Enterprise Products Partners (EPD 0.45%) is an elite dividend stock. The midstream giant delivered its 25th straight year of increasing its distribution in 2023. It has grown its payout by 5.3% over the past year, helping push its yield up to its current level of 7.7%.

The master limited partnership (MLP) has plenty of fuel to continue growing its payout. It recently secured $3.1 billion in new expansion projects. These investments will boost its cash flow as they come online in 2025. That should support the continued steady rise in its big-time distribution.

The next wave

Enterprise Products Partners recently unveiled a slew of new capital projects to support continued production growth in the Permian Basin. It's building four new projects and converting an oil pipeline back to supporting natural gas liquids (NGLs). These projects include:

  • Seminole Pipeline: Enterprise Products Partners is converting the 210,000 barrels per day (BPD) oil pipeline back to NGL service. It expects to finish this project in December to provide incremental NGL service to the Permian Basin.
  • Bahia NGL Pipeline: Instead of partially looping its existing Shil Oak Pipeline, the MLP plans to build a new 550-mile, 600,000 BPD pipeline to transport NGLs out of the Permian Basin. This pipeline should enter service in the first half of 2025.
  • Mentone 4 and Orion: The company is building two more natural gas processing plants in the Permian Basin. Mentone 4 will be in the Delaware basin, while Orion will be in the Midland. Both will begin commercial operations in the second half of 2025. These plants will separate natural gas liquids from dry natural gas.
  • NGL fractionator 14 and an associated deisobutanizer: The company is building another plant to separate natural gas liquids into their various streams (ethane, propane, and butane). This 195,000 BPD facility will start up in the second half of 2025.

Enterprise Products Partners plans to invest $3.1 billion in these projects. It now has $6.8 billion of capital projects under construction that should start up through 2026. The company is investing $3 billion into capital projects this year and sees spending between $3 billion and $3.5 billion on projects next year ($3 billion already secured and another $500 million currently under development).

This backlog gives the company tremendous visibility into its earnings growth over the next few years. "These attractive investments are core to our NGL franchise and provide further visibility to increasing cash flow per unit, which will support future distribution growth and returns of capital to investors," commented co-CEO Jim Teague in the press release unveiling the new projects.

What's fueling this growth?

The main factor driving these new investments is the expected production growth ahead in the Permian Basin. The company expects oil, natural gas, and NGL production in the region to grow throughout the decade. It predicts crude oil production will increase by 700,000 BPD this year and by about 1.5 million per day through the end of 2025. This rise in oil output will drive an increase in associated natural gas and NGL output.

Enterprise sees Permian NGL volumes rising by more than 200,000 BPD this year and by 700,000 BPD through the end of 2025. Meanwhile, it envisions more oil and NGL production growth post-2025. It forecasts another 15% increase in oil output by 2030, driving at least 500,000 BPD of additional NGL volumes. Those rising volumes are driving the need for additional infrastructure in the region.

The Permian continues to be a hotbed of activity. For example, oil giant ExxonMobil (XOM -2.78%) recently agreed to buy Pioneer Natural Resources in a more than $60 billion deal to bulk up its position in the Permian. The deal will more than double Exxon's current output in the region to 1.3 million barrels of oil equivalent per day (BOE/d). The company expects to grow its combined volumes to about 2 million BOE/d by 2027. As a result, oil companies like Exxon will need more infrastructure to process and transport their rising volumes to market centers.

Plenty of growth still ahead

Enterprise Products Partners has steadily grown its distribution over the years by investing in expanding its energy infrastructure platform. The company has even more growth ahead after securing several more projects that will come online in 2025. That should give it the fuel to continue increasing its high-yielding payout for the next several years. For those seeking an attractive and steadily rising income stream, that makes it a great investment.