The Permian Basin continues to reshape North America’s energy landscape—and natural gas liquids (NGLs) are now at the center of the next big growth wave. On Thursday, Enterprise Products Partners announced a major strategic move: Exxon Mobil is acquiring a 40% stake in Enterprise’s new Bahia NGL pipeline system and will help expand it to meet rapidly rising NGL production across the basin.
This partnership isn’t just a transaction. It’s a long-term bet on the changing composition of Permian production and the infrastructure needed to keep up.
A New Backbone for Permian NGLs
The 550-mile Bahia pipeline, currently in commissioning, is nearing commercial service at an initial 600,000 barrels per day (bpd). The system moves mixed NGLs from the Midland and Delaware basins to Enterprise’s massive Mont Belvieu fractionation hub in Texas—home to the world’s largest NGL processing and storage complex.
But the Permian isn’t slowing down.
Enterprise co-CEO Jim Teague noted that NGL output is expected to grow more than 30% from 2024 to 2030 as gas-to-oil ratios continue rising. That means operators are producing more gas and liquids per barrel of oil—and they need more takeaway capacity to avoid bottlenecks.
The Exxon Mobil partnership directly addresses that challenge.
Exxon Mobil Steps In: The Cowboy Connector
Under the deal, closing expected by early 2026, Exxon Mobil will:
- Buy a 40% stake in the Bahia pipeline
- Co-invest in boosting total capacity to 1 million bpd
- Build a 92-mile extension from the Bahia line to its Cowboy gas processing plant in Eddy County, New Mexico
Exxon’s portion of the expansion will be branded the Cowboy Connector, extending Bahia deeper into the Delaware Basin. This new segment will also interconnect with several Enterprise-operated facilities, transforming the combined system into a more integrated NGL flow corridor across New Mexico and West Texas.
The extension is expected to be complete in Q4 2027.
Why the Expansion Matters: Rising Gas & NGL Ratios
The Permian’s production profile is evolving. As formations mature and drilling targets shift, the ratio of natural gas and NGL production to crude oil continues to climb.
This trend has major implications:
1. More NGLs Means More Midstream Demand
Even if crude production plateaus, NGL-rich gas streams create sustained infrastructure needs for processing, takeaway, and fractionation.
2. Avoiding Bottlenecks Protects Operator Margins
Insufficient NGL capacity can lead to flaring, curtailments, or discounted pricing—something operators are eager to avoid as capital discipline becomes industry standard.
3. Mont Belvieu Needs Feedstock
Enterprise’s Mont Belvieu complex is a global NGL hub. Bahia strengthens its supply pipeline at a time when petrochemical demand is still expanding.
Teague put it clearly:
“The Bahia pipeline will be an essential artery.”
Positioning for the Next Permian Cycle
This deal signals confidence not only in NGL growth, but in the long-term role of the Permian as a global energy anchor.
For Exxon Mobil, the project supports:
- Its growing Delaware Basin gas processing footprint
- Its integration plans following the Pioneer acquisition
- Its broader strategy to increase production while managing emissions through better gas capture and takeaway
For Enterprise, partnering with Exxon strengthens Bahia’s throughput commitments and enhances long-term utilization.
Bottom Line: A Bigger, Smarter, More Connected NGL System
The Exxon–Enterprise partnership is more than an incremental pipeline expansion—it is a strategic buildout designed to match the next decade of Permian development.
Once fully built (target 2027):
- Capacity grows to 1 million bpd
- Coverage expands deeper into Eddy County
- Connectivity increases across Delaware Basin plants
- Mont Belvieu receives a more robust NGL supply stream
As the Permian shifts toward a more gas- and NGL-heavy profile, Bahia is poised to become one of the region’s most important midstream arteries—linking upstream growth to downstream value.
