Oneok, Inc. · NYSE:OKE
Oneok — Investor Presentation (January 2021)
20 slides from Oneok's investor presentation, January 2021
Slide 1: Investor Update January 2021
I N V E S T O R U P D AT E JANUARY 2021
Slide 2: Forward-Looking Statements
FORWARD -LOOKING STATEMENTS Statements contained in this presentation that include company expectations, outlooks or predictions should be considered forward-looking statements that are covered by the safe harbor protections provided under federal securities legislation and other applicable laws. It
Slide 3: Integrated. Reliable. Diversified.
INTEGRATED. RELIABLE. DIVERSIFIED. ◆ Competitively positioned – key asset locations and market share ◆ Approximately 40,000-mile network of natural gas liquids and natural gas pipelines ◆ Greater than 10 Bcf/d (or 10%) of U.S. natural gas production is reliant on the utilization of ONEOK’s infrastru
Slide 4: Delivering the Energy That Improves Our Lives
DELIVERING THE ENERGY THAT IMPROVES OUR LIVES COMMON USES OF NATURAL GAS AND NGLS Natural Gas: The lowest-emission hydrocarbon-based fuel, producing inexpensive, reliable and clean energy. Electricity Generation Heating and Cooking Transportation Fuel Industrial/Manufacturing Natural Gas Liquids (NG
Slide 5: Investment Thesis
INVESTMENT THESIS A PREMIER ENERGY INFRASTRUCTURE COMPANY ONEOK’s Competitive Position Key Priorities Operating Market Share Connectivity Operate safely and environmentally Leverage 1 responsibly Strategic assets in NGL Fully integrated assets Available capacity and Reinvest cash flow in high-return
Slide 6: Resilient Business Model – Proven Performance
RESILIENT BUSINESS MODEL – PROVEN PERFORMANCE BUILT TO WITHSTAND VARIOUS MARKET CONDITIONS • Solid investment-grade balance sheet ▪ S&P: BBB (stable) – affirmed April 30, 2020 Financial Strength and Flexibility ▪ Moody’s: Baa3 (stable) – affirmed May 26, 2020 ▪ Fitch: BBB (stable) – issued Nov. 3, 2
Slide 7: Business Segments
BUSINESS SEGMENTS Natural Gas Liquids Natural Gas Gathering Natural Gas Pipelines and Processing EARNINGS MIX >90% fee based >85% fee based >95% fee based CONTRACT Fee-based, bundled service volume Fee contracts with a Fee-based, demand charge STRUCTURE commitments and plant dedications POP componen
Slide 8: Regional Volume Update
REGIONAL VOLUME UPDATE AS OF THE THIRD QUARTER 2020 NATURAL GAS LIQUIDS NATURAL GAS GATHERING AND PROCESSING ◆ Rocky Mountain: ▪ NGL raw feed throughput volumes increased 33% compared with the second quarter 2020. ◆ Rocky Mountain: October 2020 NGL raw feed throughput volumes averaged approximately
Slide 9: Natural Gas Liquids
NATURAL GAS LIQUIDS ONE OF THE LARGEST INTEGRATED NGL SERVICE PROVIDERS Provides fee-based gathering, fractionation, transportation, marketing and storage services linking key NGL market centers Fee-based earnings have Primary NGL transportation significantly increased to >90% provider for the Willi
Slide 10: Natural Gas Liquids Volume Recovery
NATURAL GAS LIQUIDS VOLUME RECOVERY CURRENT ROCKIES VOLUMES EXCEEDING PRE-COVID AVERAGE VOLUMES Rockies Region NGL Raw Feed Throughput (bpd) Capacity Expandable to ~540,000 bpd(a) • Minimal capital needed to expand Elk 160,000 Creek Pipeline with pump stations to meet future customer needs. Current
Slide 11: Ethane Recovery Economics
ETHANE RECOVERY ECONOMICS ONEOK’S NGL INFRASTRUCTURE CONNECTS SUPPLY WITH THE GULF COAST MARKET ◆ Increasing ethane prices drive improving recovery economics ◆ Basins closer to market hubs currently in full or partial ethane recovery ▪ Permian Basin currently in full ethane recovery ▪ Mid-Continent
Slide 12: Natural Gas Gathering and Processing
NATURAL GAS GATHERING AND PROCESSING SERVING PRODUCERS IN KEY BASINS Provides gathering, compression, treating and processing services to producers. Expect 2020 earnings to be >85% fee based Primarily fee-based contracts 15% 13% <15% 20% 16% with a POP(b) component 44% Primary natural gas processer
Slide 13: Capturing Flared Production
CAPTURING FLARED PRODUCTION LIMITED WILLISTON BASIN ACTIVITY NEEDED TO MAINTAIN CURRENT VOLUME LEVELS 1,750 O N E O K I l l u s t r a t i v e 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 ~45 average well completions per month ONEOK Natural Gas Processing Capacity ~35 average well comple
Slide 14: Williston Basin
WILLISTON BASIN INCREASING GAS-TO-OIL RATIOS (GOR) AND FLARING PRESENT OPPORTUNITIES North Dakota Natural Gas and Crude Oil Produced North Dakota Natural Gas Produced and Flared 3,500 3,500 40% GOR has increased >60% since 2016. 3,137 3,000 35% 3,000 2,874 30% 2,500 2,500 25% 2,000 2,000 20% 1,760 1
Slide 15: Natural Gas Pipelines
NATURAL GAS PIPELINES CONNECTIVITY TO KEY MARKETS Provides fee-based natural gas transportation and storage services, and direct connectivity to end-use markets Expect 2020 earnings to be >95% fee based Connected directly to end-use markets: Local gas distribution companies, electric-generation faci
Slide 16: Well-Capitalized Customer Base
WELL -CAPITALIZED CUSTOMER BASE DIVERSIFIED COUNTERPARTIES WITH HIGH CREDIT QUALITY No single customer represents more than 10% of ONEOK’s revenue. Investment-grade Customers Primary Customers Contract Structure YE 2019 • Large integrated and well-capitalized producers, and • Limited counterparty cr
Slide 17: Promoting Long-Term Business Sustainability
PROMOTING LONG -TERM BUSINESS SUSTAINABILITY Environmental Social Governance Providing solutions to Long history of promoting Adoption of SASB reduce flaring in the diversity and inclusion reporting standards Williston Basin ESG-focused leadership Working to reduce Committed to ongoing committees he
Slide 18: ESG-Related Highlights
ESG-RELATED HIGHLIGHTS RECENT RECOGNITION ◆ Included in 30+ ESG-related indexes, including: ▪ S&P 500 ESG Index ▪ Dow Jones Sustainability World Index ▪ Dow Jones Sustainability North America Index ▪ FTSE4Good Index ▪ JUST U.S. Large Cap Diversified Index ▪ MSCI USA Quality Index ◆ Carbon Disclosure
Slide 19: ESG Initiatives and Practices
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 focused on employee, asset and nonexecutive chairman, l
Slide 20: Responding to COVID-19
RESPONDING TO COVID -19 ONEOK - AN ESSENTIAL CRITICAL INFRASTRUCTURE BUSINESS Employee and Community Business Contractor Support Support Sustainability We continue to monitor and take action Approximately $600,000 pledged to We remain focused on operating assets considering CDC and government suppor