Kinder Morgan NYSE: KMI reported record third-quarter results and expanded its project backlog to $14.4 billion, led by major natural-gas infrastructure investments aimed at serving power generation, LNG exports and growing data-center-related demand.
Chief Executive Officer Kim Dang said adjusted earnings per share rose 21% from the third quarter of 2025, while adjusted EBITDA increased 9%. Every business segment contributed to year-over-year growth, she said. The company also raised its expectations for the full year, forecasting adjusted EPS more than 13% above budget and adjusted EBITDA more than 6% above budget.
“We are delivering strong results today while continuing to build a longer runway for high-quality future growth,” Dang said.
Quarterly Results and Dividend
Chief Financial Officer David Michels said net income attributable to Kinder Morgan totaled $764 million, or $0.24 per share, compared with the prior-year quarter. Adjusted EPS was $0.35, up 21% year over year, while adjusted EBITDA reached $2.18 billion, a 9% increase and a third-quarter record for the company.
The company declared a quarterly dividend of $0.2975 per share, equivalent to $1.19 per share on an annualized basis. The dividend represents a 2% increase over 2025, Michels said.
Year to date, adjusted EBITDA has risen 13% and adjusted EPS has increased 32% from 2025, according to the company. Michels said Kinder Morgan’s 2026 outperformance includes approximately $225 million from several potentially nonrecurring items, including Winter Storm Fern and extended Northeast cold weather, a terminals contract buyout, a favorable Federal Energy Regulatory Commission rate true-up and an unusually favorable Waha-to-Houston Ship Channel pricing spread. Favorable commodity prices added another $175 million versus budget, he said.
Kinder Morgan ended the quarter with net debt-to-adjusted EBITDA of about 3.5 times, down from 3.8 times at the beginning of the year. The company expects to finish the year at about 3.6 times leverage despite spending related to the Monument acquisition and higher-than-budgeted capital expenditures.
Backlog Rises on Major Natural Gas Projects
The company added $5.4 billion in projects to its backlog during the quarter and placed $700 million of projects into service. Dang said the backlog increased from $9.6 billion to $14.4 billion and carries an average project multiple of 5.7 times.
Two joint-venture projects accounted for most of the additions: Southern Natural Gas’ Southeast Connector and Natural Gas Pipeline Company of America’s Permian Link. Kinder Morgan’s share of the two projects is approximately $4.7 billion. Both are backed by take-or-pay agreements of at least 20 years with creditworthy shippers, management said.
- Southeast Connector: Designed to deliver about 2.6 billion cubic feet per day of natural gas into the Southeast, a region Kinder Morgan identified as one of the country’s fastest-growing demand areas. Dang said large-load interconnection requests in the region exceed 200 gigawatts, which could equate to roughly 8 Bcf per day of gas demand if fully developed and supplied by gas-fired generation.
- Permian Link: Intended to transport Permian Basin gas north to meet increasing power demand in the Texas Panhandle. The project is contracted with an A-rated hyperscaler, according to Kinder Morgan.
Dang said Permian Link is expected to enter service in 2030, while Southeast Connector is scheduled to come online in stages from 2030 through 2032. The project timing extends the company’s visible growth runway beyond its previously approved developments.
During the question-and-answer session, President of Natural Gas and Pipelines Sital Mody said Kinder Morgan received more than 2 Bcf of interest during a nonbinding open season for its Tennessee Gas Pipeline 219 South project. He estimated the project could involve roughly $1.5 billion in capital spending in its initial, primarily brownfield form, though a larger 2 Bcf-to-3 Bcf-per-day project would require more investment.
Mody also said Southeast Connector could potentially be expanded to 3.5 Bcf per day, depending on additional signed customer commitments. Dang said Kinder Morgan already has enough signed commitments to move forward with a final investment decision on the project.
Segment Performance
In the natural gas business, transportation volumes increased 3% from the prior-year quarter, supported by higher LNG feed-gas deliveries on Tennessee Gas Pipeline and increased demand on the company’s intrastate system. Natural gas gathering volumes rose 14%, including a 40% increase on the KinderHawk system in the Haynesville.
Products pipeline refined-product volumes declined 3%, while crude and condensate volumes fell 11%. More than half of the crude-volume decline resulted from the removal of the Double H pipeline from service for an NGL conversion early in the third quarter of 2025, Mody said.
Kinder Morgan also reached a final investment decision during the quarter on the Western Gateway project, which is intended to change how clean products are delivered to the desert Southwest and Southern California. Kinder Morgan’s total cash investment of $300 million, including a $250 million contribution to the joint venture and $50 million for non-contributed assets, was added to backlog. The project is expected to enter service in 2029.
In terminals, liquids lease capacity remained near 93%, while utilization of available tanks at key Houston Ship Channel and Carteret, New Jersey, hubs stood just below 96%. Export activity at the company’s Houston Ship Channel docks reached 427,000 barrels per day, up 39% from the third quarter of 2025 and an all-time record, Mody said.
The CO2 segment recorded an 8% increase in net oil production volumes, led by an 11% increase at SACROC. Renewable natural gas volumes rose 18%, which management attributed to improved operating uptime and hydrocarbon recovery.
Long-Term Natural Gas Outlook
Executive Chairman Rich Kinder pointed to third-party forecasts supporting the company’s long-term natural-gas outlook. He cited Shell’s expectation that global LNG demand will reach nearly 750 million metric tons per year by 2050, up 65% from 2025, as well as North American Electric Reliability Corp. estimates for 225 gigawatts to 245 gigawatts of U.S. peak electricity-demand growth by 2035.
Kinder said the company currently delivers about 40% of U.S. natural gas, including approximately 40% of LNG feed gas and more than half of gas exports to Mexico. He said the $14.4 billion backlog could add roughly $2.5 billion of EBITDA once projects are completed.
About Kinder Morgan (NYSE:KMI)
Kinder Morgan, Inc NYSE: KMI is an energy infrastructure company that owns and operates pipelines, terminals, and other transportation and storage facilities. Its systems primarily support the movement, processing, and storage of natural gas, crude oil, refined petroleum products, and other energy commodities.
The company’s natural gas business transports and stores natural gas for utilities, power generators, industrial customers, and other energy companies. Kinder Morgan also operates refined products and crude oil pipelines, liquids terminals, and carbon dioxide infrastructure.
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