Energy Transfer Commits to $1.6 Billion South Mississippi Gas Pipeline

According to the company's earnings release, the pipeline is planned as a 36-inch line able to carry 1.2 billion cubic feet of gas a day, with service projected to start in 2030. Energy Transfer said it has secured long-term, demand-based transportation agreements with shippers. It expects to operate the line and own 51% of it, with the remaining stake held by shippers.

The design may still change. The company said a binding open season to attract more customer commitments is under way, and that the final size and capacity of the pipeline will be set once it closes.

Stronger Quarter and Higher Guidance

Energy Transfer reported adjusted EBITDA of $5.03 billion for the three months to September 30, up from $3.84 billion a year earlier. Net income attributable to partners rose to $1.21 billion from $1.02 billion, and distributable cash flow attributable to partners, as adjusted, increased to $2.52 billion from $1.90 billion. Revenue for the quarter was $37.10 billion, against $19.95 billion a year earlier, according to the income statement.

The partnership raised its full-year 2026 adjusted EBITDA forecast to between $19.7 billion and $19.9 billion, from a previous range of $18.8 billion to $19.1 billion. It expects growth capital spending of $5.4 billion to $5.6 billion this year and about $7 billion in 2027.

The company also reported agreements to supply 150,000 MMBtu a day of firm gas transport from its MRT Pipeline to two power plants under construction in Missouri, starting in late 2027 and mid-2028. The first phase of its Hugh Brinson Pipeline entered full service on September 1, ahead of schedule, with the second phase still planned for the first quarter of 2027.

Energy Transfer declared a quarterly distribution of $0.3425 per common unit, its twentieth consecutive quarterly increase.

Why It Matters

The decision adds to a series of investments by US gas and power companies betting that AI data centres will keep electricity demand rising for years. The earnings release itself does not mention data centres or AI, but the Bloomberg report ties the new line to that demand alongside LNG exports. The same argument is being made in the Gulf: at ADIPEC in Abu Dhabi this week, ADNOC Gas and Eni executives said AI computing will sustain long-term gas demand.

For investors, the 2030 start date is a reminder that the gas and grid infrastructure behind the AI build-out takes years to arrive, even when customers sign long-term contracts.