ONEOK, Inc. (pronounced /ˈwʌnoʊk/ WUN-ohk[3]; NYSE: OKE) is a diversified Fortune 200 corporation based in Tulsa, Oklahoma. Founded in 1906 as Oklahoma Natural Gas Company, it is one of the largest natural gas distributors in the United States. It serves approximately 2 million customers through its natural gas distribution companies Oklahoma Natural Gas, Kansas Gas Service, and Texas Gas Service. ONEOK is also a general partner and owns 45.7 percent of ONEOK Partners, LP which is one of the largest publicly traded limited partnerships in the gathering, processing, storage and transportation of natural gas. It also owns major natural gas liquids (NGL) systems due to the 2005 acquisition of Koch Industries' natural gas businesses.
ONEOK's Energy Services operation focuses primarily on marketing natural gas and related services throughout the U.S. Energy Services, which derives more than 84 percent of its earnings from the physical marketing business, showed an operating income increase of $26.5 million. Energy Services’ retail business participates in customer gas choice program in Nebraska and Wyoming.
In 2007 Fortune magazine named ONEOK the most admired company in the Energy industry. It changed its corporate name to ONEOK in December 1980.
ONEOK Inc. (pronounced "one oak") is a diversified energy company headquartered in Tulsa, Oklahoma. Among its utility subsidiaries, Oklahoma Natural Gas Company serves three-quarters of Oklahoma and, in terms of the number of customers it serves, is the twentieth-largest gas utility company in the United States. ONG Transmission Company, another utility division, leases pipeline capacity and provides the link for interstate gas transportation. ONEOK's non-utility division, the Energy Companies of ONEOK, is an important natural gas liquids processor and a mid-sized gas and oil exploration and production company.
ONEOK began as Oklahoma Natural Gas (ONG) and was formed in an era when natural gas was treated as a nuisance in the oil fields. In 1906 Territorial Congressman Dennis T. Flynn and businessman C. B. Ames decided to pipe gas from northeastern Oklahoma to Oklahoma City, which at the time was served by a manufactured gas facility. To do this, on October 12, 1906, they formed the Oklahoma Natural Gas Company with backers Theodore N. Barnsdall of the Barnsdall Oil Company and former Standard Oil officer Glen T. Braden.
Flynn, who was ONG's first president, signed contracts to supply local distributors, and on December 28, 1907--a month after Oklahoma was admitted to the union as the 46th state--a 100-mile pipeline, costing $1.7 million, was completed from Tulsa to Oklahoma City.
Braden replaced Flynn after the pipeline's completion, and managed the nascent company in an Oklahoma that had no highways and few schools, but more than its share of "high noon" law that was enforced by the fastest gun. This was the period when state legislators were expected to check their sidearms with the Sergeant at Arms in each legislative body. During World War I, Braden increased the company's capitalization to $10 million and reduced the price of its stock from $100 to $25 per share.
In 1921, Harry Heasley replaced an ill Braden as president. Heasley soon created two oil companies to exploit the extensive oil-bearing properties ONG had found while seeking natural gas. The second of these, Oklahoma Eastern, was later merged with Devonian Oil through an exchange of stock.
In the mid-1920s, the American economy boomed and the oil and gas business boomed with it. With such increased economic activity, ONG became a takeover target. On July 31, 1926, the company was sold to New York investment bankers White, Weld, and Company.
ONEOK, Inc. is a diversified energy company. The Company’s segments include ONEOK Partners, Distribution and Energy Services. As of December31, 2010, the Company was the sole general partner and own 42.8% of ONEOK Partners, L.P. ONEOK Partners is engaged in the gathering, processing, storage and transportation of natural gas in the United States. In addition, ONEOK Partners owns natural gas liquids systems, connecting natural gas liquids (NGL) supply in the Mid-Continent and Rocky Mountain regions with key market centers. The Company’s major distribution markets include Oklahoma City and Tulsa, Oklahoma; Kansas City, Wichita, and Topeka, Kansas, and Austin and El Paso, Texas. Its energy services operation is engaged in providing natural gas marketing services to its customers across the United States.
ONEOK Partners
ONEOK Partners’ natural gas gathering and processing business is engaged in the gathering and processing of natural gas produced from crude oil and natural gas wells, primarily in the Mid-Continent and Rocky Mountain regions, which include the Anadarko Basin of Oklahoma that contains the NGL-rich Cana-Woodford Shale formation, Hugoton and Central Kansas Uplift Basins of Kansas, the Williston Basin of Montana and North Dakota that includes the oil-producing, NGL-rich Bakken Shale and Three Forks formations, and the Powder River Basin of Wyoming. Through gathering systems, natural gas is aggregated and treated or processed for removal of water vapor, solids and other contaminants, and to extract NGLs in order to provide marketable natural gas, commonly referred to as residue gas. In the Powder River Basin, the natural gas that ONEOK Partners gathers is coal-bed methane, or dry natural gas, that does not require processing or NGL extraction, in order to be marketable; dry natural gas is gathered, compressed and delivered into a downstream pipeline or marketed for a fee.
ONEOK Partners’ natural gas pipeline business operates interstate and intrastate natural gas transmission pipelines, natural gas storage facilities and non-processable natural gas gathering facilities. ONEOK Partners also provides natural gas transportation and storage services. ONEOK Partners’ FERC-regulated interstate assets transport natural gas through pipelines that access supply from Canada and from the Mid-Continent, Rocky Mountain and Gulf Coast regions. ONEOK Partners’ intrastate natural gas pipeline assets are located in Oklahoma, Texas and Kansas, and have access to major natural gas producing areas in those states. ONEOK Partners owns underground natural gas storage facilities in Oklahoma, Kansas and Texas.
ONEOK Partners’ natural gas liquids business gathers, treats, fractionates and transports NGLs and distributes and stores NGL products. ONEOK Partners’ natural gas liquids gathering pipelines deliver unfractionated NGLs gathered from natural gas processing plants located in Oklahoma, Kansas, Texas and the Rocky Mountain region to fractionators it owns in Oklahoma, Kansas and Texas, as well as to third-party fractionators and third-party pipelines. The NGLs are then separated through the fractionation process into the individual NGL products. The individual NGL products are stored or distributed to petrochemical manufacturers, heating-fuel users, refineries and propane distributors through ONEOK Partners’ FERC-regulated distribution pipelines that move NGL products from Oklahoma and Kansas to the Mid-Continent and Gulf Coast NGL market centers, as well as the Midwest markets near Chicago, Illinois.
Distribution
The Company’s distribution segment provides natural gas distribution services to more than two million customers in Oklahoma, Kansas and Texas through Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service. The Company serves residential, commercial, industrial and transportation customers in all three states. In addition, its distribution companies serve wholesale and public authority customers. Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service distribute natural gas as public utilities to approximately 82%, 67%and 13% of the distribution markets for Oklahoma, Kansas and Texas, respectively. Natural gas sold to residential and commercial customers accounts for approximately 80% and 19% of its natural gas sales, respectively, in Oklahoma; 75% and 19% of its natural gas sales, respectively, in Kansas; and 70% and 22% of its natural gas sales, respectively, in Texas.
Energy Services
The Company’s Energy Services segment utilizes its network of contracted natural gas supply and contracted transportation and storage assets to provide services to its customers. The Company’s Energy Services segment delivers physical natural gas products and risk management services through its network of contracted transportation and storage capacity and natural gas supply. Its customers primarily include local distribution companies (LDCs), electric utilities, and commercial and industrial end users. The Company offers services and products for its customers’ swing and peaking natural gas commodity requirements on a year-round basis. It also provides no-notice service, weather-related protection and other custom solutions based on its customers’ specific needs.
The company had indeed grown and diversified. Oklahoma Natural Gas had become a major player in the industry. It distributed gas to 215 communities, wholesaled it to distributors serving 47 states, and had some 600,000 residential customers. Within ONEOK's non-utility division, the ONEOK Energy Companies, ONEOK Exploration Company explored for oil and natural gas, while Smart Drilling Company, acquired in 1979, was a contract-drilling operation.
In 1981 and 1982, sales reached record $1 billion levels. Revenues were also reaching record heights, as was capital spending, which topped $181 million in 1982. This spending included subsidiary TransTex Pipeline Company's share of the new Red River Pipeline, and Caney River Transmission Company's share of the new Ozark Gas Transmission System, which crossed the Arkoma Basin from Oklahoma to Arkansas.
But despite these records, by 1982 the company was feeling the pinch of recession-caused weaknesses in the industrial market. This market was especially important because ONEOK had signed take-or-pay contracts with its own suppliers and was therefore obliged to pay for gas even when it had no customers. Since 1982 take-or-pay claims amounted to some $108 million, Ingram and newly named CEO J. E. Tyree were faced with the necessity to economize. They cut costs, reduced ONG's capital budget, and fought these claims in court. Nevertheless, a weak economy, sparse contract-drilling demand, lower investment tax credits, increased interest costs, and a $12.8 million drilling write-off in Malta all cut 1983 earnings per share to $2.51 from 1982's $4.88.
To make matters worse, even though executives did what they could to keep industrial deliveries high by cutting prices to ONG's five fertilizer plant customers to keep them in business, deliveries continued to fall from 1982's 281 billion cubic feet (bcf) to 242 bcf. The erosion of deliveries exposed ONEOK to heavy take-or-pay claims.
Weather and rate increases helped the company recover to a degree in 1984. But while ONEOK tried to look optimistic as it opened a new 17-story company headquarters in downtown Tulsa, it cut capital expenditures, moved away from natural gas exploration, and reduced the number of rigs in its contract-drilling operation.
Events of 1985 continued to be sobering. Earnings per share continued to fall, as did demand. New federal regulations allowed industrial users to purchase gas from the wellhead and transport it through pipeline-capacity leases. On the energy side, ONEOK drilling company reported a net loss of $5 million, about half of which was attributable to a three-rig write-down.
On the positive side, executives instituted a long-range planning strategy, moved strongly into oil production by acquiring Imperial Oil for $9.4 million, and formed ONG Transmission Company to handle opportunities in pipeline capacity leases. These opportunities were made more lucrative by the fact that Oklahoma was the nation's third most prolific gas-producing state.
In 1986, a sluggish economy, warm weather, and unrecoverable take-or-pay settlements of almost $6.2 million forced ONEOK into drastic economies. It consolidated offices, cut down on drilling, and through early retirement policies, reduced its work force by 380, or nearly 15 percent. Things continued to deteriorate in 1987. After a jury awarded Forest Oil $50 million in a take-or-pay suit, banks withdrew an $85 million line of credit and ratings services downgraded ONEOK's debt.
To get ONEOK back on its financial feet, J. D. Scott, who had become president and CEO in 1986, interrupted regular dividends, appealed the Forest Oil verdict, and established reserves of $112.3 million for unresolved take-or-pay disputes. In 1988, he continued downsizing by providing an early retirement package and incentives for 113 employees to resign or retire. He also sold slightly more than 50 percent of the company's exploration leases. A light at the end of the tunnel began to appear in 1989, when earnings per share rose 71 percent, dividends were restored, and exploration and production activities became profitable for the first time in five years. In 1990, Standard and Poors and Duff and Phelps upgraded ONEOK's debt to A- from BBB+.
Scott evidenced his own confidence through acquisitions and expansions. He committed to a major expansion of the Ozark Gas Transmission System, announced a ONEOK Exploration strategy committed to riskier plays with bigger payoffs, acquired the Lone Star Gas Company in central Oklahoma, and continued a research, development, and demonstration project, begun in 1980, that used natural gas as an alternative fuel for vehicles.
By 1991, Harlan S. Byrne of Barrons commented that "for the first time in several years, most things that count were starting to click for ONEOK." In 1992 ONEOK remained optimistic despite a significantly warmer than normal winter and unprofitable spot market prices. The company formed ONEOK Gas Marketing to pool and market the products of Oklahoma's independent producers, and ONEOK Technology Company to develop and market a new meter-setting device. Looking to the future, ONEOK planned to introduce a natural gas-fired heat pump and to promote compressed natural gas fleet vehicles in a state that already has more natural-gas fueled vehicles than any state in the union.
Principal Subsidiaries: Caney River Transmission Company; ONG Red Oak Transmission Company; ONG Sayre Storage Company; ONG Western, Inc.; TransTex Pipeline Company; OkTex Pipeline Company; ONEOK Services, Inc.; ONEOK Technology Company; ONEOK Drilling Company; ONEOK Exploration Company; ONEOK Products Company; ONEOK Resources Company; ONEOK Gas Marketing Company; ONEOK Leasing Company; ONEOK Parking Company.
Source: International Directory of Company Histories, Vol. 7. St. James Press, 1993.
OVERALL
Beta: 1.08
Market Cap (Mil.): $7,593.75
Shares Outstanding (Mil.): 107.12
Annual Dividend: 2.08
Yield (%): 2.93
FINANCIALS
OKE Industry Sector
P/E (TTM): 24.83 19.04 21.11
EPS (TTM): -9.52 -- --
ROI: 6.35 2.11 1.45
ROE: 12.71 4.06 3.15
Statistics:
Public Company
Incorporated: 1906 as Oklahoma Natural Gas
Sales: $677 million
Employees: 2,229
Stock Exchanges: New York Chicago
SICs: 1311 Crude Petroleum & Natural Gas; 4923 Gas Transmission & Distribution; 6719 Holding Companies Nec
Name Age Since Current Position
Kyle, David 58 2007 Independent Chairman of the Board
Gibson, John 58 2011 Vice Chairman of the Board, President, Chief Executive Officer
Martinovich, Robert 53 2011 Chief Financial Officer, Senior Vice President, Treasurer
Dinan, Curtis 43 2011 President - Natural Gas of ONEOK Partners, L.P.
Lawhorn, Caron 49 2011 President of ONEOK Inc. Distribution Companies
French, Kari 53 2011 President of Texas Gas Service
Norton, Pierce 51 2011 Chief Operating Officer
Reiners, Derek 39 2009 Senior Vice President, Chief Accounting Officer
Barker, John 63 2004 Senior Vice President, General Counsel, Assistant Secretary
Mareburger, Robert 49 2011 Senior Vice President - Corporate Planning and Development
Spencer, Terry 51 2009 Chief Operating Officer of ONEOK Partners, L.P.
Ford, William 68 1981 Independent Lead Director
Mackie, Bert 68 1989 Independent Director
Parker, Gary 65 1991 Independent Director
Moore, Pattye 53 2002 Independent Director
Edwards, Julie 52 2007 Independent Director
Day, James 68 2004 Independent Director
Rodriguez, Eduardo 55 2004 Independent Director
Tippeconnic, David 71 2006 Independent Director
Mogg, Jim 62 2007 Independent Director
Smith, Gerald 60 2009 Independent Director
Address:
100 West Fifth Street
P.O. Box 871
Tulsa, Oklahoma 74102-0871
U.S.A.
ONEOK's Energy Services operation focuses primarily on marketing natural gas and related services throughout the U.S. Energy Services, which derives more than 84 percent of its earnings from the physical marketing business, showed an operating income increase of $26.5 million. Energy Services’ retail business participates in customer gas choice program in Nebraska and Wyoming.
In 2007 Fortune magazine named ONEOK the most admired company in the Energy industry. It changed its corporate name to ONEOK in December 1980.
ONEOK Inc. (pronounced "one oak") is a diversified energy company headquartered in Tulsa, Oklahoma. Among its utility subsidiaries, Oklahoma Natural Gas Company serves three-quarters of Oklahoma and, in terms of the number of customers it serves, is the twentieth-largest gas utility company in the United States. ONG Transmission Company, another utility division, leases pipeline capacity and provides the link for interstate gas transportation. ONEOK's non-utility division, the Energy Companies of ONEOK, is an important natural gas liquids processor and a mid-sized gas and oil exploration and production company.
ONEOK began as Oklahoma Natural Gas (ONG) and was formed in an era when natural gas was treated as a nuisance in the oil fields. In 1906 Territorial Congressman Dennis T. Flynn and businessman C. B. Ames decided to pipe gas from northeastern Oklahoma to Oklahoma City, which at the time was served by a manufactured gas facility. To do this, on October 12, 1906, they formed the Oklahoma Natural Gas Company with backers Theodore N. Barnsdall of the Barnsdall Oil Company and former Standard Oil officer Glen T. Braden.
Flynn, who was ONG's first president, signed contracts to supply local distributors, and on December 28, 1907--a month after Oklahoma was admitted to the union as the 46th state--a 100-mile pipeline, costing $1.7 million, was completed from Tulsa to Oklahoma City.
Braden replaced Flynn after the pipeline's completion, and managed the nascent company in an Oklahoma that had no highways and few schools, but more than its share of "high noon" law that was enforced by the fastest gun. This was the period when state legislators were expected to check their sidearms with the Sergeant at Arms in each legislative body. During World War I, Braden increased the company's capitalization to $10 million and reduced the price of its stock from $100 to $25 per share.
In 1921, Harry Heasley replaced an ill Braden as president. Heasley soon created two oil companies to exploit the extensive oil-bearing properties ONG had found while seeking natural gas. The second of these, Oklahoma Eastern, was later merged with Devonian Oil through an exchange of stock.
In the mid-1920s, the American economy boomed and the oil and gas business boomed with it. With such increased economic activity, ONG became a takeover target. On July 31, 1926, the company was sold to New York investment bankers White, Weld, and Company.
ONEOK, Inc. is a diversified energy company. The Company’s segments include ONEOK Partners, Distribution and Energy Services. As of December31, 2010, the Company was the sole general partner and own 42.8% of ONEOK Partners, L.P. ONEOK Partners is engaged in the gathering, processing, storage and transportation of natural gas in the United States. In addition, ONEOK Partners owns natural gas liquids systems, connecting natural gas liquids (NGL) supply in the Mid-Continent and Rocky Mountain regions with key market centers. The Company’s major distribution markets include Oklahoma City and Tulsa, Oklahoma; Kansas City, Wichita, and Topeka, Kansas, and Austin and El Paso, Texas. Its energy services operation is engaged in providing natural gas marketing services to its customers across the United States.
ONEOK Partners
ONEOK Partners’ natural gas gathering and processing business is engaged in the gathering and processing of natural gas produced from crude oil and natural gas wells, primarily in the Mid-Continent and Rocky Mountain regions, which include the Anadarko Basin of Oklahoma that contains the NGL-rich Cana-Woodford Shale formation, Hugoton and Central Kansas Uplift Basins of Kansas, the Williston Basin of Montana and North Dakota that includes the oil-producing, NGL-rich Bakken Shale and Three Forks formations, and the Powder River Basin of Wyoming. Through gathering systems, natural gas is aggregated and treated or processed for removal of water vapor, solids and other contaminants, and to extract NGLs in order to provide marketable natural gas, commonly referred to as residue gas. In the Powder River Basin, the natural gas that ONEOK Partners gathers is coal-bed methane, or dry natural gas, that does not require processing or NGL extraction, in order to be marketable; dry natural gas is gathered, compressed and delivered into a downstream pipeline or marketed for a fee.
ONEOK Partners’ natural gas pipeline business operates interstate and intrastate natural gas transmission pipelines, natural gas storage facilities and non-processable natural gas gathering facilities. ONEOK Partners also provides natural gas transportation and storage services. ONEOK Partners’ FERC-regulated interstate assets transport natural gas through pipelines that access supply from Canada and from the Mid-Continent, Rocky Mountain and Gulf Coast regions. ONEOK Partners’ intrastate natural gas pipeline assets are located in Oklahoma, Texas and Kansas, and have access to major natural gas producing areas in those states. ONEOK Partners owns underground natural gas storage facilities in Oklahoma, Kansas and Texas.
ONEOK Partners’ natural gas liquids business gathers, treats, fractionates and transports NGLs and distributes and stores NGL products. ONEOK Partners’ natural gas liquids gathering pipelines deliver unfractionated NGLs gathered from natural gas processing plants located in Oklahoma, Kansas, Texas and the Rocky Mountain region to fractionators it owns in Oklahoma, Kansas and Texas, as well as to third-party fractionators and third-party pipelines. The NGLs are then separated through the fractionation process into the individual NGL products. The individual NGL products are stored or distributed to petrochemical manufacturers, heating-fuel users, refineries and propane distributors through ONEOK Partners’ FERC-regulated distribution pipelines that move NGL products from Oklahoma and Kansas to the Mid-Continent and Gulf Coast NGL market centers, as well as the Midwest markets near Chicago, Illinois.
Distribution
The Company’s distribution segment provides natural gas distribution services to more than two million customers in Oklahoma, Kansas and Texas through Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service. The Company serves residential, commercial, industrial and transportation customers in all three states. In addition, its distribution companies serve wholesale and public authority customers. Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service distribute natural gas as public utilities to approximately 82%, 67%and 13% of the distribution markets for Oklahoma, Kansas and Texas, respectively. Natural gas sold to residential and commercial customers accounts for approximately 80% and 19% of its natural gas sales, respectively, in Oklahoma; 75% and 19% of its natural gas sales, respectively, in Kansas; and 70% and 22% of its natural gas sales, respectively, in Texas.
Energy Services
The Company’s Energy Services segment utilizes its network of contracted natural gas supply and contracted transportation and storage assets to provide services to its customers. The Company’s Energy Services segment delivers physical natural gas products and risk management services through its network of contracted transportation and storage capacity and natural gas supply. Its customers primarily include local distribution companies (LDCs), electric utilities, and commercial and industrial end users. The Company offers services and products for its customers’ swing and peaking natural gas commodity requirements on a year-round basis. It also provides no-notice service, weather-related protection and other custom solutions based on its customers’ specific needs.
The company had indeed grown and diversified. Oklahoma Natural Gas had become a major player in the industry. It distributed gas to 215 communities, wholesaled it to distributors serving 47 states, and had some 600,000 residential customers. Within ONEOK's non-utility division, the ONEOK Energy Companies, ONEOK Exploration Company explored for oil and natural gas, while Smart Drilling Company, acquired in 1979, was a contract-drilling operation.
In 1981 and 1982, sales reached record $1 billion levels. Revenues were also reaching record heights, as was capital spending, which topped $181 million in 1982. This spending included subsidiary TransTex Pipeline Company's share of the new Red River Pipeline, and Caney River Transmission Company's share of the new Ozark Gas Transmission System, which crossed the Arkoma Basin from Oklahoma to Arkansas.
But despite these records, by 1982 the company was feeling the pinch of recession-caused weaknesses in the industrial market. This market was especially important because ONEOK had signed take-or-pay contracts with its own suppliers and was therefore obliged to pay for gas even when it had no customers. Since 1982 take-or-pay claims amounted to some $108 million, Ingram and newly named CEO J. E. Tyree were faced with the necessity to economize. They cut costs, reduced ONG's capital budget, and fought these claims in court. Nevertheless, a weak economy, sparse contract-drilling demand, lower investment tax credits, increased interest costs, and a $12.8 million drilling write-off in Malta all cut 1983 earnings per share to $2.51 from 1982's $4.88.
To make matters worse, even though executives did what they could to keep industrial deliveries high by cutting prices to ONG's five fertilizer plant customers to keep them in business, deliveries continued to fall from 1982's 281 billion cubic feet (bcf) to 242 bcf. The erosion of deliveries exposed ONEOK to heavy take-or-pay claims.
Weather and rate increases helped the company recover to a degree in 1984. But while ONEOK tried to look optimistic as it opened a new 17-story company headquarters in downtown Tulsa, it cut capital expenditures, moved away from natural gas exploration, and reduced the number of rigs in its contract-drilling operation.
Events of 1985 continued to be sobering. Earnings per share continued to fall, as did demand. New federal regulations allowed industrial users to purchase gas from the wellhead and transport it through pipeline-capacity leases. On the energy side, ONEOK drilling company reported a net loss of $5 million, about half of which was attributable to a three-rig write-down.
On the positive side, executives instituted a long-range planning strategy, moved strongly into oil production by acquiring Imperial Oil for $9.4 million, and formed ONG Transmission Company to handle opportunities in pipeline capacity leases. These opportunities were made more lucrative by the fact that Oklahoma was the nation's third most prolific gas-producing state.
In 1986, a sluggish economy, warm weather, and unrecoverable take-or-pay settlements of almost $6.2 million forced ONEOK into drastic economies. It consolidated offices, cut down on drilling, and through early retirement policies, reduced its work force by 380, or nearly 15 percent. Things continued to deteriorate in 1987. After a jury awarded Forest Oil $50 million in a take-or-pay suit, banks withdrew an $85 million line of credit and ratings services downgraded ONEOK's debt.
To get ONEOK back on its financial feet, J. D. Scott, who had become president and CEO in 1986, interrupted regular dividends, appealed the Forest Oil verdict, and established reserves of $112.3 million for unresolved take-or-pay disputes. In 1988, he continued downsizing by providing an early retirement package and incentives for 113 employees to resign or retire. He also sold slightly more than 50 percent of the company's exploration leases. A light at the end of the tunnel began to appear in 1989, when earnings per share rose 71 percent, dividends were restored, and exploration and production activities became profitable for the first time in five years. In 1990, Standard and Poors and Duff and Phelps upgraded ONEOK's debt to A- from BBB+.
Scott evidenced his own confidence through acquisitions and expansions. He committed to a major expansion of the Ozark Gas Transmission System, announced a ONEOK Exploration strategy committed to riskier plays with bigger payoffs, acquired the Lone Star Gas Company in central Oklahoma, and continued a research, development, and demonstration project, begun in 1980, that used natural gas as an alternative fuel for vehicles.
By 1991, Harlan S. Byrne of Barrons commented that "for the first time in several years, most things that count were starting to click for ONEOK." In 1992 ONEOK remained optimistic despite a significantly warmer than normal winter and unprofitable spot market prices. The company formed ONEOK Gas Marketing to pool and market the products of Oklahoma's independent producers, and ONEOK Technology Company to develop and market a new meter-setting device. Looking to the future, ONEOK planned to introduce a natural gas-fired heat pump and to promote compressed natural gas fleet vehicles in a state that already has more natural-gas fueled vehicles than any state in the union.
Principal Subsidiaries: Caney River Transmission Company; ONG Red Oak Transmission Company; ONG Sayre Storage Company; ONG Western, Inc.; TransTex Pipeline Company; OkTex Pipeline Company; ONEOK Services, Inc.; ONEOK Technology Company; ONEOK Drilling Company; ONEOK Exploration Company; ONEOK Products Company; ONEOK Resources Company; ONEOK Gas Marketing Company; ONEOK Leasing Company; ONEOK Parking Company.
Source: International Directory of Company Histories, Vol. 7. St. James Press, 1993.
OVERALL
Beta: 1.08
Market Cap (Mil.): $7,593.75
Shares Outstanding (Mil.): 107.12
Annual Dividend: 2.08
Yield (%): 2.93
FINANCIALS
OKE Industry Sector
P/E (TTM): 24.83 19.04 21.11
EPS (TTM): -9.52 -- --
ROI: 6.35 2.11 1.45
ROE: 12.71 4.06 3.15
Statistics:
Public Company
Incorporated: 1906 as Oklahoma Natural Gas
Sales: $677 million
Employees: 2,229
Stock Exchanges: New York Chicago
SICs: 1311 Crude Petroleum & Natural Gas; 4923 Gas Transmission & Distribution; 6719 Holding Companies Nec
Name Age Since Current Position
Kyle, David 58 2007 Independent Chairman of the Board
Gibson, John 58 2011 Vice Chairman of the Board, President, Chief Executive Officer
Martinovich, Robert 53 2011 Chief Financial Officer, Senior Vice President, Treasurer
Dinan, Curtis 43 2011 President - Natural Gas of ONEOK Partners, L.P.
Lawhorn, Caron 49 2011 President of ONEOK Inc. Distribution Companies
French, Kari 53 2011 President of Texas Gas Service
Norton, Pierce 51 2011 Chief Operating Officer
Reiners, Derek 39 2009 Senior Vice President, Chief Accounting Officer
Barker, John 63 2004 Senior Vice President, General Counsel, Assistant Secretary
Mareburger, Robert 49 2011 Senior Vice President - Corporate Planning and Development
Spencer, Terry 51 2009 Chief Operating Officer of ONEOK Partners, L.P.
Ford, William 68 1981 Independent Lead Director
Mackie, Bert 68 1989 Independent Director
Parker, Gary 65 1991 Independent Director
Moore, Pattye 53 2002 Independent Director
Edwards, Julie 52 2007 Independent Director
Day, James 68 2004 Independent Director
Rodriguez, Eduardo 55 2004 Independent Director
Tippeconnic, David 71 2006 Independent Director
Mogg, Jim 62 2007 Independent Director
Smith, Gerald 60 2009 Independent Director
Address:
100 West Fifth Street
P.O. Box 871
Tulsa, Oklahoma 74102-0871
U.S.A.