ONEOK's second quarter results off, year-over-year
TULSA — Lowered transported volumes of natural gas liquids and natural gas translated into muted second-quarter earnings for ONEOK, it reported Tuesday.
The company stated it earned a second-quarter 2020 net income of $134.3 million, or 32 cents per share, on operating income of $355.7 million.
In the second quarter of 2019, it earned a net income of $312 million, or 75 cents per share, on operating income of $476.1 million.
Officials attributed this year’s second-quarter results to lower natural gas liquids (NGL) and natural gas volumes due to production curtailments, lower realized commodity prices in the natural gas gathering and processing segment and lower earnings from optimization and marketing in the natural gas liquids segment.
The company also saw its second quarter interest expenses climb, year-over-year, due primarily to a $48.3 million impact from the settlement of ONEOK's remaining $1.3 billion of interest-rate swaps used to hedge London Interbank Offered Rate (LIBOR)-based interest payments.
However, officials also said the company’s second-quarter results this year were helped by lower rail transportation costs due to the completion of ONEOK's Elk Creek Pipeline and higher Permian Basin average fee rates in the natural gas liquids segment.
"I am proud of the way our employees continue to operate safely and responsibly and remain focused on providing excellent customer service in a challenging environment," said Terry K. Spencer, ONEOK’s CEO.
"Second quarter results were interrupted by the pandemic's effect on worldwide crude oil demand, the resulting extensive oil and associated natural gas production curtailments by producers across our operations and low commodity prices.
"The trends we are seeing in all of our operating areas are improving," added Spencer.
"Volumes on our systems are sharply increasing as our customers bring production back online with improvements in commodity prices, which is positive for our business in the second half of the year."