Friday Night Special Council Meeting Leads To Kyle, Kinder Morgan Pipeline Settlement Agreement

The Kyle City Council has approved a settlement agreement with the Permian Highway Pipeline, LLC, and Kinder Morgan Texas Pipeline, LLC.

The agreement allows for Kinder Morgan to construct the Permian Highway Pipeline (PHP) through the boundaries of the City of Kyle and provides protections to the city regarding how the pipeline affects existing infrastructure and future development projects.

The settlement agreement was approved by the city council during a special called council meeting on Friday, October 4th.

“To be clear, this settlement has nothing to do with re-routing the pipeline out of the Hill Country,” said Travis Mitchell, Mayor, City of Kyle. “We still share in the concerns of thousands in our community who fear the impacts of the PHP on our safety and our environment. Settling this case has no bearing on those risks, which would have remained in full force either way.”

“In a perfect world, this pipeline would have been routed through unincorporated areas of Texas – preferably those areas already established with oil infrastructure — minimizing the effect on landowners, local governments and our environment,” said Mitchell. “Unfortunately, we don’t live in a perfect world. Our city council and city staff have worked diligently with Kinder Morgan to develop this framework that will provide protections to the city that otherwise are not granted through current state and federal regulations. One such protection born from the settlement is that Kinder Morgan is no longer legally allowed to convert the pipeline from natural gas to crude oil. As I see it, this negotiated point can be celebrated by all who have stood with us for the last year.”

The settlement agreement calls for Kinder Morgan to remit to the city a payment of $2.7 million dollars, protects the city from incurring any undue financial burden caused by the pipeline on existing infrastructure, and requires Kinder Morgan to participate in the alleviation of conflicts between the pipeline and future infrastructure projects in the city.

“The question before our council has been how to leverage our limited city resources to carry this fight against an opponent with virtually unlimited resources,” said Mitchell. “We believe that this settlement agreement represents a better outcome than what we could have expected in a long and drawn out, and expensive, legal battle.”

On July 2nd of this year, the Kyle City Council passed an ordinance that would have put stricter regulations on the pipeline’s construction in the Kyle City Limits. Kinder Morgan sued the city asserting that state and federal law prohibits cities from regulating pipelines. The city amended the ordinance on September 11th to address some of the claims that its ordinance was inconsistent with state and federal law.

“While we’re satisfied to have this particular legal proceeding behind us, we remain committed to advocate for Kinder Morgan to build in the most responsible manner possible,” said Mitchell. “This is certainly a step in the right direction, but it is also not the end of this fight.”

The settlement details can be read at https://www.cityofkyle.com/sites/default/files/fileattachments/communications/page/9933/kinder_morgan_settlement_agreement.pdf.