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The following discussion and analysis should be read in conjunction with our unaudited Consolidated Financial Statements and the Notes to Consolidated Financial Statements in this Quarterly Report, as well as our Annual Report.
RECENT DEVELOPMENTS
Please refer to the “Financial Results and Operating Information” and “Liquidity and Capital Resources” sections of Management’s Discussion and Analysis of Financial Condition and Results of Operations in this Quarterly Report for additional information.
Business Update and Market Conditions - Earnings increased in the second quarter of 2026, compared with the second quarter of 2025, due primarily to higher NGL, Refined Products and natural gas volumes and higher optimization and marketing activity.
Geopolitical conditions in the Middle East continue to impact our industry and contributed to a volatile commodity price environment for the six months ended June 30, 2026. These conditions highlight the importance of a reliable energy supply and infrastructure that support the United States economy and national security. We operate an integrated, reliable, resilient and regionally diversified network of gathering, processing, fractionation, transportation, storage and marine export assets connecting supply in the Rocky Mountain, Mid-Continent, Permian and Gulf Coast regions with key market centers. Our assets are well positioned to provide midstream services to producers and end-use markets to help meet domestic and international energy demand.
Each of our four reportable segments is primarily fee-based, and we expect our consolidated earnings to be approximately 90% fee-based in 2026. Our fee-based earnings are primarily supported by long-term contracts with investment-grade counterparties, including minimum volume commitments and take-or-pay agreements. While we remain well positioned to reduce downside exposure to commodity price volatility, we may use our integrated midstream network to capture product, location and seasonal price differentials in our optimization and marketing businesses as we deliver volumes to where they are needed most.
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Capital Projects - Our primary capital projects are outlined in the table below:
Project Scope Approximate Cost (a) Expected Completion
Natural Gas Gathering and Processing (In millions)
Bighorn plant 300 MMcf/d processing plant with carbon dioxide treater in the Permian Basin $365 Mid-2027
Natural Gas Liquids
Medford fractionator Rebuild our 210 MBbl/d NGL fractionation facility in Medford, Oklahoma $485 (b)
Texas City Logistics export terminal (c) 400 MBbl/d liquified petroleum gas export terminal in Texas City, Texas $700 Early 2028
MBTC Pipeline 24-inch pipeline from Mont Belvieu, Texas, storage facility to the new Texas City, Texas, export terminal $280 Early 2028
Natural Gas Pipelines
Eiger Express Pipeline (c) 450-mile, 48-inch natural gas pipeline from the Permian Basin to Katy, Texas, with capacity of 3.7 Bcf/d $350 Mid-2028
Refined Products and Crude
Greater Denver pipeline expansion Increase total system capacity by 35 MBbl/d with additional expansion opportunities $480 Third Quarter 2026
(a) - Excludes capitalized interest/AFUDC. For our Texas City Logistics, MBTC Pipeline and Eiger joint venture projects, the amounts presented exclude capital contributions from the other joint venture members.
(b) - This project is expected to be completed in two phases, with the first phase of 100 MBbl/d completed in the fourth quarter of 2026, and the second phase of 110 MBbl/d completed in the first quarter of 2027.
(c) - Our investments in Texas City Logistics and Eiger are accounted for using the equity method. Spending on these projects is recorded as contributions to unconsolidated affiliates.
In our Natural Gas Gathering and Processing segment, we completed the relocation of a 150 MMcf/d processing plant to the Permian Basin from North Texas, which went into service in the first quarter of 2026.
For a discussion of our capital expenditure financing, see “Capital Expenditures” in the “Liquidity and Capital Resources” section.
Debt Extinguishments - In April 2026, we redeemed the remaining $491 million of our $500 million, 4.85% senior notes due July 2026 at 100% of the outstanding principal amount, plus accrued and unpaid interest, with short-term borrowings.
$1.2 Billion Term Loan Agreement - In April 2026, we entered into a $1.2 Billion Term Loan Agreement, which was available to be drawn in up to two borrowings within 90 days of the closing date. Borrowings under the $1.2 Billion Term Loan Agreement bear interest at Term SOFR plus an applicable margin of 95 basis points. The $1.2 Billion Term Loan Agreement matures 364 days after June 23, 2026, the date of the initial borrowing, and may be used for working capital, capital expenditures, acquisitions, mergers and for other general corporate purposes. The $1.2 Billion Term Loan Agreement allows prepayment of all or any portion outstanding, without penalty or premium, and contains substantially the same covenants as those contained in our $3.5 Billion Credit Agreement. As of June 30, 2026, we had $600 million of borrowings outstanding at an interest rate of 4.59% under the $1.2 Billion Term Loan Agreement. In July 2026, the remaining borrowings available under the $1.2 Billion Term Loan Agreement were fully drawn and no additional amounts may be borrowed.
Dividends - In February and May 2026, we paid a quarterly common stock dividend of $1.07 per share ($4.28 per share on an annualized basis), an increase of 4% compared with the same quarters in the prior year. Our dividend growth is due primarily to the increase in cash flows resulting from the growth of our operations. We declared a quarterly common stock dividend of $1.07 per share in July 2026. The quarterly common stock dividend will be paid on August 14, 2026, to shareholders of record at the close of business on August 3, 2026.
FINANCIAL RESULTS AND OPERATING INFORMATION
How We Evaluate Our Operations
Management uses a variety of financial and operating metrics to analyze our performance. Our consolidated financial metrics include: (1) operating income; (2) net income; (3) diluted EPS; and (4) adjusted EBITDA. We evaluate segment operating results using adjusted EBITDA and our operating metrics, which include various volume and rate statistics that are relevant for the respective segment. These operating metrics allow investors to analyze the various components of segment financial results in terms of volumes and rate/price. Management uses these metrics to analyze historical segment financial results and as the
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key inputs for forecasting and budgeting segment financial results. For additional information on our operating metrics, see the respective segment subsections of this “Financial Results and Operating Information” section.
Non-GAAP Financial Measures - Adjusted EBITDA is a non-GAAP measure of our financial performance. Adjusted EBITDA is defined as net income adjusted for interest expense, depreciation and amortization, noncash impairment charges, income taxes, noncash compensation expense and certain other noncash items. Our calculation includes adjusted EBITDA related to our unconsolidated affiliates using the same recognition and measurement methods used to record equity in net earnings from investments. Adjusted EBITDA from our unconsolidated affiliates is calculated consistently with the definition above and excludes items such as interest expense, depreciation and amortization, income taxes and other noncash items. Although the amounts related to our unconsolidated affiliates are included in the calculation of adjusted EBITDA, such inclusion should not be understood to imply that we have control over the operations and resulting revenues, expenses or cash flows of such unconsolidated affiliates.
We believe this non-GAAP financial measure is useful to investors because it and similar measures are used by many companies in our industry as a measurement of financial performance and is commonly employed by financial analysts and others to evaluate our financial performance and to compare financial performance among companies in our industry. Adjusted EBITDA should not be considered an alternative to net income, EPS or any other measure of financial performance presented in accordance with GAAP. Additionally, this calculation may not be comparable with similarly titled measures of other companies. See reconciliation of net income to adjusted EBITDA in the “Non-GAAP Financial Measures” subsection.
Consolidated Operations
Selected Financial Results - The following table sets forth certain selected financial results for the periods indicated:
Three Months Ended Six Months Ended Three Months Six Months
June 30, June 30, 2026 vs. 2025 2026 vs. 2025
Financial Results 2026 2025 2026 2025 $ Increase (Decrease) $ Increase (Decrease)
(Millions of dollars, except per share amounts)
Revenues
Commodity sales $ 10,814 $ 6,726 $ 19,259 $ 13,638 4,088 5,621
Services and other 1,235 1,161 2,408 2,292 74 116
Total revenues 12,049 7,887 21,667 15,930 4,162 5,737
Cost of sales and fuel (exclusive of items shown separately below) 9,242 5,360 16,295 11,015 3,882 5,280
Operating costs 823 706 1,569 1,458 117 111
Depreciation and amortization 387 368 765 748 19 17
Transaction costs 4 22 11 64 (18) (53)
Other operating expense (income), net — — 6 (6) — (12)
Operating income $ 1,593 $ 1,431 $ 3,021 $ 2,651 162 370
Equity in net earnings from investments $ 103 $ 81 $ 192 $ 189 22 3
Impairment of equity investments $ — $ — $ (60) $ — — (60)
Interest expense, net of capitalized interest $ (434) $ (438) $ (873) $ (880) (4) (7)
Net income $ 967 $ 853 $ 1,743 $ 1,544 114 199
Net income attributable to ONEOK $ 966 $ 841 $ 1,740 $ 1,477 125 263
Diluted EPS $ 1.53 $ 1.34 $ 2.75 $ 2.38 0.19 0.37
Adjusted EBITDA $ 2,121 $ 1,981 $ 4,118 $ 3,756 140 362
Capital expenditures $ 613 $ 749 $ 1,477 $ 1,378 (136) 99
Changes in commodity prices and sales volumes affect both revenues and cost of sales and fuel in our Consolidated Statements of Income and, therefore, the impact is largely offset between these line items.
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Operating income increased $162 million for the three months ended June 30, 2026, compared with the same period in 2025, primarily as a result of the following:
•Natural Gas Gathering and Processing - an increase of $2 million due primarily to higher volumes across all regions and higher realized condensate prices, net of hedging, offset partially by higher operating costs.
•Natural Gas Liquids - a decrease of $16 million due primarily to higher operating costs and lower transportation and storage volumes, offset partially by higher optimization and marketing and higher exchange services.
•Natural Gas Pipelines - an increase of $94 million due primarily to higher optimization and marketing and higher firm transportation revenue.
•Refined Products and Crude - an increase of $77 million due primarily to higher Refined Products volumes and rates, and higher crude marketing earnings, offset partially by higher operating costs.
Operating income increased $370 million for the six months ended June 30, 2026, compared with the same period in 2025, primarily as a result of the following:
•Natural Gas Gathering and Processing - a decrease of $37 million due primarily to lower realized NGL and natural gas prices, net of hedging, offset partially by higher volumes across all regions.
•Natural Gas Liquids - an increase of $58 million due primarily to higher optimization and marketing and higher exchange services, offset partially by higher operating costs.
•Natural Gas Pipelines - an increase of $199 million due primarily to higher optimization and marketing and higher firm transportation revenue.
•Refined Products and Crude - an increase of $103 million due primarily to higher Refined Products volumes and rates, and higher crude marketing earnings, offset partially by higher operating costs.
•Consolidated Transaction Costs - a decrease of $53 million due primarily to higher transaction costs in 2025 related to the EnLink Acquisition.
Net income and diluted EPS increased for the three months ended June 30, 2026, compared with the same period in 2025, due primarily to the items discussed above and higher equity in net earnings from investments, offset partially by higher income taxes.
Net income and diluted EPS increased for the six months ended June 30, 2026, compared with the same period in 2025, due primarily to the items discussed above, offset partially by a noncash impairment charge related to our 50% investment in Powder Springs in our Refined Products and Crude segment during the first quarter of 2026, and higher income taxes.
Capital expenditures decreased for the three months ended June 30, 2026, and increased for the six months ended June 30, 2026, compared with the same periods in 2025, due primarily to the timing of payments on our large capital projects. Please refer to the “Recent Developments” section of Management’s Discussion and Analysis of Financial Condition and Results of Operations in this Quarterly Report for additional information on our capital projects.
Additional information regarding our financial results and operating information is provided in the following discussion for each of our segments.
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Natural Gas Gathering and Processing
Selected Financial Results and Operating Information - The following tables set forth certain selected financial results and operating information for our Natural Gas Gathering and Processing segment for the periods indicated:
Three Months Ended Six Months Ended Three Months Six Months
June 30, June 30, 2026 vs. 2025 2026 vs. 2025
Financial Results 2026 2025 2026 2025 $ Increase (Decrease) $ Increase (Decrease)
(Millions of dollars)
NGL and condensate sales $ 1,433 $ 1,100 $ 2,459 $ 2,327 333 132
Residue natural gas sales 171 449 882 1,147 (278) (265)
Gathering, compression, dehydration and processing fees and other revenue 274 299 534 571 (25) (37)
Cost of sales and fuel (exclusive of depreciation and operating costs) (1,079) (1,082) (2,372) (2,538) (3) (166)
Operating costs, excluding noncash compensation adjustments (251) (229) (487) (479) 22 8
Adjusted EBITDA from unconsolidated affiliates 1 1 2 3 — (1)
Other (3) 2 (5) — (5) (5)
Adjusted EBITDA $ 546 $ 540 $ 1,013 $ 1,031 6 (18)
Capital expenditures $ 185 $ 341 $ 502 $ 582 (156) (80)
Changes in commodity prices and sales volumes affect both revenues and cost of sales and fuel in our Consolidated Statements of Income and, therefore, the impact is largely offset between these line items.
Adjusted EBITDA increased $6 million for the three months ended June 30, 2026, compared with the same period in 2025, primarily as a result of the following:
•an increase of $20 million from higher volumes due to increased production in all regions; and
•an increase of $13 million due primarily to higher realized condensate prices, net of hedging, offset partially by lower realized NGL prices, net of hedging; offset by
•an increase of $22 million in operating costs due primarily to a $13 million methane fee accrual reversed in 2025 due to regulatory changes and $11 million of higher outside services related to the timing of projects.
Adjusted EBITDA decreased $18 million for the six months ended June 30, 2026, compared with the same period in 2025, primarily as a result of the following:
•a decrease of $53 million due primarily to lower realized NGL and natural gas prices, net of hedging, offset partially by higher realized condensate prices, net of hedging; and
•an increase of $8 million in operating costs due primarily to the growth of our operations; offset by
•an increase of $49 million from higher volumes due to increased production in all regions.
Capital expenditures decreased for the three and six months ended June 30, 2026, compared with the same periods in 2025, due primarily to the timing of payments on capital projects and the completion of the Permian Basin plant relocation project that was placed in service during the first quarter of 2026.
Three Months Ended Six Months Ended
June 30, June 30,
Operating Information 2026 2025 2026 2025
Natural gas processed (MMcf/d) (a) 5,707 5,573 5,585 5,412
(a) - Included volumes for consolidated entities and volumes we processed at company-owned and third-party facilities.
Our natural gas processed volumes increased for the three and six months ended June 30, 2026, compared with the same periods in 2025, due to increased production in all regions.
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Natural Gas Liquids
Selected Financial Results and Operating Information - The following tables set forth certain selected financial results and operating information for our Natural Gas Liquids segment for the periods indicated:
Three Months Ended Six Months Ended Three Months Six Months
June 30, June 30, 2026 vs. 2025 2026 vs. 2025
Financial Results 2026 2025 2026 2025 $ Increase (Decrease) $ Increase (Decrease)
(Millions of dollars)
NGL and condensate sales $ 4,433 $ 3,740 $ 7,914 $ 7,852 693 62
Exchange services and other revenues 110 97 205 202 13 3
Transportation and storage revenues 50 34 120 85 16 35
Cost of sales and fuel (exclusive of depreciation and operating costs) (3,746) (3,030) (6,514) (6,487) 716 27
Operating costs, excluding noncash compensation adjustments (213) (195) (412) (398) 18 14
Adjusted EBITDA from unconsolidated affiliates 26 22 53 50 4 3
Other (1) 5 (1) 4 (6) (5)
Adjusted EBITDA $ 659 $ 673 $ 1,365 $ 1,308 (14) 57
Capital expenditures $ 202 $ 135 $ 512 $ 306 67 206
Changes in commodity prices and sales volumes affect both revenues and cost of sales and fuel in our Consolidated Statements of Income and, therefore, the impact is largely offset between these line items.
Adjusted EBITDA decreased $14 million for the three months ended June 30, 2026, compared with the same period in 2025, primarily as a result of the following:
•an increase of $18 million in operating costs due primarily to $9 million of higher employee-related costs and $8 million of higher outside services associated with the growth of our operations; and
•a decrease of $6 million in transportation and storage due primarily to lower volumes; offset by
•an increase of $11 million in optimization and marketing due primarily to higher earnings on sales of Purity NGLs held in inventory; and
•an increase of $2 million in exchange services due primarily to:
◦$28 million of higher volumes across our system;
◦$12 million of higher transportation and fractionation costs;
◦$11 million due primarily to fewer product price differentials captured.
Adjusted EBITDA increased $57 million for the six months ended June 30, 2026, compared with the same period in 2025, primarily as a result of the following:
•an increase of $53 million in optimization and marketing due primarily to higher earnings on sales of Purity NGLs held in inventory; and
•an increase of $26 million in exchange services due primarily to:
◦$119 million of higher volumes across our system;
◦$71 million of lower average fee rates and narrower product price differentials in the Gulf Coast/Permian and Mid-Continent regions;
◦$23 million of higher transportation and fractionation costs;
•an increase of $14 million in operating costs due primarily to the growth of our operations; and
•a decrease of $6 million in transportation and storage due primarily to lower volumes.
Capital expenditures increased for the three and six months ended June 30, 2026, compared with the same periods in 2025, due primarily to the Medford fractionator rebuild project and the MBTC Pipeline.
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Three Months Ended Six Months Ended
June 30, June 30,
Operating Information 2026 2025 2026 2025
Raw feed throughput (MBbl/d) (a) 1,630 1,527 1,562 1,411
Average Conway-to-Mont Belvieu Oil Price Information Service price differential - ethane in ethane/propane mix ($/gallon) $ 0.03 $ 0.02 $ 0.02 $ 0.01
(a) - Represents physical raw feed volumes for which we provided transportation and/or fractionation services.
We generally expect ethane volumes to increase or decrease with corresponding increases or decreases in overall NGL production. However, ethane volumes may experience growth or decline greater than corresponding growth or decline in overall NGL production due to ethane economics causing producers to recover or reject ethane.
Volumes increased for the three and six months ended June 30, 2026, compared with the same periods in 2025, due primarily to higher production in all regions across our system. The three months ended June 30, 2026, also benefited from higher ethane recovery in the Rocky Mountain and Mid-Continent regions.
Natural Gas Pipelines
Selected Financial Results and Operating Information - The following tables set forth certain selected financial results and operating information for our Natural Gas Pipelines segment for the periods indicated:
Three Months Ended Six Months Ended Three Months Six Months
June 30, June 30, 2026 vs. 2025 2026 vs. 2025
Financial Results 2026 2025 2026 2025 $ Increase (Decrease) $ Increase (Decrease)
(Millions of dollars)
Transportation revenues $ 123 $ 104 $ 246 $ 204 19 42
Storage revenues 47 45 95 89 2 6
Residue natural gas sales and other revenues 279 256 734 576 23 158
Cost of sales and fuel (exclusive of depreciation and operating costs) (156) (219) (466) (480) (63) (14)
Operating costs, excluding noncash compensation adjustments (62) (53) (119) (104) 9 15
Adjusted EBITDA from unconsolidated affiliates 72 55 150 116 17 34
Other (6) — (4) (1) (6) (3)
Adjusted EBITDA $ 297 $ 188 $ 636 $ 400 109 236
Capital expenditures $ 15 $ 52 $ 61 $ 114 (37) (53)
Changes in commodity prices and sales volumes affect both revenues and cost of sales and fuel in our Consolidated Statements of Income and, therefore, the impact is largely offset between these line items.
Adjusted EBITDA increased $109 million for the three months ended June 30, 2026, compared with the same period in 2025, primarily as a result of the following:
•an increase of $77 million in optimization and marketing activity due primarily to favorable price differentials between the Waha Hub and Katy, Texas, markets;
•an increase of $19 million in transportation services due primarily to higher firm transportation revenue; and
•an increase of $17 million in adjusted EBITDA from unconsolidated affiliates due primarily to higher earnings on Northern Border and Matterhorn.
Adjusted EBITDA increased $236 million for the six months ended June 30, 2026, compared with the same period in 2025, primarily as a result of the following:
•an increase of $169 million in optimization and marketing activity due primarily to favorable price differentials between the Waha Hub and Katy, Texas, markets;
•an increase of $42 million in transportation services due primarily to higher firm transportation revenue; and
•an increase of $34 million in adjusted EBITDA from unconsolidated affiliates due primarily to higher earnings on Northern Border and Matterhorn.
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Capital expenditures decreased for the three and six months ended June 30, 2026, compared with the same periods in 2025, due primarily to the timing of growth projects.
Three Months Ended Six Months Ended
June 30, June 30,
Operating Information (a) 2026 2025 2026 2025
Natural gas transportation capacity contracted (MDth/d) 7,735 7,206 7,786 7,254
Transportation capacity contracted 92 % 90 % 92 % 90 %
(a) - Included capacity contracted for consolidated entities only.
Our natural gas transportation capacity contracted increased for the three and six months ended June 30, 2026, compared with the same periods in 2025, due primarily to expansion projects and increased volumes contracted.
Refined Products and Crude
Selected Financial Results and Operating Information - The following tables set forth certain selected financial results and operating information for our Refined Products and Crude segment for the periods indicated:
Three Months Ended Six Months Ended Three Months Six Months
June 30, June 30, 2026 vs. 2025 2026 vs. 2025
Financial Results 2026 2025 2026 2025 $ Increase (Decrease) $ Increase (Decrease)
(Millions of dollars)
Product sales $ 6,485 $ 2,316 $ 10,613 $ 4,217 4,169 6,396
Transportation revenues 452 425 867 834 27 33
Storage, terminals and other revenues 197 167 370 325 30 45
Cost of sales and fuel (exclusive of depreciation and operating costs) (6,268) (2,175) (10,320) (4,010) 4,093 6,310
Operating costs, excluding noncash compensation adjustments (258) (210) (478) (427) 48 51
Adjusted EBITDA from unconsolidated affiliates 35 34 59 82 1 (23)
Other (16) — 8 7 (16) 1
Adjusted EBITDA $ 627 $ 557 $ 1,119 $ 1,028 70 91
Impairment of equity investments $ — $ — $ 60 $ — — 60
Capital expenditures $ 191 $ 184 $ 371 $ 325 7 46
Changes in commodity prices and sales volumes affect both revenues and cost of sales and fuel in our Consolidated Statements of Income and, therefore, the impact is largely offset between these line items.
Adjusted EBITDA increased $70 million for the three months ended June 30, 2026, compared with the same period in 2025, primarily as a result of the following:
•an increase of $79 million in transportation and storage due primarily to higher Refined Products volumes and rates; and
•an increase of $40 million in optimization and marketing due primarily to $48 million of higher crude marketing earnings, offset partially by $8 million due to lower liquids blending earnings; offset by
•an increase of $48 million in operating costs due primarily to $14 million of higher outside services related to the timing of projects, $13 million of higher employee-related costs and $9 million of higher property taxes associated with the growth of our operations.
Adjusted EBITDA increased $91 million for the six months ended June 30, 2026, compared with the same period in 2025, primarily as a result of the following:
•an increase of $108 million in transportation and storage due primarily to higher Refined Products volumes and rates; and
•an increase of $64 million in optimization and marketing due primarily to $81 million of higher crude marketing earnings, offset partially by $17 million due to lower liquids blending earnings; offset by
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•an increase of $51 million in operating costs due primarily to $17 million of higher employee-related costs associated with the growth of our operations, $16 million of higher outside services related to the timing of projects and $10 million of higher property taxes associated with the growth of our operations; and
•a decrease of $23 million in adjusted EBITDA from unconsolidated affiliates due primarily to losses on Powder Springs.
During the first quarter of 2026, we recorded a noncash impairment charge of $60 million related to our 50% investment in Powder Springs. For additional information on our impairment charge, see Note H of the Notes to Consolidated Financial Statements in this Quarterly Report.
Capital expenditures increased for the three and six months ended June 30, 2026, compared with the same periods in 2025, due primarily to our routine and large capital projects, including our greater Denver pipeline expansion project.
Three Months Ended Six Months Ended
June 30, June 30,
Operating Information (a) 2026 2025 2026 2025
Refined Products volumes shipped (MBbl/d) 1,629 1,503 1,598 1,452
Crude oil volumes shipped (MBbl/d) 1,766 1,782 1,690 1,814
(a) - Included volumes for consolidated entities only.
Refined Products volumes shipped increased for the three and six months ended June 30, 2026, compared with the same periods in 2025, due primarily to increased marketing affiliate volumes and regional market dynamics that impact demand on our system including timing of refinery disruptions.
Crude oil volumes shipped decreased for the three and six months ended June 30, 2026, compared with the same periods in 2025, due primarily to lower volumes associated with low-margin, short-haul movements and further integration of our assets.
Non-GAAP Financial Measures
The following table sets forth a reconciliation of net income, the nearest comparable GAAP financial performance measure, to adjusted EBITDA for the periods indicated:
Three Months Ended Six Months Ended
June 30, June 30,
(Unaudited) 2026 2025 2026 2025
Reconciliation of net income to adjusted EBITDA (Millions of dollars)
Net income $ 967 $ 853 $ 1,743 $ 1,544
Interest expense, net of capitalized interest 434 438 873 880
Depreciation and amortization 387 368 765 748
Income taxes 299 260 544 457
Adjusted EBITDA from unconsolidated affiliates 134 113 264 252
Equity in net earnings from investments (103) (81) (192) (189)
Impairment of equity investments — — 60 —
Noncash compensation expense and other (a) 3 30 61 64
Adjusted EBITDA $ 2,121 $ 1,981 $ 4,118 $ 3,756
Reconciliation of segment adjusted EBITDA to adjusted EBITDA
Segment adjusted EBITDA:
Natural Gas Gathering and Processing $ 546 $ 540 $ 1,013 $ 1,031
Natural Gas Liquids 659 673 1,365 1,308
Natural Gas Pipelines 297 188 636 400
Refined Products and Crude 627 557 1,119 1,028
Other (a) (8) 23 (15) (11)
Adjusted EBITDA $ 2,121 $ 1,981 $ 4,118 $ 3,756
(a) - The three months ended June 30, 2025, included transaction costs related primarily to the EnLink Acquisition of $21 million included within other and $1 million included within noncash compensation expense and other. The six months ended June 30, 2025, included transaction costs related primarily to the EnLink Acquisition of $52 million included within other and $12 million included within noncash compensation expense and other.
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CONTINGENCIES
See Note I of the Notes to Consolidated Financial Statements in this Quarterly Report for a discussion of regulatory and legal matters.
LIQUIDITY AND CAPITAL RESOURCES
General - Our primary sources of cash inflows are operating cash flows, proceeds from our commercial paper program and our $3.5 Billion Credit Agreement, debt issuances and the issuance of common stock for our liquidity and capital resource requirements.
We expect our sources of cash inflows to provide sufficient resources to finance our operations, capital expenditures, quarterly cash dividends, maturities of long-term debt, share repurchases and contributions to unconsolidated affiliates and joint ventures. We believe we have sufficient liquidity due to our $3.5 Billion Credit Agreement, which expires in February 2030, our $3.5 billion commercial paper program and our access to $1.0 billion available through an “at-the-market” equity program. No shares have been sold through our “at-the-market” equity program as of the date of this filing.
We may manage interest-rate risk through the use of fixed-rate debt, floating-rate debt, Treasury locks and interest-rate swaps. For additional information on our interest-rate derivative instruments, see Note D of the Notes to Consolidated Financial Statements in our Annual Report and Note C of the Notes to Consolidated Financial Statements in this Quarterly Report.
Cash Management - At June 30, 2026, we had $161 million of cash and cash equivalents. For our wholly owned subsidiaries, we use a centralized cash management program that concentrates the cash assets of our wholly owned nonguarantor operating subsidiaries in joint accounts for the purposes of providing financial flexibility and lowering the cost of borrowing, transaction costs and bank fees. Our centralized cash management program provides that funds in excess of the daily needs of our operating subsidiaries are concentrated, consolidated or otherwise made available for use by other entities within our consolidated group. Our operating subsidiaries participate in this program to the extent they are permitted pursuant to FERC regulations or their operating agreements. Under the cash management program, depending on whether a participating subsidiary has short-term cash surpluses or cash requirements, we provide cash to the subsidiary or the subsidiary provides cash to us.
Guarantees - ONEOK, ONEOK Partners, the Intermediate Partnership, Magellan, EnLink and EnLink Partners have cross guarantees in place for ONEOK’s and ONEOK Partners’ indebtedness. These guarantees in place for our and ONEOK Partners’ indebtedness are full, irrevocable, unconditional and absolute joint and several guarantees to the holders of each series of outstanding securities. Liabilities under the guarantees rank equally in right of payment with all of the guarantors’ existing and future senior unsecured indebtedness. The Intermediate Partnership holds all of ONEOK Partners’ interests and equity in its subsidiaries, which are nonguarantors, and substantially all the assets and operations reside with nonguarantor operating subsidiaries. Magellan, EnLink and EnLink Partners hold interests in their subsidiaries, which are nonguarantors, and substantially all the assets and operations reside with nonguarantor operating subsidiaries. Therefore, as allowed under Rule 13-01 of Regulation S-X, we have excluded the summarized financial information for each issuer and guarantor as the combined financial information of subsidiary issuers and parent guarantors, excluding our ownership of all interest in ONEOK Partners, Magellan and EnLink, reflects no material assets or liabilities or results of operations apart from guaranteed indebtedness.
For additional information on our indebtedness, see Note G of the Notes to Consolidated Financial Statements in our Annual Report and Note D of the Notes to Consolidated Financial Statements in this Quarterly Report.
Short-term Liquidity - Our principal sources of short-term liquidity consist of cash generated from operating activities, distributions received from our unconsolidated affiliates, proceeds from our commercial paper program and our $3.5 Billion Credit Agreement. As of June 30, 2026, we had $899 million of commercial paper outstanding, $600 million of borrowings outstanding under our $1.2 Billion Term Loan Agreement, and no borrowings under our $3.5 Billion Credit Agreement, and we are in compliance with all covenants.
As of June 30, 2026, we had a working capital (defined as current assets less current liabilities) deficit of $1.9 billion, due primarily to current maturities of long-term debt and short-term borrowings. Generally, our working capital is influenced by several factors, including, among other things: (i) the timing of (a) debt and equity issuances, (b) the funding of capital expenditures, (c) scheduled debt payments, and (d) accounts receivable and payable; and (ii) the volume and cost of inventory and commodity imbalances. We may have working capital deficits in future periods as our long-term debt becomes current. We do not expect a working capital deficit of this nature to have a material adverse impact to our cash flows or operations.
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In April 2026, we entered into a $1.2 Billion Term Loan Agreement, which was available to be drawn in up to two borrowings within 90 days of the closing date. Borrowings under the $1.2 Billion Term Loan Agreement bear interest at Term SOFR plus an applicable margin of 95 basis points. The $1.2 Billion Term Loan Agreement matures 364 days after June 23, 2026, the date of the initial borrowing, and may be used for working capital, capital expenditures, acquisitions, mergers and for other general corporate purposes. The $1.2 Billion Term Loan Agreement allows prepayment of all or any portion outstanding, without penalty or premium, and contains substantially the same covenants as those contained in our $3.5 Billion Credit Agreement. In July 2026, the remaining borrowings available under the $1.2 Billion Term Loan Agreement were fully drawn and no additional amounts may be borrowed.
For additional information on our $3.5 Billion Credit Agreement and our $1.2 Billion Term Loan Agreement, see Note D of the Notes to Consolidated Financial Statements in this Quarterly Report.
Long-term Financing - In addition to our principal sources of short-term liquidity discussed above, we expect to fund our longer-term financing requirements by issuing long-term notes, as needed. Other options to obtain financing include, but are not limited to, issuing common stock, loans from financial institutions, issuance of convertible debt securities or preferred equity securities, asset securitization and the sale and lease-back of facilities.
We may, at any time, seek to retire or purchase our or ONEOK Partners’ outstanding debt through cash purchases and/or exchanges for equity or debt, in open-market repurchases, privately negotiated transactions, exercise of contractual call rights, public tender offers or otherwise. Such repurchases and exchanges, if any, will be on such terms and prices as we may determine and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.
Debt Extinguishments - In April 2026, we redeemed the remaining $491 million of our $500 million, 4.85% senior notes due July 2026 at 100% of the outstanding principal amount, plus accrued and unpaid interest, with short-term borrowings.
Capital Expenditures - We proactively monitor lead times on materials and equipment used in constructing capital projects, and we enter into procurement agreements for long-lead items for potential projects to plan for future growth. Our capital expenditures are financed typically through operating cash flows and short- and long-term debt.
Capital expenditures, less allowance for equity funds used during construction, were $1.5 billion and $1.4 billion for the six months ended June 30, 2026 and 2025, respectively.
We expect total capital expenditures of $2.7 billion - $3.2 billion in 2026. See discussion of our primary capital projects in the “Recent Developments” section in this Quarterly Report.
Credit Ratings - Our credit ratings as of July 27, 2026, are shown in the table below:
Rating Agency Long-term Rating Short-term Rating Outlook
Moody’s Baa2 Prime-2 Stable
S&P BBB A-2 Stable
Fitch BBB F2 Stable
Our credit ratings, which are investment grade, may be affected by our leverage, liquidity, credit profile or potential transactions. The most common criteria for assessment of our credit ratings are the debt-to-EBITDA ratio, interest coverage, business risk profile and liquidity. If our credit ratings were downgraded, our cost to borrow funds under our $3.5 Billion Credit Agreement could increase, and a potential loss of access to the commercial paper market could occur. In the event that we are unable to borrow funds under our commercial paper program and there has not been a material adverse change in our business, we would continue to have access to our $3.5 Billion Credit Agreement, which expires in February 2030. An adverse credit rating change alone is not a default under our $3.5 Billion Credit Agreement and the $1.2 Billion Term Loan Agreement.
In the normal course of business, our counterparties provide us with secured and unsecured credit. In the event of a downgrade in our credit ratings or a significant change in our counterparties’ evaluation of our creditworthiness, we could be required to provide additional collateral in the form of cash, letters of credit or other negotiable instruments as a condition of continuing to conduct business with such counterparties. We may be required to fund margin requirements with our counterparties with cash, letters of credit or other negotiable instruments.
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Dividends - Holders of our common stock share equally in any common stock dividends declared by our Board of Directors. In February and May 2026, we paid a quarterly common stock dividend of $1.07 per share ($4.28 per share on an annualized basis), an increase of 4% compared with the same quarters in the prior year. We declared a quarterly common stock dividend of $1.07 per share in July 2026. The quarterly common stock dividend will be paid on August 14, 2026, to shareholders of record at the close of business on August 3, 2026.
For the six months ended June 30, 2026, our cash flows from operations exceeded dividends paid by $1.6 billion. We expect our cash flows from operations to continue to sufficiently fund our cash dividends. To the extent operating cash flows are not sufficient to fund our dividends, we may utilize cash on hand from other sources of short- and long-term liquidity to fund a portion of our dividends.
CASH FLOW ANALYSIS
We use the indirect method to prepare our Consolidated Statements of Cash Flows. Under this method, we reconcile net income to cash flows provided by operating activities by adjusting net income for those items that affect net income but do not result in actual cash receipts or payments during the period and for operating cash items that do not impact net income. These reconciling items can include depreciation and amortization, deferred income taxes, impairment charges, allowance for equity funds used during construction, gain or loss on sale of business and assets, net undistributed earnings from unconsolidated affiliates, share-based compensation expense, other amounts and changes in our assets and liabilities not classified as investing or financing activities.
The following table sets forth the changes in cash flows by operating, investing and financing activities for the periods indicated:
Variances
Six Months Ended 2026 vs. 2025
June 30, $ Increase (Decrease) in Cash
2026 2025
(Millions of dollars)
Total cash provided by (used in):
Operating activities $ 2,987 $ 2,429 558
Investing activities (1,789) (1,508) (281)
Financing activities (1,115) (1,557) 442
Change in cash and cash equivalents 83 (636) 719
Cash and cash equivalents at beginning of period 78 733 (655)
Cash and cash equivalents at end of period $ 161 $ 97 64
Operating Cash Flows - Operating cash flows are affected by earnings from our business activities and changes in our operating assets and liabilities. Changes in commodity prices and demand for our services or products, whether because of general economic conditions, changes in supply, changes in demand for the end products that are made with our products or increased competition from other service providers, could affect our earnings and operating cash flows. Our operating cash flows can also be impacted by changes in our inventory balances, which are driven primarily by commodity prices, supply, demand and the operation of our assets.
Cash flows from operating activities, before changes in operating assets and liabilities for the six months ended June 30, 2026, increased $518 million, compared with the same period in 2025, due primarily to increased earnings resulting from higher NGL, Refined Products and natural gas volumes and higher optimization and marketing activity, and higher deferred income taxes as discussed in “Financial Results and Operating Information.”
The changes in operating assets and liabilities decreased operating cash flows $249 million for the six months ended June 30, 2026, compared with a decrease of $289 million for the same period in 2025. This change is due primarily to changes in accounts payable, which vary from period to period with changes in commodity prices and from the timing of payments to vendors, suppliers and other third parties, and changes in other assets and liabilities. These changes were offset partially by changes in accounts receivable resulting from the receipt of cash from counterparties, which vary from period to period, and with changes in commodity prices.
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Investing Cash Flows - Cash used in investing activities for the six months ended June 30, 2026, increased $281 million, compared with the same period in 2025, due primarily to an increase in contributions to unconsolidated affiliates and an increase in capital expenditures related to our capital projects.
Financing Cash Flows - Cash used in financing activities for the six months ended June 30, 2026, decreased $442 million, compared with the same period in 2025, due primarily to $600 million of borrowings drawn under the $1.2 Billion Term Loan Agreement, cash paid for the Delaware Basin JV Acquisition in 2025 and a decrease in the extinguishment of long-term debt in 2026, offset partially by a decrease in short-term borrowings in 2026 and an increase in dividends paid in 2026.
IMPACT OF NEW ACCOUNTING STANDARDS
See Note A of the Notes to Consolidated Financial Statements in this Quarterly Report for discussion of new accounting standards.
CRITICAL ACCOUNTING ESTIMATES
The preparation of our Consolidated Financial Statements and related disclosures in accordance with GAAP requires us to make estimates and assumptions with respect to values or conditions that cannot be known with certainty that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements. These estimates and assumptions also affect the reported amounts of revenue and expenses during the reporting period. Although we believe these estimates and assumptions are reasonable, actual results could differ from our estimates.
Information about our critical accounting estimates is included under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Estimates,” in our Annual Report.
FORWARD-LOOKING STATEMENTS
This Quarterly Report contains forward-looking statements in reliance on the safe harbor protections of the Securities Act of 1933, as amended (the “Securities Act”), and the Exchange Act, which involve substantial risks and uncertainties. Such forward-looking statements include, but are not limited to, statements relating to our anticipated financial performance, liquidity, management’s plans, expectations and objectives for our future capital projects and other future operations, our business prospects, the outcome of regulatory and legal proceedings, market conditions, potential or pending strategic transactions, the timing thereof and our ability to achieve the intended and projected operational, financial and strategic benefits from any such transactions, and other matters. The following discussion is intended to identify important factors that could cause future outcomes to differ materially from those set forth in the forward-looking statements.
Forward-looking statements and other statements in this Quarterly Report regarding our environmental, social and other sustainability targets, plans and goals are not an indication that these statements are required to be disclosed in our filings with the SEC, or that we will continue to make similar statements to the same extent or manner in future filings. In addition, historical, current and forward-looking environmental, social and sustainability-related statements may be based on standards and processes for measuring progress that are still developing and that continue to evolve, and assumptions that are subject to change in the future.
Forward-looking statements include the items identified in the preceding paragraphs, the information concerning possible or assumed future results of our operations and other statements contained in this Quarterly Report identified by words such as “anticipates,” “believes,” “continues,” “could,” “estimates,” “expects,” “forecasts,” “goal,” “guidance,” “intends,” “may,” “might,” “outlook,” “plans,” “potential,” “projects,” “scheduled,” “should,” “target,” “will,” “would,” and other words and terms of similar meaning.
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One should not place undue reliance on forward-looking statements. Known and unknown risks, uncertainties and other factors may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by forward-looking statements. Those factors may affect our operations, markets, products, services and prices. In addition to any assumptions and other factors referred to specifically in connection with the forward-looking statements, factors that could cause our actual results to differ materially from those contemplated in any forward-looking statement include, among others, the following:
•the impact on drilling and production by factors beyond our control, including the demand for natural gas, NGLs, Refined Products and crude oil; producers’ desire and ability to drill and obtain necessary permits; regulatory compliance; reserve performance; and capacity constraints and/or shut downs on the pipelines that transport crude oil, natural gas, NGLs, and Refined Products from producing areas and our facilities;
•the impact of unfavorable economic and market conditions, inflationary pressures, which may increase our capital expenditures and operating costs, raise the cost of capital or depress economic growth;
•the economic or other impact of announced or future tariffs, including inflationary impacts;
•the impact of the volatility of natural gas, NGL, Refined Products and crude oil prices on our earnings and cash flows, which is impacted by a variety of factors beyond our control, including international terrorism and conflicts and geopolitical instability (including instability in the Middle East and Venezuela);
•the impact of reduced volatility in energy prices or new government regulations that could discourage our storage customers from holding positions in Refined Products, crude oil and natural gas;
•our dependence on producers, gathering systems, refineries and pipelines owned and operated by others and the impact of any closures, interruptions or reduced activity levels at these facilities;
•the impact of scrutiny and conflicting stakeholder expectations regarding ESG issues, including climate change, and risks associated with the physical and financial impacts of climate change;
•risks associated with operational hazards and unforeseen interruptions at our operations;
•the inability of insurance proceeds to cover all liabilities or incurred costs and losses, or lost earnings, resulting from a loss;
•the risk of increased costs for insurance premiums or less favorable coverage;
•demand for our services and products in the proximity of our facilities;
•risks associated with our ability to hedge against commodity price risks or interest rate risks;
•a breach of information security, including a cybersecurity attack, or failure of one or more key information technology or operational systems, and terrorist attacks, including cyber sabotage;
•exposure to construction risk and supply risks if adequate natural gas, NGL, Refined Products and crude oil supply is unavailable upon completion of facilities;
•the accuracy of estimates of hydrocarbon reserves, which could result in lower than anticipated volumes;
•our lack of ownership over all of the land on which our property is located and certain of our facilities and equipment;
•the impact of changes in estimation, type of commodity and other factors on our measurement adjustments;
•excess capacity on our pipelines, processing, fractionation, terminal and storage assets;
•risks associated with the period of time our assets have been in service;
•our partial reliance on cash distributions from our unconsolidated affiliates on our operating cash flows;
•our ability to cause our joint ventures to take or not take certain actions unless some or all of our joint-venture participants agree;
•our reliance on others to construct and/or operate certain joint-venture assets and to provide other services;
•our ability to use net operating losses and certain tax attributes;
•increased regulation of exploration and production activities, including hydraulic fracturing, well setbacks and disposal of wastewater;
•impacts of regulatory oversight and potential penalties on our business;
•risks associated with the rate regulation, challenges or changes, which may reduce the amount of cash we generate;
•the impact of our gas liquids blending activities, which subject us to federal regulations that govern renewable fuel requirements in the U.S.;
•incurrence of significant costs to comply with the regulation of greenhouse gas emissions;
•the impact of federal and state laws and regulations relating to the protection of the environment, public health and safety on our operations, as well as increased litigation and activism challenging oil and gas development as well as changes to and/or increased penalties from the enforcement of laws, regulations and policies;
•the impact of unforeseen changes in interest rates, debt and equity markets and other external factors over which we have no control;
•actions by rating agencies concerning our credit;
•our indebtedness and guarantee obligations could cause adverse consequences, including making us vulnerable to general adverse economic and industry conditions, limiting our ability to borrow additional funds and placing us at competitive disadvantages compared with our competitors that have less debt;
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•an event of default may require us to offer to repurchase certain of our or ONEOK Partners’ senior notes or may impair our ability to access capital;
•the right to receive payments on our outstanding debt securities and subsidiary guarantees is unsecured and effectively subordinated to any future secured indebtedness and any existing and future indebtedness of our subsidiaries that do not guarantee the senior notes;
•use by a court of fraudulent conveyance to avoid or subordinate the cross guarantees of our or ONEOK Partners’ indebtedness;
•the risks associated with pending or possible acquisitions and dispositions, including our ability to finance or integrate any such acquisitions and any regulatory delay or conditions imposed by regulatory bodies in connection with any such acquisitions and dispositions;
•our ability to effectively manage our expanded operations following closing of recent and potential future acquisitions;
•our ability to pay dividends;
•our exposure to the credit risk of our customers or counterparties;
•a shortage of skilled labor;
•misconduct or other improper activities engaged in by our employees;
•the impact of potential impairment charges;
•the impact of the changing cost of providing pension and health care benefits, including postretirement health care benefits, to eligible employees and qualified retirees;
•our ability to maintain an effective system of internal controls; and
•the risk factors listed in the reports we have filed and may file with the SEC.
These factors are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in any of our forward-looking statements. Other factors could also adversely affect our future results. These and other risks are described in greater detail in Part I, Item 1A, “Risk Factors,” in our Annual Report and in our other filings that we make with the SEC, which are available via the SEC’s website at www.sec.gov and our website at www.oneok.com. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these factors. Any such forward-looking statement speaks only as of the date on which such statement is made, and other than as required under securities laws, we undertake no obligation to update publicly any forward-looking statement whether as a result of new information, subsequent events or change in circumstances, expectations or otherwise.
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