Matador Resources Inks Marketing Deals with Energy Transfer

Matador Resources Co said Thursday it has executed natural gas supply and other agreements with Energy Transfer LP (ET).

"This transaction is an additional step taken by Matador's marketing team to improve all-in pricing netbacks and reduce exposure to Waha Hub pricing in the second half of 2026", the Dallas, Texas-based oil and gas explorer and producer said in an online statement.

"In addition to this gas supply agreement, Matador has executed separate natural gas liquid agreements with various ET affiliates to dedicate and sell Matador’s NGLs from multiple sources in the Delaware Basin to ET".

Last year Matador secured firm transportation on Energy Transfer's Hugh Brinson Pipeline project for 500,000 million British thermal units a day of gas produced in the Permian Basin. The gas would be piped to points of sale where demand and prices have historically been elevated relative to the Waha Hub, according to Matador.

"We expect the new gas supply agreement with ET announced today will allow Matador to bridge the gap prior to Matador’s transportation agreement on the Hugh Brinson Pipeline becoming effective and realize higher natural gas prices for a portion of its natural gas production in the second half of 2026", Matador said.

"This agreement is also expected to provide ET with natural gas to feed the growing demand from artificial intelligence-driven data centers and power generation markets".

Energy Transfer, also based in Dallas, expects to put into service phase 1 of the Hugh Brinson Pipeline, previously referred to as the Warrior Pipeline project, by yearend. Designed to extend from Waha to Maypearl, Texas and connect to Energy Transfer's pipeline and storage infrastructure, the 400-mile, 42-inch first-phase pipeline will carry up to 1.5 billion cubic feet per day (Bcfd) of gas, according to Energy Transfer's announcement of the final investment decision December 6, 2024.

Phase 1 also involves the construction of the Midland Lateral, a 42-mile, 36-inch pipeline connecting Hugh Brinson with processing plants owned by Energy Transfer and third parties.

Phase 2 would add compression to raise the Hugh Brinson Pipeline's capacity to about 2.2 Bcfd.

"The Hugh Brinson Pipeline will connect shippers to Energy Transfer’s existing intrastate natural gas pipeline network and other downstream pipelines", Energy Transfer said at the time. "In addition, it will provide shippers with the optionality to access prolific markets and trading hubs throughout Texas and beyond, including Carthage and Katy.

"This project is also expected to further establish Energy Transfer as the premier option to support power plant and data center growth in the state of Texas".

Energy Transfer approved the pipeline with a budget of around $2.7 billion.

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