Oneok, Inc. · NYSE:OKE
Oneok — Investor Presentation (March 2021)
22 slides from Oneok's investor presentation, March 2021
Slide 1: Investor Update March 2021
I N V E S T O R U P D AT E MARCH 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: Resilient Business Model – Proven Performance
RESILIENT BUSINESS MODEL – PROVEN PERFORMANCE Financial Strength and Flexibility POSITIONED FOR GROWTH Solid investment-grade balance sheet $100 3500 Adjusted EBITDA CAGR COVID-19 of ~10% 2014 - 2020 Significant Liquidity 3000 Undrawn $2.5 billion credit facility | No debt maturities until 2022 $80
Slide 4: 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 5: 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 6: 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 7: Business Segments
BUSINESS SEGMENTS Natural Gas Liquids Natural Gas Gathering Natural Gas Pipelines and Processing <15% ~25% 2021 ADJUSTED >60% EBITDA GUIDANCE EARNINGS MIX ~95% fee based ~85% fee based >95% fee based CONTRACT Fee-based, bundled service volume Fee contracts with a POP component(a) Fee-based, demand c
Slide 8: Natural Gas Liquids Volume Update
NATURAL GAS LIQUIDS VOLUME UPDATE Average NGL Raw Feed Throughput Volumes(a) ◆ Rocky Mountain: Average Bundled ▪ NGL raw feed throughput increased 13% compared with the Region Third Quarter 2020 Fourth Quarter 2020 Rate (per gallon) third quarter 2020. Rocky Mountain(b) 215,000 bpd 244,000 bpd ~ 28
Slide 9: Natural Gas Gathering and Processing Volume Update
NATURAL GAS GATHERING AND PROCESSING VOLUME UPDATE G a t h e r e d Vo l u m e s ( M M c f / d ) Rocky Mountain 1,937 2,065 1,909 1,850 – 2,110 ◆ Processed volumes increased 16% compared with the third quarter 2020. 305 well connects completed in 2020. 983 827 690 - 800 ◆ 973 ◆ Expect to connect 275-
Slide 10: Strong Natural Gas Liquids Volume Recovery
STRONG NATURAL GAS LIQUIDS VOLUME RECOVERY Rockies Region NGL Raw Feed Throughput (bpd) Capacity Expandable to ~540,000 bpd • Minimal capital needed to further 100,000 expand Elk Creek Pipeline with pump Current Total Capacity ~440,000 bpd stations to meet future customer needs. • Significant operat
Slide 11: One of the Largest Integrated NGL Service Providers
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 Expect 2021 earnings to be ~95% fee based Primary NGL transportation provider for the Williston Basin/PRB
Slide 12: Ethane Recovery Economics
ETHANE RECOVERY ECONOMICS ONEOK’S NGL INFRASTRUCTURE CONNECTS SUPPLY WITH THE GULF COAST MARKET ◆ Increasing ethane prices drive improving recovery economics. ◆ Incremental ethane opportunity for ONEOK by region(a): ▪ Mid-Continent: ~100,000 bpd ▪ Williston Basin: ~100,000 bpd ◆ 25,000 bpd of Willis
Slide 13: Natural Gas Gathering and Processing: Serving Producers in Key Basins
NATURAL GAS GATHERING AND PROCESSING SERVING PRODUCERS IN KEY BASINS Provides gathering, compression, treating and processing services to producers. Expect 2021 earnings to be ~85% fee based Primarily fee-based contracts 15% 13% 14% ~15% 20% 16% with a POP(b) component Primary natural gas processer
Slide 14: 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 ~35 average well completions per month Proc
Slide 15: Williston Basin: Increasing GOR and Flaring
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 >65% since 2016. 3,137 3,000 35% 3,000 2,848 30% 2,500 2,500 25% 2,000 2,000 20% 1,711 2
Slide 16: Natural Gas Pipelines: Connectivity to Key Markets
NATURAL GAS PIPELINES CONNECTIVITY TO KEY MARKETS Provides fee-based natural gas transportation and storage services, and direct connectivity to end-use markets Expect 2021 earnings to be >95% fee based Connected directly to end-use markets: Local gas distribution companies, electric-generation faci
Slide 17: Natural Gas Pipelines – Market Connected
NATURAL GAS PIPELINES – MARKET CONNECTED Intrastate Pipeline System Interstate Pipeline System ◆ Connectivity between key markets ▪ Bi-directional between Mid-Continent and Permian Basin; Mexico markets; Gulf Coast market through pipeline interconnects ◆ Significant storage position creates reliabil
Slide 18: 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 19: ESG-Related Highlights
ESG-RELATED HIGHLIGHTS RECENT RECOGNITION ◆ Included in 30+ ESG-related indexes, including: ▪ MSCI USA SRI Index ▪ 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 ◆ Carbon Disclosure Pro
Slide 20: 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 21: 2021 Financial Guidance
2021 FINANCIAL GUIDANCE STRONG VOLUMES EXPECTED TO DRIVE SEGMENT RESULTS 2021 Guidance Range ($ in millions, except per share amounts) 2021 Earnings Drivers Net income $ 1,075 – $ 1,375 ◆ Higher Williston Basin natural gas and NGL Diluted earnings per common share $ 2.40 – $ 3.08 volumes Adjusted EB
Slide 22: 2021 Financial Guidance: Non-GAAP Reconciliation
2021 FINANCIAL GUIDANCE NON-GAAP RECONCILIATION 2021 Guidance Range (Millions of dollars) Reconciliation of net income to adjusted EBITDA and distributable cash flow Net income $ 1,075 - $ 1,375 Interest expense, net of capitalized interest 775 - 735 Depreciation and amortization 655 - 635 Income ta