Kinder Morgan (KMI) Bernstein 41st Annual Strategic Decisions Conference summary

Market outlook and demand drivers

• Forecasts 22–28 BCF/day U.S. natural gas demand growth over the next four years, mainly from LNG exports, power, industrial, and exports to Mexico.

• Existing pipeline and storage capacity is highly utilized, with significant price increases in storage services.

• 85% of expected natural gas demand growth is concentrated in the southern and southeastern U.S., aligning with infrastructure footprint.

• Power demand growth is driven by population migration, industrial onshoring, coal plant conversions, and data centers.

• LNG export projects create multiple opportunities, including upstream expansions and supply diversification.

Financial strategy and capital allocation

• $8.8 billion project backlog, 90% natural gas, mostly backed by long-term take-or-pay or fee-for-service contracts.

• Capital allocation guided by unlevered IRR thresholds, adjusted for project risk and contract quality.

• Dividend is prioritized, set for modest growth, with roughly half of post-maintenance cash flow allocated to dividends and half to expansion.

• Net debt to EBITDA target range is 3.5x–4.5x, currently at 4x, with S&P positive outlook.

• Willing to use balance sheet capacity or seek partners for growth projects if needed.

Regulatory and operational environment

• Federal permitting process has improved, with regulatory rollbacks and expedited Army Corps guidance.

• State-level permitting in the South/Southeast is generally supportive and timely.

• Judicial challenges remain a concern; pending legislation could further limit permit challenges.

• Regulatory costs are managed within sustaining CapEx and OpEx, with potential impacts on project rates.

• Cost savings are expected mainly from regulatory easing; headcount and G&A are tightly managed.