Summary
ONEOK, Inc. (OKE) filed an 8-K on April 26, 2007, to disclose information regarding its investment in Northern Border Pipeline Company (NBPC). As OKE holds a 45.7% interest in ONEOK Partners, L.P., which in turn owns a 50% stake in NBPC, the filing provides insights into NBPC's unaudited financial and operating results for the first quarter of 2007 and 2006. This disclosure is important for investors as it impacts OKE's equity earnings from unconsolidated affiliates. For the first quarter of 2007, NBPC reported a decrease in net income compared to the prior year, largely attributable to higher operating expenses, specifically operations and maintenance. While gas delivered and average throughput saw a slight decrease year-over-year, operating revenues remained relatively stable. OKE's share of NBPC's net income for the first quarter of 2007 was $18.0 million, down from $26.1 million in the same period of 2006.
Key Highlights
- 1ONEOK, Inc. (OKE) is disclosing unaudited operating and financial information for Northern Border Pipeline Company (NBPC) for the three months ended March 31, 2007, and 2006, as per Regulation FD.
- 2OKE holds a 45.7% interest in ONEOK Partners, L.P., which owns a 50% stake in NBPC, making NBPC's performance relevant to OKE's consolidated financial statements.
- 3NBPC's net income for Q1 2007 was $36.1 million, a decrease from $37.4 million in Q1 2006, primarily due to increased operating expenses.
- 4OKE's equity earnings from its investment in NBPC for Q1 2007 were $18.0 million, down from $26.1 million in Q1 2006.
- 5Gas delivered by NBPC decreased to 199,988 million cubic feet in Q1 2007 from 210,711 million cubic feet in Q1 2006.
- 6Operating revenues for NBPC were stable at $79.6 million in Q1 2007 compared to $79.8 million in Q1 2006.
- 7Capital expenditures for NBPC significantly decreased, with maintenance capex falling from $3.3 million in Q1 2006 to $0.4 million in Q1 2007, and growth capex being nil in Q1 2007.