Targa Resources (NYSE: TRGP) has signed a series of long-term integrated midstream agreements with subsidiaries of Exxon Mobil (NYSE: XOM), expanding the companies’ relationship across the Permian Basin through 2046.
The agreements cover natural gas gathering and processing, treating, NGL transportation and fractionation, with new acreage dedications in both the Delaware and Midland basins.
Targa also announced major new infrastructure investments tied to expected production growth, including three additional processing plants and a new natural gas pipeline in the Permian Delaware.
Targa Expands Exxon Relationship Across Delaware and Midland Basins
In the Permian Delaware, Targa Resources said the new agreements add significant acreage dedications for integrated fee-based services.
Those services include natural gas gathering, processing, treating, NGL transportation and fractionation through 2046.
In the Permian Midland, Targa is adding new acreage dedications while extending existing fee-floor gathering and processing agreements with ExxonMobil through the same period.
Both sets of agreements also include 20-year NGL dedications to Targa’s logistics and transportation systems.
Three New Processing Plants Planned for 2028
Targa announced plans to build three new natural gas processing plants in the Permian Delaware: Wrangler, Ranger and Ranger II.
The plants are expected to have a combined processing capacity of approximately 825 million cubic feet per day.
Targa Resources expects all three facilities to enter service during the first half of 2028.
The company is also evaluating as many as five additional processing plants to support expected long-term production growth in the region.
Targa Resources Evaluates Additional Fractionation Capacity
Beyond the new processing plants, Targa said it is assessing the timing of an additional fractionation train at its Mont Belvieu complex.
Fractionation capacity is important for separating mixed natural gas liquids into products such as ethane, propane and butane.
The potential expansion would complement the new long-term NGL dedications secured under the ExxonMobil agreements.
Bull Run II Pipeline to Add Delaware Basin Takeaway Capacity
Targa also announced plans for a new approximately 70-mile natural gas pipeline as part of its Bull Run residue system in the Permian Delaware.
The new line, known as Bull Run II, is designed to move residue gas from the newly announced processing plants to the Waha hub.
Targa said the pipeline will be supported by take-or-pay commitments, providing greater contractual visibility around the project.
Bull Run II is expected to begin operations in the first half of 2028.
Agreements Strengthen Targa’s Permian Growth Outlook
The new contracts give Targa Resources long-term visibility into gathering, processing and NGL volumes tied to one of the largest producers in the Permian Basin.
The combination of 20-year acreage dedications, new processing capacity and expanded takeaway infrastructure is expected to deepen Targa’s position across both the Delaware and Midland basins.
The agreements also reinforce the company’s broader strategy of growing fee-based infrastructure supported by long-duration customer commitments.
