ONEOK Partners Announces Completion of Garden Creek II Natural Gas Processing Facility Williston Basin Natural Gas Processing Capacity Now Exceeds 500 MMcf/d
TULSA, Okla., Aug. 26, 2014 /PRNewswire/ -- ONEOK Partners, L.P. (NYSE: OKS) today announced that its 100-million cubic feet per day (MMcf/d) natural gas processing facility in eastern McKenzie County in North Dakota – the Garden Creek II plant – is now operational. The new plant is part of the partnership's previously announced $7.0 billion to $7.5 billion capital-growth program through 2016.
"We remain committed to meeting the needs of our customers by building essential natural gas and natural gas liquids infrastructure in the Williston Basin," said Terry K. Spencer, president and chief executive officer of ONEOK Partners. "ONEOK Partners' Williston Basin natural gas processing capacity now exceeds 500 MMcf/d – five times more than our processing capacity in the region was in 2010 – and we expect that number to grow to more than 600 MMcf/d during the fourth quarter of this year, when the Garden Creek III plant is completed. Increased natural gas processing capacity also will lead to a reduction of natural gas flaring in North Dakota."
The partnership's Williston Basin natural gas processing capacity is expected to increase to approximately 1.1 billion cubic feet per day (Bcf/d) by the third quarter 2016 following the completion of additional natural gas infrastructure in the region, including:
- The Garden Creek III plant, a 100-MMcf/d natural gas processing facility in the Williston Basin in North Dakota, which is expected to be completed in the fourth quarter 2014; and expansions and upgrades to existing natural gas gathering and compression infrastructure;
- The Lonesome Creek plant, a 200-MMcf/d natural gas processing facility in the Williston Basin in North Dakota, which is expected to be completed in the fourth quarter 2015; and expansions and upgrades to existing natural gas gathering and compression infrastructure;
- The Demicks Lake plant, a 200-MMcf/d natural gas processing facility in the Williston Basin in North Dakota, which is expected to be completed in the third quarter 2016; and expansions and upgrades to the existing gathering and compression infrastructure; and
- The construction of additional natural gas compression to take advantage of additional natural gas processing capacity as a result of better than expected plant performance at the partnership's existing and planned Garden Creek and Stateline natural gas processing plants in the Williston Basin by a total of 100 MMcf/d, which is expected to be completed in the fourth quarter 2015.
"Pending board approval, we expect to announce additional Williston Basin natural gas processing capacity by the end of this year," continued Spencer.
ONEOK Partners is the largest independent operator of natural gas gathering and processing facilities in the Williston Basin, with a natural gas gathering system of more than 6,500 miles and more than 3 million acres where production is dedicated to its systems.
The partnership has announced total investments of approximately $7.0 billion and $7.5 billion through 2016 for acquisitions and infrastructure growth projects related to natural gas gathering and processing and natural gas liquids, which includes the projects described above.
These investments consist of approximately $3.8 billion to $4.3 billion for natural gas gathering and processing projects, and approximately $3.2 billion for natural gas liquids projects. Nearly $4.0 billion is for growth projects related to resource development in the Williston Basin, North Dakota.
In the aggregate, these projects are expected to generate adjusted EBITDA multiples of five to seven times. The incremental earnings from these projects are expected to increase distributable cash flow and value to unitholders in the form of higher distributions.
View a map showing the location of the Garden Creek II natural gas processing plant.
NON-GAAP (GENERALLY ACCEPTED ACCOUNTING PRINCIPLES) FINANCIAL MEASURES:
ONEOK Partners has disclosed in this news release anticipated adjusted EBITDA and distributable cash flow (DCF) levels that are non-GAAP financial measures. Adjusted EBITDA and DCF are used as a measure of the partnership's financial performance. Adjusted EBITDA is defined as net income adjusted for interest expense, depreciation and amortization, income taxes and allowance equity funds used during construction. DCF is defined as adjusted EBITDA, computed as described above, less interest expense, maintenance capital expenditures and equity earnings from investments, adjusted for cash distributions received and certain other items.
The partnership believes the non-GAAP financial measures described above are useful to investors because these measurements are used by many companies in its industry as a measurement of financial performance and are commonly employed by financial analysts and others to evaluate the financial performance of the partnership and to compare the financial performance of the partnership with the performance of other publicly traded partnerships within its industry.
Adjusted EBITDA and DCF should not be considered an alternative to net income, earnings per unit or any other measure of financial performance presented in accordance with GAAP.
These non-GAAP financial measures exclude some, but not all, items that affect net income. Additionally, these calculations may not be comparable with similarly titled measures of other companies. Furthermore, these non-GAAP measures should not be viewed as indicative of the actual amount of cash that is available for distributions or that is planned to be distributed for a given period nor do they equate to available cash as defined in the partnership agreement.
ONEOK Partners, L.P. (pronounced ONE-OAK) (NYSE: OKS) is one of the largest publicly traded master limited partnerships in the United States and is a leader in the gathering, processing, storage and transportation of natural gas in the U.S. and owns one of the nation's premier natural gas liquids (NGL) systems, connecting NGL supply in the Mid-Continent and Rocky Mountain regions with key market centers. Its general partner is a wholly owned subsidiary of ONEOK, Inc. (NYSE: OKE), a pure-play, publicly traded general partner, which owns 38.5 percent of the overall partnership interest as of June 30, 2014.
For more information, visit the website at www.oneokpartners.com.
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Some of the statements contained and incorporated in this news release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act, as amended. The forward-looking statements relate to the proposed construction of natural gas processing facilities, and the other referenced infrastructure growth projects related to natural gas gathering and processing and natural gas liquids, the schedule and costs to complete the proposed projects and related infrastructure, and expected generation of EBITDA and distributable cash flow from the proposed projects. These forward-looking statements are made in reliance on the safe-harbor protections provided under the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include the items identified in the preceding paragraph, the information concerning possible or assumed future results of our operations and other statements contained or incorporated in this news release identified by words such as "anticipate," "estimate," "expect," "project," "intend," "plan," "believe," "should," "goal," "forecast," "guidance," "could," "may," "potential," "scheduled," and other words and terms of similar meaning.
You should not place undue reliance on forward-looking statements. Known and unknown risks, uncertainties and other factors may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by forward-looking statements. Those factors may affect our operations, markets, products, services and prices. These and other risks are described in greater detail in Item 1A, Risk Factors, in our Annual Report on Form 10-K. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these factors. Other than as required under securities laws, we undertake no obligation to update publicly any forward-looking statement whether as a result of new information, subsequent events or change in circumstances, expectations or otherwise.
SOURCE ONEOK Partners, L.P.