Current Report

Exhibit 99.1

 

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		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2009				2008				2009				2008
Percent of proceeds
Wellhead purchases (MMBtu/d)			49,472				65,804				55,545				68,564
NGL sales (Bbl/d)			5,408				3,998				5,215				4,637
Residue gas sales (MMBtu/d)			46,406				42,119				41,698				38,570
Condensate sales (Bbl/d)			1,488				1,469				1,786				1,711
Percentage of total net margin			50%				64%				49%				62%
Fee-based
Wellhead volumes (MMBtu/d)			1,100,202				1,145,656				1,131,018				1,173,894
Average rate ($/MMBtu)		$	0.31			$	0.27			$	0.30			$	0.26
Percentage of total net margin			35%				22%				36%				23%
Keep-whole
NGL shrink (MMBtu/d)			16,843				20,016				17,875				21,978
Plant fuel (MMBtu/d)			1,954				2,106				2,100				2,301
Condensate shrink (MMBtu/d)			1,407				1,574				1,893				1,941
Condensate sales (Bbl/d)			285				318				383				393
Percentage of total net margin			15%				14%				15%				15%

 

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ONEOK Partners, L.P. (NYSE: OKS) is one of the largest publicly traded master limited partnerships and is a leader in the gathering, processing, storage and transportation of natural gas in the U.S. and owns one of the nation’s premier natural gas liquids (NGL) systems, connecting NGL supply in the Mid-Continent and Rocky Mountain regions with key market centers.  Its general partner is a wholly owned subsidiary of ONEOK, Inc. (NYSE: OKE), a diversified energy company, which owns 45.1 percent of the partnership.  ONEOK is one of the largest natural gas distributors in the United States, and its energy services operation focuses primarily on marketing natural gas and related services throughout the U.S. 

 

For more information, visit the Web site at www.oneokpartners.com .

 

Some of the statements contained and incorporated in this news release are forward-looking statements within the meaning of Section 27A of the Securities Act, and Section 21E of the Exchange Act, as amended.  The forward-looking statements relate to our anticipated financial performance, management’s plans and objectives for our future operations, our business prospects, the outcome of regulatory and legal proceedings, market conditions and other matters.  We make these forward-looking statements in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995.  The following discussion is intended to identify important factors that could cause future outcomes to differ materially from those set forth in the forward-looking statements.

Forward-looking statements include the items identified in the preceding paragraph, the information concerning possible or assumed future results of our operations and other statements contained or incorporated in this news release identified by words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “should,” “goal,” “forecast,” “could,” “may,” “continue,” “might,” “potential,” “scheduled” and other words and terms of similar meaning.

You should not place undue reliance on forward-looking statements, which are applicable only as of the date of this news release.  Known and unknown risks, uncertainties and other factors may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by forward-looking statements.  Those factors may affect our operations, markets, products, services and prices.  In addition to any assumptions and other factors referred to specifically in connection with the forward-looking statements, factors that could cause our actual results to differ materially from those contemplated in any forward-looking statement include, among others, the following:

·	the effects of weather and other natural phenomena on our operations, demand for our services and energy prices;

·	competition from other United States and foreign energy suppliers and transporters, as well as alternative forms of energy, including, but not limited to, solar power, wind power, geothermal energy and biofuels such as ethanol and biodiesel;

·	the capital intensive nature of our businesses;

·	the profitability of assets or businesses acquired or constructed by us;

·	our ability to make cost-saving changes in operations;

·	risks of marketing, trading and hedging activities, including the risks of changes in energy prices or the financial condition of our counterparties;

·	the uncertainty of estimates, including accruals and costs of environmental remediation;

·	the timing and extent of changes in energy commodity prices;

·	the effects of changes in governmental policies and regulatory actions, including changes with respect to income and other taxes, environmental compliance, climate change initiatives, authorized rates of recovery of gas and gas transportation costs;

·

the impact on drilling and production by factors beyond our control, including the demand for natural gas and refinery-grade crude oil; producers’ desire and ability to obtain necessary permits; reserve performance; and capacity constraints on the pipelines that transport crude oil, natural gas and NGLs from producing areas and our facilities;

·	difficulties or delays experienced by trucks or pipelines in delivering products to or from our terminals or pipelines;

·	changes in demand for the use of natural gas because of market conditions caused by concerns about global warming;

·	conflicts of interest between us, our general partner, ONEOK Partners GP, and related parties of ONEOK Partners GP;

·	the impact of unforeseen changes in interest rates, equity markets, inflation rates, economic recession and other external factors over which we have no control;

·	our indebtedness could make us vulnerable to general adverse economic and industry conditions, limit our ability to borrow additional funds and/or place us at competitive disadvantages compared with our competitors that have less debt or have other adverse consequences;

·	actions by rating agencies concerning the credit ratings of us or our general partner;

·

the results of administrative proceedings and litigation, regulatory actions and receipt of expected clearances involving the Oklahoma Corporation Commission (OCC), Kansas Corporation Commission (KCC), Texas regulatory authorities or any other local, state or federal regulatory body, including the Federal Energy Regulatory Commission (FERC);

·	our ability to access capital at competitive rates or on terms acceptable to us;

·	risks associated with adequate supply to our gathering, processing, fractionation and pipeline facilities, including production declines that outpace new drilling;

·	the risk that material weaknesses or significant deficiencies in our internal control over financial reporting could emerge or that minor problems could become significant;

·	the impact and outcome of pending and future litigation;

·	the ability to market pipeline capacity on favorable terms, including the effects of:

-	future demand for and prices of natural gas and NGLs;

-	competitive conditions in the overall energy market;

-	availability of supplies of Canadian and United States natural gas; and

-	availability of additional storage capacity;

·	performance of contractual obligations by our customers, service providers, contractors and shippers;

·	the timely receipt of approval by applicable governmental entities for construction and operation of our pipeline and other projects and required regulatory clearances;

·

our ability to acquire all necessary permits, consents and other approvals in a timely manner, to promptly obtain all necessary materials and supplies required for construction, and to construct gathering, processing, storage, fractionation and transportation facilities without labor or contractor problems;

·	the mechanical integrity of facilities operated;

·	demand for our services in the proximity of our facilities;

·	our ability to control operating costs;

·	acts of nature, sabotage, terrorism or other similar acts that cause damage to our facilities or our suppliers’ or shippers’ facilities;

·	economic climate and growth in the geographic areas in which we do business;

·	the risk of a prolonged slowdown in growth or decline in the U.S. economy or the risk of delay in growth recovery in the U.S. economy, including increasing liquidity risks in U.S. credit markets;

·	the impact of recently issued and future accounting updates and other changes in accounting policies;

·	the possibility of future terrorist attacks or the possibility or occurrence of an outbreak of, or changes in, hostilities or changes in the political conditions in the Middle East and elsewhere;

·	the risk of increased costs for insurance premiums, security or other items as a consequence of terrorist attacks;

·	risks associated with pending or possible acquisitions and dispositions, including our ability to finance or integrate any such acquisitions and any regulatory delay or conditions imposed by regulatory bodies in connection with any such acquisitions and dispositions;

·	the impact of unsold pipeline capacity being greater or less than expected;

·	the ability to recover operating costs and amounts equivalent to income taxes, costs of property, plant and equipment and regulatory assets in our state and FERC-regulated rates;

·	the composition and quality of the natural gas and NGLs we gather and process in our plants and transport on our pipelines;

·	the efficiency of our plants in processing natural gas and extracting and fractionating NGLs;

·	the impact of potential impairment charges;

·	the risk inherent in the use of information systems in our respective businesses, implementation of new software and hardware, and the impact on the timeliness of information for financial reporting;

·	our ability to control construction costs and completion schedules of our pipelines and other projects; and

·	the risk factors listed in the reports we have filed and may file with the Securities and Exchange Commission (SEC), which are incorporated by reference.

These factors are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in any of our forward-looking statements.  Other factors could also have material adverse effects on our future results.  These and other risks are described in greater detail in Part I, Item 1A, Risk Factors, in our Annual Report.  All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these factors.  Other than as required under securities laws, we undertake no obligation to update publicly any forward-looking statement whether as a result of new information, subsequent events or change in circumstances, expectations or otherwise.  OKS-FE

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ONEOK Partners Reports Third-quarter 2009 Results;

Updates 2009 Earnings Guidance

November 3, 2009

Page 14 

 

ONEOK Partners, L.P. and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS		Nine Months Ended
		September 30,
(Unaudited)		2009				2008
		(Thousands of dollars)
Operating activities
Net income		$	318,854			$	503,779
Depreciation and amortization			121,750				90,383
Allowance for equity funds used during construction			(25,761	)			(35,788	)
Gain on sale of assets			(2,760	)			(50	)
Equity earnings from investments			(55,464	)			(74,805	)
Distributions received from unconsolidated affiliates			56,896				67,812
Changes in assets and liabilities:
Accounts receivable			(128,003	)			98,214
Affiliate receivables			4,244				9,245
Gas and natural gas liquids in storage			2,843				(59,690	)
Derivative financial instruments			(3,035	)			(47,017	)
Accounts payable			20,375				(52,516	)
Affiliate payables			9,156				11,401
Commodity exchanges and imbalances, net			(16,751	)			(3,521	)
Accrued interest			29,695				32,117
Other assets and liabilities			16,999				29,101
Cash provided by operating activities			349,038				568,665
Investing activities
Changes in investments in unconsolidated affiliates			(19,878	)			3,063
Acquisitions			-				2,450
Capital expenditures (less allowance for equity funds used during construction)			(491,256	)			(860,167	)
Proceeds from sale of assets			8,528				133
Cash used in investing activities			(502,606	)			(854,521	)
Financing activities
Cash distributions:
General and limited partners			(370,094	)			(332,090	)
Noncontrolling interests			(588	)			(223	)
Borrowing of notes payable, net			515,000				180,000
Repayment of notes payable with maturities over 90 days			(870,000	)			-
Issuance of long-term debt, net of discounts			498,325				-
Long-term debt financing costs			(4,000	)			-
Repayment of long-term debt			(8,948	)			(8,947	)
Issuance of common units, net of discounts			241,643				450,198
Contribution from general partner			5,130				9,508
Cash provided by financing activities			6,468				298,446
Change in cash and cash equivalents			(147,100	)			12,590
Cash and cash equivalents at beginning of period			177,635				3,213
Cash and cash equivalents at end of period		$	30,535			$	15,803

 

 

 

 

ONEOK Partners, L.P. and Subsidiaries
RECONCILIATION OF EBITDA NON-GAAP FINANCIAL MEASURES
		Three Months Ended								Nine Months Ended
		September 30,								September 30,
(Unaudited)		2009				2008				2009				2008
		(Thousands of dollars)
Reconciliation of Net Income to EBITDA
Net income		$	121,705			$	203,983			$	318,854			$	503,779
Interest expense			50,371				34,447				152,167				107,681
Depreciation and amortization			41,857				30,408				121,750				90,383
Income taxes			4,729				(670	)			10,668				6,703
Allowance for equity funds used during construction			(7,290	)			(15,616	)			(25,761	)			(35,788	)
EBITDA		$	211,372			$	252,552			$	577,678			$	672,758
Natural Gas Gathering and Processing Reconciliation of Operating Income to EBITDA
Operating income		$	40,218			$	63,538			$	120,864			$	198,774
Depreciation and amortization			15,312				12,533				44,225				36,431
Equity earnings from investments			8,396				8,819				20,583				23,989
Other income (expense)			1,357				(2,191	)			1,486				(3,128	)
EBITDA		$	65,283			$	82,699			$	187,158			$	256,066
Natural Gas Pipelines Reconciliation of Operating Income to EBITDA
Operating income		$	41,732			$	33,303			$	106,078			$	102,708
Depreciation and amortization			10,607				8,607				34,029				25,547
Equity earnings from investments			11,039				20,207				32,802				49,421
Other income (expense)			1,102				(1,391	)			1,429				(1,983	)
EBITDA		$	64,480			$	60,726			$	174,338			$	175,693
Natural Gas Liquids Reconciliation of Operating Income to EBITDA
Operating income		$	63,272			$	101,202			$	167,895			$	211,879
Depreciation and amortization			15,944				9,262				43,488				28,388
Equity earnings from investments			619				386				2,079				1,395
Other income (expense)			1,562				(2,649	)			723				(4,169	)
EBITDA		$	81,397			$	108,201			$	214,185			$	237,493