Phillips 66 appears to be backing up its midstream growth strategy with new infrastructure investments in the Midland Basin.
During the company’s Q1 2026 earnings call, Don Baldridge, Executive Vice President of Midstream & Chemicals, stated that Phillips 66 will continue pursuing opportunities to add gathering and processing capacity, support customer volume growth, and expand infrastructure while maintaining capital discipline. Management also expressed confidence in achieving its $4.5 billion Midstream EBITDA target by 2027 and sustaining growth beyond that timeframe.
Recent regulatory filings suggest that strategy is actively being executed in West Texas. Through its wholly owned subsidiary DCP Operating Company, LP, Phillips 66 received approval for two new compressor station registrations in Ector County during the week of June 17-18. The projects include the Goose Compressor Station near Goldsmith and the Jester Compressor Station near Gardendale, both located in the core Midland Basin.
Compressor stations are critical components of natural gas gathering systems, providing the pressure needed to move increasing gas volumes from producing wells to processing facilities and downstream markets. The addition of two new compressor stations in the same county within days of each other may indicate a broader expansion of Phillips 66’s gathering and compression network in response to growing customer demand.
Key Takeaways about Air Permits
| Project | Goose Compressor Station | Jester Compressor Station |
|---|---|---|
| Permit # | 184431 | 184438 |
| Operator | DCP Operating Company, LP | DCP Operating Company, LP |
| County | Ector County, TX | Ector County, TX |
| Area | Goldsmith | Gardendale |
| Status | Complete | Complete |
| Permit Date | June 17, 2026 | June 18, 2026 |
| Type | New Oil & Gas Facility Registration | New Oil & Gas Facility Registration |
The infrastructure additions come as drilling activity remains active across Ector County. Year-to-date drilling records show 37 wells drilled in the county, led by Diamondback Energy with 17 wells, followed by Continental Resources, Ovintiv, and ConocoPhillips. More than 90% of the wells were horizontal, with most activity concentrated in the Spraberry trend, one of the Midland Basin’s most productive oil and gas plays.
Top Operators by Wells Drilled Ector County
| Operator | Wells |
|---|---|
| Diamondback Energy | 17 |
| Continental Resources | 6 |
| Ovintiv USA | 5 |
| ConocoPhillips | 4 |
| Admiral Permian Resources (APR) | 2 |
| Phillips 66 | 1 |
| FireBird Energy II | 1 |
| Ares Energy | 1 |
The combination of new compression infrastructure and ongoing drilling activity suggests Phillips 66 is positioning its midstream network to capture additional natural gas volumes from continued development in the Midland Basin. For oilfield service companies, the projects may create opportunities related to compression equipment, automation and controls, electrical and instrumentation work, emissions monitoring, pipeline tie-ins, and facility construction.
While management did not specifically reference the Permian Basin during its discussion of future gathering and processing investments, the newly approved Goose and Jester Compressor Stations provide a tangible example of Phillips 66 expanding infrastructure in one of North America’s most active shale regions.
Author: phinds