ONEOK (OKE) 10-Q 6 Aug 09 2009 Q2 Quarterly report Financial data

Consolidated Statements of Inco

Consolidated Statements of Income (USD $)
In Thousands	3 Months Ended Jun. 30, 2009	3 Months Ended Jun. 30, 2008	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Revenues	$2,227,627	$4,172,866	$5,017,454	$9,074,942
Cost of sales and fuel	1,795,201	3,752,038	4,033,617	8,068,202
Net margin	432,426	420,828	983,837	1,006,740
Operating expenses
Operations and maintenance	184,874	171,431	346,593	339,423
Depreciation and amortization	71,249	59,701	143,375	119,180
General taxes	25,261	16,680	50,488	42,011
Total operating expenses	281,384	247,812	540,456	500,614
Gain (loss) on sale of assets	3,762	(4)	4,426	9
Operating income	154,804	173,012	447,807	506,135
Equity earnings from investments	14,188	17,610	35,410	45,393
Allowance for equity funds used during construction	9,468	11,676	18,471	20,172
Other income	7,939	704	9,604	3,936
Other expense	(1,399)	(407)	(5,343)	(5,015)
Interest expense	(73,392)	(59,059)	(151,353)	(121,920)
Income before income taxes	111,608	143,536	354,596	448,701
Income taxes	(30,258)	(30,574)	(109,697)	(122,942)
Net income	81,350	112,962	244,899	325,759
Less: Net income attributable to noncontrolling interests	39,671	71,097	80,935	140,057
Net income attributable to ONEOK	$41,679	$41,865	$163,964	$185,702
Earnings per share of common stock
Net earnings per share, basic	0.4	0.4	1.56	1.78
Net earnings per share, diluted	0.39	0.39	1.55	1.75
Average shares of common stock (thousands)
Basic	105,335	104,340	105,249	104,255
Diluted	105,950	106,072	105,848	105,947
Dividends declared per share of common stock	0.4	0.38	0.8	0.76

Consolidated Balance Sheets

Consolidated Balance Sheets (USD $)
In Thousands	Jun. 30, 2009	Dec. 31, 2008
Current assets
Cash and cash equivalents	$47,038	$510,058
Accounts receivable, net	771,196	1,265,300
Gas and natural gas liquids in storage	564,530	858,966
Commodity exchanges and imbalances	53,417	56,248
Energy marketing and risk management assets	168,457	362,808
Other current assets	189,277	324,222
Total current assets	1,793,915	3,377,602
Property, plant and equipment
Property, plant and equipment	9,880,620	9,476,619
Accumulated depreciation and amortization	2,289,760	2,212,850
Net property, plant and equipment	7,590,860	7,263,769
Investments and other assets
Goodwill and intangible assets	1,034,393	1,038,226
Energy marketing and risk management assets	47,163	45,900
Investments in unconsolidated affiliates	735,394	755,492
Other assets	631,998	645,073
Total investments and other assets	2,448,948	2,484,691
Total assets	11,833,723	13,126,062
Current liabilities
Current maturities of long-term debt	268,205	118,195
Notes payable	689,910	2,270,000
Accounts payable	826,414	1,122,761
Commodity exchanges and imbalances	166,847	188,030
Energy marketing and risk management liabilities	41,485	175,006
Other current liabilities	444,182	319,772
Total current liabilities	2,437,043	4,193,764
Long-term debt, excluding current maturities
Long-term debt, excluding current maturities	4,346,285	4,112,581
Deferred credits and other liabilities
Deferred income taxes	867,015	890,815
Energy marketing and risk management liabilities	8,301	46,311
Other deferred credits	762,213	715,052
Total deferred credits and other liabilities	1,637,529	1,652,178
ONEOK shareholders' equity
Common stock, $0.01 par value: authorized 300,000,000 shares; issued 122,180,571 shares and outstanding 105,371,561 shares at June 30, 2009	1,222	1,216
Paid in capital	1,308,141	1,301,153
Accumulated other comprehensive loss	(82,960)	(70,616)
Retained earnings	1,632,795	1,553,033
Treasury stock, at cost: 16,809,010 shares at June 30, 2009	(696,805)	(696,616)
Total ONEOK shareholders' equity	2,162,393	2,088,170
Noncontrolling interests in consolidated subsidiaries	1,250,473	1,079,369
Total shareholders' equity	3,412,866	3,167,539
Total liabilities and shareholders' equity	$11,833,723	$13,126,062

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) (USD $)
	Jun. 30, 2009	Dec. 31, 2008
Consolidated Balance Sheets (Parenthetical)
Common stock, par value	0.01	0.01
Common stock, shares authorized	300,000,000	300,000,000
Common stock, shares, issued	122,180,571	121,647,007
Common stock, shares, outstanding	105,371,561	104,845,231
Treasury stock, shares	16,809,010	16,801,776

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (USD $)
In Thousands	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Operating activities
Net income	$244,899	$325,759
Depreciation and amortization	143,375	119,180
Allowance for equity funds used during construction	(18,471)	(20,172)
Gain on sale of assets	(4,426)	(9)
Equity earnings from investments	(35,410)	(45,393)
Distributions received from unconsolidated affiliates	38,233	39,904
Deferred income taxes	40,865	65,374
Stock-based compensation expense	8,551	14,416
Allowance for doubtful accounts	1,663	6,965
Changes in assets and liabilities:
Accounts receivable	492,441	194,146
Gas and natural gas liquids in storage	285,271	(85,083)
Accounts payable	(324,364)	261,530
Commodity exchanges and imbalances, net	(18,352)	53,881
Energy marketing and risk management assets and liabilities	35,373	77,033
Unrecovered purchased gas costs	42,766	18,185
Fair value of firm commitments	179,582	(350,626)
Other assets and liabilities	(36,144)	(140,285)
Cash provided by operating activities	1,075,852	534,805
Investing activities
Changes in investments in unconsolidated affiliates	17,393	6,480
Capital expenditures (less allowance for equity funds used during construction)	(407,600)	(640,048)
Proceeds from sale of assets	10,029	201
Proceeds from insurance	0	9,792
Acquisitions	0	2,450
Cash used in investing activities	(380,178)	(621,125)
Financing activities
Borrowing (repayment) of notes payable, net	(710,090)	598,893
Repayment of notes payable with maturities over 90 days	(870,000)	0
Issuance of debt, net of discounts	498,325	0
Long-term debt financing costs	(4,000)	0
Payment of debt	(107,970)	(408,789)
Repurchase of common stock	(250)	(29)
Issuance of common stock	4,342	5,786
Issuance of common units, net of discounts	220,458	146,969
Dividends paid	(84,202)	(79,212)
Distributions to noncontrolling interests	(105,307)	(97,659)
Cash provided by (used in) financing activities	(1,158,694)	165,959
Change in cash and cash equivalents	(463,020)	79,639
Cash and cash equivalents at beginning of period	510,058	19,105
Cash and cash equivalents at end of period	$47,038	$98,744

Consolidated Statement of Share

Consolidated Statement of Shareholders' Equity (USD $)
In Thousands, except Share data	Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Common Stock	Retained Earnings	Treasury Stock	Noncontrolling Interests in Consolidated Subsidiaries	Total
Shareholders' equity, beginning balance at Dec. 31, 2008	$1,301,153	($70,616)	$1,216	$1,553,033	($696,616)	$1,079,369	$3,167,539
Common stock issued, beginning balance at Dec. 31, 2008			121,647,007
Net income				163,964		80,935	244,899
Other comprehensive income (loss)		(12,344)				(24,982)	(37,326)
Repurchase of common stock					(250)		(250)
Common stock issued, shares			533,564
Common stock issued	6,988		6		61		7,055
Common stock dividends - $0.80 per share				(84,202)			(84,202)
Issuance of equity units						220,458	220,458
Distributions paid						(105,307)	(105,307)
Shareholders' equity, ending balance at Jun. 30, 2009	$1,308,141	($82,960)	$1,222	$1,632,795	($696,805)	$1,250,473	$3,412,866
Common stock issued, ending balance at Jun. 30, 2009			122,180,571

Consolidated Statement of Compr

Consolidated Statement of Comprehensive Income (USD $)
In Thousands	3 Months Ended Jun. 30, 2009	3 Months Ended Jun. 30, 2008	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Net income	$81,350	$112,962	$244,899	$325,759
Other comprehensive income (loss), net of tax
Unrealized gains (losses) on energy marketing and risk management assets/liabilities, net of tax	(22,177)	(66,249)	38,469	(118,570)
Realized (gains) losses in net income, net of tax	(16,793)	11,267	(70,713)	4,000
Unrealized holding gains (losses) arising during the period, net of tax	318	(682)	505	(5,446)
Change in pension and postretirement benefit plan liability, net of tax	(3,260)	(2,468)	(5,795)	(4,937)
Other	18	0	208	0
Total other comprehensive income (loss), net of tax	(41,894)	(58,132)	(37,326)	(124,953)
Comprehensive income	39,456	54,830	207,573	200,806
Less: Comprehensive income attributable to noncontrolling interests	24,731	51,184	55,953	121,431
Comprehensive income attributable to ONEOK	$14,725	$3,646	$151,620	$79,375

Summary of Accounting Policies

Summary of Accounting Policies
	6 Months Ended Jun. 30, 2009 USD / shares
Summary of Accounting Policies
Summary of Accounting Policies	A. SUMMARY OF ACCOUNTING POLICIES Our accompanying unaudited consolidated financial statements have been prepared in accordance with GAAP and reflect all adjustments that, in our opinion, are necessary for a fair presentation of the results for the interim periods presented. All such adjustments are of a normal recurring nature. The 2008 year-end consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP. These unaudited consolidated financial statements should be read in conjunction with our audited consolidated financial statements in our Annual Report. Due to the seasonal nature of our business, the results of operations for the three and six months ended June 30, 2009, are not necessarily indicative of the results that may be expected for a 12-month period. Our accounting policies are consistent with those disclosed in Note A of the Notes to Consolidated Financial Statements in our Annual Report. The following recently issued accounting pronouncements will affect our consolidated financial statements during 2009. Noncontrolling Interests - Statement 160, Noncontrolling Interests in Consolidated Financial Statements - an amendment of ARB No. 51, requires noncontrolling interest (previously referred to as minority interest) to be reported as a component of equity. Statement 160 was effective for our year beginning January 1, 2009, and requires retroactive adoption of the presentation and disclosure requirements for existing noncontrolling interests. Derivative Instruments and Hedging Activities - Statement 161, Disclosures about Derivative Instruments and Hedging Activities - an amendment to FASB Statement No. 133, requires enhanced disclosures about how derivative and hedging activities affect our financial position, financial performance and cash flows. Statement 161 was effective for our year beginning January 1, 2009, and was applied prospectively. See Note C for applicable disclosures. Fair Value Measurements - As of January 1, 2009, we have applied the provisions of Statement 157, Fair Value Measurements, to assets and liabilities that are measured at fair value on a nonrecurring basis subsequent to initial recognition, and the impact was not material. See Note B for disclosures of our fair value measurements. Interim Disclosures about Fair Value - FSP 107-1 and Accounting Principles Board (APB) Opinion No. 28-1, Interim Disclosures about Fair Value of Financial Instruments, require disclosures of fair value of financial instruments for interim reporting periods, which were effective for our quarter ended June 30, 2009. These disclosures are included in Note B. Postretirement Benefit Plan Assets - FSP 132R-1, Employers Disclosures about Postretirement Benefit Plan Assets, requires enhanced disclosures about our plan assets, including our investment policies, major categories of plan assets, significant concentrations of risk within plan assets, and inputs and valuation techniques used to measure the fair value of plan assets, is effective for our fiscal year ending December 31, 2009, and will be applied prospectively. S

Fair Value Measurements

Fair Value Measurements
	6 Months Ended Jun. 30, 2009 USD / shares
Fair Value Measurements
Fair Value Measurements	B. FAIR VALUE MEASUREMENTS Refer to Notes A and C of the Notes to Consolidated Financial Statements in our Annual Report for a discussion of our fair value measurements and the fair value hierarchy. Recurring Fair Value Measurements - The following tables set forth our recurring fair value measurements for the periods indicated. June 30, 2009 Level 1 Level 2 Level 3 Netting (a) Total (Thousands of dollars) Assets Derivatives $ 258,603 $ 103,849 $ 635,094 $ (781,926) $ 215,620 Trading securities 7,341 - - - 7,341 Available-for-sale investment securities 2,489 - - - 2,489 Total assets $ 268,433 $ 103,849 $ 635,094 $ (781,926) $ 225,450 Liabilities Derivatives $ (230,180) $ (38,227) $ (464,680) $ 683,301 $ (49,786) Fair value of firm commitments - - (137,403) - (137,403) Total liabilities $ (230,180) $ (38,227) $ (602,083) $ 683,301 $ (187,189) (a) - Our derivative assets and liabilities are presented in our Consolidated Balance Sheets on a net basis. We net derivative assets and liabilities, including cash collateral, when a legally enforceable master netting arrangement exists between us and the counterparty to a derivative contract. At June 30, 2009, we held $127.1 million of cash collateral and had posted $28.5 million of cash collateral with various counterparties. December 31, 2008 Level 1 Level 2 Level 3 Netting (a) Total (Thousands of dollars) Assets Derivatives $ 580,029 $ 215,116 $ 454,377 $ (840,814) $ 408,708 Trading securities 4,910 - - - 4,910 Available-for-sale investment securities 1,665 - - - 1,665 Fair value of firm commitments - - 42,179 - 42,179 Total assets $ 586,604 $ 215,116 $ 496,556 $ (840,814) $ 457,462 Liabilities Derivatives $ (501,726) $ (55,705) $ (412,022) $ 748,136 $ (221,317) Long-term debt swapped to floating - - (171,455) - (171,455) Total liabilities $ (501,726) $ (55,705) $ (583,477) $ 748,136 $ (392,772) (a) - Our derivative assets and liabilities are presented in our Consolidated Balance Sheets on a net basis. We net derivative assets and liabilities, including cash collateral, when a legally enforceable master netting arrangement exists between us and the counterparty to a derivative contract. At December 31, 2008, we held $92.7 million of cash collateral. In accordance with Statement 157, we categorize derivatives for which fair value is determined based on multiple inputs within a single level, based on the lowest level input that is signi

Risk Management and Hedging Act

Risk Management and Hedging Activities Using Derivatives
	6 Months Ended Jun. 30, 2009 USD / shares
Risk Management and Hedging Activities Using Derivatives
Risk Managment and Hedging Activities Using Derivatives	C. RISK MANAGEMENT AND HEDGING ACTIVITIES USING DERIVATIVES Energy Marketing and Risk Management Activities Our Energy Services and ONEOK Partners segments are exposed to various risks that we manage by periodically entering into derivative instruments. These risks include the following: Commodity price risk - We are exposed to the risk of loss in cash flows and future earnings arising from adverse changes in the price of natural gas, NGLs and crude oil. We use commodity derivative instruments such as futures, physical forward contracts, swaps and options to mitigate the commodity price risk associated with a portion of the forecasted purchases and sales of commodities and natural gas and natural gas liquids in storage. Basis risk - We are exposed to the risk of loss in cash flows and future earnings arising from adverse changes in the price differentials between pipeline receipt and delivery locations. Our firm transportation capacity allows us to purchase gas at a pipeline receipt point and sell gas at a pipeline delivery point. Our Energy Services segment periodically enters into basis swaps between the transportation receipt and delivery points in order to protect the fair value of these location price differentials related to our firm commitments. Currency exchange rate risk - As a result of our Energy Services segments activities in Canada, we are exposed to the risk of loss in cash flows and future earnings from adverse changes in currency exchange rates on our commodity purchases and sales primarily related to our firm transportation and storage contracts that are transacted in a currency other than our functional currency, the U.S. dollar. To reduce our exposure to exchange-rate fluctuations, we use physical forward transactions, which result in an actual two-way flow of currency on the settlement date in which we exchange U.S. dollars for Canadian dollars with another party. The following derivative instruments are used to manage our exposure to these risks. Futures contracts- Standardized exchange-traded contracts to purchase or sell natural gas and crude oil at a specified price, requiring delivery on or settlement through the sale or purchase of an offsetting contract by a specified future date under the provisions of exchange regulations. Forward contracts- Commitments to purchase or sell natural gas, crude oil or NGLs for delivery at some specified time in the future. Forward contracts are different from futures in that forwards are customized and non-exchange traded. Swaps- Financial trades involving the exchange of payments based on two different pricing structures for a commodity. In a typical commodity swap, parties exchange payments based on changes in the price of a commodity or a market index, while fixing the price they effectively pay or receive for the physical commodity. As a result, one party assumes the risks and benefits of movements in market prices, while the other party assumes the risks and benefits of a fixed price for the commodity. Options - Contractual agreements that give the holder the right, but not the obligation, to buy or sell a fixed quantity of a commodity, at a

Other Comprehensive Income

Other Comprehensive Income (Loss)
	6 Months Ended Jun. 30, 2009 USD / shares
Other Comprehensive Income (Loss)
Other Comprehensive Income (Loss)	D. OTHER COMPREHENSIVE INCOME (LOSS) The following table sets forth the gross amount of other comprehensive income (loss) and related tax (expense) benefit for the periods indicated. Three Months Ended Three Months Ended June 30, 2009 June 30, 2008 Gross Tax (Expense) or Benefit Net Gross Tax (Expense) or Benefit Net (Thousands of dollars) Unrealized losses on energy marketing and risk management assets/liabilities $ (31,920) $ 9,743 $ (22,177) $ (92,320) $ 26,071 $ (66,249) Less: Gains (losses) on energy marketing and risk management assets/liabilities recognized in net income 21,969 (5,176) 16,793 (15,217) 3,950 (11,267) Unrealized holding gains (losses) on investment securities arising during the period 518 (200) 318 (1,112) 430 (682) Change in pension and postretirement benefit plan liability (5,317) 2,057 (3,260) (4,025) 1,557 (2,468) Other 29 (11) 18 - - - Other comprehensive income (loss) $ (58,659) $ 16,765 $ (41,894) $ (82,240) $ 24,108 $ (58,132) Less: Other comprehensive income (loss) attributable to noncontrolling interests (14,940) - (14,940) (19,913) - (19,913) Total other comprehensive income (loss) attributable to ONEOK $ (43,719) $ 16,765 $ (26,954) $ (62,327) $ 24,108 $ (38,219) Six Months Ended Six Months Ended June 30, 2009 June 30, 2008 Gross Tax (Expense) or Benefit Net Gross Tax (Expense) or Benefit Net (Thousands of dollars) Unrealized gains (losses) on energy marketing and risk management assets/liabilities $ 66,809 $ (28,340) $ 38,469 $ (181,279) $ 62,709 $ (118,570) Less: Gains (losses) on energy marketing and risk management assets/liabilities recognized in net income 103,566 (32,853) 70,713 (960) (3,040) (4,000) Unrealized holding gains (losses) on investment securities arising during the period 824 (319) 505 (8,881) 3,435 (5,446) Change in pension and postretirement benefit plan liability (9,450) 3,655 (5,795) (8,050) 3,113 (4,937) Other 270 (62) 208 - - - Other comprehensive income (loss) $ (45,113) $ 7,787 $ (37,326) $ (197,250) $ 72,297 $ (124,953) Less: Other comprehensive income (loss) attributable to noncontrolling interests (24,982) - (24,982) (18,626) - (18,626) Total other comprehensive income (loss) attributable to ONEOK $ (20,131) $ 7,787 $ (12,34

Capital Stock

Capital Stock
	6 Months Ended Jun. 30, 2009 USD / shares
Capital Stock
Capital Stock	E. CAPITAL STOCK Dividends - Fourth-quarter 2008 and first-quarter 2009 quarterly dividends paid on our common stock to shareholders of record as of the close of business on January 30, 2009, and April 30, 2009, respectively, were $0.40 per share. Additionally, a second-quarter 2009 dividend of $0.42 per share was declared for shareholders of record on July 31, 2009, payable on August 14, 2009.

Credit Facilities and Short-Ter

Credit Facilities and Short-Term Notes Payable
	6 Months Ended Jun. 30, 2009 USD / shares
Credit Facilities and Short-Term Notes Payable
Credit Facilities and Short-Term Notes Payable	F. CREDIT FACILITIES AND SHORT-TERM NOTES PAYABLE ONEOKs $1.2 billion amended and restated credit agreement dated July 14, 2006 (ONEOK Credit Agreement), which expires in July 2011, and ONEOK Partners $1.0 billion amended and restated revolving credit agreement dated March 30, 2007 (ONEOK Partners Credit Agreement), which expires in March 2012, contain certain financial and other typical covenants as discussed in Note H of the Notes to Consolidated Financial Statements in our Annual Report. Among other things, the ONEOK Credit Agreements covenants include a limitation on ONEOKs stand-alone debt-to-capital ratio, which may not exceed 67.5 percent at the end of any calendar quarter. At June 30, 2009, ONEOKs stand-alone debt-to-capital ratio, as calculated under the terms of the ONEOK Credit Agreement, was 45.7 percent, and ONEOK was in compliance with all covenants under the ONEOK Credit Agreement and the $400 million, 364-day revolving credit facility dated August 6, 2008 (364-Day Facility). ONEOK Partners Credit Agreements covenants include, among other things, maintaining a ratio of indebtedness to adjusted EBITDA (EBITDA as adjusted for all non-cash charges and increased for projected EBITDA from certain lender-approved capital expansion projects) of no more than 5 to 1. At June 30, 2009, ONEOK Partners ratio of indebtedness to adjusted EBITDA was 4.3 to 1. ONEOK Partners was in compliance with all covenants under the ONEOK Partners Credit Agreement at June 30, 2009. At June 30, 2009, ONEOK had $329.9 million in commercial paper outstanding and $48.0 million in letters of credit issued under the ONEOK Credit Agreement. At June 30, 2009, ONEOK had approximately $822.1 million of credit available under the ONEOK Credit Agreement and $400.0 million under the 364-Day Facility. The 364-Day Facility expired on August 5, 2009. At June 30, 2009, ONEOK Partners had $360.0 million in borrowings outstanding and $586.5 million of credit available under the ONEOK Partners Credit Agreement. ONEOK Partners had a total of $49.2 million issued in letters of credit outside of the ONEOK Partners Credit Agreement. Borrowings under the ONEOK Credit Agreement and the ONEOK Partners Credit Agreement are short term in nature, ranging from one day to six months. Accordingly, these borrowings are classified as short-term notes payable.

Long-Term Debt

Long-Term Debt
	6 Months Ended Jun. 30, 2009 USD / shares
Long-Term Debt
Long-term Debt	G. LONG-TERM DEBT In February 2009, ONEOK repaid $100 million of maturing long-term debt with cash from operations and short-term borrowings. ONEOK Partners Debt Issuance - In March 2009, ONEOK Partners completed an underwritten public offering of $500 million aggregate principal amount of 8.625 percent Senior Notes due 2019 (2019 Notes). The 2019 Notes were issued under ONEOK Partners existing shelf registration statement filed with the SEC. ONEOK Partners may redeem the 2019 Notes, in whole or in part, at any time prior to their maturity at a redemption price equal to the principal amount, plus accrued and unpaid interest and a make-whole premium. The redemption price will never be less than 100 percent of the principal amount of the 2019 Notes plus accrued and unpaid interest to the redemption date. The 2019 Notes are senior unsecured obligations, ranking equally in right of payment with all of ONEOK Partners existing and future unsecured senior indebtedness, and effectively junior to all of the existing and future debt and other liabilities of its non-guarantor subsidiaries. The 2019 Notes are nonrecourse to ONEOK. The net proceeds from the 2019 Notes, after deducting underwriting discounts and commissions and expenses, of approximately $494.3 million were used to repay indebtedness outstanding under the ONEOK Partners Credit Agreement. The 2019 Notes are fully and unconditionally guaranteed on a senior unsecured basis by ONEOK Partners Intermediate Limited Partnership (Intermediate Partnership). The guarantee ranks equally in right of payment to all of the Intermediate Partnerships existing and future unsecured senior indebtedness. The terms of the 2019 Notes are governed by an indenture, dated as of September 25, 2006, between ONEOK Partners and Wells Fargo Bank, N.A., as trustee, as supplemented by the Fifth Supplemental Indenture, dated March 3, 2009 (Indenture). The Indenture does not limit the aggregate principal amount of debt securities that may be issued and provides that debt securities may be issued from time to time in one or more additional series. The Indenture contains covenants including, among other provisions, limitations on ONEOK Partners ability to place liens on its property or assets and to sell and leaseback its property. The 2019 Notes will mature on March 1, 2019. ONEOK Partners will pay interest on the 2019 Notes on March 1 and September 1 of each year. The first payment of interest on the 2019 Notes will be made on September 1, 2009. Interest on the 2019 Notes accrues from March 3, 2009, which was the issuance date.

Employee Benefit Plans

Employee Benefit Plans
	6 Months Ended Jun. 30, 2009 USD / shares
Employee Benefit Plans
Employee Benefit Plans	H. EMPLOYEE BENEFIT PLANS The following table sets forth the components of net periodic benefit cost for our pension and other postretirement benefit plans for the periods indicated. Pension Benefits Pension Benefits Three Months Ended Six Months Ended June 30, June 30, 2009 2008 2009 2008 (Thousands of dollars) Components of net periodic benefit cost Service cost $ 4,984 $ 5,041 $ 9,968 $ 10,082 Interest cost 13,454 12,451 28,659 24,902 Expected return on assets (16,508) (15,317) (33,016) (30,634) Amortization of unrecognized prior service cost 391 388 782 776 Amortization of net loss 4,330 2,386 11,144 4,772 Net periodic benefit cost $ 6,651 $ 4,949 $ 17,537 $ 9,898 Postretirement Benefits Postretirement Benefits Three Months Ended Six Months Ended June 30, June 30, 2009 2008 2009 2008 (Thousands of dollars) Components of net periodic benefit cost Service cost $ 1,294 $ 1,419 $ 2,587 $ 2,838 Interest cost 4,229 4,475 8,459 8,950 Expected return on assets (1,702) (1,855) (3,404) (3,710) Amortization of unrecognized net asset at adoption 797 797 1,594 1,594 Amortization of unrecognized prior service cost (501) (501) (1,002) (1,002) Amortization of net loss 2,415 2,743 4,830 5,486 Net periodic benefit cost $ 6,532 $ 7,078 $ 13,064 $ 14,156

Commitments and Contingencies

Commitments and Contingencies
	6 Months Ended Jun. 30, 2009 USD / shares
Commitments and Contingencies
Commitments and Contingencies	I. COMMITMENTS AND CONTINGENCIES Investment in Northern Border Pipeline- In March 2009, ONEOK Partners made an equity contribution of $4.3 million to Northern Border Pipeline. Northern Border Pipeline anticipates requiring an additional equity contribution of approximately $76 million from its partners in the third quarter of 2009, of which ONEOK Partners share will be approximately $38 million based on its 50 percent equity interest. Environmental Liabilities - We are subject to multiple environmental, historical and wildlife preservation laws and regulations affecting many aspects of our present and future operations. Regulated activities include those involving air emissions, stormwater and wastewater discharges, handling and disposal of solid and hazardous wastes, hazardous materials transportation, and pipeline and facility construction. These laws and regulations require us to obtain and comply with a wide variety of environmental clearances, registrations, licenses, permits and other approvals. Failure to comply with these laws, regulations, permits and licenses may expose us to fines, penalties and/or interruptions in our operations that could be material to our results of operations. If a leak or spill of hazardous substances or petroleum products occurs from lines or facilities that we own, operate or otherwise use, we could be held jointly and severally liable for all resulting liabilities, including response, investigation and clean up costs, which could materially affect our results of operations and cash flows. In addition, emission controls required under the federal Clean Air Act and other similar federal and state laws could require unexpected capital expenditures at our facilities. We cannot assure that existing environmental regulations will not be revised or that new regulations will not be adopted or become applicable to us. Revised or additional regulations that result in increased compliance costs or additional operating restrictions, could have a material adverse effect on our business, financial condition and results of operations. We own or retain legal responsibility for the environmental conditions at 12 former manufactured gas sites in Kansas. These sites contain potentially harmful materials that are subject to control or remediation under various environmental laws and regulations. A consent agreement with the KDHE presently governs all work at these sites. The terms of the consent agreement allow us to investigate these sites and set remediation activities based upon the results of the investigations and risk analysis. Remediation typically involves the management of contaminated soils and may involve removal of structures and monitoring and/or remediation of groundwater. Of the 12 sites, we have begun soil remediation on 11 sites. Regulatory closure has been achieved at two locations, and we have completed or are near completion of soil remediation at nine sites. We have begun site assessment at the remaining site where no active remediation has occurred. Our expenditures for environmental evaluation, mitigation and remediation to date have not been significant in relation to our f

Property, Plant and Equipment

Property, Plant and Equipment
	6 Months Ended Jun. 30, 2009 USD / shares
Property, Plant and Equipment
Property, Plant and Equipment	J. PROPERTY, PLANT AND EQUIPMENT The following table sets forth our property, plant and equipment, by segment, for the periods indicated. June 30, December 31, 2009 2008 (Thousands of dollars) Non-Regulated ONEOK Partners $ 2,522,084 $ 2,465,369 Energy Services 7,907 7,907 Other 233,078 225,479 Regulated ONEOK Partners 3,627,600 3,343,310 Distribution 3,489,951 3,434,554 Property, plant and equipment 9,880,620 9,476,619 Accumulated depreciation and amortization 2,289,760 2,212,850 Net property, plant and equipment $ 7,590,860 $ 7,263,769 Property, plant and equipment on our Consolidated Balance Sheets includes construction work in process for capital projects that have not yet been put in service and therefore are not being depreciated. The following table sets forth our construction work in process, by segment, for the periods indicated. June 30, December 31, 2009 2008 (Thousands of dollars) ONEOK Partners $ 793,885 $ 809,978 Distribution 21,291 57,038 Other 12,570 10,984 Total construction work in process $ 827,746 $ 878,000

Segments

Segments
	6 Months Ended Jun. 30, 2009 USD / shares
Segments
Segments	K. SEGMENTS Segment Descriptions - We have divided our operations into four reportable business segments based on similarities in economic characteristics, products and services, types of customers, methods of distribution and regulatory environment. These segments are as follows: (i) our ONEOK Partners segment gathers, processes, transports, stores and sells natural gas and gathers, treats, fractionates, stores, distributes and markets NGLs; (ii) our Distribution segment delivers natural gas to residential, commercial and industrial customers, and transports natural gas; (iii) our Energy Services segment markets natural gas to wholesale and retail customers; and (iv) our Other segment primarily consists of the operating and leasing operations of our headquarters building and a related parking facility. Our Distribution segment is comprised of regulated public utilities, and portions of our ONEOK Partners segment are also regulated. Accounting Policies - The accounting policies of the segments are the same as those described in Note A and Note M of the Notes to Consolidated Financial Statements in our Annual Report. Intersegment sales are recorded on the same basis as sales to unaffiliated customers and are discussed in further detail in Note N. Net margin is comprised of total revenues less cost of sales and fuel. Cost of sales and fuel includes commodity purchases, fuel and transportation costs. Customers - For the three and six months ended June 30, 2009 and 2008, we had no single external customer from which we received 10 percent or more of our consolidated revenues. Operating Segment Information - The following tables set forth certain selected financial information for our operating segments for the periods indicated. Three Months Ended June 30, 2009 ONEOK Partners (a) Distribution (b) Energy Services Other and Eliminations Total (Thousands of dollars) Sales to unaffiliated customers $1,289,487 $ 276,599 $ 660,772 $ 769 $ 2,227,627 Intersegment revenues 107,570 2 66,339 (173,911) - Total revenues $1,397,057 $ 276,601 $ 727,111 $ (173,142) $ 2,227,627 Net margin $ 261,982 $ 139,563 $ 30,114 $ 767 $ 432,426 Operating costs 100,507 99,467 10,530 (369) 210,135 Depreciation and amortization 39,953 30,717 146 433 71,249 Gain (loss) on sale of assets 3,276 486 - - 3,762 Operating income $ 124,798 $ 9,865 $ 19,438 $ 703 $ 154,804 Equity earnings from investments $ 14,188 $ - $ - $ - $ 14,188 Capital expenditures $ 129,366 $ 32,632 $ - $ 2,575 $ 164,573 (a) - Our ONEOK Partners segment has regulated and non-regulated operations. Our ONEOK Partners segment's regulated operations had revenues of $116.6 million, net margin of $96.9 million and operating income of $40.

Unconsolidated Affiliates

Unconsolidated Affiliates
	6 Months Ended Jun. 30, 2009 USD / shares
Unconsolidated Affiliates
Unconsolidated Affiliates	L. UNCONSOLIDATED AFFILIATES Equity Earnings from Investments - The following table sets forth our equity earnings from investments for the periods indicated. All amounts in the table below are equity earnings from investments in our ONEOK Partners segment. Three Months Ended Six Months Ended June 30, June 30, 2009 2008 2009 2008 (Thousands of dollars) Northern Border Pipeline $ 5,454 $ 8,880 $ 21,492 $ 28,661 Fort Union Gas Gathering, L.L.C. 3,805 3,464 6,015 5,759 Bighorn Gas Gathering, L.L.C. 1,824 2,005 3,910 4,323 Lost Creek Gathering Company, L.L.C. 1,312 1,797 2,202 3,082 Other 1,793 1,464 1,791 3,568 Equity earnings from investments $ 14,188 $ 17,610 $ 35,410 $ 45,393 Unconsolidated Affiliates Financial Information - The following table sets forth summarized combined financial information of our unconsolidated affiliates for the periods indicated. Three Months Ended Six Months Ended June 30, June 30, 2009 2008 2009 2008 (Thousands of dollars) Income Statement Operating revenues $ 87,951 $ 95,040 $ 194,017 $ 206,435 Operating expenses $ 44,429 $ 45,201 $ 89,232 $ 88,545 Net income $ 32,129 $ 33,927 $ 82,645 $ 89,748 Distributions paid to us $ 30,142 $ 33,214 $ 63,473 $ 60,627

Earnings Per Share

Earnings Per Share
	6 Months Ended Jun. 30, 2009 USD / shares
Earnings Per Share
Earnings Per Share	M. EARNINGS PER SHARE INFORMATION The following tables set forth the computations of basic and diluted EPS from continuing operations for the periods indicated. Three Months Ended June 30, 2009 Per Share Income Shares Amount (Thousands, except per share amounts) Basic EPS from continuing operations Net income attributable to ONEOK available for common stock $ 41,679 105,335 $0.40 Diluted EPS from continuing operations Effect of options and other dilutive securities - 615 Net income attributable to ONEOK available for common stock and common stock equivalents $ 41,679 105,950 $ 0.39 Three Months Ended June 30, 2008 Per Share Income Shares Amount (Thousands, except per share amounts) Basic EPS from continuing operations Net income attributable to ONEOK available for common stock $ 41,865 104,340 $ 0.40 Diluted EPS from continuing operations Effect of options and other dilutive securities - 1,732 Net income attributable to ONEOK available for common stock and common stock equivalents $ 41,865 106,072 $ 0.39 Six Months Ended June 30, 2009 Per Share Income Shares Amount (Thousands, except per share amounts) Basic EPS from continuing operations Net income attributable to ONEOK available for common stock $ 163,964 105,249 $ 1.56 Diluted EPS from continuing operations Effect of options and other dilutive securities - 599 Net income attributable to ONEOK available for common stock and common stock equivalents $ 163,964 105,848 $ 1.55 Six Months Ended June 30, 2008 Per Share Income Shares Amount (Thousands, except per share amounts) Basic EPS from continuing operations Net income attributable to ONEOK available for common stock $ 185,702 104,255 $ 1.78 Diluted EPS from continuing operations Effect of options and other dilutive securities - 1,692 Net income attributable to ONEOK available for common stock and common stock equivalents $ 185,702 105,947 $ 1.75 There were 258,225 and 261,634 option shares excluded from the calculation of diluted EPS for the three and six months ended June 30, 2009, respectively, since their inclusion would have been anti-dilutive. There were no anti-dilutive option shares for the three and six months ended June 30, 2008.

ONEOK Partners

ONEOK Partners
	6 Months Ended Jun. 30, 2009 USD / shares
ONEOK Partners
ONEOK Partners	N. ONEOK PARTNERS Ownership Interest in ONEOK Partners - Our ownership interest in ONEOK Partners is shown in the following table for the periods indicated. June 30, December 31, 2009 2008 General partner interest 2.0% 2.0% Limited partner interest 43.3% (a) 45.7% (a) Total ownership interest 45.3% (b) 47.7% (a) - Represents 5.9 million common units and approximately 36.5 million Class B units, which are convertible, at our option, into common units. (b) - Following the July 2009 sale of additional ONEOK Partners' units, our interest in ONEOK Partners was 45.1 percent. In June 2009, ONEOK Partners completed an underwritten public offering of 5,000,000 common units at $45.81 per common unit, generating net proceeds of approximately $219.9 million after deducting underwriting discounts but before offering expenses. In conjunction with ONEOK Partners public offering of common units, ONEOK Partners GP contributed $4.7 million to ONEOK Partners in order to maintain its 2 percent general partner interest. In July 2009, ONEOK Partners sold an additional 486,690 common units at $45.81 per common unit to the underwriters of the public offering upon the partial exercise of their option to purchase additional common units to cover over-allotments. ONEOK Partners received net proceeds of approximately $21.4 million from the sale of the common units after deducting underwriting discounts but before offering expenses. In conjunction with the partial exercise by the underwriters, ONEOK Partners GP contributed $0.5 million to ONEOK Partners in order to maintain its 2 percent general partner interest. Following these transactions, our interest in ONEOK Partners is 45.1 percent. Cash Distributions - The following table sets forth ONEOK Partners general partner and incentive distributions declared for the periods indicated. Three Months Ended Six Months Ended June 30, June 30, 2009 2008 2009 2008 (Thousands of dollars) General partner distributions $ 2,551 $ 2,346 $ 4,970 $ 4,619 Incentive distributions 21,437 18,574 41,757 35,403 Total distributions to general partner $ 23,988 $ 20,920 $ 46,727 $ 40,022 The quarterly distributions paid by ONEOK Partners to limited partners in each of the first and second quarters of 2009 were $1.08 per unit. The quarterly distributions paid by ONEOK Partners to limited partners in the first and second quarters of 2008 were $1.025 per unit and $1.04 per unit, respectively. In July 2009, ONEOK Partners declared a second-quarter 2009 cash distribution of $1.08 per unit payable in the third quarter. Relationship - We consolidate ONEOK Partners in our consolidated financial statements; however, we are restricted from the assets and cash flows of ONEOK Partners except for our distributions. Distributions are declared quarterly by ONEOK Partners general partner based on the terms of the ONEOK Partners partnership ag

Document Information

Document Information
	6 Months Ended Jun. 30, 2009 USD / shares
Document Information
Document Type	10-Q
Amendment Flag	false
Document Period End Date	2009-06-30
Document Fiscal Period Focus	Q2

Entity Information

Entity Information (USD $)
In Billions, except Share data	6 Months Ended Jun. 30, 2009	Jul. 31, 2009
Entity Information
Entity Registrant Name	ONEOK, Inc.
Entity Central Index Key	0001039684
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float	3.1
Entity Common Stock, Shares Outstanding		105,394,349
Entity Address, Address Line One	100 West Fifth Street
Entity Address, City or Town	Tulsa
Entity Address, State or Province	OK
Entity Address, Postal Zip Code	74103
Local Phone Number	918-588-7000