ONE Gas (OGS) 10-Q 1 Nov 16 2016 Q3 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Oct. 25, 2016
Document Information [Line Items]
Entity Registrant Name	ONE Gas, Inc.
Entity Central Index Key	1,587,732
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 Common Stock, Shares Outstanding		52,245,273
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q3
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2016

STATEMENTS OF INCOME

STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Gross Margin
Revenues	$ 232,191	$ 225,226	$ 986,479	$ 1,158,543
Cost of natural gas	52,253	54,724	344,439	548,226
Net margin	179,938	170,502	642,040	610,317
Operating expenses
Operations and maintenance	99,402	98,698	302,652	304,681
Depreciation and amortization	36,241	33,956	106,490	98,592
General taxes	13,403	12,897	42,311	41,818
Total operating expenses	149,046	145,551	451,453	445,091
Operating income	30,892	24,951	190,587	165,226
Other income	911	166	1,345	1,051
Other expense	(357)	(1,884)	(1,126)	(2,840)
Interest expense, net	(10,809)	(11,233)	(32,504)	(33,592)
Income before income taxes	20,637	12,000	158,302	129,845
Income taxes	(7,900)	(4,629)	(60,521)	(50,017)
Net income	$ 12,737	$ 7,371	$ 97,781	$ 79,828
Earnings per share
Basic	$ 0.24	$ 0.14	$ 1.86	$ 1.52
Diluted	$ 0.24	$ 0.14	$ 1.85	$ 1.50
Average shares (thousands)
Basic	52,453	52,408	52,452	52,627
Diluted	52,942	53,072	52,962	53,315
Dividends declared per share of stock	$ 0.35	$ 0.30	$ 1.05	$ 0.90

STATEMENTS OF COMPREHENSIVE INC

STATEMENTS OF COMPREHENSIVE INCOME STATEMENTS OF COMPREHENSIVE INCOME Parenthetical - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
STATEMENTS OF COMPREHENSIVE INCOME Parenthetical [Abstract]
Pension and other postretirement benefit plans, tax	$ (72)	$ (88)	$ (217)	$ (264)

STATEMENTS OF COMPREHENSIVE IN4

STATEMENTS OF COMPREHENSIVE INCOME STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Net income	$ 12,737	$ 7,371	$ 97,781	$ 79,828
Other comprehensive income (loss), net of tax
Change in pension and postretirement benefit plan liability, net of tax of $(72), $(88), $(217) and $(264), respectively	116	141	347	423
Other comprehensive income (loss), net of tax	116	141	347	423
Comprehensive income	$ 12,853	$ 7,512	$ 98,128	$ 80,251

BALANCE SHEETS

BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Property, plant and equipment
Property, plant and equipment	$ 5,338,591	$ 5,132,682
Accumulated depreciation and amortization	1,658,266	1,620,771
Net property, plant and equipment	3,680,325	3,511,911
Current assets
Cash and cash equivalents	4,513	2,433
Accounts receivable, net	105,060	216,343
Materials and supplies	30,098	33,325
Income tax receivable	6,952	38,877
Natural gas in storage	144,230	142,153
Regulatory assets	73,863	32,925
Other current assets	12,457	16,789
Total current assets	377,173	482,845
Goodwill and other assets
Regulatory assets	431,086	435,863
Goodwill	157,953	157,953
Other assets	47,142	46,193
Total goodwill and other assets	636,181	640,009
Total assets	4,693,679	4,634,765
Equity and long-term debt
Common stock, $0.01 par value: authorized 250,000,000 shares; issued 52,598,005 shares and outstanding 52,245,273 shares at September 30, 2016; issued 52,598,005 shares and outstanding 52,259,224 shares at December 31, 2015	526	526
Paid-in Capital	1,748,965	1,764,875
Retained earnings	137,221	95,046
Accumulated other comprehensive income (loss)	(4,054)	(4,401)
Treasury stock, at cost: 352,732 shares at September 30, 2016 and 338,781 shares at December 31, 2015	(20,314)	(14,491)
Total equity	1,862,344	1,841,555
Long-term debt, excluding current maturities and net of issuance costs of $9,051 and $9,645, respectively	1,192,248	1,191,660
Total equity and long-term debt	3,054,592	3,033,215
Current liabilities
Current maturities of long-term debt	7	7
Notes payable	41,000	12,500
Accounts payable	70,562	107,482
Accrued interest	7,691	18,873
Accrued taxes other than income	39,919	37,249
Accrued liabilities	17,812	31,470
Customer deposits	60,425	60,325
Regulatory liabilities	13,204	24,615
Other current liabilities	8,212	11,700
Total current liabilities	258,832	304,221
Deferred credits and other liabilities [Abstract]
Deferred income taxes	1,011,691	951,785
Employee benefit obligations	291,230	272,309
Other deferred credits	77,334	73,235
Total deferred credits and other liabilities	1,380,255	1,297,329
Commitments and contingencies
Total liabilities and equity	$ 4,693,679	$ 4,634,765

BALANCE SHEETS BALANCE SHEETS P

BALANCE SHEETS BALANCE SHEETS Parenthetical - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2016	Dec. 31, 2015
Common stock, par value per share	$ 0.01	$ 0.01
Common stock, shares authorized	250,000,000	250,000,000
Common stock, shares issued	52,598,005	52,598,005
Common stock, shares outstanding	52,245,273	52,259,224
Treasury Stock, Shares	352,732	338,781
Debt Issuance Cost	$ 9,051,000	$ 9,645,000

STATEMENTS OF CASH FLOWS

STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Operating activities
Net income	$ 97,781	$ 79,828
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	106,490	98,592
Deferred income taxes	59,771	19,384
Share-based compensation expense	9,341	3,863
Provision for doubtful accounts	3,521	2,951
Changes in assets and liabilities:
Accounts receivable	107,762	220,392
Materials and supplies	3,227	(5,889)
Income tax receivable	31,925	20,075
Natural gas in storage	(2,077)	25,388
Asset removal costs	(40,715)	(33,744)
Accounts payable	(32,923)	(104,948)
Accrued interest	(11,182)	(11,225)
Accrued taxes other than income	2,670	(4,313)
Accrued liabilities	(13,658)	(8,019)
Customer deposits	100	(1,672)
Regulatory assets and liabilities	(18,726)	64,368
Other assets and liabilities	(21,877)	(15,493)
Cash provided by operating activities	281,430	349,538
Investing activities
Capital expenditures	(231,336)	(199,678)
Other	492	0
Cash used in investing activities	(230,844)	(199,678)
Financing activities
Borrowings (repayments) on notes payable, net	28,500	(42,000)
Repurchase of common stock	(24,066)	(24,122)
Issuance of common stock	1,983	4,471
Dividends paid	(54,923)	(47,178)
Cash provided by (used in) financing activities	(48,506)	(108,829)
Change in cash and cash equivalents	2,080	41,031
Cash and cash equivalents at beginning of period	2,433	11,943
Cash and cash equivalents at end of period	$ 4,513	$ 52,974

STATEMENT OF CHANGES IN EQUITY

STATEMENT OF CHANGES IN EQUITY - 9 months ended Sep. 30, 2016 - USD ($) $ in Thousands	Total	Common Stock [Member]	Paid-in Capital [Member]	Retained Earnings [Member]	Treasury Stock [Member]	Accumulated Other Comprehensive Income (Loss) [Member]
Shares issued, beginning balance at Dec. 31, 2015	52,598,005	52,598,005
Equity, beginning balance at Dec. 31, 2015	$ 1,841,555	$ 526	$ 1,764,875	$ 95,046	$ (14,491)	$ (4,401)
Net income	97,781	0	0	97,781	0	0
Other comprehensive income	347	0	0	0		347
Repurchase of common stock	(24,066)	$ 0	0	0	(24,066)	0
Common stock issued, shares		0
Common stock issued, value	1,650	$ 0	(16,593)	0	18,243	0
Common stock dividends - $1.05 per share	$ 54,923	$ 0	(683)	55,606	0	0
Shares issued, ending balance at Sep. 30, 2016	52,598,005	52,598,005
Equity, ending balance at Sep. 30, 2016	$ 1,862,344	$ 526	$ 1,748,965	$ 137,221	$ (20,314)	$ (4,054)

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Notes)	9 Months Ended
	Sep. 30, 2016
Significant Accounting Policies [Line Items]
SIGNIFICANT ACCOUNTING POLICIES	1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Our accompanying unaudited financial statements have been prepared pursuant to the rules and regulations of the SEC. These statements also have been prepared in accordance with GAAP and reflect all adjustments that, in our opinion, are necessary for a fair statement of the results for the interim periods presented. All such adjustments are of a normal recurring nature. The 2015 year-end balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. These unaudited financial statements should be read in conjunction with the audited financial statements and footnotes in our Annual Report. Due to the seasonal nature of our business, the results of operations for the three and nine months ended September 30, 2016 , are not necessarily indicative of the results that may be expected for a 12-month period. We provide natural gas distribution services to more than 2 million customers in Oklahoma, Kansas and Texas through Oklahoma Natural Gas, Kansas Gas Service and Texas Gas Service, respectively. We serve residential, commercial, industrial and transportation customers in all three states. In addition, we also provide natural gas distribution services to wholesale and public authority customers. Use of Estimates - The preparation of our 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 amount of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the financial statements. These estimates and assumptions also affect the reported amounts of revenue and expenses during the reporting period. Items that may be estimated include, but are not limited to, the economic useful life of assets, fair value of assets and liabilities, provision for doubtful accounts, unbilled revenues for natural gas delivered but for which meters have not been read, natural gas purchased but for which no invoice has been received, provision for income taxes, including any deferred tax valuation allowances, the results of litigation and various other recorded or disclosed amounts. We evaluate these estimates on an ongoing basis using historical experience and other methods we consider reasonable based on the particular circumstances. Nevertheless, actual results may differ significantly from the estimates. Any effects on our financial position or results of operations from revisions to these estimates are recorded in the period when the facts that give rise to the revision become known. Segments - We operate in one reportable business segment: regulated public utilities that deliver natural gas to residential, commercial, industrial, wholesale, public authority and transportation customers. The accounting policies for our segment are the same as described in Note 1 of our Notes to the Financial Statements in our Annual Report. We evaluate our financial performance principally on operating income. For the three and nine months ended September 30, 2016 , and 2015 , we had no single external customer from which we received 10 percent or more of our gross revenues. Goodwill Impairment Test - We assess our goodwill for impairment at least annually as of July 1. At July 1, 2016, we assessed qualitative factors to determine whether it was more likely than not that the fair value of our reporting unit was less than its carrying amount. After assessing qualitative factors (including macroeconomic conditions, industry and market considerations, cost factors and overall financial performance), we determined that no further testing was necessary. Recently Issued Accounting Standards Update - In March 2016, the FASB issued ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting,” which includes various new aspects to simplify how share-based payments are accounted for and presented in the financial statements. The new standard will modify several aspects of the accounting and reporting for employee share-based payments and related tax accounting impacts, including the presentation in the statements of operations and cash flows. This new guidance is required to be adopted for our interim and annual reports for periods beginning after December 15, 2016, but may be adopted early. We are evaluating the impact of this guidance and the timing of adoption. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842),” which prescribes recognizing lease assets and liabilities on the balance sheet and includes disclosure of key information about leasing arrangements. A modified retrospective transition approach is required for leases existing at the time of adoption. We are evaluating our population of leases, analyzing lease agreements, and holding meetings with cross-divisional teams to determine the potential impact of this accounting standard on our financial position, results of operations and cash flows and the transition approach we will utilize. This new guidance is required for our interim and annual reports for periods beginning after December 15, 2018, and early adoption is permitted. In August 2015, the FASB issued ASU 2015-15, “Interest-Imputation of Interest (Subtopic 835-30),” which addresses the presentation and subsequent measurement of debt issuance costs associated with line of credit arrangements. We adopted this guidance in the first quarter 2016, and it did not have an impact on our financial position or results of operations. In April 2015, the FASB issued ASU 2015-03, “Interest-Imputation of Interest,” which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. We adopted this guidance in the first quarter of 2016, and have applied the changes retrospectively to all periods presented. We have presented such amounts as a direct deduction from the face amount of our long-term debt, rather than in other assets as a deferred charge in our Balance Sheets. Amortization of the debt issuance costs continues to be reported as interest expense in our Statements of Income. In April 2015, the FASB issued ASU 2015-05, “Intangibles-Goodwill and Other-Internal-Use Software,” which helps entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement. We adopted this guidance prospectively in the first quarter of 2016, and it did not have a material impact on our financial position or results of operations. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers,” which clarifies and converges the revenue recognition principles under GAAP and International Financial Reporting Standards. In July 2015, FASB delayed the effective date for one year. We are evaluating all of our sources of revenue to determine the potential effect on our financial position, results of operations and cash flows and the transition approach we will utilize. We are monitoring the FASB for additional implementation guidance that may impact the final conclusions of our evaluation. We are required to adopt this guidance for our interim and annual reports beginning with the first quarter 2018.

REGULATORY ASSETS AND LIABILITI

REGULATORY ASSETS AND LIABILITIES (Notes)	9 Months Ended
	Sep. 30, 2016
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Schedule of Regulatory Assets and Liabilities [Text Block]	2. REGULATORY ASSETS AND LIABILITIES The tables below present a summary of regulatory assets, net of amortization, and liabilities for the periods indicated: September 30, 2016 Current Noncurrent Total ( Thousands of dollars ) Under-recovered purchased-gas costs $ 29,109 $ — $ 29,109 Pension and postemployment benefit costs 24,706 416,327 441,033 Weather normalization 17,004 — 17,004 Reacquired debt costs 812 8,312 9,124 Other 2,232 6,447 8,679 Total regulatory assets, net of amortization 73,863 431,086 504,949 Accumulated removal costs (a) — (7,019 ) (7,019 ) Over-recovered purchased-gas costs (11,538 ) — (11,538 ) Ad valorem tax (1,666 ) — (1,666 ) Total regulatory liabilities (13,204 ) (7,019 ) (20,223 ) Net regulatory assets (liabilities) $ 60,659 $ 424,067 $ 484,726 (a) Included in other deferred credits in our Balance Sheets. December 31, 2015 Current Noncurrent Total ( Thousands of dollars ) Under-recovered purchased-gas costs $ 13,336 $ — $ 13,336 Pension and postemployment benefit costs 15,670 425,175 440,845 Weather normalization 2,198 — 2,198 Reacquired debt costs 812 8,919 9,731 Other 909 1,769 2,678 Total regulatory assets, net of amortization 32,925 435,863 468,788 Accumulated removal costs (a) — (9,032 ) (9,032 ) Over-recovered purchased-gas costs (22,884 ) — (22,884 ) Ad valorem tax (1,731 ) — (1,731 ) Total regulatory liabilities (24,615 ) (9,032 ) (33,647 ) Net regulatory assets (liabilities) $ 8,310 $ 426,831 $ 435,141 (a) Included in other deferred credits in our Balance Sheets. Regulatory assets on our Balance Sheets, as authorized by various regulatory authorities, are probable of recovery. Base rates are designed to provide a recovery of costs during the period rates are in effect, but do not generally provide for a return on investment for amounts we have deferred as regulatory assets. All of our regulatory assets are subject to review by the respective regulatory authorities during future regulatory proceedings. We are not aware of any evidence that these costs will not be recoverable through either riders or base rates, and we believe that we will be able to recover such costs, consistent with our historical recoveries. In January 2016, as a result of the OCC’s approval of our rate case in Oklahoma, we recorded a regulatory asset of $2.4 million to recover certain information technology costs incurred as a result of our separation from ONEOK in 2014, which will be recovered over four years.

CREDIT FACILITIES (Notes)

CREDIT FACILITIES (Notes)	9 Months Ended
	Sep. 30, 2016
Line of Credit Facility [Line Items]
Short-term Debt [Text Block]	3. CREDIT FACILITY AND SHORT-TERM NOTES PAYABLE The ONE Gas Credit Agreement contains certain financial, operational and legal covenants. Among other things, these covenants include maintaining ONE Gas’ debt-to-capital ratio of no more than 70 percent at the end of any calendar quarter. At September 30, 2016 , our debt-to-capital ratio was 40 percent and we were in compliance with all covenants under the ONE Gas Credit Agreement. We have a commercial paper program under which we may issue unsecured commercial paper up to a maximum amount of $700 million to fund short-term borrowing needs. The maturities of the commercial paper notes may vary but may not exceed 270 days from the date of issue. The commercial paper notes are generally sold at par less a discount representing an interest factor. The ONE Gas Credit Agreement is available to repay the commercial paper notes, if necessary. Amounts outstanding under the commercial paper program reduce the borrowing capacity under the ONE Gas Credit Agreement. At September 30, 2016 , we had $41.0 million in short-term borrowings, $1.0 million in letters of credit issued under the ONE Gas Credit Agreement and $658.0 million of remaining credit available under the ONE Gas Credit Agreement.

LONG-TERM DEBT (Notes)

LONG-TERM DEBT (Notes)	9 Months Ended
	Sep. 30, 2015
Long-term Debt, Unclassified [Abstract]
Long-term Debt [Text Block]	4. LONG-TERM DEBT We have senior notes, consisting of $300 million of 2.07 percent senior notes due in 2019 , $300 million of 3.61 percent senior notes due in 2024 and $600 million of 4.658 percent senior notes due in 2044 (collectively, our “Senior Notes”). The indenture governing our Senior Notes includes an event of default upon the acceleration of other indebtedness of $100 million or more. Such events of default would entitle the trustee or the holders of 25 percent in aggregate principal amount of the outstanding Senior Notes to declare those Senior Notes immediately due and payable in full.

EQUITY (Notes)

EQUITY (Notes)	9 Months Ended
	Sep. 30, 2016
EQUITY [Line Items]
Stockholders' Equity Note Disclosure [Text Block]	5. EQUITY In the first quarter of 2016, we repurchased approximately 407 thousand shares of our common stock for approximately $24.1 million . In October 2016, a dividend of $0.35 per share ( $1.40 per share on an annualized basis) was declared for shareholders of record on November 14, 2016, payable December 1, 2016.

ACCUMULATED OTHER COMPREHENSIVE

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Notes)	9 Months Ended
	Sep. 30, 2016
Accumulated Other Comprehensive Income (Loss) [Line Items]
Comprehensive Income (Loss) Note [Text Block]	6. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following table sets forth the effect of reclassifications from accumulated other comprehensive income (loss) in our Statements of Income for the periods indicated: Three Months Ended Nine Months Ended Details about Accumulated Other Comprehensive September 30, September 30, Affected Line Item in the Income (Loss) Components 2016 2015 2016 2015 Statements of Income ( Thousands of dollars ) Pension and other postemployment benefit plan obligations (a) Amortization of net loss $ 10,040 $ 12,564 $ 30,113 $ 37,694 Amortization of unrecognized prior service cost (909 ) (374 ) (2,725 ) (1,120 ) 9,131 12,190 27,388 36,574 Regulatory adjustments (b) (8,943 ) (11,961 ) (26,824 ) (35,887 ) 188 229 564 687 Income before income taxes (72 ) (88 ) (217 ) (264 ) Income tax expense Total reclassifications for the period $ 116 $ 141 $ 347 $ 423 Net income (a) These components of accumulated other comprehensive income (loss) are included in the computation of net periodic benefit cost. See Note 8 for additional detail of our net periodic benefit cost . (b) Regulatory adjustments represent pension and other postemployment benefit costs expected to be recovered through rates and are deferred as part of our regulatory assets. See Note 2 for additional disclosures of regulatory assets and liabilities.

EARNINGS PER SHARE (Notes)

EARNINGS PER SHARE (Notes)	9 Months Ended
	Sep. 30, 2016
EARNINGS PER SHARE [Line Items]
Earnings Per Share [Text Block]	7. EARNINGS PER SHARE Basic EPS is based on net income and is calculated based upon the daily weighted-average number of common shares outstanding during the periods presented. Also, this calculation includes fully vested stock awards that have not yet been issued as common stock. Diluted EPS includes basic EPS, plus unvested stock awards granted under our compensation plans, but only to the extent these instruments dilute earnings per share. The following tables set forth the computation of basic and diluted EPS from continuing operations for the periods indicated: Three Months Ended September 30, 2016 Income Shares Per Share Amount ( Thousands, except per share amounts ) Basic EPS Calculation Net income available for common stock $ 12,737 52,453 $ 0.24 Diluted EPS Calculation Effect of dilutive securities — 489 Net income available for common stock and common stock equivalents $ 12,737 52,942 $ 0.24 Three Months Ended September 30, 2015 Income Shares Per Share Amount ( Thousands, except per share amounts ) Basic EPS Calculation Net income available for common stock $ 7,371 52,408 $ 0.14 Diluted EPS Calculation Effect of dilutive securities — 664 Net income available for common stock and common stock equivalents $ 7,371 53,072 $ 0.14 Nine Months Ended September 30, 2016 Income Shares Per Share Amount ( Thousands, except per share amounts ) Basic EPS Calculation Net income available for common stock $ 97,781 52,452 $ 1.86 Diluted EPS Calculation Effect of dilutive securities — 510 Net income available for common stock and common stock equivalents $ 97,781 52,962 $ 1.85 Nine Months Ended September 30, 2015 Income Shares Per Share Amount ( Thousands, except per share amounts ) Basic EPS Calculation Net income available for common stock $ 79,828 52,627 $ 1.52 Diluted EPS Calculation Effect of dilutive securities — 688 Net income available for common stock and common stock equivalents $ 79,828 53,315 $ 1.50

EMPLOYEE BENEFIT PLANS (Notes)

EMPLOYEE BENEFIT PLANS (Notes)	9 Months Ended
	Sep. 30, 2016
Employee Benefit Plans [Line Items]
EMPLOYEE BENEFIT PLANS	8. EMPLOYEE BENEFIT PLANS The following tables set forth the components of net periodic benefit cost for our pension and other postemployment benefit plans for the periods indicated: Pension Benefits Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 ( Thousands of dollars ) Components of net periodic benefit cost Service cost $ 3,014 $ 3,497 $ 9,042 $ 10,518 Interest cost 11,387 10,652 34,162 31,956 Expected return on assets (15,296 ) (15,363 ) (45,888 ) (46,087 ) Amortization of unrecognized prior service cost — 66 — 200 Amortization of net loss 8,886 11,054 26,657 33,164 Net periodic benefit cost $ 7,991 $ 9,906 $ 23,973 $ 29,751 Other Postemployment Benefits Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 ( Thousands of dollars ) Components of net periodic benefit cost Service cost $ 637 $ 849 $ 1,913 $ 2,547 Interest cost 2,626 2,665 7,880 7,997 Expected return on assets (3,070 ) (2,908 ) (9,212 ) (8,724 ) Amortization of unrecognized prior service cost (909 ) (440 ) (2,725 ) (1,320 ) Amortization of net loss 1,154 1,510 3,456 4,530 Net periodic benefit cost $ 438 $ 1,676 $ 1,312 $ 5,030 We recover qualified pension benefit plan and other postemployment benefit plan costs through rates charged to our customers. Certain utility commissions require that the recovery of these costs be based on specific guidelines. The difference between these regulatory-based amounts and the periodic benefit cost calculated pursuant to GAAP is deferred as a regulatory asset or liability and amortized to expense over periods in which this difference will be recovered in rates, as authorized by the applicable utility commission. Regulatory deferrals related to net periodic benefit cost were not material for the three and nine months ended September 30, 2016 . In October 2015, we announced to certain pre-65 participants in our postretirement medical plans a change from a self-insured postretirement medical plan to a plan providing participants an annual benefit that would allow them to select coverage on a healthcare exchange beginning January 1, 2017. In September 2016, due to uncertain market conditions with health insurance exchange providers, we elected not to move the eligible pre-65 participants in our postemployment medical plans to a healthcare exchange. As a result, we remeasured the respective plan assets and benefit obligations, effective September 30, 2016, which resulted in an increase in benefit obligations of our postemployment benefit plan of $31.5 million . The remeasurement will increase the net periodic benefit cost of our postemployment benefit plan by $0.8 million for the three months ending December 31, 2016. The following table sets forth the weighted-average assumptions used in the remeasurement of the benefit obligations for postemployment benefits for the periods indicated: September 30, 2016 December 31, 2015 Discount rate 3.75% 4.75% Expected long-term return on plan assets 7.75% 8.00% The following table sets forth the weighted-average assumptions used in the remeasurement to determine periodic benefit costs for the periods indicated: Three Months Ended December 31, Nine Months Ended September 30, 2016 2016 Discount rate - other postemployment plans 3.75% 4.75% Expected long-term return on plan assets 7.75% 8.00% There were no other changes in assumptions for the other postemployment benefits calculations, which are described in our Annual Report. There was no impact to our previously disclosed obligations and benefit costs for our pension plan.

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Notes)	9 Months Ended
	Sep. 30, 2016
Commitments and Contingencies [Line Items]
COMMITMENTS AND CONTINGENCIES	9. COMMITMENTS AND CONTINGENCIES Environmental Matters - We are subject to multiple historical, wildlife preservation and environmental laws and/or regulations that affect many aspects of our present and future operations. Regulated activities include, but are not limited to, those involving air emissions, storm water and wastewater discharges, handling and disposal of solid and hazardous wastes, wetland preservation, hazardous materials transportation, and pipeline and facility construction. These laws and regulations require us to obtain and/or comply with a wide variety of environmental clearances, registrations, licenses, permits and other approvals. Failure to comply with these laws, regulations, licenses and permits may expose us to fines, penalties and/or interruptions in our operations that could be material to our results of operations. In addition, emission controls and/or other regulatory or permitting mandates under the Clean Air Act and other similar federal and state laws could require unexpected capital expenditures at our facilities. We cannot assure that existing environmental statutes and regulations will not be revised or that new regulations will not be adopted or become applicable to us. Revised or additional statutes or regulations that result in increased compliance costs or additional operating restrictions could have a material adverse effect on our business, financial condition, results of operations and cash flows. We own or retain legal responsibility for the environmental conditions at 12 former manufactured natural 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 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. We have completed or addressed removal of the source of soil contamination at 11 of the 12 sites according to plans approved by the KDHE. Regulatory closure has been achieved at three of the sites. We have begun site assessment at the remaining site where no active remediation has occurred. Our expenditures for environmental evaluation, mitigation, remediation and compliance to date have not been significant in relation to our financial position, results of operations or cash flows, and our expenditures related to environmental matters had no material effects on earnings or cash flows during the three and nine months ended September 30, 2016 and 2015 . We do not expect expenditures for these matters to have a material adverse effect on our financial condition, results of operations or cash flows. Pipeline Safety - We are subject to PHMSA regulations, including integrity-management regulations. PHMSA regulations require pipeline companies operating high-pressure transmission pipelines to perform integrity assessments on pipeline segments that pass through densely populated areas or near specifically designated high-consequence areas. In January 2012, the Pipeline Safety, Regulatory Certainty and Job Creation Act was signed into law. The law increased maximum penalties for violating federal pipeline safety regulations and directs the DOT and the Secretary of Transportation to conduct further review or studies on issues that may or may not be material to us. These issues include, but are not limited to, the following: • an evaluation of whether natural gas pipeline integrity-management requirements should be expanded beyond current high-consequence areas; • a verification of records for pipelines in class 3 and 4 locations and high-consequence areas to confirm maximum allowable operating pressures; and • a requirement to test previously untested pipelines operating above 30 percent yield strength in high-consequence areas. In April 2016, PHMSA published a notice of proposed rulemaking (NPRM), the Safety of Gas Transmission & Gathering Lines Rule, in the Federal Register to revise pipeline safety regulations applicable to the safety of onshore natural gas transmission and gathering pipelines. Proposals include changes to pipeline integrity management requirements and other safety-related requirements. The NPRM comment period ended July 7, 2016, and comments are under review by PHMSA. The potential capital and operating expenditures associated with the NPRM are currently being evaluated and could be significant depending on the final regulations. Legal Proceedings - We are a party to various litigation matters and claims that have arisen in the normal course of our operations. While the results of litigation and claims cannot be predicted with certainty, we believe the reasonably possible losses from such matters, individually and in the aggregate, are not material. Additionally, we believe the probable final outcome of such matters will not have a material adverse effect on our results of operations, financial position or cash flows.

DERIVATIVE FINANCIAL INSTRUMENT

DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Notes)	9 Months Ended
	Sep. 30, 2016
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Fair Value Disclosures	10. DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS Accounting Treatment - We record all derivative instruments at fair value, with the exception of normal purchases and normal sales that are expected to result in physical delivery. The accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and, if so, the reason for holding it, or if regulatory rulings require a different accounting treatment. If certain conditions are met, we may elect to designate a derivative instrument as a hedge to mitigate the risk of exposure to changes in fair values or cash flows. The table below summarizes the various ways in which we account for our derivative instruments and the impact on our financial statements: Recognition and Measurement Accounting Treatment Balance Sheet Income Statement Normal purchases and normal sales - Recorded at historical cost - Change in fair value not recognized in earnings Mark-to-market - Recorded at fair value - Change in fair value recognized in, and recoverable through, the purchased-gas cost adjustment mechanisms We have not elected to designate any of our derivative instruments as hedges. Premiums paid and any cash settlements received associated with the commodity derivative instruments entered into by us are included in, and recoverable through, the purchased-gas cost adjustment mechanisms. Determining Fair Value - We define fair value as the price that would be received from the sale of an asset or the transfer of a liability in an orderly transaction between market participants at the measurement date. We use the market and income approaches to determine the fair value of our assets and liabilities and consider the markets in which the transactions are executed. We measure the fair value of a group of financial assets and liabilities consistent with how a market participant would price the net risk exposure at the measurement date. Fair Value Hierarchy - At each balance sheet date, we utilize a fair value hierarchy to classify fair value amounts recognized or disclosed in our financial statements based on the observability of inputs used to estimate such fair value. The levels of the hierarchy are described below: • Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities; • Level 2 - Significant observable pricing inputs other than quoted prices included within Level 1 that are, either directly or indirectly, observable as of the reporting date. Essentially, this represents inputs that are derived principally from or corroborated by observable market data; and • Level 3 - May include one or more unobservable inputs that are significant in establishing a fair value estimate. These unobservable inputs are developed based on the best information available and may include our own internal data. We recognize transfers into and out of the levels as of the end of each reporting period. Determining the appropriate classification of our fair value measurements within the fair value hierarchy requires management’s judgment regarding the degree to which market data is observable or corroborated by observable market data. We categorize derivatives for which fair value is determined using multiple inputs within a single level, based on the lowest level input that is significant to the fair value measurement in its entirety. Derivative Instruments - At September 30, 2016 , we held purchased natural gas call options for the heating season ending March 2017, with total notional amounts of 30.5 Bcf, for which we paid premiums of $9.4 million , and had a fair value of $8.1 million . At December 31, 2015 , we held purchased natural gas call options for the heating season ended March 2016, with total notional amounts of 17.0 Bcf, for which we paid premiums of $5.8 million , and had a fair value of $0.4 million . The premiums paid and any cash settlements received are recorded as part of our unrecovered purchased-gas costs in current regulatory assets as these contracts are included in, and recoverable through, the purchased-gas cost adjustment mechanisms. Additionally, changes in fair value associated with these contracts are deferred as part of our unrecovered purchased-gas costs in our Balance Sheets. Our natural gas call options are classified as Level 1 as fair value amounts are based on unadjusted quoted prices in active markets including NYMEX-settled prices. There were no transfers between levels for the three and nine months ended September 30, 2016 and 2015 . Other Financial Instruments - The approximate fair value of cash and cash equivalents, accounts receivable and accounts payable is equal to book value, due to the short-term nature of these items. Our cash and cash equivalents are comprised of bank deposits and money market accounts, and are classified as Level 1. Short-term notes payable and commercial paper are due upon demand and, therefore, the carrying amounts approximate fair value and are classified as Level 1. The book value of our long-term debt, including current maturities, was $1.2 billion at both September 30, 2016 and December 31, 2015 . The estimated fair value of our long-term debt, including current maturities, was $1.3 billion and $1.2 billion at September 30, 2016 and December 31, 2015 , respectively. The estimated fair value of our Senior Notes at September 30, 2016 and December 31, 2015 , was determined using quoted market prices, and are considered Level 2.

SUMMARY OF SIGNIFICANT ACCOUN19

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Sep. 30, 2016
Significant Accounting Policies [Line Items]
Use of Estimates	Use of Estimates - The preparation of our 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 amount of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the financial statements. These estimates and assumptions also affect the reported amounts of revenue and expenses during the reporting period. Items that may be estimated include, but are not limited to, the economic useful life of assets, fair value of assets and liabilities, provision for doubtful accounts, unbilled revenues for natural gas delivered but for which meters have not been read, natural gas purchased but for which no invoice has been received, provision for income taxes, including any deferred tax valuation allowances, the results of litigation and various other recorded or disclosed amounts. We evaluate these estimates on an ongoing basis using historical experience and other methods we consider reasonable based on the particular circumstances. Nevertheless, actual results may differ significantly from the estimates. Any effects on our financial position or results of operations from revisions to these estimates are recorded in the period when the facts that give rise to the revision become known.
Segments	Segments - We operate in one reportable business segment: regulated public utilities that deliver natural gas to residential, commercial, industrial, wholesale, public authority and transportation customers. The accounting policies for our segment are the same as described in Note 1 of our Notes to the Financial Statements in our Annual Report. We evaluate our financial performance principally on operating income. For the three and nine months ended September 30, 2016 , and 2015 , we had no single external customer from which we received 10 percent or more of our gross revenues.
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block]	Goodwill Impairment Test - We assess our goodwill for impairment at least annually as of July 1. At July 1, 2016, we assessed qualitative factors to determine whether it was more likely than not that the fair value of our reporting unit was less than its carrying amount. After assessing qualitative factors (including macroeconomic conditions, industry and market considerations, cost factors and overall financial performance), we determined that no further testing was necessary.
Recently Issued Accounting Standards Update	Recently Issued Accounting Standards Update - In March 2016, the FASB issued ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting,” which includes various new aspects to simplify how share-based payments are accounted for and presented in the financial statements. The new standard will modify several aspects of the accounting and reporting for employee share-based payments and related tax accounting impacts, including the presentation in the statements of operations and cash flows. This new guidance is required to be adopted for our interim and annual reports for periods beginning after December 15, 2016, but may be adopted early. We are evaluating the impact of this guidance and the timing of adoption. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842),” which prescribes recognizing lease assets and liabilities on the balance sheet and includes disclosure of key information about leasing arrangements. A modified retrospective transition approach is required for leases existing at the time of adoption. We are evaluating our population of leases, analyzing lease agreements, and holding meetings with cross-divisional teams to determine the potential impact of this accounting standard on our financial position, results of operations and cash flows and the transition approach we will utilize. This new guidance is required for our interim and annual reports for periods beginning after December 15, 2018, and early adoption is permitted. In August 2015, the FASB issued ASU 2015-15, “Interest-Imputation of Interest (Subtopic 835-30),” which addresses the presentation and subsequent measurement of debt issuance costs associated with line of credit arrangements. We adopted this guidance in the first quarter 2016, and it did not have an impact on our financial position or results of operations. In April 2015, the FASB issued ASU 2015-03, “Interest-Imputation of Interest,” which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. We adopted this guidance in the first quarter of 2016, and have applied the changes retrospectively to all periods presented. We have presented such amounts as a direct deduction from the face amount of our long-term debt, rather than in other assets as a deferred charge in our Balance Sheets. Amortization of the debt issuance costs continues to be reported as interest expense in our Statements of Income. In April 2015, the FASB issued ASU 2015-05, “Intangibles-Goodwill and Other-Internal-Use Software,” which helps entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement. We adopted this guidance prospectively in the first quarter of 2016, and it did not have a material impact on our financial position or results of operations. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers,” which clarifies and converges the revenue recognition principles under GAAP and International Financial Reporting Standards. In July 2015, FASB delayed the effective date for one year. We are evaluating all of our sources of revenue to determine the potential effect on our financial position, results of operations and cash flows and the transition approach we will utilize. We are monitoring the FASB for additional implementation guidance that may impact the final conclusions of our evaluation. We are required to adopt this guidance for our interim and annual reports beginning with the first quarter 2018.

DERIVATIVE FINANCIAL INSTRUME20

DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Policies)	9 Months Ended
	Sep. 30, 2016
Derivatives and Fair Value Measurement [Abstract]
Derivatives	Accounting Treatment - We record all derivative instruments at fair value, with the exception of normal purchases and normal sales that are expected to result in physical delivery. The accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and, if so, the reason for holding it, or if regulatory rulings require a different accounting treatment. If certain conditions are met, we may elect to designate a derivative instrument as a hedge to mitigate the risk of exposure to changes in fair values or cash flows. The table below summarizes the various ways in which we account for our derivative instruments and the impact on our financial statements: Recognition and Measurement Accounting Treatment Balance Sheet Income Statement Normal purchases and normal sales - Recorded at historical cost - Change in fair value not recognized in earnings Mark-to-market - Recorded at fair value - Change in fair value recognized in, and recoverable through, the purchased-gas cost adjustment mechanisms We have not elected to designate any of our derivative instruments as hedges. Premiums paid and any cash settlements received associated with the commodity derivative instruments entered into by us are included in, and recoverable through, the purchased-gas cost adjustment mechanisms.
Fair Value Measurement	Determining Fair Value - We define fair value as the price that would be received from the sale of an asset or the transfer of a liability in an orderly transaction between market participants at the measurement date. We use the market and income approaches to determine the fair value of our assets and liabilities and consider the markets in which the transactions are executed. We measure the fair value of a group of financial assets and liabilities consistent with how a market participant would price the net risk exposure at the measurement date. Fair Value Hierarchy - At each balance sheet date, we utilize a fair value hierarchy to classify fair value amounts recognized or disclosed in our financial statements based on the observability of inputs used to estimate such fair value. The levels of the hierarchy are described below: • Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities; • Level 2 - Significant observable pricing inputs other than quoted prices included within Level 1 that are, either directly or indirectly, observable as of the reporting date. Essentially, this represents inputs that are derived principally from or corroborated by observable market data; and • Level 3 - May include one or more unobservable inputs that are significant in establishing a fair value estimate. These unobservable inputs are developed based on the best information available and may include our own internal data. We recognize transfers into and out of the levels as of the end of each reporting period. Determining the appropriate classification of our fair value measurements within the fair value hierarchy requires management’s judgment regarding the degree to which market data is observable or corroborated by observable market data. We categorize derivatives for which fair value is determined using multiple inputs within a single level, based on the lowest level input that is significant to the fair value measurement in its entirety.

REGULATORY ASSETS AND LIABILI21

REGULATORY ASSETS AND LIABILITIES (Tables)	9 Months Ended
	Sep. 30, 2016
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES	The tables below present a summary of regulatory assets, net of amortization, and liabilities for the periods indicated: September 30, 2016 Current Noncurrent Total ( Thousands of dollars ) Under-recovered purchased-gas costs $ 29,109 $ — $ 29,109 Pension and postemployment benefit costs 24,706 416,327 441,033 Weather normalization 17,004 — 17,004 Reacquired debt costs 812 8,312 9,124 Other 2,232 6,447 8,679 Total regulatory assets, net of amortization 73,863 431,086 504,949 Accumulated removal costs (a) — (7,019 ) (7,019 ) Over-recovered purchased-gas costs (11,538 ) — (11,538 ) Ad valorem tax (1,666 ) — (1,666 ) Total regulatory liabilities (13,204 ) (7,019 ) (20,223 ) Net regulatory assets (liabilities) $ 60,659 $ 424,067 $ 484,726 (a) Included in other deferred credits in our Balance Sheets. December 31, 2015 Current Noncurrent Total ( Thousands of dollars ) Under-recovered purchased-gas costs $ 13,336 $ — $ 13,336 Pension and postemployment benefit costs 15,670 425,175 440,845 Weather normalization 2,198 — 2,198 Reacquired debt costs 812 8,919 9,731 Other 909 1,769 2,678 Total regulatory assets, net of amortization 32,925 435,863 468,788 Accumulated removal costs (a) — (9,032 ) (9,032 ) Over-recovered purchased-gas costs (22,884 ) — (22,884 ) Ad valorem tax (1,731 ) — (1,731 ) Total regulatory liabilities (24,615 ) (9,032 ) (33,647 ) Net regulatory assets (liabilities) $ 8,310 $ 426,831 $ 435,141 (a) Included in other deferred credits in our Balance Sheets.

ACCUMULATED OTHER COMPREHENSI22

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)	9 Months Ended
	Sep. 30, 2016
Accumulated Other Comprehensive Income (Loss) [Line Items]
Reclassification out of Accumulated Other Comprehensive Income [Table Text Block]	The following table sets forth the effect of reclassifications from accumulated other comprehensive income (loss) in our Statements of Income for the periods indicated: Three Months Ended Nine Months Ended Details about Accumulated Other Comprehensive September 30, September 30, Affected Line Item in the Income (Loss) Components 2016 2015 2016 2015 Statements of Income ( Thousands of dollars ) Pension and other postemployment benefit plan obligations (a) Amortization of net loss $ 10,040 $ 12,564 $ 30,113 $ 37,694 Amortization of unrecognized prior service cost (909 ) (374 ) (2,725 ) (1,120 ) 9,131 12,190 27,388 36,574 Regulatory adjustments (b) (8,943 ) (11,961 ) (26,824 ) (35,887 ) 188 229 564 687 Income before income taxes (72 ) (88 ) (217 ) (264 ) Income tax expense Total reclassifications for the period $ 116 $ 141 $ 347 $ 423 Net income (a) These components of accumulated other comprehensive income (loss) are included in the computation of net periodic benefit cost. See Note 8 for additional detail of our net periodic benefit cost . (b) Regulatory adjustments represent pension and other postemployment benefit costs expected to be recovered through rates and are deferred as part of our regulatory assets. See Note 2 for additional disclosures of regulatory assets and liabilities.

EARNINGS PER SHARE (Tables)

EARNINGS PER SHARE (Tables)	9 Months Ended
	Sep. 30, 2016
EARNINGS PER SHARE [Line Items]
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]	The following tables set forth the computation of basic and diluted EPS from continuing operations for the periods indicated: Three Months Ended September 30, 2016 Income Shares Per Share Amount ( Thousands, except per share amounts ) Basic EPS Calculation Net income available for common stock $ 12,737 52,453 $ 0.24 Diluted EPS Calculation Effect of dilutive securities — 489 Net income available for common stock and common stock equivalents $ 12,737 52,942 $ 0.24 Three Months Ended September 30, 2015 Income Shares Per Share Amount ( Thousands, except per share amounts ) Basic EPS Calculation Net income available for common stock $ 7,371 52,408 $ 0.14 Diluted EPS Calculation Effect of dilutive securities — 664 Net income available for common stock and common stock equivalents $ 7,371 53,072 $ 0.14 Nine Months Ended September 30, 2016 Income Shares Per Share Amount ( Thousands, except per share amounts ) Basic EPS Calculation Net income available for common stock $ 97,781 52,452 $ 1.86 Diluted EPS Calculation Effect of dilutive securities — 510 Net income available for common stock and common stock equivalents $ 97,781 52,962 $ 1.85 Nine Months Ended September 30, 2015 Income Shares Per Share Amount ( Thousands, except per share amounts ) Basic EPS Calculation Net income available for common stock $ 79,828 52,627 $ 1.52 Diluted EPS Calculation Effect of dilutive securities — 688 Net income available for common stock and common stock equivalents $ 79,828 53,315 $ 1.50

EMPLOYEE BENEFIT PLANS (Tables)

EMPLOYEE BENEFIT PLANS (Tables)	9 Months Ended
	Sep. 30, 2016
Employee Benefit Plans [Line Items]
Schedule of Net Benefit Costs [Table Text Block]	The following tables set forth the components of net periodic benefit cost for our pension and other postemployment benefit plans for the periods indicated: Pension Benefits Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 ( Thousands of dollars ) Components of net periodic benefit cost Service cost $ 3,014 $ 3,497 $ 9,042 $ 10,518 Interest cost 11,387 10,652 34,162 31,956 Expected return on assets (15,296 ) (15,363 ) (45,888 ) (46,087 ) Amortization of unrecognized prior service cost — 66 — 200 Amortization of net loss 8,886 11,054 26,657 33,164 Net periodic benefit cost $ 7,991 $ 9,906 $ 23,973 $ 29,751 Other Postemployment Benefits Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 ( Thousands of dollars ) Components of net periodic benefit cost Service cost $ 637 $ 849 $ 1,913 $ 2,547 Interest cost 2,626 2,665 7,880 7,997 Expected return on assets (3,070 ) (2,908 ) (9,212 ) (8,724 ) Amortization of unrecognized prior service cost (909 ) (440 ) (2,725 ) (1,320 ) Amortization of net loss 1,154 1,510 3,456 4,530 Net periodic benefit cost $ 438 $ 1,676 $ 1,312 $ 5,030
Schedule of Assumptions Used [Table Text Block]	September 30, 2016 December 31, 2015 Discount rate 3.75% 4.75% Expected long-term return on plan assets 7.75% 8.00% The following table sets forth the weighted-average assumptions used in the remeasurement to determine periodic benefit costs for the periods indicated: Three Months Ended December 31, Nine Months Ended September 30, 2016 2016 Discount rate - other postemployment plans 3.75% 4.75% Expected long-term return on plan assets 7.75% 8.00%

SUMMARY OF SIGNIFICANT ACCOUN25

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) number in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Significant Accounting Policies [Line Items]
Number of natural gas distribution services customers	2		2
Segment Reporting, Disclosure of Major Customers	0	0	0	0

REGULATORY ASSETS AND LIABILI26

REGULATORY ASSETS AND LIABILITIES (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Sep. 30, 2016	Jan. 31, 2016	Dec. 31, 2015
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Regulatory Assets, Current		$ 73,863		$ 32,925
Regulatory Assets, Noncurrent		431,086		435,863
Regulatory Liability, Current		(13,204)		(24,615)
Net regulatory assets (liabilities), current		60,659		8,310
Net regulatory assets (liabilities), noncurrent		424,067		426,831
Net Regulatory Assets		484,726		435,141
Accumulated removal costs [Member]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Regulatory Liability, Current		0		0
Regulatory Liability, Noncurrent		(7,019)		(9,032)
Regulatory Liabilities		(7,019)		(9,032)
Over-recovered purchased-gas costs [Member]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Regulatory Liability, Current		(11,538)		(22,884)
Regulatory Liability, Noncurrent		0		0
Regulatory Liabilities		(11,538)		(22,884)
Ad valorem tax [Member]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Regulatory Liability, Current		(1,666)		(1,731)
Regulatory Liability, Noncurrent		0		0
Regulatory Liabilities		(1,666)		(1,731)
Total regulated liabilities [Member]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Regulatory Liability, Current		(13,204)		(24,615)
Regulatory Liability, Noncurrent		(7,019)		(9,032)
Regulatory Liabilities		(20,223)		(33,647)
Information Technology Costs [Member]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Regulatory Assets, Noncurrent			$ 2,400
Information Technology Costs [Member] | Subsequent Event [Member]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Estimated Recovery Period	4
Under-recovered purchased-gas costs [Member]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Regulatory Assets		29,109		13,336
Regulatory Assets, Current		29,109		13,336
Regulatory Assets, Noncurrent		0		0
Pension and postretirement benefit costs [Member]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Regulatory Assets		441,033		440,845
Regulatory Assets, Current		24,706		15,670
Regulatory Assets, Noncurrent		416,327		425,175
Weather normalization [Member]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Regulatory Assets		17,004		2,198
Regulatory Assets, Current		17,004		2,198
Regulatory Assets, Noncurrent		0		0
Reacquired debt costs [Member]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Regulatory Assets		9,124		9,731
Regulatory Assets, Current		812		812
Regulatory Assets, Noncurrent		8,312		8,919
Other regulatory assets [Member]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Regulatory Assets		8,679		2,678
Regulatory Assets, Current		2,232		909
Regulatory Assets, Noncurrent		6,447		1,769
Total regulatory assets, net of amortization [Member]
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]
Regulatory Assets		504,949		468,788
Regulatory Assets, Current		73,863		32,925
Regulatory Assets, Noncurrent		$ 431,086		$ 435,863

CREDIT FACILITIES (Details)

CREDIT FACILITIES (Details) $ in Millions	9 Months Ended
	Sep. 30, 2016USD ($)
Line of Credit Facility [Line Items]
Ratio of Indebtedness to Net Capital	0.4
Commercial paper maximum borrowing capacity	$ 700
Commercial paper	41
Letters of Credit Outstanding, Amount	1
Line of Credit Facility, Remaining Borrowing Capacity	$ 658
Line of Credit [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Covenant Description	The ONE Gas Credit Agreement contains certain financial, operational and legal covenants. Among other things, these covenants include maintaining ONE Gas’ debt-to-capital ratio of no more than 70 percent at the end of any calendar quarter.

LONG-TERM DEBT (Details)

LONG-TERM DEBT (Details) $ in Millions	9 Months Ended
	Sep. 30, 2016USD ($)
Note Payable Due 2019 [Member]
Debt Instrument [Line Items]
Debt Instrument, Covenant Description	The indenture governing our Senior Notes includes an event of default upon the acceleration of other indebtedness of $100 million or more. Such events of default would entitle the trustee or the holders of 25 percent in aggregate principal amount of the outstanding Senior Notes to declare those senior notes immediately due and payable in full.
Long-term Debt, Gross	$ 300
Debt Instrument, Interest Rate, Stated Percentage	2.07%
Note Payable Due 2024 [Member]
Debt Instrument [Line Items]
Debt Instrument, Covenant Description	The indenture governing our Senior Notes includes an event of default upon the acceleration of other indebtedness of $100 million or more. Such events of default would entitle the trustee or the holders of 25 percent in aggregate principal amount of the outstanding Senior Notes to declare those senior notes immediately due and payable in full.
Long-term Debt, Gross	$ 300
Debt Instrument, Interest Rate, Stated Percentage	3.61%
Notes Payable Due 2044 [Member]
Debt Instrument [Line Items]
Debt Instrument, Covenant Description	The indenture governing our Senior Notes includes an event of default upon the acceleration of other indebtedness of $100 million or more. Such events of default would entitle the trustee or the holders of 25 percent in aggregate principal amount of the outstanding Senior Notes to declare those senior notes immediately due and payable in full.
Long-term Debt, Gross	$ 600
Debt Instrument, Interest Rate, Stated Percentage	4.658%

EQUITY (Details)

EQUITY (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Mar. 31, 2016	Sep. 30, 2016
Dividends Declared [Line Items]
Treasury Stock, Shares, Acquired		407
Treasury Stock		$ 24,100	$ 24,066
Common Stock, Dividends, Per Share, Declared	$ 0.35
Common Stock, Dividends, Declared, Annualized Basis	$ 1.40

ACCUMULATED OTHER COMPREHENSI30

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Accumulated Other Comprehensive Income (Loss) [Line Items]
Amortization of net loss	$ 10,040	$ 12,564	$ 30,113	$ 37,694
Amortization of unrecognized prior service cost	(909)	(374)	(2,725)	(1,120)
Reclassification adjustment, before tax and regulatory adjustments	9,131	12,190	27,388	36,574
Regulatory adjustments	(8,943)	(11,961)	(26,824)	(35,887)
Reclassification adjustment, before tax	188	229	564	687
Reclassification adjustment, Tax	(72)	(88)	(217)	(264)
Reclassification adjustment, net of tax	$ 116	$ 141	$ 347	$ 423

EARNINGS PER SHARE (Details)

EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
EARNINGS PER SHARE [Line Items]
Common stock, shares issued	52,598,005		52,598,005		52,598,005
Basic EPS Calculation
Net income available for common stock	$ 12,737	$ 7,371	$ 97,781	$ 79,828
Weighted Average Number of Shares Outstanding, Basic	52,453,000	52,408,000	52,452,000	52,627,000
Earnings Per Share, Basic	$ 0.24	$ 0.14	$ 1.86	$ 1.52
Diluted EPS Calculation
Net income available for common stock	$ 12,737	$ 7,371	$ 97,781	$ 79,828
Effect of dilutive securities on income	$ 0	$ 0	$ 0	$ 0
Effect of dilutive securities on shares	489,000	664,000	510,000	688,000
Weighted Average Number of Shares Outstanding, Diluted	52,942,000	53,072,000	52,962,000	53,315,000
Earnings Per Share, Diluted	$ 0.24	$ 0.14	$ 1.85	$ 1.50

EMPLOYEE BENEFIT PLANS (Details

EMPLOYEE BENEFIT PLANS (Details) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended		12 Months Ended
	Dec. 31, 2016	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Employee Benefit Plans [Line Items]
Defined Benefit Plan, Assumptions Used Calculating Benefit Obligation, Discount Rate		3.75%		3.75%		4.75%
Components of net periodic benefit cost:
Amortization of unrecognized prior service cost		$ (909)	$ (374)	$ (2,725)	$ (1,120)
Amortization of net loss		10,040	12,564	30,113	37,694
Defined Benefit Plan, Effect of Plan Amendment on Net Periodic Benefit Cost		$ 800		$ 800
Discount Rate		4.75%		4.75%
Expected long-term return on plan assets				8.00%
Defined Benefit Plan, Assumptions Used Calculating Net Periodic Benefit Cost, Expected Long-term Return on Assets				7.75%		8.00%
Subsequent Event [Member]
Components of net periodic benefit cost:
Discount Rate	3.75%
Expected long-term return on plan assets	7.75%
ONE Gas Pension Plans [Member]
Components of net periodic benefit cost:
Service cost		$ 3,014	3,497	$ 9,042	10,518
Interest cost		11,387	10,652	34,162	31,956
Expected return on assets		(15,296)	(15,363)	(45,888)	(46,087)
Amortization of unrecognized prior service cost		0	66	0	200
Amortization of net loss		8,886	11,054	26,657	33,164
Net periodic benefit cost		7,991	9,906	23,973	29,751
ONE Gas Postretirement Benefit Plans [Member]
Employee Benefit Plans [Line Items]
Defined Benefit Plan, Plan Amendments				31,500
Components of net periodic benefit cost:
Service cost		637	849	1,913	2,547
Interest cost		2,626	2,665	7,880	7,997
Expected return on assets		(3,070)	(2,908)	(9,212)	(8,724)
Amortization of unrecognized prior service cost		(909)	(440)	(2,725)	(1,320)
Amortization of net loss		1,154	1,510	3,456	4,530
Net periodic benefit cost		$ 438	$ 1,676	$ 1,312	$ 5,030

COMMITMENTS AND CONTINGENCIES33

COMMITMENTS AND CONTINGENCIES (Details)	Sep. 30, 2016
Commitments and Contingencies [Line Items]
Number Of Former Manufactured Gas Sites Where We Own Or Retain Legal Responsibility For Environmental Conditions	12
Number of sites where we have completed or addressed removal of the source of soil contamination according to plans approved by KDHE	11
Number of sites where regulatory closure has been achieved	3
Percentage yield of high consequence pipeline areas	30.00%

DERIVATIVE FINANCIAL INSTRUME34

DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2016USD ($)MMcf	Sep. 30, 2015USD ($)	Sep. 30, 2016USD ($)MMcf	Sep. 30, 2015USD ($)	Dec. 31, 2015USD ($)MMcf	Dec. 31, 2014USD ($)
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Derivative, Nonmonetary Notional Amount | MMcf	30,500		30,500		17,000
Premiums recorded in other current assets on natural gas contracts held	$ 9,400,000		$ 9,400,000		$ 5,800,000
Fair Value Assets, Transfers between Levels	0	$ 0	0	$ 0
Long-term Debt, including current maturities	1,192,248,000		1,192,248,000		1,191,660,000
Cash and Cash Equivalents, at Carrying Value	4,513,000	$ 52,974,000	4,513,000	$ 52,974,000	2,433,000	$ 11,943,000
Long-term Debt	1,200,000,000		1,200,000,000		1,200,000,000
Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Fair value, natural gas call options	8,100,000		8,100,000		400,000
Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Long-term Debt, Fair Value	$ 1,300,000,000		$ 1,300,000,000		$ 1,200,000,000