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| Statement |
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| Our Natural Gas Pipeline segment significantly exceeded its 2023 financial guidance range on higher earnings from long-term storage services and higher rates from negotiated fee-based contracts |
| Record volumes, strong financial performance and the closing of the Magellan acquisition solidified 2023 as a year of significant growth and transformation for ONEOK |
| So I think the pipe is positioned well for the next couple of years |
| With our earnings release yesterday, we reported double-digit NGL and natural gas processing volume growth year-over-year and continued fee-based earnings growth in all three of our legacy business segments |
| Walt will provide more detail on our guidance, which is underscored by solid business fundamentals, demand for the products that we deliver, and a full year of earnings contribution from our refined products and crude oil segments and the initial realization of acquisition-related synergies |
| As we’ve said with the West Texas expansion that we are contracting and continue to contract more volume on that to have an acceptable return with a significant amount of upside going forward |
| We feel that we have a very good opportunity to continue to bring incentivized ethane out of the Bakken just from our fully integrated NGL system and G&P system as well |
| So, trains one and two post-FID, we feel good about those volumes as we sit here today |
| Looking ahead, ONEOK is well positioned in 2024 for another year of significant growth and opportunity |
| It’s a platform which is already providing opportunities and enabling us to generate exceptional value for our stakeholders |
| We continue to see good on the NGL side |
| Additional benefits are expected from higher volumes and margins related to liquids blending in 2024, driven by favorable market conditions and synergy-related opportunities |
| We continue to expect healthy business fundamentals and the segment’s more than 85% fee-based earnings to drive consistent performance |
| And over the course of our company’s history and now with a more diversified portfolio of assets, we are even better positioned to make the most of future opportunities |
| These longer laterals continue to drive improved production efficiencies and result in fewer well connections needed to grow gathered volumes |
| While there were a number of unique items contributing to the significant year-over-year increase in results such as the Medford settlement and the Magellan acquisition, the strong performance from our legacy business segments continued |
| Strong producer activity levels in 2023 and the continued trend of high gas-to-oil ratios drove several months of record North Dakota natural gas production with the latest record of 3.52 Bcf per day set in December |
| We also expect to see continued opportunities to incentivize ethane recovery in the Rocky Mountain region |
| Like we said, I mean we feel – obviously, we feel really good about our progress we have made on the cost savings side |
| Healthy demand for ethane from the petrochemical industry and wide gas-to-oil ratios are setting up a positive backdrop for NGL markets in 2024 |
| Solid refined products demand, continued strength in fee-based earnings and rates and our first full year of annualized synergies |
| Key drivers for our higher 2024 guidance includes stable producer activity and continued production efficiency improvements, providing strong natural gas and NGL volumes across our systems |
| Our optimization and marketing activities, which includes liquids blending also benefited from strong margins and volumes |
| This segment’s performance was driven by midyear tariff increases, longer haul refined product shipments and steady crude oil transportation volumes |
| We saw strong year-over-year volume growth in 2023 with natural gas processing volumes up 14% and NGL volumes up 10% compared with 2022 |
| Rocky Mountain region volumes were particularly strong with double-digit growth in both NGL and natural gas processing volumes year-over-year |
| Higher producer activity levels, increased well connects, and continued strong gas-to-oil ratios drove record fourth quarter volumes totaling nearly 400,000 barrels per day of NGLs and nearly 1.6 Bcf per day of processed volume |
| Mid-Continent process volume increased 15% year-over-year and Permian Basin NGL increased 19% year-over-year, both benefiting from solid producer activity throughout the year in those regions |
| Our commitment to maintaining our financial flexibility and taking advantage of attractive return, capital growth opportunities that complement our now larger and more diverse operating footprint continues to be the highest priority in our capital allocation strategy |
| Momentum from our operations in 2023 is setting the stage for additional growth in 2024 |
| Statement |
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| The whole facility wasn’t as damaged by the fire in certain parts |
| And then the contract that we will no longer be getting volume off of Overland Pass is a very low margin, very kind of high-volume contract that has an impact |
| Just going back up to the Rockies growth, you noted 9% year-over-year in 2024, but it looks like NGL growth is a bit lower than that for the year |
| And of course, the downside would be things that might impact the volume, which is the weather and the user activity |
| So we are going to see a drop off from our previous cadence on capital that we need to spend in the area to maintain volume |
| And your outlook, does that have the risk of increasing rejection in the Bakken or Mid-Con over the next couple of years? And could that be a drag on EBITDA? Sheridan Swords Potentially, I think when we get out in 2025, we will see a little bit more of ethane export capability coming online |
| As far as Northern Border goes, the volumes that we see coming down there today, I don’t think will be appreciably impacted but the Canadian volumes diverted to LNG Canada |
| So we will see our capital come down |
| As we think about increased frac capacity and our needs there, really what we are looking at right now is bottlenecks throughout our system where we can get very low-cost expansions through our existing fracs |
| We – in terms of contracts roll off, we have seen a little bit of that |
| Mid-Continent maybe where we see a little bit of swing, could be a little bit more swing in ethane recovery, but those were at much lower rates than we see coming out of the Bakken |
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