ONEOK Partners (OKS) 10-Q 6 Aug 09 2010 Q2 Quarterly report Financial data

Consolidated Statements of Inco

Consolidated Statements of Income (USD $)
In Thousands, except Per Share data	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	$1,397,057	$2,143,892	$2,647,922	$4,202,927
Cost of sales and fuel	1,135,075	1,862,959	2,132,399	3,653,469
Net margin	261,982	280,933	515,523	549,458
Operating expenses
Operations and maintenance	87,712	80,532	165,391	157,473
Depreciation and amortization	39,953	30,033	79,893	59,975
General taxes	12,795	6,626	24,562	17,767
Total operating expenses	140,460	117,191	269,846	235,215
Gain (loss) on sale of assets	3,276	(3)	3,940	28
Operating income	124,798	163,739	249,617	314,271
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	3,424	676	3,815	2,734
Other expense	(383)	(36)	(2,429)	(2,167)
Interest expense	(50,888)	(34,705)	(101,796)	(73,234)
Income before income taxes	100,607	158,960	203,088	307,169
Income taxes	(3,068)	(4,305)	(5,939)	(7,373)
Net income	97,539	154,655	197,149	299,796
Less: Net income attributable to noncontrolling interests	1	134	20	257
Net income attributable to ONEOK Partners, L.P.	97,538	154,521	197,129	299,539
Limited partners' interest in net income:
Net income attributable to ONEOK Partners, L.P.	97,538	154,521	197,129	299,539
General partner's interest in net income	(23,388)	(21,688)	(45,700)	(41,393)
Limited partners' interest in net income	$74,150	$132,833	$151,429	$258,146
Limited partners' net income per unit, basic and diluted
Limited partners' net income per unit, basic and diluted	0.81	1.46	1.66	2.94
Number of units used in computation (thousands)	91,415	90,906	91,169	87,680

Consolidated Balance Sheets

Consolidated Balance Sheets (USD $)
In Thousands	Jun. 30, 2009	Dec. 31, 2008
Current assets
Cash and cash equivalents	$31,803	$177,635
Accounts receivable, net	397,006	317,182
Affiliate receivables	25,831	25,776
Gas and natural gas liquids in storage	164,640	190,616
Commodity exchanges and imbalances	55,104	55,086
Derivative financial instruments	18,732	63,780
Other current assets	42,039	28,176
Total current assets	735,155	858,251
Property, plant and equipment
Property, plant and equipment	6,149,684	5,808,679
Accumulated depreciation and amortization	930,031	875,279
Net property, plant and equipment	5,219,653	4,933,400
Investments and other assets
Investments in unconsolidated affiliates	735,394	755,492
Goodwill and intangible assets	672,703	676,536
Other assets	37,841	30,593
Total investments and other assets	1,445,938	1,462,621
Total assets	7,400,746	7,254,272
Current liabilities
Current maturities of long-term debt	261,931	11,931
Notes payable	360,000	870,000
Accounts payable	541,190	496,763
Affiliate payables	22,604	23,333
Commodity exchanges and imbalances	165,713	191,165
Other current liabilities	113,724	100,832
Total current liabilities	1,465,162	1,694,024
Long-term debt, excluding current maturities
Long-term debt, excluding current maturities	2,829,946	2,589,509
Deferred credits and other liabilities
Deferred credits and other liabilities	58,231	54,773
ONEOK Partners, L.P. partners' equity:
General partner	82,443	77,546
Common units: 59,426,087 and 54,426,087 units issued and outstanding at June 30, 2009 and December 31, 2008, respectively	1,554,685	1,361,058
Class B units: 36,494,126 units issued and outstanding at June 30, 2009 and December 31, 2008	1,388,890	1,407,016
Accumulated other comprehensive income	15,917	64,405
Total ONEOK Partners, L.P. partners' equity	3,041,935	2,910,025
Noncontrolling interests in consolidated subsidiaries	5,472	5,941
Total partners' equity	3,047,407	2,915,966
Total liabilities and partners' equity	$7,400,746	$7,254,272

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) (USD $)
	Jun. 30, 2009	Dec. 31, 2008
Consolidated Balance Sheets (Parenthetical)
Common units issued	59,426,087	54,426,087
Common units outstanding	59,426,087	54,426,087
Class B units issued	36,494,126	36,494,126
Class B units outstanding	36,494,126	36,494,126

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	$197,149	$299,796
Depreciation and amortization	79,893	59,975
Allowance for equity funds used during construction	(18,471)	(20,172)
Gain on sale of assets	(3,940)	(28)
Equity earnings from investments	(35,410)	(45,393)
Distributions received from unconsolidated affiliates	38,233	39,904
Changes in assets and liabilities:
Accounts receivable	(79,824)	35,134
Affiliate receivables	(55)	(14,815)
Gas and natural gas liquids in storage	25,976	(104,557)
Derivative financial instruments	(2,058)	10,344
Accounts payable	16,410	39,225
Affiliate payables	(729)	34,558
Commodity exchanges and imbalances, net	(25,470)	55,202
Other assets and liabilities	(2,259)	(59,230)
Cash provided by operating activities	189,445	329,943
Investing activities
Changes in investments in unconsolidated affiliates	17,393	6,480
Acquisitions	0	2,450
Capital expenditures (less allowance for equity funds used during construction)	(321,860)	(524,587)
Proceeds from sale of assets	8,050	111
Cash used in investing activities	(296,417)	(515,546)
Financing activities
Cash distributions: General and limited partners	(241,864)	(214,794)
Cash distributions: Noncontrolling interests	(489)	(148)
Borrowing of notes payable, net	360,000	20,000
Repayment of notes payable with maturities over 90 days	(870,000)	0
Issuance of long-term debt, net of discounts	498,325	0
Long-term debt financing costs	(4,000)	0
Issuance of common units, net of discounts	220,458	450,198
Contributions from general partner	4,675	9,508
Payment of long-term debt	(5,965)	(5,964)
Cash provided by (used in) financing activities	(38,860)	258,800
Change in cash and cash equivalents	(145,832)	73,197
Cash and cash equivalents at beginning of period	177,635	3,213
Cash and cash equivalents at end of period	$31,803	$76,410

Consolidated Statement of Chang

Consolidated Statement of Changes in Partners' Equity (USD $)
In Thousands, except Share data	3 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2009	Dec. 31, 2008
Partners' Capital
Partners' capital, beginning balance		$2,915,966
Net income	97,539	197,149
Other comprehensive income (loss)		(48,488)
Issuance of equity units		220,458
Contribution from general partner		4,675
Distributions paid		(242,353)
Partners' capital, ending balance	3,047,407	3,047,407	2,915,966
General Partner
Partners' Capital
Partners' capital, beginning balance		77,546
Net income		45,700
Contribution from general partner		4,675
Distributions paid		(45,478)
Partners' capital, ending balance	82,443	82,443	77,546
Common Units
Partners' Capital
Partners' capital, beginning balance		1,361,058
Net income		90,729
Issuance of equity units		220,458
Distributions paid		(117,560)
Partners' capital, ending balance	1,554,685	1,554,685	1,361,058
Partners' capital account, units, beginning balance		54,426,087
Issuance of equity units		5,000,000
Partners' capital account, units, ending balance	59,426,087	59,426,087	54,426,087
Class B Units
Partners' Capital
Partners' capital, beginning balance		1,407,016
Net income		60,700
Distributions paid		(78,826)
Partners' capital, ending balance	1,388,890	1,388,890	1,407,016
Partners' capital account, units, beginning balance		36,494,126
Partners' capital account, units, ending balance	36,494,126	36,494,126	36,494,126
Accumulated Other Comprehensive Income (Loss)
Partners' Capital
Partners' capital, beginning balance		64,405
Other comprehensive income (loss)		(48,488)
Partners' capital, ending balance	15,917	15,917	64,405
Noncontrolling Interests in Consolidated Subsidiaries
Partners' Capital
Partners' capital, beginning balance		5,941
Net income		20
Distributions paid		(489)
Partners' capital, ending balance	$5,472	$5,472	$5,941

Consolidated Statements of Comp

Consolidated Statements 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	$97,539	$154,655	$197,149	$299,796
Other comprehensive income (loss)	(29,289)	(38,049)	(48,488)	(36,300)
Comprehensive income	68,250	116,606	148,661	263,496
Less: Comprehensive income attributable to noncontrolling interests	1	134	20	257
Comprehensive Income Attributable to ONEOK Partners, L.P.	$68,249	$116,472	$148,641	$263,239

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. 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 interests (previously referred to as minority interests) to be reported as a component of equity. Statement 160 was effective for our year beginning January 1, 2009, and required 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 has been applied prospectively. See Note C for disclosures of our derivative instruments and hedging activities. 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. Limited Partners Net Income Per Unit - EITF 07-4, Application of the Two-Class Method under FASB Statement No. 128 to Master Limited Partnerships, was effective for our year beginning January 1, 2009, and required retroactive application. Application of EITF 07-4 had no impact on our limited partners net income per unit for the three and six months ended June 30, 2009 and 2008. See Note L for a discussion of our calculation of basic and diluted limited partners net income per unit. 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. Subsequent Events - Statement 165, Subsequent Events, establishes standards of accounting for and disclosures of events that occur after the

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) Derivatives Assets (b) $ - $10,550 $15,062 $(6,880) $18,732 Liabilities (c) $ - $(4,796) $(3,465) $6,880 $(1,381) (a) - Our derivative assets and liabilities are presented in our Consolidated Balance Sheet on a net basis. We net derivative assets and liabilities when a legally enforceable master netting arrangement exists between us and the counterparty to a derivative contract. (b) - Included in derivative financial instruments in our Consolidated Balance Sheet. (c) - Included in deferred credits and other liabilities in our Consolidated Balance Sheet. December 31, 2008 Level 1 Level 2 Level 3 Netting (a) Total (Thousands of dollars) Derivatives Assets (b) $ - $26,131 $37,649 $ - $63,780 (a) - Our derivative assets and liabilities are presented in our Consolidated Balance Sheet on a net basis. We net derivative assets and liabilities when a legally enforceable master netting arrangement exists between us and the counterparty to a derivative contract. (b) - Included in derivative financial instruments in our Consolidated Balance Sheet. At June 30, 2009, and December 31, 2008, we had no cash collateral held or posted under our master netting arrangements. 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 significant to the fair value measurement in its entirety. Our derivative instruments categorized as Level 2 include non-exchange traded fixed-price swaps for natural gas and crude oil that are valued based on NYMEX-settled prices. Our derivative instruments categorized as Level 3 include over-the-counter fixed-price swaps for purity NGL products and natural gas basis swaps. These swaps are valued based on information from a pricing service, the forward NYMEX curve for crude oil, correlations of specific NGL purity products to crude oil and internally developed basis curves incorporating observable and unobservable market data. We corroborate the data on which our fair value estimates are based using our market knowledge of recent transactions and day-to-day pricing fluctuations and analysis of historical relationships of data from the pricing service compared with actual settlements and correlations. We do not believe that our Level 3 fair value estimates have a material impact on our results of operations, as the majority of our derivatives are accounted for as cash flow hedges for which ineffectiveness is not ma

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 Management and Hedging Activities Using Derivatives	C. RISK MANAGEMENT AND HEDGING ACTIVITIES USING DERIVATIVES Risk Management Activities - We are sensitive to changes in natural gas, condensate and NGL prices, principally as a result of contractual terms under which these commodities are processed, purchased and sold. We use physical forward sales and financial derivatives to secure a certain price for a portion of our natural gas, condensate and NGL products. We follow established policies and procedures to assess risk and approve, monitor and report our risk management activities. We have not used these instruments for trading purposes. We are also subject to the risk of interest rate fluctuation in the normal course of business. Commodity price risk - Commodity price risk refers to the risk of loss in cash flows and future earnings arising from adverse changes in the price of natural gas, NGLs and condensate. We use the following commodity derivative instruments to mitigate the commodity price risk associated with a portion of the forecasted sales of these commodities. 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 the movements in market prices while the other party assumes the risks and benefits of a fixed price for the commodity. In our Natural Gas Gathering and Processing segment, we are exposed to commodity price risk, primarily NGLs and natural gas, as a result of receiving commodities in exchange for services associated with our POP contracts. To a lesser extent, exposures arise from the relative price differential between NGLs and natural gas, or the gross processing spread, with respect to our keep-whole processing contracts. We are also exposed to basis risk between the various production and market locations where we buy and sell commodities. As part of our hedging strategy, we use the aforementioned commodity derivative instruments to minimize earnings volatility related to natural gas, NGL and condensate price fluctuations. We reduce our gross processing spread exposure through a combination of physical and financial hedges. We utilize a portion of our POP equity natural gas as an offset, or natural hedge, to an equivalent portion of our keep-whole shrink requirements. This has the effect of converting our gross processing spread risk to NGL commodity price risk. We hedge a portion of the forecasted sales of th

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 other comprehensive income (loss) for the periods indicated. Three Months Ended Six Months Ended June 30, June 30, 2009 2008 2009 2008 (Thousands of dollars) Unrealized gains (losses) on derivatives $(12,870) $(47,620) $(13,080) $(53,165) Less: Realized gains (losses) recognized in net income 16,419 (9,571) 35,620 (16,865) Other - - 212 - Other comprehensive income (loss) $(29,289) $(38,049) $(48,488) $(36,300) The following table sets forth the balance in accumulated other comprehensive income (loss) for the period indicated. Unrealized Gains (Losses) on Derivatives (Thousands of dollars) December 31, 2008 $64,405 Other comprehensive income (loss) (48,488) June 30, 2009 $15,917

Partners' Equity

Partners' Equity
	6 Months Ended Jun. 30, 2009 USD / shares
Partners' Equity
Partners' Equity	E. PARTNERS EQUITY Equity Issuance - In June 2009, we 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 the public offering of common units, ONEOK Partners GP contributed $4.7 million in order to maintain its 2 percent general partner interest in us. In July 2009, we 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. We 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 in order to maintain its 2 percent general partner interest in us. As a result of these transactions, ONEOK and its subsidiaries now hold an aggregate 45.1 percent interest in us. We used the proceeds from the sale of common units and the general partner contributions to repay borrowings under our Partnership Credit Agreement and for general partnership purposes. Cash Distributions - For the six months ended June 30, 2009, cash distributions included $45.5 million paid to our general partner, of which $40.6 million was related to incentive distributions. These distributions pertained to the fourth quarter of 2008 and first quarter of 2009. In July 2009, we declared a cash distribution of $1.08 per unit ($4.32 per unit on an annualized basis) for the second quarter of 2009. The distribution will be paid on August 14, 2009, to unitholders of record as of July 31, 2009. For the six months ended June 30, 2008, cash distributions included $35.3 million paid to our general partner, of which $30.9 million was related to incentive distributions. These distributions pertained to the fourth quarter of 2007 and first quarter of 2008.

Credit Facilities

Credit Facilities
	6 Months Ended Jun. 30, 2009 USD / shares
Credit Facilities
Credit Facilities	F. CREDIT FACILITIES Our Partnership Credit Agreement, which expires in March 2012, contains 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, these covenants include 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, our ratio of indebtedness to adjusted EBITDA was 4.3 to 1, and we were in compliance with all covenants under our Partnership Credit Agreement. At June 30, 2009, we had $360 million of borrowings outstanding and $586.5 million of credit available under our Partnership Credit Agreement. At June 30, 2009, we had a total of $49.2 million issued in letters of credit outside of the Partnership Credit Agreement. Borrowings under our Partnership 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 Debt Issuance - In March 2009, we 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 our existing shelf registration statement filed with the SEC. We 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 our existing and future unsecured senior indebtedness, and effectively junior to all of the existing and future debt and other liabilities of our non-guarantor subsidiaries. The 2019 Notes are nonrecourse to our general partner. 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 our Partnership 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 us 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 our ability to place liens on our property or assets and to sell and leaseback our property. The 2019 Notes will mature on March 1, 2019. We 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.

Commitments and Contingencies

Commitments and Contingencies
	6 Months Ended Jun. 30, 2009 USD / shares
Commitments and Contingencies
Commitments and Contingencies	H. COMMITMENTS AND CONTINGENCIES Investment in Northern Border Pipeline- In March 2009, we 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 our share will be approximately $38 million based on our 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. Our expenditures for environmental evaluation, mitigation and remediation to date have not been significant in relation to our financial position or results of operations, and there were no material effects upon earnings or cash flows during the three and six months ended June 30, 2009 and 2008 related to compliance with environmental regulations.

Property, Plant and Equipment

Property, Plant and Equipment
	6 Months Ended Jun. 30, 2009 USD / shares
Property, Plant and Equipment
Property, Plant and Equipment	I. 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 Natural Gas Gathering and Processing $1,409,985 $1,368,223 Natural Gas Pipelines 168,191 167,625 Natural Gas Liquids Gathering and Fractionation 903,776 879,047 Other 40,132 50,474 Regulated Natural Gas Pipelines 1,490,628 1,460,764 Natural Gas Liquids Pipelines 2,136,972 1,882,546 Property, plant and equipment 6,149,684 5,808,679 Accumulated depreciation and amortization 930,031 875,279 Net property, plant and equipment $5,219,653 $4,933,400 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) Natural Gas Gathering and Processing $71,917 $135,252 Natural Gas Pipelines 30,024 107,686 Natural Gas Liquids Gathering and Fractionation 91,791 121,007 Natural Gas Liquids Pipelines 599,593 445,836 Other 560 197 Total construction work in process $793,885 $809,978

Segments

Segments
	6 Months Ended Jun. 30, 2009 USD / shares
Segments
Segments	J. SEGMENTS Segment Descriptions - Our operations are divided into four business segments based on similarities in economic characteristics, products and services, types of customers, methods of distribution and regulatory environment, as follows: our Natural Gas Gathering and Processing segment primarily gathers and processes unprocessed natural gas; our Natural Gas Pipelines segment primarily operates regulated interstate and intrastate natural gas transmission pipelines and natural gas storage facilities; our Natural Gas Liquids Gathering and Fractionation segment primarily gathers, treats and fractionates NGLs and stores and markets NGL products; and our Natural Gas Liquids Pipelines segment primarily operates regulated interstate natural gas liquids gathering and distribution pipelines. Accounting Policies - The accounting policies of the segments are the same as those described in Note A and Note L of the Notes to Consolidated Financial Statements in our Annual Report. Intersegment and affiliate sales are recorded on the same basis as sales to unaffiliated customers. 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 six months ended June 30, 2009, we had no single unaffiliated customer from which we received 10 percent or more of our consolidated revenues. We had one unaffiliated customer from which we received $140.4 million, or approximately 10 percent, of our consolidated revenues, for the three months ended June 30, 2009. We had one unaffiliated customer from which we received $308 million and $476 million, or approximately 14 percent and 11 percent, of our consolidated revenues, for the three and six months ended June 30, 2008, respectively. All of these revenues pertain to our Natural Gas Liquids Gathering and Fractionation segment. For the three and six months ended June 30, 2009 and 2008, sales to affiliated customers were less than 10 percent of our consolidated revenues. See Note M for additional information about our sales to affiliated customers. 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 Natural Gas Gathering and Processing Natural Gas Pipelines (a) Natural Gas Liquids Gathering and Fractionation Natural Gas Liquids Pipelines (b) Other and Eliminations Total (Thousands of dollars) Sales to unaffiliated customers $73,667 $51,493 $1,144,980 $19,348 $(1) $1,289,487 Sales to affiliated customers 84,713 22,857 - - - 107,570 Intersegment revenues 81,721 176 8,643 36,383 (126,923) - Total revenues $240,101 $74,526 $1,153,623 $55,731 $(126,924) $1,397,057 Net margin $86,292 $66,861 $67,714 $44,102 $(2,987) $261,982 Operating

Unconsolidated Affiliates

Unconsolidated Affiliates
	6 Months Ended Jun. 30, 2009 USD / shares
Unconsolidated Affiliates
Unconsolidated Affiliates	K. UNCONSOLIDATED AFFILIATES Equity Earnings from Investments - The following table sets forth our equity earnings from investments for the periods indicated. 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

Limited Partners' Net Income Pe

Limited Partners' Net Income Per Unit and Distributions to Partners
	Jun. 30, 2009
Limited Partners' Net Income Per Unit and Distributions to Partners
Limited Partners' Net Income Per Unit and Distributions to Partners	L. LIMITED PARTNERS NET INCOME PER UNIT As discussed in Note A, we adopted EITF 07-4 on January 1, 2009, which requires us to utilize the two-class method of calculating net income per unit. Limited partners net income per unit is computed by dividing net income attributable to ONEOK Partners, L.P., after deducting the general partners allocation, by the weighted-average number of outstanding limited partner units, which includes our common and Class B limited partner units. As discussed in Note B of the Notes to Consolidated Financial Statements in our Annual Report, ONEOK, as sole holder of our Class B units, has waived its right to receive increased quarterly distributions on the Class B units. Because ONEOK has waived its right to increased quarterly distributions, currently each Class B unit and common unit share equally in the earnings of the Partnership and neither has any liquidation or other preferences. ONEOK retains the option to withdraw its waiver at any time by giving us no less than 90 days advance notice. ONEOK Partners GP owns the entire 2 percent general partnership interest in us, which entitles it to incentive distribution rights that provide for an increasing proportion of cash distributions from the partnership as the distributions made to limited partners increase above specified levels. For purposes of our calculation of limited partners net income per unit, net income attributable to ONEOK Partners, L.P. is generally allocated to the general partner as follows: (i) an amount based upon the 2 percent general partner interest in net income attributable to ONEOK Partners, L.P. and (ii) the amount of the general partners incentive distribution rights based on the total cash distributions declared for the period. The amount of incentive distribution allocated to our general partner totaled $21.4 million and $41.8 million for the three and six months ended June 30, 2009, respectively. The terms of our Partnership Agreement limit the general partners incentive distribution to the amount of available cash calculated for the period. As such, incentive distribution rights are not allocated on undistributed earnings or distributions in excess of earnings. Gains resulting from interim capital transactions, as defined in our Partnership Agreement, are generally not subject to distribution; however, our Partnership Agreement provides that if such distributions were made, the incentive distribution rights would not apply. For additional information regarding our general partners incentive distribution rights, see Cash Distribution Policy under Part II, Item 5, Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities, in our Annual Report.

Related-Party Transactions

Related-Party Transactions
	6 Months Ended Jun. 30, 2009 USD / shares
Related-Party Transactions
Related-Party Transactions	M. RELATED-PARTY TRANSACTIONS Intersegment and affiliate sales are recorded on the same basis as sales to unaffiliated customers. Our Natural Gas Gathering and Processing segment sells natural gas to ONEOK and its subsidiaries. A portion of our Natural Gas Pipelines segments revenues are from ONEOK and its subsidiaries. Additionally, our Natural Gas Gathering and Processing segment and Natural Gas Liquids Gathering and Fractionation segment purchase a portion of the natural gas used in their operations from ONEOK and its subsidiaries. We have certain contractual rights to the Bushton Plant. Our Processing and Services Agreement with ONEOK and OBPI sets out the terms by which OBPI provides services to us at the Bushton Plant through 2012. We have contracted for all of the capacity of the Bushton Plant from OBPI. In exchange, we pay OBPI for all costs and expenses of the Bushton Plant, including reimbursement of a portion of OBPIs obligations under equipment leases covering the Bushton Plant. Under the Services Agreement with ONEOK, ONEOK Partners GP and NBP Services (Services Agreement), our operations and the operations of ONEOK and its affiliates can combine or share certain common services in order to operate more efficiently and cost-effectively. Under the Services Agreement, ONEOK provides to us similar services that it provides to its affiliates, including those services required to be provided pursuant to our Partnership Agreement. ONEOK Partners GP operates our interstate natural gas pipeline assets according to each pipelines operating agreement. ONEOK Partners GP may purchase services from ONEOK and its affiliates pursuant to the terms of the Services Agreement. ONEOK Partners GP has no employees and utilizes the services of ONEOK and ONEOK Services Company to fulfill its operating obligations. ONEOK and its affiliates provide a variety of services to us under the Services Agreement, including cash management and financial services, employee benefits provided through ONEOKs benefit plans, administrative services, insurance and office space leased in ONEOKs headquarters building and other field locations. Where costs are specifically incurred on behalf of one of our affiliates, the costs are billed directly to us by ONEOK. In other situations, the costs may be allocated to us through a variety of methods, depending upon the nature of the expense and activities. For example, a service that applies equally to all employees is allocated based upon the number of employees. However, an expense benefiting the consolidated company but having no direct basis for allocation is allocated by the modified Distrigas method, a method using a combination of ratios that includes gross plant and investment, earnings before interest and taxes and payroll expense. It is not practicable to determine what these general overhead costs would be on a stand-alone basis. All costs directly charged or allocated to us are included in our Consolidated Statements of Income. Our derivative contracts with OES are discussed under Credit Risk in Note C. The following table sets forth the transactions with related parties for the perio

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 in Thousands	6 Months Ended Jun. 30, 2009	Jul. 31, 2009 Common units	Jul. 31, 2009 Class B units
Entity Information
Entity Registrant Name	ONEOK Partners, L.P.
Entity Central Index Key	0000909281
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	Yes
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float	2.7
Entity Address, Address Line One	100 West Fifth Street
Entity Address, City or Town	Tulsa
Entity Address, State or Province	Oklahoma
Entity Address, Postal Zip Code	74103
Local Phone Number	918-588-7000
Entity Common Stock, Shares Outstanding		59,912,777	36,494,126