What was the financial performance of ONEOK in 2022?

In 2022, ONEOK experienced earnings growth driven by increased producer activity, higher realized commodity prices (net of hedging), and higher average fee rates across its operations. Approximately 90% of its consolidated earnings were fee-based, providing stability against commodity price volatility. The company reported a net income of $1.72 billion and an Adjusted EBITDA of $3.62 billion.

How did the Medford incident impact ONEOK, and what is the status of the insurance claim?

A fire occurred at ONEOK's Medford, Oklahoma, NGL fractionation facility on July 9, 2022. The company recorded $150.7 million in insurance accruals in 2022 for property damage and business interruption. Crucially, on January 9, 2023, ONEOK settled all claims for $930 million, receiving $100 million in 2022 and the remaining $830 million in Q1 2023. This settlement covers physical damage, business interruption claims up to the settlement date, and future business interruption claims.

What are ONEOK's key growth projects and their expected impact?

ONEOK is focused on expanding its midstream infrastructure. Key growth projects include the completed Demicks Lake III natural gas processing plant in the Williston Basin, which enhances processing capacity. Additionally, the MB-5 NGL fractionator in Mont Belvieu, Texas, is expected to be completed in the second quarter of 2023, followed by plans for the MB-6 NGL fractionator. These projects are expected to drive higher volumes and contribute to earnings growth.

How is ONEOK addressing environmental, social, and governance (ESG) factors?

ONEOK is committed to ESG initiatives, evidenced by its inclusion in the S&P Global Sustainability Yearbook for the third consecutive year and receiving an MSCI ESG Rating of AAA. The company has set an absolute GHG emissions reduction target of 2.2 million metric tons by 2030 (a 30% reduction from 2019 levels) and has already achieved approximately 0.5 million metric tons of reduction through various initiatives like methane emissions mitigation and system optimizations. They are also exploring opportunities in renewable energy and low-carbon projects.

OKE 10-K FY2022 Annual Report — Revenue, Net Income, EPS

Summary

ONEOK Inc. reported robust earnings growth in 2022, driven by increased producer activity and higher commodity prices, with approximately 90% of its earnings being fee-based, providing a degree of insulation from commodity price volatility. The company successfully navigated operational challenges, including the Medford incident, by securing a significant insurance settlement of $930 million. Strategic capital investments in new processing and fractionation facilities are set to enhance future volumes and earnings. ONEOK is also proactively addressing ESG initiatives, setting emissions reduction targets and exploring low-carbon projects, positioning itself for a transforming energy future while maintaining a strong financial position and a commitment to shareholder returns through dividends.

Financial Highlights

54 data points

Beta

Revenue

$22.39B

0.2% Gross Margin

Net Income

$1.72B

0.1% Net Margin

EPS (Diluted)

$3.84

Total Assets

$24.38B

Cash & Equivalents

$220.00M

Free Cash Flow

$1.70B

Financial Statements

Beta

Revenue	$22.39B
Cost of Revenue	$17.91B
Gross Profit	$4.48B
Operating Income	$2.81B
Interest Expense	$676.00M
Net Income	$1.72B
EPS (Basic)	$3.85
EPS (Diluted)	$3.84
Shares Outstanding (Basic)	447.50M
Shares Outstanding (Diluted)	448.40M

Key Highlights

1ONEOK reported earnings growth in 2022 due to increased producer activity, higher commodity prices, and improved fee rates, with approximately 90% of earnings being fee-based.
2The company reached a $930 million insurance settlement for the July 2022 Medford fractionation facility incident, with $100 million received in 2022 and the remainder in Q1 2023.
3Key capital growth projects are progressing, including the Demicks Lake III natural gas processing plant (completed) and the MB-5 NGL fractionator (expected Q2 2023), with plans for an MB-6 fractionator.
4Natural Gas Gathering & Processing segment adjusted EBITDA increased by $147.5 million, driven by higher commodity prices, fee rates, and volumes.
5Natural Gas Liquids segment adjusted EBITDA grew by $131.6 million, benefiting from higher fee rates and volumes, offset by increased costs.
6Natural Gas Pipelines segment adjusted EBITDA saw a decrease of $39.4 million, primarily due to the favorable impact of Winter Storm Uri in the prior year.
7The company maintained its commitment to shareholders by paying dividends totaling $3.74 per share in 2022 and increasing its quarterly dividend by 2% in February 2023.

ONEOK INC /NEW/ Annual Report, Year Ended Dec 31, 2022

Summary

Financial Highlights

Key Highlights

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