ONEOK(OKE)2024-10-30 18:20Financial Data and Key Metrics Changes - ONEOK's Q3 2024 net income totaled $693 million or $1.18 per share, including $0.04 per share of transaction expenses, with adjusted EBITDA totaling $1.55 billion [10][11] - The updated consolidated financial guidance includes a net income midpoint of approximately $3 billion and an adjusted EBITDA midpoint of $6.625 billion for 2024 [12][13] - The stand-alone adjusted EBITDA guidance for 2024 is $6.275 billion, which is $100 million higher than previous guidance [14] Business Line Data and Key Metrics Changes - In the Natural Gas Liquids segment, Rocky Mountain volumes increased by 7% year-over-year, driven by higher propane plus volume [18] - The refined products and crude segment saw total refined products volumes reach nearly 1.6 million barrels per day, a new record for the system [24] - Crude oil volumes shipped on wholly-owned assets increased by 10% year-over-year due to committed shipper volume ramps [27] Market Data and Key Metrics Changes - The Rocky Mountain region processing volumes averaged nearly 1.7 Bcf per day, with planned and unplanned outages affecting some production [29] - The Natural Gas Pipeline segment benefited from higher firm and interruptible transportation rates, positioning it well to exceed expectations for 2024 [33] Company Strategy and Development Direction - The company is focused on integrating the EnLink and Medallion acquisitions to enhance its asset base and drive growth [9][38] - ONEOK aims to maintain a strong fee-based earnings model while pursuing synergy opportunities from recent acquisitions [6][14] - The company expects to achieve a pro forma 2025 net debt-to-EBITDA of approximately 3.9x, trending towards a target of 3.5x in 2026 [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to create shareholder value through strategic acquisitions and operational efficiencies [10][38] - The company anticipates strong financial performance driven by synergies from recent acquisitions and sustained strength in fee-based earnings [14][16] - Management acknowledged challenges from severe weather events but praised employee dedication to maintaining operations [36][37] Other Important Information - The company continues to expect total stand-alone capital expenditures in the range of $1.75 billion to $1.95 billion for 2024 [15] - The completion of the West Texas NGL pipeline expansion is expected by year-end, with additional projects slated for completion in 2025 and 2026 [21][26] Q&A Session Summary Question: How are ONEOK's assets positioned to capture growth in natural gas demand? - Management indicated that the company is well-positioned with 23 projects in discussion, specifically targeting demand centers [42] Question: What is the current flow of Medallion volumes? - Some Medallion volumes are moving to Houston, with expectations for increased synergies as they integrate into the long-haul pipeline system [44][45] Question: What drives ethane recovery in the Bakken? - Ethane recovery is primarily driven by regional gas prices, with opportunities expected to increase during periods of lower natural gas prices [50] Question: Can you provide insights on the $8 billion EBITDA guidance for 2025? - Management confirmed that the guidance is comfortably above $8 billion, reflecting strong performance and contributions from recent acquisitions [56] Question: How are synergies from the Magellan acquisition progressing? - The company is ahead of schedule in achieving synergies from the Magellan acquisition, with additional opportunities identified [88] Question: What are the plans for EnLink's growth capital backlog? - Management plans to evaluate and prioritize growth projects from EnLink to meet customer demand [82] Question: Are there further consolidation opportunities in the industry? - Management sees potential for consolidation in the Mid-Continent region and Louisiana, leveraging the expanded asset base from recent acquisitions [90]