Summit Midstream Makes Final Investment Decision on Double E Pipeline Expansion, Plans $100 Million Investment

Summit Midstream Corporation said Monday that its Double E Pipeline joint venture has reached a final investment decision on a mainline compression expansion that will add roughly 900 million cubic feet per day of forward-haul capacity toward the Waha Hub in Texas. The company expects the project, together with new plant connections and related infrastructure, to require about $100 million of investment net to Summit’s 70% interest and to enter service in the fourth quarter of 2028.

The decision was supported by a new long-term take-or-pay transportation agreement with an investment-grade shipper for 200 MMcf/d. Summit said the latest contract lifts Double E’s total contracted firm capacity to about 2.2 Bcf/d, while the expansion open season produced approximately 550 MMcf/d of binding long-term commitments. The project still requires Federal Energy Regulatory Commission and other customary regulatory approvals.

Open season gives Double E enough support to proceed

Months of commercial work preceded the final investment decision. In its August 31 announcement, Summit said the open season had concluded successfully and that the new 200 MMcf/d agreement helped support the decision to move forward with the compressor project.

Double E is a 135-mile interstate natural gas pipeline that began operating in November 2021. It carries gas from receipt points in the Delaware Basin to delivery points in and around Waha, an important West Texas gas hub. Summit owns 70% of Double E through subsidiaries and operates the system, while ExxonMobil owns the remaining 30%.

The company said approximately 550 MMcf/d of new binding long-term take-or-pay commitments were secured through the compression expansion open season. Summit is also continuing discussions with prospective shippers for remaining expansion capacity. Management described the existing shipper base as primarily investment grade, giving the project a contracted revenue foundation before the new compressor station is placed in service.

That commercial support was not in place all at once. In June, Summit reported 250 MMcf/d of new binding agreements during the open season and a firm option for another 200 MMcf/d. By its second-quarter update on August 10, the company had extended the process through the end of August while it worked to finalize more transportation agreements. Monday’s announcement therefore marks the point at which management moved from evaluating the expansion to formally approving the investment.

The $100 million figure is Summit’s net share

One qualification is important when reading the spending figure. Summit did not say the entire Double E expansion has a gross cost of $100 million. Instead, it expects to invest approximately $100 million net to its 70% ownership interest for the mainline compressor station, incremental plant connections and related infrastructure. The amount is therefore Summit’s expected capital contribution rather than a stated total project cost for the joint venture.

Financing for that contribution is tied to Summit Permian Transmission. In March, the subsidiary completed a $440 million senior secured term-loan refinancing maturing in 2031. Summit’s second-quarter Form 10-Q described the facility as consisting of $340 million of initial term-loan commitments, a $50 million committed delayed-draw facility and a $50 million uncommitted incremental facility.

With the final investment decision, Summit said the previously uncommitted $50 million accordion has now been converted into committed capacity. Combined with the $50 million delayed-draw facility established when the refinancing closed, the company says Summit Permian Transmission now has $100 million of committed expansion financing available to fund Summit’s expected Double E contributions over the next several years. The facility is non-recourse to Summit Midstream Corporation, meaning the borrowing sits at the subsidiary level rather than as a direct corporate obligation of SMC.

Monday’s financing change came after the project had already moved beyond a purely conceptual stage. Summit disclosed earlier this summer that Double E had placed an order for long-lead gas turbine compressor units to preserve manufacturing slots needed for the targeted 2028 schedule. Its June-quarter filing still described formal FID as a future milestone and said Double E anticipated filing a Section 7(c) certificate application with FERC later in 2026.

Compression is designed to push more Permian gas toward Waha

At the asset level, the expansion centers on a new bi-directional mainline compressor station. Summit says the station will increase Double E’s forward-haul capacity to Waha by about 900 MMcf/d, allowing the existing pipe to move more gas without constructing an entirely new long-distance pipeline along the same route. New plant connections and associated infrastructure are also part of the planned investment.

Double E is already handling substantially more gas than it did a year ago. Summit reported average pipeline throughput of 859 MMcf/d in the second quarter, up from 682 MMcf/d in the same period of 2025. The Permian segment generated $9.4 million of segment Adjusted EBITDA in the quarter, compared with $8.3 million a year earlier, with the increase primarily tied to higher proportional earnings from Summit’s Double E investment.

Management is attaching a larger long-term earnings opportunity to the expansion, but those figures remain forecasts rather than contracted outcomes. Summit said that if the project becomes fully subscribed, it expects Permian Segment Adjusted EBITDA to rise from roughly $37 million in 2026 to more than $100 million by 2030. Achieving that level depends on additional commercial commitments, completion of the project, regulatory approvals and actual operating performance.

Summit also pointed to potential future demand associated with data-center development in Texas and New Mexico and to additional downstream pipelines seeking access to Permian gas. Those opportunities are part of management’s longer-range outlook, not the basis for treating future volumes as secured today. The confirmed development is narrower: Double E has reached FID, added a 200 MMcf/d long-term shipper commitment, secured financing for Summit’s expected share and is targeting the fourth quarter of 2028 for service.

Regulatory work remains the next major execution step. Summit’s latest announcement says the compression project remains subject to FERC and other customary approvals, while its June-quarter filing said Double E expected to submit its Section 7(c) certificate application later this year. Until those approvals are obtained and construction is completed, the additional 900 MMcf/d of forward-haul capacity remains a planned expansion rather than operating capacity.