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    OKE
    Earnings call· Dec 2025(Q4 FY25)

    ONEOK INC /NEW/ Q4 FY25 earnings call OKE

    Feb 24, 2026 Source

    Executive summary

    ONEOK Q4 FY25 — Double-Digit Earnings Growth and Strong Adjusted EBITDA

    ONEOK delivered strong FY25 results with double-digit earnings and EBITDA growth, driven by successful integration of acquisitions and significant synergy capture. Despite anticipating lower crude prices and some volume headwinds, management projects continued growth in 2026, supported by ongoing project completions and further synergy realization, while maintaining a disciplined capital allocation strategy.

    Highlights

    5

    • Net income attributable to ONEOK increased 12% to $3.39 billion for FY25.

    • Adjusted EBITDA grew 18% to $8.02 billion for FY25, marking 12 consecutive years of growth.

    • Realized nearly $500 million of total synergies since the Magellan acquisition, with $250 million in 2025 alone.

    • Returned nearly $2.7 billion to shareholders in 2025 through dividends and share repurchases.

    • Increased quarterly dividend by 4%, reinforcing shareholder commitment.

    Concerns

    5

    • Lower Bakken volume growth resulted in gathered volumes 100 million cubic feet per day lower than originally anticipated in 2025.

    • Anticipated NGL volumes reduced due to 2 third-party Permian NGL customer plants delayed for most of 2025.

    • $125 million reduction in lower upgrade margin in NGL and refined products businesses in 2025.

    • $150 million reduction in 2026 EBITDA due to lower forecasted Waha to Katy differentials and lower price realizations.

    • Winter storm Fern caused temporary wellhead freeze-offs, impacting January 2026 G&P and NGL volumes by approximately 10% below original expectations.

    Guidance & targets

    12
    CategoryTargetConfidence
    Adjusted EBITDA
    $8.1 billion
    high materiality
    High
    Net income attributable to ONEOK
    $3.45 billion
    high materiality
    High
    EPS per diluted share
    $5.45
    high materiality
    High
    Capital expenditure
    $2.7 billion to $3.2 billion
    high materiality
    High
    WTI crude oil price
    $55 to $60 per barrel
    medium materiality
    Medium
    Incremental acquisition synergies
    $150 million
    medium materiality
    High
    Cash taxes
    No meaningful cash taxes
    low materiality
    High
    Bakken G&P position growth
    1%
    low materiality
    Medium
    Rocky Mountain and Mid-Continent NGL and G&P volumes growth
    Steady, low single-digit level
    low materiality
    Medium
    Permian G&P growth
    Mid- to high single digits
    medium materiality
    High
    FERC rate index review tariff increase
    Low to mid-single-digit range
    low materiality
    Medium
    Long-term leverage target
    3.5x or lower
    high materiality
    High

    Segment performance

    5
    SegmentRevenueYoYQoQMargin
    Natural Gas Liquids
    Achieved record volumes in the Rocky Mountain region in 2025 and significant increases in the Permian Basin. Expects continued year-over-year volume growth across operations in 2026, with low single-digit growth in Rocky Mountain and Mid-Continent regions.
    Rocky Mountain region NGL volumes: Record in 2025Permian Basin NGL volumes: Increased significantly in 2025Year-over-year volume growth: Expected in 2026Rocky Mountain and Mid-Continent region NGL volumes growth: Steady, low single-digit level in 2026
    		————
    Refined Products
    Achieved record liquids blending volumes in 2025. 2026 performance is expected to be driven by steady demand, enhanced asset connectivity, continued strong blending, and contributions from the fully contracted Denver pipeline project.
    Liquids blending volumes: Record in 20252026 performance drivers: Steady base refined product demand, increased asset connectivity, strong liquids blending, incremental contribution from Denver pipeline project
    		————
    Crude
    Experienced increased throughput into long-haul crude oil pipelines, benefiting from expanded interconnectivity with gathering systems.
    Throughput into long-haul crude oil pipelines: Increased from gathering systems due to expanded interconnectivity
    		————
    Natural Gas Gathering and Processing
    Achieved record G&P volumes in the Rocky Mountain region and significant increases in Permian Basin processing volumes in 2025. Expects continued growth in 2026 from its multi-basin portfolio, with mid- to high single-digit growth in the Permian and single-digit growth in the Rocky Mountain region.
    Rocky Mountain region G&P volumes: Record in 2025Permian Basin processing volumes: Increased significantly in 2025Multi-basin portfolio: Expected to provide growth in 2026Permian G&P growth: Mid- to high single digits in 2026Mid-Continent rigs on dedicated acreage: 13Rocky Mountain rigs on dedicated acreage: 12Rocky Mountain region growth: Single-digit in 2026
    		————
    Natural Gas Pipeline
    Outperformed in 2025, exceeding the high end of its guidance range, and anticipates another strong year in 2026. The Eiger Express joint venture pipeline has expanded to 3.7 Bcf per day, fully contracted for at least 10 years, supporting growing demand.
    Performance: Exceeded high end of guidance range in 20252026 performance: Expected to be strongEiger Express JV pipeline expansion: 3.7 Bcf per day, 100% contracted for minimum 10 years
    		————

    Operational metrics

    37
    Net income attributable to ONEOK
    $3.39 billion+12% YoY
    FY25

    Increased 12% compared to 2024.

    Net income attributable to ONEOK
    $977 million
    Q4 FY25

    Totaled for the fourth quarter of 2025.

    EPS attributable to ONEOK
    $5.42
    FY25

    Diluted earnings per share for the full year 2025.

    EPS attributable to ONEOK
    $1.55
    Q4 FY25

    Diluted earnings per share for the fourth quarter of 2025.

    Adjusted EBITDA
    $8.02 billion+18% YoY
    FY25

    Up 18% for the full year 2025, marking 12 consecutive years of growth.

    Adjusted EBITDA
    $2.15 billion
    Q4 FY25

    Totaled for the fourth quarter of 2025.

    Adjusted EBITDA (excluding transaction costs)
    $8.085 billionvs $8.225 billion original guidance
    FY25

    Ended 2025, compared to original 2025 guidance of $8.225 billion.

    Transaction costs
    $65 million
    FY25

    Included in full year 2025 results.

    Total synergies realized
    $500 million
    Since Sept 2023

    Total synergies realized since closing the Magellan acquisition in September 2023.

    Synergies realized
    $250 million
    FY25

    Realized in 2025 alone.

    Long-term debt extinguished
    $3.1 billion
    FY25

    Total long-term debt extinguished for the full year 2025.

    Long-term debt extinguished
    $1.75 billion
    Q4 FY25

    Retired in senior notes through redemptions and repurchases during Q4 2025.

    Shareholder returns (dividends + buybacks)
    $2.7 billion
    FY25

    Returned to shareholders through a combination of dividends and share repurchases.

    Quarterly dividend increase
    4%
    Q1 FY26

    Recently increased quarterly dividend.

    Bakken gathered volumes (lower than anticipated)
    100 million cubic feet per daylower than originally anticipated
    FY25

    Resulted from lower Bakken volume growth.

    NGL and refined products upgrade margin reduction
    $125 million
    FY25

    Reduction due to narrowing of RBOB to butane spreads in blending business.

    Waha to Katy spread contribution
    $150 million
    FY25

    Added to EBITDA from strong location differentials in Natural Gas Pipeline segment.

    Other income (gain on debt repurchases)
    $85 million
    FY25

    Majority of other income reflected on bridge chart.

    EBITDA growth from increased Permian volumes
    $100 million
    FY26

    From increased volumes in the Permian and full year of third-party Permian plant volumes delayed in 2025.

    Asset optimization EBITDA
    $150 million
    FY26

    From batching and blending logistical benefits and other synergy projects.

    EBITDA reduction from lower differentials/price realizations
    $150 million
    FY26

    Stems from lower forecasted Waha to Katy differentials and lower price realizations year-over-year.

    EBITDA reduction from no debt repurchase gains
    $85 million
    FY26

    No gains on debt repurchases forecasted for 2026.

    Average daily EBITDA
    $22 million
    FY26

    Expected average daily EBITDA for 2026.

    Bakken wells yet to be drilled on dedicated acreage
    5,000
    Current

    Identified wells on dedicated acreage.

    Bakken inventory at current rig rates
    15+ years
    Current

    Inventory based on current rig rates.

    Bakken NGL contract rolling off
    18,000 barrels per day
    2026

    Continental NGLs rolling off Rocky Mountain region volumes.

    Permian NGL system capacity
    >740,000 barrels per day
    Current

    Total capacity on the West Texas NGL pipeline after looping.

    Permian NGL system available capacity
    ~300,000 barrels per day
    Current

    Roughly available capacity on the West Texas NGL pipeline.

    Permian projected growth
    >1 Bcf per year
    Ongoing

    Permian Basin projected to grow by more than 1 Bcf per year.

    Mid-Con rigs on dedicated acreage
    13
    Current

    Currently operating across more than 1 million dedicated acres.

    Rocky Mountain rigs on dedicated acreage
    12
    Current

    Currently operating on dedicated acreage.

    Well connects (3-4 mile laterals)
    50%vs 30% in 2025, 20% in 2024
    FY26

    Expected percentage of well connects in 2026 to be 3 and 4-mile laterals, a significant increase.

    Maintenance capex
    $600 million
    Annual

    Estimated annual maintenance capital expenditure.

    Routine growth capex
    $1 billion
    Annual

    Estimated annual routine growth capital expenditure for expanding and extending the system.

    Other larger capital projects
    $400 million-$500 million
    Annual

    Estimated annual spend on other larger capital projects identified by the commercial team.

    Commodity exposure open
    ~25%
    Ongoing

    Percentage of commodity exposures left open after hedging, mainly in the G&P business.

    Bundled NGL rate in Bakken
    $0.27
    Q4 FY25

    Slipped to $0.27 in Q4, driven by increased ethane recovery.

    Industry KPIs

    9
    MetricValueDetails
    D c efficiency rig activity13 rigsrigs
    Pipeline throughput storage3.7 Bcf per dayBcf/d
    Realized price differential$150 millionUSD
    Regulated rate case outcomesLow to mid-single-digit range%
    Sanctioned expansion backlog3.7 Bcf per dayBcf/d
    Basin level production volumeLow single-digit growth%
    FCF shareholder distributions$2.7 billionUSD
    Take or pay contract structure100%%
    Weather event volume earnings impact10%%

    Orderbook & backlog

    1
    Eiger Express JV pipeline contracted capacity3.7 Bcf per dayQ4 FY25

    100% contracted for a minimum of 10 years.

    Deals & partnerships

    6
    Magellanacquisition

    Acquisition closed in September 2023, driving significant synergies and integration benefits.

    Eastonacquisition

    Acquisition contributing to integrated platform advantage and synergy realization.

    EnLinkacquisition

    Acquisition contributing to integrated platform advantage and synergy realization, with some contractual arrangements still rolling off.

    Medallionacquisition

    Acquisition contributing to integrated platform advantage, enhancing gathering systems and long-haul crude pipes.

    Multiple (Eiger Express JV)partnershipMinimum 10 years

    Eiger Express joint venture pipeline expanded to 3.7 Bcf per day, with all capacity 100% contracted for a minimum of 10 years, driven by Permian supply and Gulf Coast demand.

    MPLXjoint venture

    Joint venture for the Texas City export terminal, progressing as planned with commercialization efforts underway.

    Capital programs

    7
    Shadowfax plant relocationunderway

    Benefit: 150 million cubic feet per day

    Plant being relocated to the Midland Basin for North Texas, expected to be in service by the end of the first quarter 2026.

    Delaware natural gas processing assets expansionsunderway

    Benefit: 110 million cubic feet per day

    Expansions expected to be completed early in the third quarter 2026, aligned with specific producer projects.

    Denver area pipeline expansionunderway

    Expansion remains on track for expected mid-third quarter 2026 startup, fully contracted with take-or-pay volumes.

    Medford NGL fractionator rebuild Phase 1underway

    Benefit: 100,000 barrels per day fractionation capacity

    Phase 1 is on track for fourth quarter 2026 completion, adding initial fractionation capacity.

    Medford NGL fractionator rebuild Phase 2underway

    Benefit: 110,000 barrels per day fractionation capacity

    Phase 2 will add additional fractionation capacity in the first quarter of 2027.

    Texas City export terminal (JV)underway

    Joint venture with MPLX, progressing as planned, with commercialization efforts advancing.

    JISH natural gas storage expansionunderway

    Benefit: From 2 Bcf to 10 Bcf

    Expansion of natural gas storage capacity in Louisiana, expected to be completed in 2028 and has been contracted.

    Risks & headwinds

    7
    Lower crude oil pricesFY26

    WTI crude oil price range of $55 to $60 per barrel assumed for 2026.

    Mitigation: Guidance reflects disciplined caution; continued confidence in integrated asset base and employee ingenuity.

    Lower Bakken volume growthFY25

    Gathered volumes 100 million cubic feet per day lower than originally anticipated in 2025.

    Mitigation: 2026 guidance incorporates this impact; focus on efficiencies and longer laterals by producers.

    Delayed third-party Permian NGL customer plantsFY25

    2 plants delayed for most of 2025, reducing anticipated NGL volumes.

    Mitigation: Full year of these volumes expected in 2026, contributing $100 million EBITDA growth.

    Lower upgrade margin in NGL and refined productsFY25

    $125 million reduction in 2025 EBITDA due to narrowing RBOB to butane spreads.

    Mitigation: Asset optimization and synergy projects expected to add $150 million EBITDA in 2026.

    Lower forecasted differentials and price realizationsFY26

    $150 million reduction in 2026 EBITDA due to lower Waha to Katy differentials and lower price realizations.

    Mitigation: Guidance incorporates these assumptions.

    No gains on debt repurchases forecastedFY26

    $85 million reduction in 2026 EBITDA compared to 2025.

    Mitigation: This is a forecast and not a operational risk.

    Winter storm Fern impactQ1 FY26

    January 2026 G&P and NGL volumes approximately 10% below original expectations.

    Mitigation: Impacts have already been incorporated into 2026 guidance.

    Q&A highlights

    8

    Asked about conservatism in the 2026 guidance, particularly around commodity assumptions, and potential optimization opportunities that could provide upside to the guide.

    Management noted the $55-$60 WTI assumption for conservatism and highlighted potential upsides from stronger pricing. They identified discretionary ethane recovery, spot offloads in Permian G&P, and NGL/refined products spread capture as commercial optimization opportunities not fully baked into the guidance.

    “We've also had on the G&P side, especially the Permian, we have a little bit of open capacity. They've been able to have some offloads, some spot off loads as they get throughout the year as they continue to work with producers and leverage our customer relationships.”

    asked by Spiro Dounis · answered by Sheridan Swords

    2 min read7 chapters

    Detailed Narrative

    01

    FY25 Performance Highlights

    ONEOK achieved a defining year in 2025, delivering double-digit earnings growth with net income attributable to ONEOK increasing 12% to $3.39 billion and adjusted EBITDA up 18% to $8.02 billion. This marked 12 consecutive years of adjusted EBITDA growth, with a 17% average annual growth rate over the same period, demonstrating sustained earnings power through various market conditions.

    02

    Integrated Platform Advantage & Synergies

    The company has successfully integrated major acquisitions (Magellan, Easton, EnLink, Medallion), realizing nearly $500 million in total synergies since September 2023, with $250 million achieved in 2025 alone. This integration drives scale, connectivity, and commercial optionality across NGL, refined products, crude, and natural gas systems, creating a high-quality earnings mix with approximately 90% fee-based earnings.

    03

    2026 Outlook and Commodity Assumptions

    ONEOK's 2026 adjusted EBITDA midpoint of $8.1 billion is supported by volume growth, completed projects, and $150 million of incremental acquisition synergies. The guidance incorporates a disciplined caution around commodity prices, assuming an average WTI crude oil price range of $55 to $60 per barrel for 2026, and reflects normal seasonal dynamics with Q1 expected to be the lowest EBITDA quarter.

    04

    Capital Projects and Infrastructure Expansion

    Key growth projects are progressing as planned, including the 150 MMcf/d Shadowfax plant (in service Q1 2026), 110 MMcf/d Delaware processing expansions (early Q3 2026), and the Denver area pipeline expansion (mid-Q3 2026). The Medford NGL fractionator rebuild will add 100,000 bbl/day capacity by Q4 2026 (Phase 1) and an additional 110,000 bbl/day by Q1 2027 (Phase 2), extending and expanding existing systems to address future volumes.

    05

    Permian Basin Growth and Strategy

    The Permian Basin is expected to see sustained higher growth, with ONEOK connecting at least 3 natural gas processing plants to its system in 2026. The company's integrated Permian platform and advantaged West Texas NGL pipeline position it to capture incremental throughput and drive efficiencies, with the basin projected to grow by more than 1 Bcf per year.

    06

    Natural Gas Pipeline and Storage Opportunities

    The Natural Gas Pipelines segment continues strong performance, benefiting from strategic locations near demand and export hubs. The Eiger Express joint venture pipeline has expanded to 3.7 Bcf per day, 100% contracted for a minimum of 10 years, driven by Permian supply and Gulf Coast demand. The company is also exploring natural gas storage expansion opportunities, particularly in Texas, Oklahoma, and Louisiana, tied to industrial customers and LNG exports.

    07

    Producer Activity and Efficiency Gains

    Producers are maintaining steady drilling rigs and crews, focusing on improving production efficiencies through technology, operational enhancements, and longer laterals. In the Bakken, 50% of 2026 well connects are expected to be 3- and 4-mile laterals, up from 30% in 2025, indicating a shift towards more efficient drilling. Gas-to-oil ratios are also naturally rising, supporting a stable long-term outlook for natural gas and NGLs.

    AI-generated summary of the company’s earnings call. Not investment advice.