Pipeline Operators Lock In Decade-Long Contracts for LNG, AI Power

Williams Companies is buying Momentum Midstream for $5.5 billion, adding 4.05 billion cubic feet per day of capacity across three take-or-pay pipelines built to serve Gulf Coast LNG exports and industrial customers. The deal is the largest single transaction in a wave of midstream expansions that also includes a new Permian-to-LNG pipeline from a joint venture of Enbridge and MPLX LP, and two TC Energy projects backed by 20-year contracts for data center power.

Williams separately announced a $1.5 billion Delta Access expansion along its Transco corridor, a 2.25 Bcf/d take-or-pay project that will move Haynesville natural gas to Gulf Coast markets starting in early 2029. Take-or-pay contracts, which commit buyers to pay for capacity whether or not they use it, are standard in the midstream space. They shift volume risk off the pipeline operator and onto the shipper, making financing easier to secure.

A joint venture including Enbridge and MPLX LP has sanctioned the Bay Runner Twin Pipeline, designed to deliver 2.6 Bcf/d of Permian gas to NextDecade's Rio Grande LNG facility. That take-or-pay line is scheduled to enter service by 2030. It adds to the original 2.6 Bcf/d Bay Runner Pipeline, which starts up in the third quarter of this year. Together the two lines give the Rio Grande terminal a dedicated supply corridor from the Permian basin.

Artificial intelligence data centers are becoming a second anchor for demand. TC Energy sanctioned two expansions backed by 20-year take-or-pay contracts, locking in revenue before construction starts. The $300 million Central Virginia project adds 0.4 Bcf/d of capacity between 2028 and 2030, and the $100 million Clark project adds 0.3 Bcf/d targeted for 2028. Both feed natural gas-fired utilities that supply regional data centers.

DT Midstream commercialized a 380 million cubic feet per day interconnect on its NEXUS pipeline, adding a direct supply link to a newly built AI data center in Ohio.

For investors looking for exposure to these names, the Alerian Energy Infrastructure ETF holds all three. Williams carries an Alpha Score of 55, Enbridge 58, and MPLX 65. The ETF is covered in broader commodities analysis.

The Bay Runner Twin Pipeline and the Williams Delta Access project are both scheduled to enter service by the end of the decade. TC Energy's Clark project targets 2028, with the Central Virginia expansion following between 2028 and 2030.