Investment extends Devon’s integrated Delaware Basin model – capturing value from the wellhead to the demand center
Devon Energy Corporation has announced a positive Final Investment Decision ('FID') on the Solitude Pipeline System, a WhiteWater-led joint venture that will construct two 48-inch natural gas pipelines connecting the Permian Basin to Katy, TX. Solitude is the latest in a deliberate series of steps Devon has taken to integrate and consolidate the infrastructure supporting its Delaware Basin position. Our integrated business model is built to convert basin-level constraints into durable margin and to capture value across the entire value chain, from the wellhead to the demand center.
The Solitude Pipeline System is designed for a phased build-out of approximately 2.25 Bcf per day entering service in the second half of 2029, followed by a similarly sized second phase in 2030 and the ability to expand further to meet shipper demand. Construction and in-service timing remain subject to customary regulatory approvals.
Devon has secured firm transportation capacity and will hold a 25% equity interest in the joint venture, alongside WhiteWater (50%), MPLX (10%), Diamondback Energy (7.5%) and Western Midstream Partners (7.5%).
UNLOCKING VALUE IN PERMIAN NATURAL GAS
Permian producers have long absorbed volatile and periodically negative pricing at the Waha hub, where takeaway capacity has repeatedly failed to keep pace with associated gas growth. Firm, long-haul capacity to the Gulf Coast changes that equation: it moves the majority of Devon’s Delaware gas out of Waha and into markets that will be tied to expanding LNG export and power generation, where North American liquefaction capacity is expected to more than double by the end of the decade.
Devon has already initiated the process of securing international LNG-linked pricing, including a 100 MMcf per day agreement beginning in 2027 and an additional 150 MMcf per day in 2028. Solitude gives Devon the scale and duration to access this growing LNG demand, presenting an opportunity to enhance the value of our natural gas portfolio.
'Solitude is not a standalone investment; it is the next step in an integrated model we have been building for years,' said Clay Gaspar, president and CEO. 'We have taken the hardest constraints in the Delaware Basin: water, processing, compression, takeaway and power, and have de-risked the physical constraints turning each one into a source of value rather than a tax on our returns. The company’s integrated model continues to lower our cost of supply — driving free cash flow higher and deepening our peer-leading Delaware inventory. Our advantaged position will continue to enhance the company’s Delaware return profile and will enable Devon to achieve differentiated resource capture.'
AN INTEGRATED DELAWARE BASIN: VALUE CREATION FROM WELLHEAD TO MARKET
Devon holds one of the largest operated positions in the economic core of the Delaware Basin, the asset that anchors more than half of the company’s production and free cash flow. Over the past several years, Devon has systematically taken ownership or long-term contractual control of the infrastructure that position depends on for optimal and profitable development:
- Crude and NGL market access. Devon has built a parallel path to market its liquids, holding firm crude transportation from the Delaware Basin to the Gulf Coast. The company exports crude on an FOB basis across five to seven loading windows per month, through its VLCC position at Ingleside and through Pin Oak, where Devon holds an equity interest, providing direct waterborne access to international buyers. On the NGL side, Devon markets an LPG FOB program scaling toward three to five loading windows per month that prices a portion of its barrel against international benchmarks, supported by diversified fractionation capacity and Gulf Coast storage.
- Gas takeaway. Devon has underwritten multiple long-haul projects to solve Permian egress, taking early equity positions where the risk-adjusted return warranted it. The company was a founding equity owner in Matterhorn Express, which it monetized in 2025 at a substantial gain while retaining its transportation rights. Devon has secured an additional 550 MMcf per day of firm transportation capacity on Blackcomb and Eiger, further expanding its access to Gulf Coast markets. The Solitude pipeline represents the next step in that progression, adding long-dated capacity and further diversifying Devon’s pathways to growing LNG and power-generation demand.
- Gas processing. Devon owns a 50% interest in Catalyst Midstream Partners, its gas gathering and processing joint venture with Howard Energy Partners, which serves Devon’s Stateline development with more than 600 MMcf per day of gas processing capacity.
- Gas gathering and compression. In August 2025, Devon acquired the remaining third-party interests in Cotton Draw Midstream, moving to 100% ownership of the gathering and compression system serving the company’s Cotton Draw development. Combined with the company’s Stateline and Triple Crown gas gathering and compression systems, Devon has 3.4 Bcf per day of operated compression capacity.
- Power and in-basin demand. Devon has built approximately 1,200 miles of electrical distribution infrastructure and four in-basin microgrids with roughly 75 MW of installed capacity, securing reliable electricity in a supply-constrained region. Devon is simultaneously underwriting new local demand for its own gas, agreeing to supply 115 MMcf per day over a seven-year term to CPV’s 1,350-megawatt Basin Ranch Energy Center in Ward County, Texas, beginning in 2028 at pricing indexed to ERCOT West.
- Produced water. In 2023, Devon combined its Stateline produced-water gathering and disposal system with WaterBridge NDB, contributing approximately 210 miles of pipeline and 18 disposal wells. Following WaterBridge Infrastructure’s (NYSE: WBI) September 2025 initial public offering, Devon retains an approximate 13% ownership position in what is now one of the largest produced-water platforms in the Delaware Basin. Devon continues to build out its owned and operated water systems in the Delaware Basin with nearly 1,000 miles of water pipeline and a system capacity of 2.2 million barrels per day.
'Owning and controlling this infrastructure allows for improved commercial terms that lower operating costs, earlier visibility into opportunities, and direct exposure to the demand centers that will set the price of our products for the next decade,' Gaspar continued. 'Our track record, from WaterBridge to Cotton Draw to Matterhorn Express, reflects the discipline we bring to these decisions. We intend to keep applying that discipline, and this integrated model, to create long-term value for our shareholders for years to come.'
Kirkland & Ellis LLP served as legal counsel to Devon Energy Corporation in connection with the transaction.
Source: Devon Energy
