Despite significantly lower realized commodity prices, increased volumes from the Overland Pass Pipeline and the Guardian Pipeline extension helped ONEOK Inc. keep its earnings at 39 cents/share on net income of $41.7 million in 2Q2009, compared with 39 cents/share on net income of $41.9 million in 2Q2008, the Tulsa-based company said Wednesday.
The Federal Energy Regulatory Commission granted Guardian Pipeline LLC’s request to commence service on the 119-mile Guardian Expansion and Extension Project in Wisconsin late last year (see Daily GPI, Dec. 30, 2008). Guardian, which is owned by ONEOK Partners LP, has executed precedent agreements with three local distribution companies for an initial term of 15 years.
ONEOK narrowed its 2009 earnings guidance to $2.40-2.70/share from the previously announced $2.25-2.75 and raised the midpoint to $2.55 from the previously announced $2.50.
Subsidiary ONEOK Partners LP reported 2Q2009 operating income of $124.8 million, compared with $163.7 million in 2Q2008, due primarily to a $34 million decrease from lower realized commodity prices in the natural gas gathering and processing business. ONEOK Partners narrowed its 2009 earnings guidance to $3.25-3.65 from the previously announced $3.15-3.75.
ONEOK now expects each of its operating segments — ONEOK Partners, Distribution and Energy Services — and all four of ONEOK Partners’ operating segments to perform at or better than the levels it forecast in February. But equity earnings are expected to be lower at ONEOK Partners due primarily to lower-than-anticipated throughput at the jointly owned Powder River Basin gathering systems, CEO John Gibson said during a conference call with analysts Wednesday.
“While uncertainty still exists in the marketplace and in the economy, we are confident about our 2009 performance,” Gibson said. “We have a clearer view of the operating environment — certainly much clearer than we did at the beginning of the year — which is why we are updating our guidance at both entities.”
ONEOK Partners announced on Wednesday that four additional directors have been named to its board of directors. Julie H. Edwards, Jim W. Mogg, Shelby E. Odell and Craig F. Strehl were elected to the board effective immediately, the company said. Edwards and Mogg currently also serve, and will continue to serve, on the board of directors of ONEOK.
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