ExxonMobil (XOM -0.84%) has been under pressure to do something to fix its sagging production, which slid 3% during the second quarter and impacted the company's ability to cash in on higher oil prices. That led it to unveil a bold plan earlier this year that would see it boost its production up to 5 million barrels of oil equivalent per day (BOE/D) by 2025 -- a 25% increase from its current level -- and more than double its earnings and cash flow. One of the key fuels driving that growth is the Permian Basin, where Exxon expects to boost its output fivefold, to as much as 800,000 BOE/D.

Given the importance of the Permian to Exxon's future, the company is working to ensure that nothing will impede its progress in the area. That's why it's helped spearhead several new pipelines in the region so it has the market access needed to support its growth, especially in light of the region's recent capacity issues. One of those projects recently took another step closer to becoming a reality after a new partner signed up to join Exxon's venture.

Sunset through the twists of a pipeline system.

Image source: Getty Images.

Getting out ahead of the next problem

Back in June, Exxon and oil pipeline company Plains All American Pipeline (PAA -0.84%) signed a letter of intent to pursue the creation of a joint venture that would build another oil pipeline out of the Permian Basin. Exxon and Plains All American envisioned a more than 1 million barrel-a-day pipeline that would move oil produced by Exxon and others to refining and export markets along the Gulf Coast.

That multi-billion-dollar project recently got a boost after Lotus Midstream agreed to participate. The private equity-backed company recently made waves after sealing a deal to buy Occidental Petroleum's (OXY 0.07%) Centurion pipeline system, as well as its Southwest New Mexico oil-gathering system. The sale gave Occidental Petroleum a huge cash windfall that it plans on using to repurchase shares.

Meanwhile, it provides Lotus with a premier midstream business in the heart of the Permian, backed by Occidental Petroleum's production. That system, which features a long-haul oil pipeline to the nation's oil storage hub in Cushing, Oklahoma, would be even more valuable to customers if they could also access oil markets along the Gulf Coast, which is why this partnership with Exxon and Plains makes sense.

At the moment, the industry doesn't seem to need another oil pipeline out of the Permian. Plains All American already has two underway, including one that should start up in about a month. Meanwhile, several more are on pace to begin service by the end of next year, and at least one more should follow by the end of 2020. These pipelines have the potential to boost the Permian's pipeline capacity from its current level of 3.6 million barrels per day to nearly 6 million BPD by the end of 2020. However, with Permian production expected to surge past 7 million BPD by 2025, it appears as if the region will eventually need Exxon's pipeline.

A person in a hard hat standing near a stack of pipelines.

Image source: Getty Images.

Pushing projects over the finish line

In addition to helping drive that oil pipeline forward, Exxon has played a key role in nudging two gas pipeline projects toward their respective finish lines. The company made a statement when it signed up to be an anchor shipper on Kinder Morgan's Permian Highway Pipeline, committing to a quarter of its capacity to ensure it moved forward. That commitment helped accelerate the project, which enabled Kinder Morgan to sanction it earlier this month.

Meanwhile, Exxon signed on to be a foundation shipper on Summit Midstream's (SMLP 4.64%) Double E Pipeline by committing to a firm transportation agreement for up to half of the pipeline's capacity. Further, Exxon has the right to acquire up to a 50% interest in the pipeline from Summit, which could help with securing project-related funding. By getting Exxon's backing, Summit is increasingly likely to move forward with this pipeline.

Using its power to make sure nothing slows its Permian growth engine

The Permian Basin is a key fuel for Exxon's expansion strategy. That's why the company has been partnering with pipeline companies to make sure their projects move forward, which would guarantee its market access. With each project making progress, it increases the likelihood that Exxon's Permian-driven growth plan will succeed, positioning the oil giant to create significant value for investors in the coming years.