INDEX OVERVIEW 4 FUTURE GROWTH 17 APPENDIX 26 Business Segments 29 Williston Basin 41 Mid-Continent 45 Permian Basin 48 Powder River Basin 51 NON-GAAP RECONCILIATIONS 53 Elk Creek Pipeline Kansas
O V E RV I E W Mont Belvieu II fractionator Gulf Coast
INTEGRATED. RELIABLE. DIVERSIFIED. Approximately 38,000-mile network of natural gas liquids and natural gas pipelines Provides midstream services to producers, processors and customers Significant basin diversification Growth…
KEY INVESTMENT CONSIDERATIONS A PREMIER ENERGY INFRASTRUCTURE COMPANY Adjusted EBITDA Growth ( in billions) MAJOR ENERGY INFRASTRUCTURE COMPANY 2.45 2.60 Extensive systems connect North American energy supply with worldwide demand…
FINANCIAL STRENGTH A COM PETITIVE ADVANTAGE INCREASING EXCESS CASH Distributable Cash Flow (DCF) in Excess of Dividends Paid DCF in excess of dividends paid of 183 million, a 20% increase ( in millions) compared with the first quarter…
INVESTMENT THESIS ONEOKs Competitive Position Key Priorities Connectivity Makes system duplication uneconomic Operate safely and environmentally Full NGL value chain essential for operations NGL pipelines, fractionators, storage and…
ONEOK BUSINESS SEGMENTS Natural Gas Liquids Natural Gas Gathering Natural Gas Pipelines and Processing 15% 25% 2019 EARNINGS 60% GUIDANCE EARNINGS MIX 80% fee based 85% fee based 95% fee based CONTRACT Fee-based, bundled…
ONEOKS FEE-FOR -SERVICE BUSINESS MODEL FEE-BASED EARNINGS COLLECTED FROM WELLHEAD TO MARKET CENTERS Natural Gas Gathering and Processing Fees/Sales Natural Gas Gathering and Processing 2018 Adj. EBITDA Natural Gas Liquids Fees/Sales…
EARNINGS DRIVERS EXPECTED KEY DRIVERS FEE-BASED SOLUTIONS 2020 OUTLOOK 850 MMcf/d new capacity NATURAL GAS FLARING 300 MMcf/d on ONEOK dedicated acreage and from ONEOK and third-party processing plants expected to be 500 MMcf/d…
LONG -TERM GROWTH OUTLOOK LEADING EARNINGS PER SHARE (EPS) GROWTH 3-year EPS Growth (Median CAGR) 12/31/2018 - 12/31/2021 ONEOK 14.7% (a) S&P 500 7.8% (shown as percentages) Median S&P 500 Median ONEOK Dividend S&P…
ATTRACTIVE DIVIDEND PROFILE 1 OF 25 COMPANIES IN THE S&P 500 WITH A DIVIDEND YIELD GREATER THAN 5% S&P 500 Dividend Yield 127 99 83 5.08% 78 60 33 13 12 0% 0% - 1% 1% - 2% 2% - 3% 3% - 4% 4% - 5% 5% - 6% 6% Source:…
ESG INITIATIVES AND PRACTICES PROMOTING LONG-TERM BUSINESS SUSTAINABILITY Effective Governance and Oversight Committed to Safety Diverse board of directors members elected annually, including a Training robust protocols and training…
ESG-RELATED RECOGNITION RECENT HIGHLIGHTS FTSE4Good Index Includes companies demonstrating strong ESG practices. The FTSE4Good indices are used by a variety of market participants to create and assess responsible investment funds and…
DELIVERING LONG -TERM VALUE ALIGNED WITH SHAREHOLDERS Value Creation and Equity Returns Drive Incentives Total Shareholder Returns ONEOKs executive compensation program is focused on ONEOKs total shareholder returns have consistently…
FUTURE GROWTH Elk Creek Pipeline Kansas
ELK CREEK PIPELINE VOLUME RAMP EXPECT TO ACHIEVE FOUR TO SIX TIMES EBITDA MULTIPLE IN FIRST QUARTER 2020 Up to 240,000(a) Plants contracted: volumes up to 225,000 bpd Additional contracted volume: Demicks Lake II, Bear Creek…
NORTH DAKOTA NATURAL GAS FLARING CONNECTED MORE THAN 600 WELLS IN 2018 O N E O K D e d i c a t e d G r o s s P r o d u c t i o n (a) 1,500 Capacity with Demicks Lake II Capacity with MMcf/d Demicks Lake I GGaass…
WILLISTON BASIN PRODUCTION INCREASING PRODUCTION AT LOWER CRUDE OIL PRICES AND WITH FEWER RIGS Rig Count vs. Natural Gas Production(a) N o r t h D a k o t a C r u d e O i l P e r f o r m a n c e (c) 250 3.0 Natural Gas Production…
WILLISTON BASIN INCREASING GAS-TO-OIL RATIOS (GOR) DRIVING VOLUME GROWTH Producer efficiencies across the basin leading to increasing Natural gas production of 2.8 Bcf/d reported in May 2019, production with fewer rigs compared with 2.3…
WILLISTON BASIN INCREASED NATURAL GAS CAPTURE RESULTS Increased NGL and natural gas value uplift Approximately 81% of North Dakotas natural gas production was captured in May 2019 North Dakota Industrial Commission (NDIC) policy…
NATURAL GAS LIQUIDS GROWTH PROJECTS CapEx Expected Project Scope ( in millions) Completion 900-mile NGL pipeline from the Williston Basin to the Mid-Continent with capacity of up to 240,000 bpd, and related infrastructure Elk Creek…
GATHERING AND PROCESSING GROWTH PROJECTS CapEx Expected Project Scope ( in millions) Completion 200 MMcf/d processing plant in the core of the Williston Basin Demicks Lake I plant and Expected to open full by capturing natural gas…
NATURAL GAS PIPELINES GROWTH PROJECTS Expected Project Scope Completion ONEOK Gas Transportation 100 MMcf/d westbound expansion from the STACK area to multiple western Oklahoma pipeline delivery points Complete (OGT) westbound…
APPENDIX Mont Belvieu fractionator Texas
ONEOK VS. S&P 500 A UNIQUE INVESTMENT OPPORTUNITY (a) 2019-2021 growth rates based on consensus estimates as of July 31, 2019. (b) Includes the companies within the S&P 1,500 that have followed a managed-dividends policy of…
ONEOK 2019 FINANCIAL GUIDANCE 2019 Guidance Range ( in millions) Midpoint Net income 1,140 1,270 1,400 Adjusted EBITDA 2,500 2,600 2,700 Distributable cash flow 1,820 1,940 2,060 Capital-growth expenditures 2,500 3,100 3,700…
BUSINESS SEGMENTS Mustang Pipeline Oklahoma
NATURAL GAS LIQUIDS ONE OF THE LARGEST INTEGRATED NGL SERVICE PROVIDERS Integrated NGL pipeline system from the Williston Basin to the Gulf Coast, linking key NGL market centers at Conway, Kansas and Mont Belvieu, Texas Provides…
NATURAL GAS LIQUIDS PREDOMINANTLY FEE BASED Sources of Earnings Exchange Services Primarily fee based Gather, fractionate and transport raw NGL feed to storage and market hubs Transportation & Storage Services Fee based Transport NGL…
NATURAL GAS LIQUIDS VOLUME UPDATE Average NGL Raw Feed Throughput Volumes(a) NGL raw feed throughput volumes increased 8%, Average Bundled compared with the first quarter 2019 Region/Asset First Quarter 2019 Second Quarter 2019 Rate…
NATURAL GAS GATHERING AND PROCESSING SERVING PRODUCERS IN KEY BASINS Provides gathering, compression, treating and processing services to producers Diverse contract portfolio More than 2,000 contracts Fee-based contracts with a…
NATURAL GAS GATHERING AND PROCESSING PREDOMINANTLY FEE BASED Increased fee-based contract mix by restructuring percent-of- Contract Mix by Earnings proceeds (POP) contracts with a fee component to include a higher fee rate Increasing…
NATURAL GAS GATHERING AND PROCESSING VOLUME UPDATE G a t h e r e d Vo l u m e s (MMcf/d) Rocky Mountain 1,915 2,115 1,937 Expect to connect approximately 620 wells in 2019 1,680 1,561 259 well connects completed in the first half of…
NATURAL GAS GATHERING AND PROCESSING Six Months Ending Dec. 31, 2019 Commodity Volumes Hedged Average Price Percent Hedged Natural Gas (BBtu/d)(a) 82.0 2.30 / MMBtu 73% Condensate (MBbl/d) 2.6 58.55 / Bbl 76% Natural Gas Liquids…
NATURAL GAS GATHERING AND PROCESSING COMMODITY PRICE SENSITIVITIES(a) Earnings Impact Earnings Impact ( in Millions) ( in Millions) Commodity Sensitivity 2019(b) 2020(c) Natural Gas 0.10 / MMBtu 2.1 4.0 Natural Gas Liquids…
NATURAL GAS PIPELINES CONNECTIVITY TO KEY MARKETS Predominantly fee-based earnings 96% of transportation capacity contracted under firm demand-based rates in 2018 85% of contracted system transportation capacity served end-use…
NATURAL GAS PIPELINES PREDOMINANTLY FEE BASED Firm demand-based contracts serving primarily investment- Sources of Earnings grade utility customers Recently completed approximately 1.3 billion cubic feet per day 2% 4% 4%…
NATURAL GAS PIPELINES WELL-POSITIONED AND MARKET-CONNECTED N a t u r a l G a s Tr a n s p o r t a t i o n Capacity Contracted (MDth/d) Natural gas transportation capacity contracted increased 14% compared with the second quarter 2018…
WILLISTON BASIN Bear Creek plant North Dakota
WILLISTON BASIN PROVIDING VALUABLE TAKEAWAY CAPACITY Natural Gas Gathering and Processing More than 1 Bcf/d of natural gas processing capacity, increasing to more than 1.6 Bcf/d in the first quarter 2021 More than 3 million acres…
ELK CREEK PIPELINE PROJECT ATTRACTIVE PROJECT RETURN Existing Bakken NGL Pipeline and Overland Pass Pipeline operating at full capacity Expected to reach 100,000 bpd in the first quarter 2020 Growing production in the region drives…
WILLISTON BASIN PROCESSING PLANT PROJECTS PROCESSING CAPACITY TO SUPPORT PRODUCER GROWTH AND HELP MEET GAS CAPTURE TARGETS Williston Basin growth continues with enhanced well-completion techniques driving increased production and lower…
MID -CONTINENT REGION Canadian Valley plant Oklahoma
MID -CONTINENT REGION RELIABLE FULL-SERVICE PROVIDER SERVING GROWTH IN THE STACK AND SCOOP PLAYS Natural Gas Liquids More than 110 existing natural gas processing plant connections Currently gathering approximately 575,000 bpd of NGLs…
ARBUCKLE II PIPELINE CRITICAL INFRASTRUCTURE TO SERVE GROWING PRODUCTION Volume growth expected across ONEOK footprint, particularly in the STACK and SCOOP areas and Williston and Permian basins, creating a need for additional…
PERMIAN BASIN Roadrunner Pipeline Permian Basin
ONEOKS PERMIAN BASIN STRATEGY CONNECTING PERMIAN BASIN TO ARBUCKLE II UTILIZING INCREMENTAL, CAPITAL-EFFICIENT EXPANSIONS STRATEGY POTENTIAL FUTURE Legacy WTLPG system potential conversion to crude service New Permian to Arbuckle II…
PERMIAN BASIN RELIABLE SERVICE PROVIDER Natural Gas Liquids Approximately 40 third-party natural gas processing plant connections in the Permian Basin Current West Texas LPG pipeline expansion projects to increase mainline capacity…
POWDER RIVER BASIN Lonesome Creek plant North Dakota
POWDER RIVER BASIN PROVIDING VALUABLE TAKEAWAY CAPACITY Natural Gas Liquids Assets located in NGL-rich Niobrara, Sussex and Turner formations Approximately 1 million acres dedicated to ONEOK NGL takeaway through Bakken NGL Pipeline…
NON-GAAP R E C O N C I L I AT I O N S Mont Belvieu II fractionator Gulf Coast
NON-GAAP RECONCILIATIONS ONEOK has disclosed in this presentation adjusted EBITDA, distributable cash flow (DCF) and dividend coverage ratio, which are non-GAAP financial metrics, used to measure ONEOKs financial performance, and are…
2019 FINANCIAL GUIDANCE NON-GAAP RECONCILIATION 2019 Guidance Range (Millions of dollars) Reconciliation of Net Income to Adjusted EBITDA and Distributable Cash Flow Net Income 1,140 - 1,400 Interest expense, net of capitalized…
NON-G A A P RECONCILIATION 2017 2018 2019 ( in Millions) Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Reconciliation of Net Income to Adjusted EBITDA Net income 186 176 167 65 594 266 282 314 293 1,155 337 312 Interest expense, net of…
NON-GAAP RECONCILIATION NET INCOME TO ADJUSTED EBITDA (millions of dollars) 2014 2015 2016 2017 2018 Reconciliation of net income to adjusted EBITDA Net income 663 379 744 594 1,155 Interest expense, net of capitalized interest 356…
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