By a News Reporter-Staff News Editor at Energy Weekly News -- ONEOK Partners, L.P. (NYSE: OKS) announced second-quarter 2014 net income attributable to ONEOK Partners of $214.4 million, or 54 cents per unit, compared with $202.4 million, or 62 cents per unit, in the second quarter 2013.
Second-quarter 2014 adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) increased 15 percent to $360.9 million, compared with $315.1 million in the second quarter 2013.
Second-quarter 2014 results reflect higher natural gas volumes gathered, processed and sold, and higher natural gas liquids (NGL) volumes sold in the natural gas gathering and processing segment, as a result of recently completed capital-growth projects.
Second-quarter 2014 distributable cash flow (DCF) was $272.0 million, providing 1.02 times coverage of the cash distributions that will be paid, compared with second-quarter 2013 DCF of $251.9 million that provided 1.17 times coverage.
"Our natural gas gathering and processing segment reported strong volume growth in the second quarter from recently completed projects," said Terry K. Spencer, president and chief executive officer of ONEOK Partners. "As we've said previously, we expect natural gas and NGL volumes to continue to increase during the remainder of 2014 as we continue to add natural gas gathering and processing infrastructure and connect new natural gas plants to our NGL systems and as previously connected plants continue to ramp up.
"Our capital-growth program increased approximately $1.1 billion to $7.0 billion to $7.5 billion, and our backlog remains $3 billion to $4 billion after our recently announced projects in the natural gas gathering and processing segment, which include new natural gas processing plants and related infrastructure in Oklahoma and North Dakota that will increase our ability to gather and process growing supply in those areas," Spencer said. "The Demicks Lake plant in North Dakota will increase our natural gas processing capacity in the Williston Basin to approximately 1.1 billion cubic feet per day (Bcf/d), which will be more than 10 times our processing capacity in the region, compared with 2010. The Knox plant will be our first natural gas processing plant built in the emerging South Central Oklahoma Oil Province (SCOOP) play and will increase our Oklahoma processing capacity to approximately 900 million cubic feet per day (MMcf/d).
"These new projects, combined with our previously announced projects, are expected to further increase natural gas and NGL volumes and contracted capacity on our systems and create long-term value for our unitholders through increased earnings and distributions," Spencer added. "Pending board approval, we expect to announce additional Williston Basin natural gas processing capacity by the end of this year."
Year-to-date net income attributable to ONEOK Partners was $479.8 million, or $1.35 per unit, compared with $359.0 million, or $1.03 per unit, in the same period last year. Year-to-date 2014 adjusted EBITDA was $754.6 million, compared with $575.5 million in the same period last year.
DCF for the first six months of 2014 was $570.2 million, providing 1.14 times coverage, compared with $445.1 million for the same period last year, providing coverage of 0.99 times.
In the second quarter 2014, the partnership completed a public offering of approximately 13.9 million common units generating net proceeds of approximately $730 million and issued approximately 1.9 million common units through its at-the-market equity program. No common units were issued through the equity program in the second quarter 2013.
During the first six months of 2014, the partnership has issued approximately 3.0 million common units through its at-the-market equity program, compared with 300,000 during the same period last year.
There was a weighted average of approximately 236.4 million units outstanding for the six-month period ending June 30, 2014, compared with a weighted average of approximately 220.0 million units outstanding for the six-month period ending June 30, 2013.
The partnership also reaffirmed its 2014 net income guidance range of $975 million to $1.075 billion; its adjusted EBITDA guidance range of $1.565 billion to $1.665 billion; and its DCF guidance range of $1.15 billion to $1.25 billion, provided on Dec. 2, 2013.
2014 earnings guidance includes a projected 1.5-cent-per-unit-per-quarter increase in unitholder distributions declared while maintaining an annual coverage ratio of 1.05 to 1.15 times. Actual unitholder distribution declarations are subject to ONEOK Partners board approval.
SECOND-QUARTER AND YEAR-TO-DATE 2014 FINANCIAL PERFORMANCE
Second-quarter 2014 operating income was $262.2 million, compared with $230.0 million in the second quarter 2013.
Keywords for this news article include: L.P., Energy, Oil & Gas, Natural Gas, Oneok Partners L.P, Investment and Finance.
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