$5.3B Pipeline to Carry West Texas Natural Gas Across the Southwest

MIDLAND, TX — Energy Transfer LP has announced plans for a $5.3 billion expansion of its Transwestern Pipeline system that will carry natural gas from West Texas to markets in Arizona and New Mexico, aiming to meet rising demand tied to population growth, data centers, and industrial development.

The Desert Southwest Expansion project includes 516 miles of new 42-inch pipeline and nine compressor stations across Texas, New Mexico, and Arizona. The line will draw directly from the Permian Basin. 

Construction is expected to be completed by the fourth quarter of 2029, with the expanded system capable of transporting 1.5 billion cubic feet of natural gas per day.

Utilities in Arizona, including Arizona Public Service, have already committed to purchasing gas from the expanded line. Energy Transfer said it will launch an open season later this year to secure the remaining capacity. The company anticipates the project will be fully subscribed and could expand further if demand increases.

The Dallas-based pipeline company expects the project to generate up to 5,000 construction jobs and will prioritize U.S.-manufactured steel for the pipeline. The total project cost includes $600 million in construction-related financial allowances, backed by long-term contracts with investment-grade customers.

Energy Transfer owns one of the largest energy infrastructure networks in the U.S., with about 140,000 miles of pipeline, including extensive operations throughout West Texas.