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Journey By DesignJourney By DesignJourney By DesignJourney By DesignNew York City | October 2, 2008
Dan HarrisonDan HarrisonDan HarrisonDan HarrisonVice PresidentInvestor Relations & Public Affairs
2 | Journey By Design
Investor Relations & Public Affairs
ForwardForward--Looking StatementLooking Statement
Statements contained in this presentation that include company p p yexpectations or predictions should be considered forward-looking statements which are covered by the safe harbor provisions of the Securities Act of 1933 and the Securities and Exchange Act of 1934 Securities Act of 1933 and the Securities and Exchange Act of 1934. It is important to note that the actual results of company earnings could differ materially from those projected in such forward-looking statements. For additional information, refer to ONEOK’s and ONEOK Partners’ Securities and Exchange Commission Filings.
3 | Journey By Design
John W GibsonJohn W GibsonJohn W. GibsonJohn W. GibsonONEOK, Inc. | Chief Executive OfficerONEOK Partners, L.P. | Chairman and Chief Executive Officer
4 | Journey By Design
ONEOK Partners, L.P. | Chairman and Chief Executive Officer
LeadershipLeadershipONEOK and ONEOK Partners
John W. GibsonChief Executive Officer
Curtis DinanSenior Vice President Jim Kneale
P id t &Chief Financial Officer &Treasurer
President &Chief Operating Officer
Caron Lawhorn Terry SpencerPierce Norton II
5 | Journey By Design
Caron LawhornSenior Vice President
& Chief Accounting Officer
Terry SpencerExecutive Vice President
Pierce Norton IIExecutive Vice President
LeadershipLeadershipONEOK and ONEOK Partners
Terry SpencerExecutive Vice President
Pierce Norton IIExecutive Vice President
Kent ShortridgeKent ShortridgePresidentPresident
Natural Gas PipelinesNatural Gas Pipelines
Rob MartinovichRob MartinovichPresidentPresident
Natural Gas Natural Gas Gathering & ProcessingGathering & Processing
Sheridan SwordsSheridan SwordsPresidentPresident
NGL Gathering NGL Gathering & & FractionationFractionation
Roger ThorpeRoger ThorpePresident President
NGL PipelinesNGL Pipelines
Patrick McDoniePatrick McDoniePresident President
Energy ServicesEnergy Services
Samuel Combs IIISamuel Combs IIIPresidentPresidentDistributionDistribution
6 | Journey By Design
AgendaAgenda
7 | Journey By Design
AgendaAgendaJohn W. Gibson Vision, Strategy and Overview 8:30
ONEOK P t Jim Kneale, President & Chief OKS O i 8 45ONEOK Partners Jim Kneale, President & Chief Operating Officer OKS Overview 8:45
Pierce Norton II, Executive Vice President Natural Gas 8:55
Rob Martinovich, President Gathering & Processing
Kent Shortridge, President Natural Gas Pipelines
Natural Gas Q & A
Terry Spencer, Executive Vice President Natural Gas Liquids 9:30
Sheridan Swords, President Gathering & Fractionation
Roger Thorpe, President Natural Gas Liquids Pipelines
Natural Gas Liquids Q & A
Caron Lawhorn, Senior Vice President & Chief Accounting Officer OKS Financial Review 10:05
ONEOK Partners Q & A
BREAK 10:25
8 | Journey By Design
BREAK 10:25
AgendaAgenda
ONEOK I Jim Kneale, President & Chief OKE O i 10 45ONEOK, Inc. Jim Kneale, President & Chief Operating Officer OKE Overview 10:45
Pierce Norton II, Executive Vice President Distribution 10:50
Sam Combs III, President
Terry Spencer, Executive Vice President Energy Services 11:05
Patrick McDonie, President
ONEOK Q & A
Caron Lawhorn, Senior Vice President & Chief Accounting Officer OKE Financial Review 11:30
John W. Gibson Closing Remarks 11:45
Q & A
LUNCHEON 12:00
9 | Journey By Design
Overview & VisionOverview & Vision
10 | Journey By Design
ONEOK TodayONEOK Today
• Assets that fit and work • Strong balance sheet
A Premier Energy Company
together– Integrated operations
Expanding participation in the
g• Market capitalization
– ONEOK: $3.8 billion$– Expanding participation in the
value chain• Proven ability to grow
– ONEOK Partners: $4.9 billion
profitably– Predominately fee-based
income– Executing $2 billion of growth
projects at ONEOK Partners
11 | Journey By Design
Journey By DesignJourney By Design
• Demonstrated financial flexibility and discipline
Key Points
– Ability to access capital markets– No significant exposure to financially challenged firms– Disciplined acquirer of assets
• Growth at ONEOK Partners will continue to benefit ONEOK– OKS incremental EBITDA and distributable cash flow increases OKE earnings
and cash flow– OKE has demonstrated its interest in increasing its ownership in OKS
• Growing NGL business provides non-discretionary, fee-based services• Distribution segment has increased its sustainable level of earnings g g
through the execution of key strategies• Energy Services focuses on physical marketing of natural gas to LDCs
and is positioned to capitalize on market inefficiencies
12 | Journey By Design
Our VisionOur Vision
A premier energy company creating exceptional value for all
A Premier Energy Company
p gy p y g pstakeholders by:• Rebundling services across the value chain, primarily through
ti l i t ti t id t ith i i vertical integration, to provide customers with premium services at lower costs
• Applying our capabilities — as a gatherer, processor, transporter, Applying our capabilities as a gatherer, processor, transporter, marketer and distributor — to natural gas and natural gas liquids…
…and other commodities
13 | Journey By Design
A Journey By DesignA Journey By DesignRebundling the Value Chain and Applying Our Capabilities
MidstreamNatural Gas
MidstreamNGLs
Exploration & Production
Distribution MarketsMarketing
• Leading marketer of natural gas
• Gathering• Processing• Pipelines• Storage
• Gathering• Fractionation• Pipelines• Storage
• Serve 2 million customers in Oklahoma, Kansas & Texas
14 | Journey By Design
Our Key StrategiesOur Key StrategiesA Premier Energy Company
• Generate consistent growth and sustainable earningsg g– Develop and execute internally generated growth projects at
ONEOK PartnersImprove profitability of ONEOK Distribution Companies– Improve profitability of ONEOK Distribution Companies
– Continue focus on physical activities at ONEOK Energy Services
• Execute strategic acquisitions that provide long-term valueg q p g• Manage our balance sheet and maintain strong credit ratings
at or above current level• Operate in a safe and environmentally responsible manner• Attract, develop and retain employees to support strategy
15 | Journey By Design
p p y pp gyexecution
Strategy ExecutionStrategy Execution
• Increased dividends and distributions
Since We Last Met…
– ONEOK: Indicated annual rate from $1.44 to $1.60 per share – ONEOK Partners: Indicated annual rate from $4.00 to $4.24 per unit
• Growth in ONEOK Partners segmentO erland Pass Pipeline start p has beg n on the largest pipeline project in – Overland Pass Pipeline—start-up has begun on the largest pipeline project in our history
– Expanded the Bushton fractionator, storage and other related infrastructure projects
– Constructing three other NGL pipeline projects– Acquisition of NGL and refined petroleum products pipeline system
• ONEOK increased its investment in ONEOK PartnersDi t ib ti t i l t d dditi l fit bilit h t • Distribution segment implemented additional profitability enhancement mechanisms
• Operational excellence and reliability
16 | Journey By Design
Jim KnealeJim KnealePresident & Chief Operating OfficerJim KnealeJim Kneale
17 | Journey By Design
ONEOK PartnersONEOK Partners
• Strategic assets connected to
Assets That Fit and Work Together
gprolific supply basins with access to key markets
• Provide non discretionary• Provide non-discretionaryservices to producers
• Predominantly fee-based income generates stable cash flows
• $2 billion of internally $2 billion of internally generated growth projects under way
18 | Journey By Design
Roadmap to GrowthRoadmap to Growth$2 Billion of Internal Growth Projects Under Way, 2007-2009
Grasslands plant expansionplant expansion
$40-$45 million Guardian II Expansion
$277-$305 millionFort Union Gas Gathering Expansion
(37% owner)
Piceance Lateral
Overland Pass Pipeline
$575-$590 million
NGL & Refined Product System Acquisition
$300 million
(
D-J Lateral $70-$80 million
Lateral $110-$140 million NGL Upgrade
Projects $230-$240 million
Woodford
Midwestern Extension $69 million
Arbuckle Pipeline
$340-$360 million
Natural Gas Gathering & ProcessingNatural Gas PipelinesNatural Gas Liquids Gathering & FractionationNatural Gas Liquids Pipelines
Extension $30-$35 million
2010 -2015 Internal Growth Projects:$300-500 million/year
l i iti
19 | Journey By Design
Natural Gas Liquids PipelinesGrowth Projects
plus acquisitions
Pierce Norton IIPierce Norton IIExecutive Vice PresidentNatural Gas
Pierce Norton IIPierce Norton II
20 | Journey By Design
Natural Gas
Natural GasNatural GasDiverse Asset Base
• Two segmentsGrasslands Plant
Expansion Guardian II
– Natural Gas Gathering & Processing
– Natural Gas PipelinesFort Union Gas
Expansion
• Diverse supply basins, producers and contracts mitigate earnings volatility in
Fort Union Gas Gathering Expansion
gathering and processing• Earnings on pipelines are
predominantly fee basedMidwestern Extension
• More than $600 million of internal growth projects under way through 2009 Natural Gas Gathering Pipeline
GNatural Gas Processing Plant
G S
21 | Journey By Design
y gNatural Gas Interstate PipelineNatural Gas Intrastate PipelineNorthern Border Pipeline (50% interest)
Natural Gas StorageGrowth Projects
Natural Gas Gathering and ProcessingNatural Gas Gathering and Processing
22 | Journey By Design
Current EnvironmentCurrent Environment
• Commodity prices affect drilling activity
Natural Gas Gathering and Processing
y p g y• High level of infrastructure build-outs has significantly increased
material and construction labor costs• Higher margins have led to increased competition for new
supplies, primarily from producers• Internally generated growth projects continue to offer the greatest • Internally generated growth projects continue to offer the greatest
return on investment
23 | Journey By Design
Natural Gas Gathering and ProcessingNatural Gas Gathering and Processing
Gathering
Providing Non-discretionary Services to Producers
g– More than 14,500 miles of pipeline– Approximately 9,000 meters– 1,100 MMcf/d* gathered Williston
Compression– More than 625,000 Bhp Wind River Powder River
Treating– Removal of water and other
contaminants Kansas UpliftHugoton
Processing– 13 plants with 725 MMcf/d capacity
560 MMcf/d* processed
Anadarko
24 | Journey By Design
– 560 MMcf/d processed*At second quarter 2008
Contract PortfolioContract Portfolio
• Diverse portfolio
Successful Execution of Strategy
Contract Mix by Volume Diverse portfolio– More than 2,000 contracts– No one contract accounts for more
than 10 percent of volume27% 30% 32%
19% 15% 10% 6% 1% 1%3% 3% 3% 6% 8% 7%
Contract Mix by Volume
than 10 percent of volume– Average term slightly more than
two years• Contract restructuring has
25% 31% 34%27%
Contract restructuring has reduced commodity price sensitivity and increased fee revenues
52% 51% 53%61% 61% 60%
revenues• Conditioning language on 85
percent of keep-whole contracts reduces spread risk
2003 2004 2005 2006 2007 2008G
Fee Based Percent of ProceedsKeep Whole Keep Whole w/ Conditioning
25 | Journey By Design
reduces spread risk
Risk MitigationRisk Mitigation
• Contract portfolio
Through Contract Portfolio and Hedging
Commodity Price Sensitivity*– Minimizes exposure to keep-whole
spread– NGL exposure diversified among
five individual products
$4.8 $4.5$3.8
y yMargin Impact ($ Millions)
five individual products• Hedging strategy focuses on
long NGL, condensate and natural gas positions -$0 1 $0.3 $0.2
$2.1$1.7 $1.6$1.1 $1.3 $1.0
$0.4$0.5 $0.7
natural gas positions– Target 75 percent of expected
production• Hedged position: -$3.5
-$2.7
-$1.6
-$0.1
g p2003 2004 2005 2006 2007 2008
Commodity SensitivityNatural Gas Liquids 1 cent/gallon increase
Natural Gas 10 cent/MMBtu increase
Crude Oil $1/barrel increase2009
Second Half 2008:
NGLs & Condensate 74% $1.38 / gallon
Natural Gas 54% $9.35 / MMBtu
26 | Journey By Design
Crude Oil $1/barrel increaseFull Year 2009:
NGLs & Condensate 30% $2.22 / gallon *Excludes effects of hedging
SupplySupply
• Natural gas supplies from six
Strong Focus on Natural Gas SupplyNatural Gas Gathered *
Bbtu/dbasins
• Significant drilling activity under way in the Powder River, Williston
1,1711,1681,182 1,188
and Anadarko basins• Well connects outpacing prior
years, January – August:908 852 800 805
– 2008: 295– 2007: 240– 2006: 282 274 316 371 383
• Approximately $30 million annual growth capital for new well connections
2005 2006 2007 2008
Rocky Mountain Mid-Continent
Jun YTD
27 | Journey By Design
Rocky Mountain Mid-Continent
* Volumes based on existing asset base
Moving ForwardMoving Forward
• Disciplined growth through well connects and contract
Key Growth Strategies
p g grenegotiations
• Expand and extend existing systems and plants– Bakken and Woodford Shale
• Extending our footprint to other basins– Partner with producers to build infrastructurePartner with producers to build infrastructure– Acquisition and consolidation opportunities
28 | Journey By Design
Natural Gas PipelinesNatural Gas Pipelines
29 | Journey By Design
Current EnvironmentCurrent Environment
• Increased supply driving current pipeline infrastructure build-outs
Natural Gas Pipelines
pp y g p p• High level of infrastructure build-outs has significantly increased
material and construction labor costs• Regulatory environment continues to change• Energy demand from natural gas-fired electric generation is
increasingincreasing
30 | Journey By Design
Natural Gas PipelinesNatural Gas Pipelines
• Stable markets and diverse
Key Points
Viking Gas
supply basins• Predominately fee-based
iGuardian Pipeline
Northern Border Pipeline
Transmission
income• Storage provides valuable
servicesMidwestern Gas
Transmissionservices• Regulation at the state and
federal level
Pipelines 6,900 miles, 5.3 Bcf/d peak capacityStorage 51.6 Bcf active working capacityEquity 50% Northern Border Pipeline
Natural Gas Interstate PipelineNatural Gas Intrastate PipelineNatural Gas Storage
31 | Journey By Design
Equity Investment
50% Northern Border Pipeline Natural Gas Storage Northern Border Pipeline (50% interest)
Contract PortfolioContract Portfolio
• Interstate Pipelines
Provides Sustainable, Stable Cash Flow
Viking Gas p– Wholly owned pipelines are fully
subscribed under demand-based ratesN th B d Pi li (50 t
Guardian Pipeline
Northern Border Pipeline
Transmission
– Northern Border Pipeline (50 percent interest) is 80 percent subscribed under demand-based rates
• Intrastate PipelinesMidwestern Gas
Transmission
Intrastate Pipelines– 60-70 percent subscribed under
demand-based rates• StorageStorage
– 100 percent subscribed under market-based rates
• Key CustomersNatural Gas Interstate PipelineNatural Gas Intrastate PipelineNatural Gas Storage
32 | Journey By Design
y– Natural gas and electric utilities
Natural Gas Storage Northern Border Pipeline (50% interest)
Guardian PipelineGuardian Pipeline
• Construction is approximately
Expansion and Extension
• Construction is approximately 70 percent complete
• Fourth-quarter 2008 in-service Existing PipelineExtensionq
date• Fully subscribed with two
15 year agreements15-year agreements• New interconnect opportunities
Guardian Extension: $277-$305 millionCapacity Incremental of 537 MMcf/d, bringing
total capacity to 1 287 MMcf/d
33 | Journey By Design
total capacity to 1,287 MMcf/dExtension 119 miles from Ixonia to Green Bay
Northern Border PipelineNorthern Border Pipeline
• Sold Bison Pipeline project
50 Percent Equity Investment
p p jto TransCanada– Bison Pipeline to be built or
combined with Pathfinder combined with Pathfinder Pipeline project
– Diversifies supplies to Northern Border PipelineBorder Pipeline
Northern Border PipelineProposed Bison Pipeline Proposed Pathfinder Pipeline
Northern Border PipelinePipeline 1,249 miles
34 | Journey By Design
Capacity 2.4 Bcf/d
Moving ForwardMoving Forward
• Expand and extend existing pipeline systems ($15 million)
Key Growth Strategies
p g p p y ($ )– Midwestern southbound expansion– Viking Fargo lateral
N d d d i t t id ti lit ($10 illi )• New and expanded interconnects provide optionality ($10 million)– Midwestern interconnect to Rockies Express – Guardian interconnects to Alliance and Vector
• Storage expansion and development
35 | Journey By Design
Questions & AnswersQuestions & AnswersQuestions & AnswersQuestions & Answers
36 | Journey By Design
Terry SpencerTerry SpencerExecutive Vice PresidentNatural Gas Liquids
Terry SpencerTerry Spencer
37 | Journey By Design
Natural Gas Liquids
Natural Gas LiquidsNatural Gas Liquids
• Two segments
Largest Gatherer and Fractionator of NGLs in the Mid-Continent
g– NGL Gathering & Fractionation– NGL Pipelines
• Connect large supply Overland Pass
Pipeline Overland Pass
Pipeline
Connect large supply position to major market centers and end-use demand
• Provide a full range of non
Piceance LateralPiceance Lateral
D-J Lateral
• Provide a full range of non-discretionary services to our customersO t iti f th
NGL Upgrade Projects
NGL Upgrade Projects
Woodford Extension
• Opportunities for growth through major expansions into new supply areas
NGL Pipelines NGL Storage
Arbuckle PipelineArbuckle Pipeline
38 | Journey By Design
NGL PipelinesNGL Gathering & FractionationNGL Growth Projects
gNGL FractionatorNGL Market Hub
Journey by DesignJourney by DesignApplying Our Capabilities to Natural Gas Liquids
Strategic Assets Pave the Way for
• Established presence in 2000• Acquired Koch NGL assets in 2005
Future Growth
• Doubled the size of the business through internally generated projects
– Extending our reach into the Rockies, Barnett Shale and Woodford Shale
• Acquired North System in 2007• Continued infrastructure expansions
needed to serve production growth in our core areas plus new regionsour core areas, plus new regions
– Appalachia– West Texas– Williston Basin
NGL PipelinesNGL Gathering & FractionationNGL Growth Projects
NGL StorageNGL FractionatorNGL Market Hub
39 | Journey By Design
NGL Growth ProjectsNGL Pipeline System Acquired 2007
NGL Market Hub
Current EnvironmentCurrent Environment
• NGL supply affected by drilling activity
Natural Gas Liquids
pp y y g y• U.S. NGL supply and demand
– Supply declines to be offset by regional growth– 2008 petrochemical demand has been strong, driven by international growth– Ethane demand may increase due to its cost advantage
• Fractionation and pipeline capacity is tightening due to regional Fractionation and pipeline capacity is tightening due to regional production growth
• Conway-to-Mont Belvieu regional basis differentials remain wide• High level of infrastructure build-outs has significantly increased
material and construction labor costs
40 | Journey By Design
NGL Gathering & FractionationNGL Gathering & Fractionation
41 | Journey By Design
NGL Gathering and FractionationNGL Gathering and Fractionation
Gathering
Providing Non-discretionary Services to Customers
g– More than 2,500 miles of pipeline– Access to 82 natural gas processing
plants, more than 90 percent of the Mid-Continent region’s plantsMid-Continent region s plants
Fractionation– Approximately 550,000 Bpd (net)
capacitycapacity– Isomerization 9,000 Bpd capacity
Storage– Underground caverns with capacity
of 24.6 million barrels
MarketingNGL Market HubNGL FractionatorNGL StorageNGL G th i Pi li
42 | Journey By Design
– NGL products to end-users NGL Gathering PipelineNGL Growth Projects
Sources of MarginSources of MarginFee-based Earnings with Optimization Opportunities
Exchange & Storage Services
Gather, fractionate, transport and store NGLs and deliver to market hubs
Fee-based
78%73%
70%2008G
20062007
MarketingPurchase for resaleapproximately one-half of system supply in the Mid-Continent on an index-related basis
Differential-based
8%13%
8%2008G20072006
OptimizationObtain highest product price by directing product movement between market hubs
Differential-based
Isomerization Convert normal butane to Differential- and
5%8%
18%
4%
2008G20072006
2008GIsomerization Convert normal butane to isobutane
Differential- and fee-based
9%6%
4%20072006
2008G
43 | Journey By Design
SupplySupply
• Significant volume growth in the Mid-Continent from 19 new processing
Strong Focus on NGL Supply
g g p gplant connections and growth from existing connections
• Rockies, Barnett Shale and Woodford Shale provide additional growth
246251 253
385 391
Gathering VolumeMBpd
Fractionation VolumeMBpd
213208 210 210
224232
309
275 281
333 326312 319
349370
385371
193 189 193275 281
31% Growth 20% Growth
44 | Journey By Design
3Q05 1Q06 3Q06 1Q07 3Q07 1Q08 3Q05 1Q06 3Q06 1Q07 3Q07 1Q08
NGL PipelinesNGL Pipelines
45 | Journey By Design
NGL PipelinesNGL Pipelines
• Links key NGL market
Key Points
ycenters at Conway, Kansas and Mont Belvieu, TexasN th S t t Mid
,
• North System connects Mid-Continent to upper Midwest refiners
• Developing links to the Rockies and Barnett Shale
NGL Distribution PipelineNGL Gathering PipelineGrowth ProjectsNGL Market HubNGL Fractionator
Distribution 3,350 miles of pipe with 434,000 Bpd capacity
Gathering 720 miles of pipe with 93,000 Bpd
NGL Storage
46 | Journey By Design
Gathering 720 miles of pipe with 93,000 Bpd capacity
NGL PipelinesNGL Pipelines
• Delivers to the petrochemical and refining ind stries
• Primary supply sources in Mid-
Key Points
and refining industries– Texas Gulf Coast– Mid-Continent– Midwest
Continent, and soon-to-be Rockies and north Texas, with connections to:– 23 natural gas processing plants, with
access to another 59 Midwest• Regulation
– FERC-approved tariffs
access to another 59– 8 fractionators – 8 storage facilities
4 refineries– 4 refineries
MarketsSupply
47 | Journey By Design
Petrochemical HeatingRefiningProcessing Plants Fractionators Storage
North SystemNorth SystemStrategic Acquisition Creating Value
• Extends distribution network into upper Midwest
• Connects to Mid-Continent supply and Bushton storagesupply and Bushton storage– Seasonal refinery-grade
butane and propane• Opportunities for growthOpportunities for growth
– Diluent and denaturant– Propylene
Adds refined petroleum
North SystemNGL Distribution PipelineNGL Gathering PipelineGrowth ProjectsNGL Market HubNGL Fractionator• Adds refined petroleum
products to value chainDistribution 1,630 miles of pipe
NGL FractionatorNGL Storage
48 | Journey By Design
Capacity for Purity & Refined Products
134,000 Bpd of transport978,000 Bbl of storage
NGL GrowthNGL Growth
49 | Journey By Design
Growth in the RockiesGrowth in the Rockies
• Supply
Overland Pass Pipeline, Piceance Lateral and D-J Basin Lateral
– 140,000 Bpd committed– 60,000 Bpd over the next 3-5
years in various stages of negotiationnegotiation
• Overland Pass– Start up in 2008 at 110,000 Bpd
initial capacityinitial capacity– Expandable to 255,000 Bpd,
expected by 20105-7 additional pump stations p pneeded at cost of approximately $5 million each
• Piceance and D-J Laterals start up in 2009
50 | Journey By Design
up in 2009
Moving ForwardMoving Forward
• Continued focus on adding new supply connections
Key Growth Strategies
• Optimize existing assets– Enhance margins– Improve contract terms
Manage operating costs– Manage operating costs– Improve fuel efficiency
• New or expanded asset positions to increase capability and services– New supply regions– New supply regions– Pipeline and fractionation capacity– Storage capacity– Rail and truck racks– Treating services
• New markets– Expand market share using our reliability and supply infrastructure
$
51 | Journey By Design
• Complete $1.4 billion of growth projects currently under way
Questions & AnswersQuestions & AnswersQuestions & AnswersQuestions & Answers
52 | Journey By Design
Caron LawhornCaron LawhornSenior Vice President & Chief Accounting OfficerCaron LawhornCaron Lawhorn
53 | Journey By Design
Earnings GrowthEarnings Growth
• Diverse asset base
Delivering Consistent Growth and Stable Earnings
O ti I * $624provides significant fee-based income and stable earnings $445
$269 Operating Income*
Natural Gas Gathering &
$624
stable earnings• Strategy execution
results in significant $253 $257
$396
$142
Gathering & Processing
Natural Gas Pipelines
earnings growth– Particularly in NGL
Pipelines beginning $68
$153 NGL Gathering & Fractionation20% CAGR
pe es beg gin 2009
$68
2004 2005 2006 2007 2008G
NGL Pipelines
*Millions of dollars, excluding gain/loss on sale of assets
54 | Journey By Design
Stable Cash FlowStable Cash Flow
• Predominantly fee based
Financial Strength
y– Large growth projects increase
fee-based income• Commodity and spread risk 12% 13% 16%
Sources of Margin
$1.1 Billion$896 Million$844 Million
• Commodity and spread risk is measured and managed within each segment
28% 27% 29%
16%
• Equity earnings are also primarily fee based– 2008 Guidance: $81 million
60% 60% 55%
– 2008 Guidance: $81 million
2006 2007 2008 GuidanceFee Commodity Spread
55 | Journey By Design
y p
Capital ExpendituresCapital ExpendituresComplements Existing Infrastructure and Core Operating Capabilities
Current Growth Program, 2007-2009• $2 billion of internally generated
projects and routine growth• EBITDA* generated
$1,230
Growth Capital Expendituresg ,
EBITDA generated – Primarily fee based– 2009: $260 million
2010 $360 illi
$878
n M
illio
ns
$650$300-$500
$670 spent through Aug-08
– 2010: $360 million
• $300 - $500 million of growth $188 $352
$132
$462 $233
$ In
$365 per year
Looking Forward, 2010-2015
projects per year– Two-thirds in Natural Gas Liquids
2007 2008 2009 2010-2015
Natural Gas Liquids Natural Gas
56 | Journey By Design
* EBITDA contributions assume projects are completed on schedule* Does not include WMB exercising its 50/50 option in OPPL, Piceance Lateral or D-J Lateral
Strong Balance SheetStrong Balance Sheet
• Disciplined approach to raising
Financial Discipline
• Capital structure p pp gcapital for growth
• Common unit offering in March 2008 generating net proceeds
p– Goal: 50/50 capitalization– Strong credit rating
2008, generating net proceeds of $460 million
• $1 billion revolver, $720 million il bl S t b 30
EquityTotal Debtavailable September 30
• Overland Pass joint-venture option
50%Debt50%
• ONEOK interested in increasing ownership of ONEOK Partners Capitalization: June 30, 2008
57 | Journey By Design
Distribution CoverageDistribution CoverageFinancial Discipline
$5.80 Distributions Declared Per UnitDistributable Cash Flow Per Unit• Target coverage ratio of
$3 78 $4.025 $4.22 $4.15
$4.48 $4.92
Coverage Ratiog g
1.05x to 1.15x• Some distributable cash
fl t i d t f d $3.20 $3.20
$3.78 $3.71 flow retained to fund growth
• Other considerations
1.30 1.16 1.19 1.22 1.37
Other considerations– Commodity prices– Overland Pass option
Capital market conditions2004 2005 2006 2007 2008
Guidance** Assumes quarterly payments for Q3 and Q4 at indicated amount
– Capital market conditions
58 | Journey By Design
q y p y
Distribution GrowthDistribution Growth
• ONEOK as sole general
Creating Exceptional Value for Unitholders
gpartner– 10 consecutive distribution
increases $1 01 $1.025 $1.04
$1.06
Distributions Paid Per Unit
increases– 11 percent compound annual
growth rateC ti d t iti f $0 88
$0.95 $0.97 $0.98 $0.99 $1.00 $1.01
• Continued opportunities for distribution growth $0.80
$0.88
11% CAGR
1Q06 3Q06 1Q07 3Q07 1Q08 3Q08
59 | Journey By Design
Value CreationValue CreationDelivering Consistent Growth and Stable Earnings
• General partner with T t l U ith ld R t
$67.50120%
140%
$60
$70Unit Price Total Return
paligned interests
• Demonstrated financial di i li
Total Unitholder Return
$42.10$45.75
$48.24$47.85 $47.92
$56.25
$59.46 $57.50$54.03
80%
100%
120%
$40
$50
$60discipline • Visible growth profile
– $2 billion under way91%
20%
40%
60%
$10
$20
$30$2 billion under way
– 2010–2015: $300 - $500 million per year
0%$01Q04 3Q04 1Q05 3Q05 1Q06 3Q06 1Q07 3Q07 1Q08 3Q08
ONEOK Partners Alerian MLP Index
*Unit prices are closing prices at last day of quarter; Third quarter 2008 through closing prices on 9/25/08.
60 | Journey By Design
Questions & AnswersQuestions & AnswersQuestions & AnswersQuestions & Answers
61 | Journey By Design
BreakBreakBreakBreak
Jim KnealeJim KnealePresident & Chief Operating OfficerJim KnealeJim Kneale
63 | Journey By Design
Business SegmentsBusiness Segments
• ONEOK Partners
Diversity Provides Stability & Opportunity
– ONEOK’s primary growth engine• Distribution
– Provides low-risk, stable cash flow– Rate strategies have led to an increase in
sustainable earnings and an improved return on equity
• Energy Services– Combined supply, transportation and storage Combined supply, transportation and storage
contracts provide premium service to customers– Positions us to capture upside in the market
64 | Journey By Design
DistributionDistribution
Pierce Norton IIPierce Norton IIExecutive Vice PresidentPierce Norton IIPierce Norton II
65 | Journey By Design
Current EnvironmentCurrent Environment
• Higher commodity prices and technological advancements in
Distribution
g y p genergy efficiency result in residential conservation
• Economic downturn in housing market results in fewer new ticonnections
• Regulators are challenged to balance consumer and business interests, creating opportunity for innovative rate designinterests, creating opportunity for innovative rate design
• Consumer awareness of “carbon footprint” stimulates interest in higher natural gas consumption
66 | Journey By Design
DistributionDistribution
• Growth
Focused Strategy
• Earnings stability• Margin protection• Operational efficiency
Revenues $2.1 billionAsset Base $2.7 billion
67 | Journey By Design
Rate Base $1.7 billion
DistributionDistribution
• Largest natural gas distributor in
Sixth Largest Natural Gas Distributor in U.S.
g gOklahoma and Kansas; third largest in TexasS th t illi t• Serve more than two million customers
Oklahoma Natural Gas
Largest customer base
2008 Rate $19.8 million
Kansas Gas Service
Coldest territory with weather normalization & bad debt recovery
2008 R t $2 9 illi
Texas Gas Service
Highest potential growth
2008 Rate $5.2 million008 ateFilings
$ 9 8 o
Customer Base Approximately 85% residential load
Rate Base $675 million
2008 Rate Filings
$2.9 million
Customer Base Approximately 70% residential load
Rate Base $710 million
2008 Rate Filings
$5 o
Customer Base Approximately 600,000 customers
Rate Base $302 million
68 | Journey By Design
Rate Strategy ProgressRate Strategy ProgressSuccessful Execution of Strategy
2005
Opportunities Rate Mechanism Solution Oklahoma Kansas Texas *
Earnings Lag Capital Recovery 36%
2008
Oklahoma Kansas Texas *
50%
Margin Protection
Bad Debt Recovery
Customer Charge
Weather Normalization 46%
FILED 46%
Increased Increased Increased
61%Weather Normalization 46%
Incentive Rates Revenue Sharing
* Percent of customers within the 17 Texas jurisdictions
61%
FUTURE
69 | Journey By Design
Strategy ExecutionStrategy Execution
• Increased level of sustainable
Established a New Level of Performance
• Closing the gap between actual earnings
• Rate mechanisms reduce regulatory lag
and allowed returns– $70 million operating income gap
in 2005Reduced to $20 million in 2008regulatory lag
8 8%10.2%Return on Equity*
$174 $186 Operating Income$ in Millions
– Reduced to $20 million in 2008
4.9% 5.3%
8.5% 8.8%
$114 $117
$174 $ in Millions
2005 2006 2007 2008 2008 2005 2006 2007 2008
13% CAGR 80% Increase
70 | Journey By Design
2005 2006 2007 2008 Guidance
2008 Allowed
* ROE calculations are consistent with utility ratemaking in each jurisdiction and not consistent with GAAP returns
2005 2006 2007 2008 Guidance
Moving ForwardMoving Forward
• Grow asset base
Key Strategies
– Efficient capital investment– Infrastructure and technology
E i t bili ti• Earnings stabilization– Ruling on Oklahoma bad-debt filing expected by end of 2008– Anticipate filing rate cases in Oklahoma and Austin in 2009– Capital and pipeline integrity management recovery
• Cost ControlStandardi ation– Standardization
– Continuous process improvement– Utilize technology
71 | Journey By Design
Energy ServicesEnergy Services
Terry SpencerTerry SpencerExecutive Vice PresidentTerry SpencerTerry Spencer
72 | Journey By Design
Energy ServicesEnergy ServicesStrategic Leased Assets Enhance Our Ability to Provide Premium
Services to Customers
• Deliver natural gas, together with bundled, reliable, premium products p pand services
• Access to prolific supply and high-demand areasand high demand areas
• Industry knowledge and customer relationships
Leased PipelineLeased Storage
Storage 91 Bcf of capacity2.2 Bcf/d of withdrawal rights1.4 Bcf/d of injection rights
Transportation 1.5 Bcf/d of long-term firm capacity
73 | Journey By Design
Sales 3.3 Bcf/d in 2007 3.1 Bcf/d in 2006
Energy ServicesEnergy Services
• Contract for natural gas supply from diverse sources
What We Do
• Lease and optimize storage and transportation capacity• Provide bundled, reliable products and services to natural gas
d l t i tilitiand electric utilities• During periods of market inefficiencies, effectively use storage
and transportation assets to capture incremental marginsa d t a spo tat o assets to captu e c e e ta a g s
MarketsTransportationStorageSupply
• LDCs • Electric Generators
• Trading Counterparties
Retail Customers:• Industrial• Commercial• Residential
74 | Journey By Design
Current EnvironmentCurrent Environment
• Rapidly changing supply sources and infrastructure build-outs ff ti l ti diff ti l
Energy Services
affecting location differentials– Widening location differentials in areas where pipeline capacity remains
insufficientI i U S l d i i il f h l b i– Increase in U.S. natural gas production, primarily from shale basins
– Softening regional wellhead netbacks could impact drilling and supply growth
Fi i l i tit ti ti it i t dit k t t • Financial-institution activity into commodity markets creates greater pricing uncertainty
• Competitive environmentp– Providing premium products and services– Obtaining and retaining leased assets
• Working capital requirements fluctuate with commodity prices
75 | Journey By Design
Working capital requirements fluctuate with commodity prices
Sources of MarginSources of MarginMore Than 75 Percent From Storage and Transportation
Storage Baseload, swing and peakingservices
Differential- and demand-based
Transportation Differential- and fee-
48%60%
53%
26%
2008G20072006
2008GMarketing & risk management services to producers and marketsTransportationMaximize delivered value
based
Optimization Enhance margins through application of market knowledge and risk-
Differential-, commodity-and derivative-based
11%
32%27%
26%20072006
2008G2007 0%
services to producers and markets
of market knowledge and riskmanagement skills
Retail Provide supply and risk-managementservices to industrial, commercial and residential customers
Commodity- and fee-based
5%
7%6%
10%
2006
2008G20072006
2007 0%
Trading Extract margins using primarily derivatives, leveraging our physical positions through market knowledge, volatility or inefficiencies
Differential-, commodity-and derivative-based
8%7%2007
2006
2008G 0%
76 | Journey By Design
Operating Income HistoryOperating Income History
• $880 million of operating income in five years
Key Drivers
$880 million of operating income in five years• Seasonal storage and transportation differentials have the
greatest impact
$166
$229 $205
$200
$250
$4.00
$5.00
illion
s)
$139 $
$142
$100
$150
$2.00
$3.00
ing
Inco
me (
M
$/MMB
tu
$0
$50
$-
$1.00
2004 2005 2006 2007 2008 Guidance
Oper
at
77 | Journey By Design
2004 2005 2006 2007 2008 GuidanceRealized Storage Differential Rockies to Mid-Continent Differential Operating Income
Moving ForwardMoving Forward
• Manage current portfolio of supply and leased assets to continue
Key Strategies
g p pp yto grow premium products and services
• Grow asset management arrangements with LDCs• Draw on the competitive position of our assets to extract
incremental value through daily optimization of our storage and transportation assetstransportation assets– Physical delivery of natural gas
• Use hedging to establish base margins and capture incremental i l t d t l ti d l diff ti lmargins related to location and seasonal differentials
• Continue to achieve high customer satisfaction
78 | Journey By Design
Questions & AnswersQuestions & AnswersQuestions & AnswersQuestions & Answers
79 | Journey By Design
Financial HighlightsFinancial Highlights
Caron LawhornCaron LawhornSenior Vice President & Chief Accounting OfficerCaron LawhornCaron Lawhorn
80 | Journey By Design
Earnings GrowthEarnings GrowthDelivering Consistent Growth and Stable Earnings
Di b
$
Stand-alone Operating Income Plus Equity Earnings
$638
• Diverse asset base provides significant fee-based income and
$444 $535 $524
$591 $313
ONEOK Partners
stable earnings• Strategy execution
res lts in significant
$142
$186 Distribution
Energy
results in significant earnings growth 7.5% CAGR
2004 2005 2006 2007 2008G
Energy Services
*Millions of dollars, excluding gain/loss on sale of assets
81 | Journey By Design
Aligned InterestsAligned Interests
• Purchased 5.4 million OKS • As ONEOK Partners grows,
Increasing Our Investment in ONEOK Partners
common units in March 2008 for $303 million– Contributed $9.6 million to maintain
gONEOK grows– EBITDA growth: Two-thirds of
every incremental dollar flows to $2 percent general partner interest
– Increased ownership to 47.7 percentONEOK
– Distribution growth: Penny a quarter adds $5.2 million to ONEOK’s annual cash flow ONEOK s annual cash flow
DividendsCapital Projects
EBITDA Growth
Higher Distributions
IDR and Equity Income
Net Income
82 | Journey By Design
Share Price AppreciationShare Price AppreciationUnit Price AppreciationUnit Price Appreciation
Aligned InterestsAligned Interests
• Quarterly distributions to $19.1 $20.9 General Partner Distributions
Growth at ONEOK Partners Benefits ONEOK
Q yONEOK have increased in the past two years:
General partner interest has $10.0
$11.6 $12.4 $13.3 $14.1 $14.9 $16.2 $19.1
39% CAGR $ in
Millio
ns
– General partner interest has more than doubled
– Limited partner interest has increased almost $10 million
2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08
39% CAGR $
increased almost $10 million• Internally generated growth
projects will result in $35.1 $35.9 $36.3 $36.6 $37.0 $37.4 $37.9
$44.1 $44.9 Limited Partner Distributions
ns
additional growth12% CAGR $ i
n Mi
llion
83 | Journey By Design
2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08
Strong Balance SheetStrong Balance Sheet
• Strong credit rating
Demonstrated Financial Discipline
Stand–alone Capitalization
46% 47% 49% 46%
g g– S&P: BBB– Moody’s: Baa2
C it l t t
Stand–alone Capitalization
46% 47% 52% 49% 46%• Capital structure– Goal: 50/50 capitalization
• Short-term liquidity54% 53% 48% 51% 54%
Short term liquidity– $480 million available under
existing $1.6 billion facilities– Storage 80 percent full at
2004 2005 2006 2007 2008*
Total Debt Equity
– Storage 80 percent full at September 30, 2008
*At June 30, 2008
84 | Journey By Design
Financial Risk ManagementFinancial Risk Management
• Diversified asset base and cash-flow stream
Enterprise View
– Contract structure, terms, customers– Across the value chain– Numerous supply and market centers
• Investment-grade credit rating• 80 percent of long-term debt at fixed rate• Diversified counterparty riskDiversified counterparty risk
– Numerous banks participate in revolving credit facilities– Hedging primarily through NYMEX and Intercontinental Exchange contracts– Secured creditSecured credit
• Commodity exposure– Risk managed within each segment– Corporatewide risk oversight committee
85 | Journey By Design
Corporatewide risk oversight committee
Stable Cash FlowStable Cash Flow
• Continued strong free-cash flow
Financial Flexibility
Free Cash Flow$ i Milli
gavailable for:– Acquisitions – Investment in OKS
$183 $159 $205 $182 $180
$ in Millions
– Share repurchase– Dividend increases – Debt repayment
$89 $110
$135 $150 $163
• Repurchased $884 million of shares since 2005
• Paid $402 million of maturing
$264 $250 $175 $174 $182
Paid $402 million of maturing long-term debt in February 2008
• Invested $313 million in ONEOK Partners in March 2008
2004 2005 2006 2007 2008 Guidance
Capital Expenditures Dividends Surplus
86 | Journey By Design
Partners in March 2008 Capital Expenditures Dividends Surplus*Stand-alone cash flow, excluding acquisitions
Dividend GrowthDividend Growth
• Target: 50-55 percent of
Creating Exceptional Value for Shareholders
Dividends Per Shareg precurring earnings
• 10 dividend increases i J 2004 30
0.32
$0.3
4
$0.3
6 $0.3
8
$0.4
0
since January 2004• 17 percent compound
annual growth rate $0.1
9
$0.2
1
$0.2
3
$0.2
5 $0.2
8 $0. 3 $0
annual growth rate $
17% CAGR
Q1 2004 Q1 2005 Q1 2006 Q1 2007 Q1 2008
87 | Journey By Design
Shareholder ValueShareholder Value
• Demonstrated financial
Delivering Consistent Growth and Stable Earnings
T t l Sh h ld R t
$47.40 160%
180%$50
discipline • Continued free cash flow
id fl ibilit
Total Shareholder Return
Share Price Total Return
$30.82 $34.02
$32 25
$37.79
$45.00 $44.63
$36.50
100%
120%
140%
160%
$30
$40provides flexibility• Visible growth profile
through ONEOK Partners 95%
$22.55 $26.02 $32.25
20%
40%
60%
80%
$10
$20
through ONEOK Partners• Stable and reliable cash
flows from distribution t 0%$0
1Q04 3Q04 1Q05 3Q05 1Q06 3Q06 1Q07 3Q07 1Q08 3Q08
segment*Share prices are closing prices at last day of quarter; third quarter as of 9/25/08.
S&P 500ONEOK, Inc.
88 | Journey By Design
John W GibsonJohn W GibsonJohn W. GibsonJohn W. Gibson
89 | Journey By Design
What’s Next?What’s Next?
• Successful execution of $2 billion projects paves the way for
Our Journey By Design
$ p j p yfuture growth
• $300-500 million per year 2010–2015– Two-thirds likely in NGL business– Expansions in existing footprint and into new basins
• Opportunistic acquisitionsOpportunistic acquisitions• Applying our capabilities to other commodities• Financial flexibility and discipline allow us to capture these
opportunities as they arise
90 | Journey By Design
ConclusionsConclusions
• ONEOK and ONEOK Partners have clearly articulated growth strategies
Key Points
y g g– Growth at OKS benefits OKE through earnings and cash flow
• ONEOK Partners’ fee-based earnings will increaseAs growth projects come on line in 2009 and beyond– As growth projects come on line in 2009 and beyond
• Funding growth– Capital requirements in 2009 are less than 2008– OKE interested in additional OKS units
• Growing NGL business provides essential, non-discretionary services– Fee-based business, relatively insensitive to commodity prices, y y p
• Distribution segment has increased its sustainable level of earnings• Energy Services provides natural gas and related services to its customers
E i id t k l ti d t diff ti l
91 | Journey By Design
– Earnings upside tracks location and storage differentials
ONEOK and ONEOK PartnersONEOK and ONEOK PartnersAssets That Fit and Work Together
ONEOK DistributionONEOK Energy Services
Leased Pipeline CapacityLeased Storage Capacity
ONEOK Partners G th P j t
92 | Journey By Design
Growth Projects
Questions & AnswersQuestions & AnswersQuestions & AnswersQuestions & Answers
93 | Journey By Design
Lunch | 12:00 Lunch | 12:00 –– 1:00 pm Regent Parlor 1:00 pm Regent Parlor
NGL Breakout | 1:30 NGL Breakout | 1:30 –– 3:30 pm Murray Hill Suite3:30 pm Murray Hill Suite
94 | Journey By Design
Journey By DesignJourney By DesignJourney By DesignJourney By Design
BiographiesBiographies
96 | Journey By Design
John W. GibsonJohn W. GibsonONEOK Chi f E ti OffiONEOK Chief Executive OfficerONEOK Partners Chairman and Chief Executive Officer
John W. Gibson is chief executive officer of ONEOK and chairman and chief executive John W. Gibson is chief executive officer of ONEOK and chairman and chief executive officer of ONEOK Partners. He was previously president and chief operating officer of ONEOK Partners, the master limited partnership that contains the midstream natural gas and natural gas liquids businesses. He is a member of the boards of directors of ONEOK and ONEOK Partners.
Gibson began his career in the energy industry in 1974 as a refinery engineer with Exxon Gibson began his career in the energy industry in 1974 as a refinery engineer with Exxon Company, USA. He then spent 18 years with Phillips Petroleum Company in a variety of domestic and international positions in the natural gas, natural gas liquids and exploration and production businesses. When Gibson left Phillips in 1995, he was vice president of marketing of GPM Gas Corporation, a wholly owned natural gas gathering, processing and marketing subsidiary.
Prior to joining ONEOK in 2000, Gibson was the executive vice president of Koch Energy, Inc., a subsidiary of Koch Industries, responsible for its interstate natural gas pipelines and gathering and processing businesses.
Gibson is active in many professional organizations and has served on the boards of the y p gAssociation of Texas Intrastate Natural Gas Pipelines and the Interstate Natural Gas Association of America. He was an original member of the Gas Industry Standards Board. Gibson currently serves as a director of the Bank of Oklahoma, N.A., and his community involvement includes work with the Boy Scouts of America and Habitat for Humanity.
A native of Kansas City Kansas Gibson earned an engineering degree in 1974 from the
97 | Journey By Design
A native of Kansas City, Kansas, Gibson earned an engineering degree in 1974 from the University of Missouri at Rolla, now called Missouri University of Science and Technology. He has also completed advanced studies at Harvard University.
Jim KnealeJim KnealePresident and Chief Operating Officer
Jim Kneale is president and chief operating officer of ONEOK and ONEOK Partners. He also serves as a director of ONEOK Partners.
Kneale joined ONEOK in 1981 as vice president of accounting and then moved to Okl h N t l G i id t f ti i 1992 H d i i Oklahoma Natural Gas as vice president of accounting in 1992. He served in various executive operating and finance positions until being named president of Oklahoma Natural Gas in 1997, holding that post until 1999 when he became chief financial officer of ONEOK.
He serves on the boards of directors of the YMCA of Greater Tulsa the Tulsa Area United He serves on the boards of directors of the YMCA of Greater Tulsa, the Tulsa Area United Way, the Tulsa Metropolitan Chamber of Commerce and the Oklahoma Business Roundtable. He also serves on the board of directors of the American Gas Association and is a member of the UMB Bank Advisory Board for Oklahoma. He is a graduate of both Leadership Oklahoma and Leadership Tulsa, and a recipient of Leadership Tulsa’s Paragon AwardAward.
A native of Kansas City, Missouri, Kneale graduated from high school in Amarillo, Texas. He earned a Bachelor of Business Administration degree in accounting in 1973 from West Texas A&M in Canyon He has completed advanced studies at Harvard University
98 | Journey By Design
Texas A&M in Canyon. He has completed advanced studies at Harvard University.
Curtis DinanCurtis DinanONEOK S i Vi P id t Chi f Fi i l Offi d TONEOK Senior Vice President, Chief Financial Officer and TreasurerONEOK Partners Executive Vice President, Chief Financial Officer and Treasurer
C rtis Dinan is senior ice president chief financial officer and treas rer of ONEOK Curtis Dinan is senior vice president, chief financial officer and treasurer of ONEOK, executive vice president, chief financial officer and treasurer of ONEOK Partners, and a director of ONEOK Partners.
He joined ONEOK in February 2004, after being an audit partner with both Arthur Andersen j y , g pLLP and Grant Thornton LLP.
Dinan is a member of the American Institute of Certified Public Accountants, the Oklahoma Society of CPAs and is an advisory board member for the Breech School of Business at Drury University in Springfield Missouri He is also a past president treasurer and director Drury University in Springfield, Missouri. He is also a past president, treasurer and director of Tulsa Court Appointed Special Advocates, a graduate and past treasurer and director of Leadership Tulsa, past treasurer and director of the Child Abuse Network and a graduate of Leadership Oklahoma.
A Missouri native, Dinan earned Bachelor of Arts degrees in accounting and business administration in 1989 from Drury University.
99 | Journey By Design
Caron LawhornCaron LawhornSenior Vice President and Chief Accounting Officer
Caron Lawhorn is senior vice president and chief accounting officer for ONEOK and Caron Lawhorn is senior vice president and chief accounting officer for ONEOK and ONEOK Partners. She is responsible for accounting, external financial reporting andcorporate budgeting and forecasting.
Previously, Lawhorn was senior vice president of financial services and treasurer forONEOK She joined ONEOK in 1998 as manager of auditing Before joining ONEOKONEOK. She joined ONEOK in 1998 as manager of auditing. Before joining ONEOK,she was a senior manager at KPMG LLP, and chief financial officer for EmergencyMedical Services Authority in Tulsa.
A Certified Public Accountant, Lawhorn is a member of the Executive Advisory Board of the University of Tulsa College of Business the American Institute of Certified Public University of Tulsa College of Business, the American Institute of Certified Public Accountants, the Oklahoma Academy and the Oklahoma Business Ethics Consortium. She is treasurer of Saint Simeon’s Episcopal Home and a graduate of Leadership Oklahoma and Leadership Tulsa.
Lawhorn earned her Bachelor of Science degree in business administration in 1983Lawhorn earned her Bachelor of Science degree in business administration in 1983from the University of Tulsa, where she was named an Outstanding Alumna in theCollege of Business.
100 | Journey By Design
Pierce Norton IIPierce Norton IIExecutive Vice President
Pierce Norton is executive vice president of ONEOK with responsibilities for Pierce Norton is executive vice president of ONEOK with responsibilities for ONEOK’s distribution companies. He is also executive vice president, natural gas, of ONEOK Partners where he has responsibilities for the partnership’s natural gas gathering and processing and pipelines business.
He began his natural gas industry career in 1982 at Delhi Gas Pipeline. He later worked for American Oil and Gas and KN Energy, and was named Bear Paw Energy’s president in 2005. Bear Paw is now a subsidiary of ONEOK Partners.
Norton is a board member of the Interstate Natural Gas Association of America and Norton is a board member of the Interstate Natural Gas Association of America and the Texas Pipeline Association. He is a past board member of the North Dakota Petroleum Council and the Independent Petroleum Association of Mountain States.
An Alabama native, Norton earned a Bachelor of Science degree in mechanical i i i 1982 f th U i it f Al b i T lengineering in 1982 from the University of Alabama in Tuscaloosa.
101 | Journey By Design
Terry SpencerTerry SpencerExecutive Vice President
Terry Spencer is executive vice president of ONEOK with responsibilities for energyTerry Spencer is executive vice president of ONEOK with responsibilities for energyservices. He is also executive vice president, natural gas liquids, of ONEOK Partners and has responsibilities for its natural gas liquids gathering and fractionation and pipelines businesses.
Spencer joined ONEOK in 2001 as director project development for natural gas gatheringSpencer joined ONEOK in 2001 as director, project development, for natural gas gatheringand processing. Later, he served as vice president of gas supply and project development inthe gathering and processing segment. In 2005, Spencer became senior vice president ofONEOK’s natural gas liquids business following the asset acquisition from Koch. He became president of natural gas liquids in 2006.
Prior to joining ONEOK, Spencer held positions of increasing responsibility in the natural gas gathering and processing industry with Continental Natural Gas, Inc., in Tulsa; Stellar Gas Company in Houston; and Texas Oil and Gas Corporation’s Delhi Gas Pipeline subsidiary in Dallas. He is a member of the Gas Processors Association board of directors.
Spencer earned a Bachelor of Science degree in petroleum engineering in 1981 from theUniversity of Alabama in Tuscaloosa.
102 | Journey By Design
Rob MartinovichRob MartinovichPresident, Natural Gas Gathering and Processing
Rob Martinovich is president of ONEOK Partners’ natural gas gathering and processing Rob Martinovich is president of ONEOK Partners natural gas gathering and processing business, responsible for natural gas supply, business development and operations in the Mid-Continent and Rocky Mountain regions.
Prior to joining ONEOK, he was group vice president of environment, health and safety,operations and technical services for DCP Midstream LLC Martinovich joined DCPoperations and technical services for DCP Midstream, LLC. Martinovich joined DCPMidstream in 2000 as senior vice president, responsible for the Permian Basin assets, andin 2002 was named senior vice president responsible for the Mid-Continent and RockyMountain assets.
Before joining DCP Midstream he was senior vice president of GPM Gas Corporation theBefore joining DCP Midstream, he was senior vice president of GPM Gas Corporation, thenatural gas gathering, processing and marketing division of Phillips Petroleum Company.Martinovich joined Phillips in 1980 as a resin development engineer and held variousengineering and sales and marketing positions in the research and development and theplastics divisions of Phillips, and served on the company’s corporate planning anddevelopment staffdevelopment staff.
Active in industry affairs, Martinovich served as president of the Gas Processors Associationfrom 2004 to 2006.
A ti f B tl ill Okl h M ti i h d B h l f S i d i
103 | Journey By Design
A native of Bartlesville, Oklahoma, Martinovich earned a Bachelor of Science degree inchemical engineering in 1980 from the University of Notre Dame in South Bend, Indiana.
Kent ShortridgeKent ShortridgePresident, Natural Gas Pipelines
Kent Shortridge is president of ONEOK Partners’ natural gas pipelines business segment Kent Shortridge is president of ONEOK Partners natural gas pipelines business segment, responsible for interstate and intrastate natural gas pipelines and storage.
Previously, he was vice president of gas supply and administration for ONEOK Distribution Companies. He joined Oklahoma Natural Gas in 1990 and has held a variety of roles of increasing responsibilityincreasing responsibility.
Active in the community and industry, Shortridge is a graduate of Leadership Oklahoma -Class XV and has served on various nonprofit boards in the communities where he has lived. He has chaired roundtables for the Southern Gas Association and is a senior member of the University of Oklahoma’s College of Industrial Engineering Advisory Boardof the University of Oklahoma s College of Industrial Engineering Advisory Board.
A native of California, Shortridge earned a Bachelor of Science degree in industrialengineering in 1990 from the University of Oklahoma in Norman and a Master of Business Administration degree in 1997 from Oklahoma State University in Stillwater.
104 | Journey By Design
Sam Combs IIISam Combs IIIPresident, Distribution
Sam Combs is president of ONEOK Distribution Companies, responsible for ONEOK’s Sam Combs is president of ONEOK Distribution Companies, responsible for ONEOK s three natural gas utilities – Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service.
He began his career with Oklahoma Natural Gas in 1984 and has held engineering, marketing and management positions at the company. He became vice president of marketing and management positions at the company. He became vice president of Oklahoma Natural’s Oklahoma City district in 1996 and was named vice president of its Western Region in 1998. Combs was promoted to president of Oklahoma Natural Gas in 2001 and named to his current position in 2005.
A past president of Leadership Oklahoma Combs has been active as a leader in theA past president of Leadership Oklahoma, Combs has been active as a leader in thecommunity and the state. He was recognized by Black Enterprise magazine on its list of the “75 Most Powerful African Americans in Corporate America.” Combs was honored as an “Oklahoma Star” by Governor Brad Henry and the Oklahoma Department of Commerce.
A native of Bristow Oklahoma Combs holds a Bachelor of Science degree in industrial A native of Bristow, Oklahoma, Combs holds a Bachelor of Science degree in industrial engineering from Oklahoma State University in Stillwater, and has received the university’s Distinguished Alumni Award. He graduated from the Ross School of Business Executive Program at the University of Michigan, Ann Arbor, in 1999 and has completed advanced studies at Harvard University.
105 | Journey By Design
Sheridan SwordsSheridan SwordsPresident, Natural Gas Liquids Gathering and Fractionation
Sheridan Swords is president of ONEOK Partners’ natural gas liquids gathering andfractionation business.
Swords began his career in the natural gas industry as a division engineer for KochGathering Systems Company in 1992. He held various positions with Koch companies; and Gathering Systems Company in 1992. He held various positions with Koch companies; and prior to joining ONEOK Partners, Swords was vice president of the Mid-Continent for Koch Hydrocarbon, LP.
A native of Kansas, Swords earned a Bachelor of Science degree in mechanical engineering in 1991 from Kansas State University in Manhattanengineering in 1991 from Kansas State University in Manhattan.
106 | Journey By Design
Roger ThorpeRoger ThorpePresident, Natural Gas Liquids Pipelines
Roger Thorpe is president of ONEOK Partners’ natural gas liquids pipelines business, responsible for natural gas liquids and refined products pipeline assets.
He joined ONEOK in 1990 as a field engineer and has held positions of increasingresponsibility across ONEOK Partners’ natural gas liquids and natural gas midstreamresponsibility across ONEOK Partners natural gas liquids and natural gas midstreambusinesses. In his previous position as vice president, he was responsible for the operations and engineering aspect of the partnership’s natural gas gathering and processing business. He has also held the positions of manager of gas measurement and manager of operations for the partnership’s gas transmission and gathering and processing assets.
He is active in community and charitable organizations and recently served as co-chair for ONEOK’s annual Habitat for Humanity home build.
A native of Idaho, Thorpe received an industrial engineering degree in 1990 from theUniversity of Oklahoma in NormanUniversity of Oklahoma in Norman.
107 | Journey By Design
Patrick McDoniePatrick McDoniePresident, Energy Services
Patrick McDonie is president of ONEOK Energy Services Company, which supplieslocal distribution companies and industrial customers with reliable delivery of natural gas. He is responsible for marketing, storing, trading, transporting and delivery scheduling related to the company’s natural gas marketing operations.
McDonie joined ONEOK in 1997 as a director of trading for ONEOK Gas MarketingCompany and later served as senior vice president and vice president of origination and new business development and as vice president of physical trading for ONEOK Energy Services. Prior to joining ONEOK, McDonie held positions of increasing responsibility in the natural gas production and marketing industry with Tristar Gas Marketing Pacific natural gas production and marketing industry with Tristar Gas Marketing, Pacific Enterprises Oil Company and Texas Oil and Gas.
McDonie is a member of the Natural Gas Association of Oklahoma and the North Texas Natural Gas and Electric Power Society. He is also involved with the Cystic Fibrosis Foundation and the American Heart AssociationFoundation and the American Heart Association.
A native of West Virginia, McDonie earned a Bachelor of Science degree in petroleum engineering in 1983 from Marietta College in Marietta, Ohio, and a Master of Business Administration degree in 1984 from West Virginia University in Morgantown.
108 | Journey By Design
Journey By DesignJourney By DesignJourney By DesignJourney By Design
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