ONEOK (OKE).
On KMI’s 4Q24 earnings call, executives said the Outrigger assets give it exposure to production north of the Missouri River. Producers behind KMI’s and the Outrigger G&P system include Continental, Hess (HES), Devon Energy (DVN), Chord (CHRD) and Exxon (XOM), as shown in East Daley’s Energy Data Studio. CHRD and HES have recently been active on KMI’s Bakken G&P system north of the Missouri.
ONEOK Risk Mitigation: EDA believes OKE can mitigate lost NGL production on Double H by extracting more in-the-money ethane in ’26 to utilize its downstream assets near Conway (Medford frac) and the Arbuckle/Sterling NGL pipeline systems. The whole value-chain enchilada would require ethane export infrastructure to meet growing ethane demand. EDA will cover two Indian companies next week that either 1) have already or 2) are considering sourcing more ethane from the US.
Rigs:
The total rig count decreased by 5 for the January 5 week, down to 521 from 526. Liquids-driven basins declined by 5 rigs W-o-W.
Flows:
The weekend winter storm has reduced pipeline samples by ~15 Bcf over the 4-day event from December average levels. Using interstate pipeline % coverage estimates, this translates to nearly 20 Bcf of dry gas production. While the worst of the weather is behind us, we expect lingering reduced production through the end of the month as the snow melts, temperatures warm and operations resume.
Several US basins have been affected, most notably the Anadarko, Appalachia, Permian and Rockies. The Haynesville and Barnett have seemingly been able to avoid freeze-offs with pipeline samples for each region increasing by ~5%.
*W-o-W change is for the two most recent weeks.
Data Points & Product Release Calendar: