The Williams Companies, Inc. WMB recently announced a significant $1.6 billion agreement to develop onsite natural gas and power generation infrastructure for an undisclosed investment-grade company. The project, anticipated to be completed in the second half of 2026, will enhance power availability in grid-constrained markets, ensuring a reliable energy supply.
This venture marks Williams’ first major step into power innovation, reinforcing its commitment to delivering fast, efficient solutions to high-demand regions.
WMB is well-positioned to capitalize on the rising demand for natural gas, driven significantly by the increasing energy needs of artificial intelligence and data centers. With its existing network handling a third of the U.S. natural gas and significant expansion projects in the pipeline, the company is set to benefit from favorable industry dynamics and growth prospects.
Per the terms of the agreement, Williams has agreed to invest about $1.6 billion to provide the natural gas and power pipeline infrastructure to an investment-grade company. The project is anticipated to be completed by the second half of 2026, provided the company receives all the required permits on time.
The project includes a 10-year, primarily fixed-price power purchase agreement with an extension option. The long-term projects reduce WMB’s risk associated with the variations in the oil and natural gas prices, providing financial stability.
As a result of this agreement, Williams has raised its 2025 growth Capex guidance by $925 million, bringing the total range to $2.6-$2.9 billion. This increased investment is expected to push the company’s 2025 leverage ratio midpoint to 3.65.
Oklahoma-based The Williams Companies is a premier energy infrastructure provider in North America. Currently, WMB has a Zacks Rank #3 (Hold).
Investors interested in the energy sector might look at some top-ranked stocks like Repsol, S.A. REPYY, Prairie Operating Co. PROP and Gulfport Energy Corporation GPOR.While Repsol and Prairie Operating currently sport a Zacks Rank #1 (Strong Buy) each, Gulfport Energy carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Repsol explores, develops and produces crude oil products and natural gas, and transports petroleum products, liquefied petroleum gas and refined petroleum. REPYY’s expected EPS (earnings per share) growth rate for the next year is 17%, which aligns favorably with the industry growth rate of 13.10%.
Houston-based Prairie Operating is an independent energy company engaged in the development and acquisition of proven, producing oil and natural gas resources principally in the United States. The Zacks Consensus Estimate for PROP’s 2024 earnings indicates 81.19% year-over-year growth.
Gulfport Energy is an independent natural gas and oil company focused on the exploration and development of natural gas and oil properties in North America. The Zacks Consensus Estimate for GPOR’s 2024 earnings indicates 108.53% year-over-year growth.
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