Detailed Narrative
Strategic Pipeline Expansions and Upgrades
Energy Transfer is significantly expanding its natural gas pipeline infrastructure, including upsizing the Desert Southwest Pipeline Project to 48 inches, increasing its capacity to 2.3 Bcf per day. The Hugh Brinson pipeline is ahead of schedule, with mainline construction 75% complete and Phase 1 expected in service in Q4 2026. This system will be bidirectional, transporting 2.2 Bcf per day from West to East and 1 Bcf per day from East to West, with the West to East capacity fully contracted.
Florida Gas Transmission Projects
The company completed open seasons for two new projects on Florida Gas Transmission (FGT). The Phase IX project will expand capacity by up to 550 million cubic feet per day, expected by Q4 2028, with Energy Transfer's share of cost up to $535 million. The South Florida Project will add a new 37-mile lateral and compression, expected by Q1 2030, with a cost of up to $110 million. These projects are supported by long-term binding agreements with anchor shippers.
Growing Demand from Power Plants and Data Centers
Energy Transfer has secured long-term agreements with Oracle to deliver 900,000 Mcf per day of natural gas to three U.S. data centers, with the first lateral already flowing gas and two more expected by mid-2026. The company also has a 20-year binding agreement with Entergy Louisiana for 250,000 MMBtus per day. In total, over 6 Bcf per day of pipeline capacity has been contracted with demand-pull customers, including end users, data centers, and utilities.
Oklahoma Power Generation Initiatives
The Oklahoma intrastate power team added connections to serve three new power plant loads totaling 190 million cubic feet per day, expected online in Q2 2026, backed by long-term contracts with investment-grade counterparties. Advanced negotiations are underway for another 350 million cubic feet per day of new power plant demand in Oklahoma. The company is also constructing a 10-megawatt natural gas-fired electric generation facility at its Grey Wolf processing plant, expected in service in Q1 2026, with five more facilities planned for completion in 2026.
NGL and Crude Oil Infrastructure Developments
Permian processing expansions include Mustang Draw I and II plants, expected in service in Q2 and Q4 2026, respectively. At the Nederland terminal, Flexport NGL export expansion project volumes are ramping up, contributing to record exports in Q4 2025, including the first two ethylene cargoes. The company is also working with Enbridge on a project to provide 250,000 barrels per day of light Canadian crude oil capacity through the Dakota Access pipeline, with FID expected by mid-2026.
Lake Charles LNG Project Status
Energy Transfer suspended the development of the Lake Charles LNG project, citing a focus on capital discipline and projects with more attractive risk/return profiles. However, the company remains open to discussions with third parties interested in developing the project and is exploring other profitable uses for the terminal, such as NGL or crude oil terminal operations, or accommodating other commodities.