ONEOK (OKE) 10-K risk factor changes: FY2021 vs FY2020

Uncertainty remains regarding the duration of global impacts due to [removed: COVID-19 and the possible resurgence or mutation of the virus.][added: COVID-19.]

The degree to which the pandemic further impacts our business and results of operations will depend on future developments beyond our control, including the success of [removed: actions to contain the virus,] [added: vaccination efforts and] the [removed: length] [added: effectiveness] of [removed: time needed to vaccinate a significant segment] [added: such vaccines against future mutations] of the [removed: global population,] [added: COVID-19 virus,] how quickly and to what extent [removed: normal] economic and operating conditions [removed: can resume,] [added: resume to pre-COVID-19 levels,] and the severity and duration of [removed: the] [added: reduced] global and regional economic [removed: downturn that results] [added: activity resulting] from the pandemic.

We may be subject to physical and financial risks associated with climate [removed: change and changes in investor sentiment towards climate change may affect the demand for our securities.][added: change.]

Changes in regulatory policies, public sentiment or [removed: technology due to the threat] [added: widespread adoption] of [added: technologies that aim to address] climate change [removed: that] [added: through reducing GHG emissions may] result in a reduction in the demand for hydrocarbon products, restrictions on their [removed: use,] [added: use] or increased use of renewable [removed: energy could reduce future demand for hydrocarbons and reduce volumes available to us for gathering, processing, fractionation, transportation, storage and marketing.][added: energy.]

[removed: Finally,] [added: In addition,] increasing attention to climate change [removed: and the impacts of GHG emissions] has resulted in an increased likelihood of governmental [added: regulations,] investigations, [removed: regulation] [added: shareholder activism] and private litigation, which could increase our costs or otherwise affect adversely our business.

Due to climate change concerns, some investors may choose to either not invest, or to reduce their investment, in companies that [removed: explore for, produce,] [added: gather,] process, [removed: transport] [added: fractionate, transport, store] or [removed: sell] [added: market] products derived from hydrocarbons.

If this [added: negative] investor sentiment increases, we may see reduced demand for our securities, which could impact our liquidity or the value of our securities.

[removed: In addition, to] [added: To] the extent financial markets view climate change and emissions of GHGs as a financial risk, this could [removed: affect] [added: also] negatively [added: affect] our ability to access capital [removed: markets] or cause us to receive less favorable terms and conditions in future financings.

[removed: Our] [added: Some of our] customers’ energy needs vary with weather conditions, primarily [removed: temperature and humidity.][added: temperature.]

Severe weather impacts our operating territories primarily through hurricanes, thunderstorms, [removed: tornados] [added: tornados, freezing temperatures] and snow or ice storms.

To the extent the [added: severity or] frequency of extreme weather events increases, this could increase our cost of providing [removed: service.][added: services, including the cost of insurance, and decrease the availability of certain insurance coverages.]

Other operational hazards and unforeseen interruptions include adverse weather conditions, infectious disease including a pandemic, [added: cybersecurity attacks,] geopolitical reactions, accidents, explosions, fires, the collision of equipment with our pipeline facilities (for example, this may occur if a third party were to perform excavation or construction work near our facilities) and catastrophic events such as tornados, hurricanes, earthquakes, floods, and other similar events beyond our control.

[removed: Also,] [added: Further,] the United States government warned that energy assets, specifically the nation’s pipeline infrastructure, may be targets of terrorist attacks.

[removed: In our Natural Gas Gathering and Processing segment, the development of] reserves could move drilling rigs from our current service areas to other areas, which may reduce demand for our services.

To manage the risk from market price fluctuations in natural gas, [removed: NGLs and] [added: NGLs,] crude oil [added: and electricity] prices, we may use derivative instruments such as swaps, futures, forwards and options.

- controlling our plants and pipelines with industrial control systems including Supervisory Control and Data [removed: Acquisition (SCADA);][added: Acquisition;]

According to experts, since the beginning of the COVID-19 pandemic there has been a rise in the number and sophistication of cyberattacks on companies’ network and information systems by both state-sponsored and criminal organizations, and as a result, the risks associated with such an event continue to [removed: increase.]

A significant failure, compromise, breach or interruption in our [removed: systems] [added: systems, or those of our vendors,] could result in a disruption of our operations, physical [added: or environmental] damages, customer dissatisfaction, damage to our reputation and a loss of customers or revenues.

Efforts by us and our vendors to develop, implement and maintain security measures may not be successful in [added: anticipating, detecting or] preventing these events from occurring, and any network and information systems-related events could require us to expend significant resources to [added: identify, assess and] remedy [added: such events.]

Although we believe that we have robust information security procedures and other safeguards in place, [added: including sufficient insurance,] as cyberthreats continue to evolve, we may be required to expend additional resources to continue to enhance our information security measures and/or to investigate and remediate information security vulnerabilities.

Cyberattacks against us or others in our industry could result in additional [removed: regulations.][added: regulations or contractual obligations.]

Current efforts by the federal government, such as the Improving Critical Infrastructure Cybersecurity executive order, and [added: the TSA security directives issued in May and July 2021, have utilized significant internal and external resources, and] any potential future [added: statutes,] regulations [added: or orders] could lead to [added: further] increased regulatory compliance costs, insurance coverage [removed: cost] [added: costs] or capital expenditures.

We cannot predict the potential impact to our business [removed: or the energy industry] resulting from additional regulations.

Accordingly, we may not have accurate estimates of total reserves [removed: serviced by] [added: committed to] our assets, the anticipated life of such reserves or the expected volumes to be produced from those reserves.

In such event, if we are unable to secure additional sources, then the volumes that we [removed: gather or process] [added: gather, process, fractionate and transport] in the future could be less than anticipated.

The quantification and resolution of measurement adjustments are complicated by several factors including: (i) the significant quantities (*i.e.*, thousands) of measurement equipment that we use across our natural gas and NGL systems, primarily around our gathering and processing assets; (ii) varying qualities of natural gas in the streams gathered and processed through our systems and the mixed nature of NGLs gathered and fractionated; and (iii) variances in measurement that are inherent in metering [removed: technologies.][added: technologies and standards.]

[removed: Examples of these more significant activities] are large expenditures or contractual commitments, the construction or acquisition of assets, borrowing money or otherwise raising capital, transactions with affiliates of a joint-venture participant, litigation and transactions not in the ordinary course of business, among others.

[added: Any] such transaction could result in us being required to partner with different or additional parties who may have business interests different from ours.

We believe it is likely that future governmental legislation and/or regulation on the federal, state [removed: and] [added: or] regional [removed: levels,] [added: level] may require us either to limit GHG emissions associated with our operations, pay additional taxes or to purchase allowances for [removed: such] [added: certain] emissions.

However, we cannot predict precisely what form these future regulations will take, the stringency of the [removed: regulations or] [added: regulations,] when they [removed: may] [added: will] become [removed: effective.][added: effective or the impact on our capital expenditures, competitive position and results of operations.]

- the Clean Water Act and analogous state laws that regulate discharge of wastewater from our facilities [removed: to] [added: into] state and federal waters;

- the federal Resource Conservation and Recovery Act [added: (RCRA)] and analogous state laws that impose requirements for the handling and discharge of solid and hazardous waste from our facilities.

Joint and several, strict liability may be incurred without regard to fault under the CERCLA, [removed: Resource Conservation and Recovery Act] [added: RCRA] and analogous state laws for the remediation of contaminated areas.

There is an inherent risk of incurring environmental costs and liabilities in our business due to our handling of the products we gather, transport, process and store, air emissions related to our operations, past industry operations and waste disposal [removed: practices, some of which may be material.]

Increased litigation challenging oil and gas development, [added: changes to laws, regulations and policies,] as well as changes [removed: to] [added: in regulators’ interpretation or application of such] laws, regulations and policies could impact our business.

[added: New or revised environmental] regulations might also affect adversely our products and activities, and federal and state agencies could impose additional safety requirements, all of which could affect adversely our profitability.

However, in [removed: November 2020,] [added: March 2021,] the administrator of LIBOR, the ICE Benchmark Administration, announced [removed: its intention to continue publications of] all U.S. dollar LIBOR tenors [added: will continue to be published] through June 2023, with the exception of one-week and two-month [removed: tenors] [added: tenors,] which [removed: will cease] [added: ceased] at the end of 2021.

[removed: Although there have been some issuances] [added: In addition, although financial institutions are increasingly] utilizing [removed: SOFR,] [added: SOFR in credit facilities,] it is unknown whether [removed: this] [added: SOFR or any other] alternative reference rate will attain market acceptance as a replacement for LIBOR.

Our $2.5 Billion Credit Agreement includes provisions that grant the administrative agent [removed: broad] discretion to establish a replacement rate for LIBOR, if necessary, which could increase our short-term borrowing costs for amounts issued under this facility.

[removed: If these agencies were to downgrade our long-term debt or our commercial paper rating, particularly below investment grade, our] borrowing costs could increase, which would affect adversely our financial results, and our potential pool of investors and funding sources could decrease.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

Increasing attention to ESG matters, including climate change, may impact our business.

There are increasing expectations that companies across all industries address ESG matters, including climate change.

These changes could reduce the demand for our services, impacting our business, results of operations, financial position and cash flows.

For example, there are plans to propose new climate change disclosure requirements this year.

While we do not know what form those requirements may take, we may face increased costs associated with complying with any new climate disclosure requirements.

Certain investors are increasingly focused on ESG matters, including climate change.

Further, organizations that provide information to investors on corporate governance and related matters have also increased their focus on ESG matters and have developed ratings processes for evaluating companies on various ESG initiatives.

Unfavorable ESG ratings may lead to increased negative investor sentiment toward us.

Additionally, certain large institutional lenders have begun to announce their own policies to meet publicly announced climate commitments, which often involve commitments to shift lending activities in

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

the energy sector to meet GHG emissions goals.

As a result, certain institutional lenders may impose additional requirements on us, or decide not to lend to us, based on ESG concerns, which could adversely affect our access to capital on reasonable terms or at all and, as a result, our financial condition.

In September 2021, we announced a 30% absolute GHG reduction target, or 2.2 million metric tons, of our combined Scope 1 and Scope 2 emissions by 2030, compared with 2019 base-year levels.

To the extent that the potential pathways we have identified to achieve this emissions reduction target are not available to us, or to the extent we otherwise are unable to make progress toward other ESG-related targets we may establish, we may face additional costs to meet these targets, or we may fail to meet them entirely, which could negatively impact our business and reputation.

Extreme cold weather can result in supply reductions from producer wellhead freeze-offs, as well as power curtailments or outages, any of which can negatively impact our business, results of operations, financial position and cash flows.

In our Natural Gas Gathering and Processing segment, the development of

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

increase.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

Examples of these more significant activities

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

- change to federal, state and local taxation;

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

In addition to activities on the federal level, state and regional initiatives could also lead to the regulation of GHG emissions sooner than or independent of federal regulation.

These regulations could be more stringent than any federal legislation that may be adopted.

Recently, the EPA has proposed updating the New Source Performance Standards Subpart OOOO regulations to further reduce methane emissions, which includes increased monitoring frequency and more stringent repair requirements for new and modified oil and gas facilities.

In addition, the EPA is proposing new nationwide emission guidelines for states to limit methane emissions from existing facilities.

We cannot predict the potential impact to our business resulting from these additional regulations and guidelines.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

practices, some of which may be material.

The U.S. Federal Reserve concurrently issued a statement advising banks to stop new LIBOR issuances by the end of 2021.

It is impossible to predict whether and to what extent banks will continue to provide LIBOR submissions to the administrator of LIBOR or whether any additional reforms to LIBOR may be enacted in the United Kingdom or elsewhere.

Actions by the British Bankers Association, the United Kingdom Financial Conduct Authority or other regulators or law enforcement agencies as a result of these or future events, may result in changes to the manner in which LIBOR is determined.

In addition, any further changes or reforms to the determination or supervision of LIBOR may result in a sudden or prolonged increase or decrease in reported LIBOR.

At this time, no consensus exists as to what rate or rates will become accepted alternatives to LIBOR, although on July 29, 2021, the Alternative Reference Rates Committee, a U.S.-based steering committee composed of large US financial institutions convened by the U.S. Federal Reserve Board and the Federal Reserve Bank of New York, formally recommended SOFR Term rates.

Given the inherent differences between LIBOR and SOFR, or any other alternative benchmark rate that is established, there are many uncertainties regarding a transition from LIBOR, including how this will impact the cost of our variable rate debt and certain derivative financial instruments, or whether the COVID-19 pandemic will have further effect on LIBOR transition plans.

If these agencies were to downgrade our long-term debt or our commercial paper rating, particularly below investment grade, our

Due to reductions in economic activity, the world experienced reduced demand for crude oil, refined products, NGLs and natural gas, and weakened commodity prices, which affected adversely our operations.

such event.

Any

New or revised environmental

The U.S. Federal Reserve, in conjunction with the Alternative Reference Rates Committee, a steering committee composed of large US financial institutions, is considering replacing U.S. dollar LIBOR with the Secured Overnight Financing Rate (SOFR), a new index supported by short-term Treasury repurchase agreements.

Our [added: publicly] announced capital-growth projects are outlined in the table below:

| [removed: Project (b)] [added: Project] | | | Scope | | | Approximate Costs (a) | | | Completion | | |

| [removed: Demicks Lake I] [added: Bear Creek] plant [added: expansion] and related infrastructure | | | 200 MMcf/d processing plant [added: expansion] and related gathering infrastructure in the [removed: core of the] Williston Basin | | | [removed: $400] [added: $405] | | | Completed [removed: October 2019] | | |

| | | | Supported by acreage dedications with [removed: long-term] primarily fee-based contracts | | | | | | | | |

| Demicks Lake [removed: II] [added: III] plant [removed: and related infrastructure] | | | 200 MMcf/d processing plant [removed: and related gathering infrastructure] in the core of the Williston Basin | | | [removed: $410] [added: $188 (b)] | | | [removed: Completed January 2020] [added: First Quarter 2023] | | |

| [removed: ONEOK West Texas NGL pipeline expansion and] Arbuckle II [removed: connection] [added: pipeline expansion] | | | [removed: Increasing] [added: Increased] mainline capacity [removed: by 80 MBbl/d] with additional pump facilities [removed: and pipeline looping] | | | [removed: $295] [added: $60] | | | Completed [removed: June 2020 (e)] | | |

| [removed: Increases] [added: Increased] capacity to 500 MBbl/d | | | | | | | | | | | |

| MB-5 fractionator [removed: and related infrastructure] | | | 125 MBbl/d NGL fractionator in Mont Belvieu, [removed: Texas, and related infrastructure, which includes additional NGL storage in Mont Belvieu] [added: Texas] | | | $750 [added: (c)] | | | [removed: Paused (c)] [added: Third Quarter 2023] | | |

[removed: Ethane Production - Ethane production fluctuates over short-term periods driven by] [added: As a result of these] ethane economics, [removed: and as a result,] [added: ethane] volumes [added: on our system] can [removed: also] fluctuate period to period.

Ethane volumes under long-term contracts delivered to our NGL system [removed: averaged 375 MBbl/d in 2020, compared with 385 MBbl/d in 2019, but] increased [removed: by] approximately [removed: 30] [added: 55] MBbl/d [removed: in the second half] [added: to an average] of [removed: 2020,] [added: 430 MBbl/d in 2021,] compared with [removed: the second quarter] [added: 375 MBbl/d in] 2020, due primarily to [removed: improved] [added: changes in] ethane [added: extraction] economics.

In [removed: 2020,] [added: 2021,] we repurchased in the open market outstanding principal of certain of our senior notes in the amount of [removed: $224.4] [added: $55.2] million for an aggregate repurchase price of [removed: $199.6] [added: $54.6] million with cash on hand.

In February [removed: 2021,] [added: 2022,] we [removed: maintained and] paid a quarterly [added: common stock] dividend of $0.935 per share ($3.74 per share on an annualized basis), which is consistent with the same quarter in the prior year.

[removed: *Natural Gas Gathering and Processing* - In 2020, we recorded $382.2 million of noncash impairment charges related primarily to certain long-lived asset groups that were not recoverable,] $153.4 million [removed: of] noncash impairment [removed: charges] [added: charge] related to goodwill and [added: a] $30.5 million [removed: of] noncash impairment [removed: charges] [added: charge] related to our 10.2% investment in Venice Energy Services Company.

[removed: *Natural Gas Liquids -* In] [added: Impairments - The year ended December 31,] 2020, [removed: we recorded] [added: includes] $71.6 million of noncash impairment charges related primarily to certain inactive assets [removed: as our expectation for future use of the assets changed] and [added: a] $7.2 million [removed: of] noncash impairment [removed: charges] [added: charge] related to our 50% investment in Chisholm Pipeline Company.

[removed: For additional information on our impairment charges, see Notes A, D, E and M] [added: See Note N] of the Notes to Consolidated Financial Statements in this Annual [removed: Report.][added: Report for a discussion of regulatory and environmental matters.]

Our consolidated financial metrics include: (1) operating income; (2) net income; (3) diluted EPS; and (4) [removed: the following non-GAAP financial measures:] adjusted [removed: EBITDA and distributable cash flow.][added: EBITDA.]

Non-GAAP Financial Measures - Adjusted [removed: EBITDA, distributable cash flow and dividend coverage ratio are] [added: EBITDA is a] non-GAAP [removed: measures] [added: measure] of our financial performance.

We believe [removed: these] [added: this] non-GAAP financial [removed: measures are] [added: measure is] useful to investors because [removed: they] [added: it] and similar measures are used by many companies in our industry as a measurement of financial performance and [removed: are] [added: is] commonly employed by financial analysts and others to evaluate our financial performance and to compare financial performance among companies in our industry.

Adjusted [removed: EBITDA, distributable cash flow and dividend coverage ratio] [added: EBITDA] should not be considered [removed: alternatives] [added: an alternative] to net income, EPS or any other measure of financial performance presented in accordance with GAAP.

Additionally, [removed: these calculations] [added: this calculation] may not be comparable with similarly titled measures of other companies.

| | | | | | | Years Ended December 31, | | | | | | | | | | | | | | | | | | [removed: 2020] [added: 2021] vs. [removed: 2019] [added: 2020] | | | | | | [removed: 2019] [added: 2020] vs. [removed: 2018] [added: 2019] | | |

| Financial Results | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | | | | | $ Increase (Decrease) | | | | | | | | |

| Commodity sales | | | | | | $ | [removed: 7,255.2] [added: 15,180.3] | | | | | $ | [removed: 8,916.1] [added: 7,255.2] | | | | | $ | [removed: 11,395.6] [added: 8,916.1] | | | | | [removed: (1,660.9)] [added: 7,925.1] | | | | | | [removed: (2,479.5)] [added: (1,660.9)] | | |

| Services | | | | | | [removed: 1,287.0] [added: 1,360.0] | | | | | | [removed: 1,248.3] [added: 1,287.0] | | | | | | [removed: 1,197.6] [added: 1,248.3] | | | | | | [removed: 38.7] [added: 73.0] | | | | | | [removed: 50.7] [added: 38.7] | | |

| Total revenues | | | | | | [removed: 8,542.2] [added: 16,540.3] | | | | | | [removed: 10,164.4] [added: 8,542.2] | | | | | | [removed: 12,593.2] [added: 10,164.4] | | | | | | [removed: (1,622.2)] [added: 7,998.1] | | | | | | [removed: (2,428.8)] [added: (1,622.2)] | | |

| Cost of sales and fuel (exclusive of items shown separately below) | | | | | | [removed: 5,110.1] [added: 12,256.7] | | | | | | [removed: 6,788.0] [added: 5,110.1] | | | | | | [removed: 9,422.7] [added: 6,788.0] | | | | | | [removed: (1,677.9)] [added: 7,146.6] | | | | | | [removed: (2,634.7)] [added: (1,677.9)] | | |

| Operating costs | | | | | | [removed: 886.1] [added: 1,067.0] | | | | | | [removed: 982.9] [added: 886.1] | | | | | | [removed: 907.0] [added: 982.9] | | | | | | [removed: (96.8)] [added: 180.9] | | | | | | [removed: 75.9] [added: (96.8)] | | |

| Depreciation and amortization | | | | | | [removed: 578.7] [added: 621.7] | | | | | | [removed: 476.5] [added: 578.7] | | | | | | [removed: 428.6] [added: 476.5] | | | | | | [removed: 102.2] [added: 43.0] | | | | | | [removed: 47.9] [added: 102.2] | | |

| Impairment charges | | | | | | [removed: 607.2] [added: —] | | | | | | [removed: —] [added: 607.2] | | | | | | — | | | | | | [removed: 607.2] [added: (607.2)] | | | | | | [removed: —] [added: 607.2] | | |

| (Gain) loss on sale of assets | | | | | | [removed: (1.3)] [added: (1.4)] | | | | | | [removed: 2.6] [added: (1.3)] | | | | | | [removed: (0.6)] [added: 2.6] | | | | | | [removed: 3.9] [added: 0.1] | | | | | | [removed: (3.2)] [added: 3.9] | | |

| Operating income | | | | | | $ | [removed: 1,361.4] [added: 2,596.3] | | | | | $ | [removed: 1,914.4] [added: 1,361.4] | | | | | $ | [removed: 1,835.5] [added: 1,914.4] | | | | | [removed: (553.0)] [added: 1,234.9] | | | | | | [removed: 78.9] [added: (553.0)] | | |

| Equity in net earnings from investments | | | | | | $ | [removed: 143.2] [added: 122.5] | | | | | $ | [removed: 154.5] [added: 143.2] | | | | | $ | [removed: 158.4] [added: 154.5] | | | | | [removed: (11.3)] [added: (20.7)] | | | | | | [removed: (3.9)] [added: (11.3)] | | |

| Impairment of equity investments | | | | | | $ | [removed: (37.7)] [added: —] | | | | | $ | [removed: —] [added: (37.7)] | | | | | $ | — | | | | | [removed: 37.7] [added: (37.7)] | | | | | | [removed: —] [added: 37.7] | | |

| Interest expense, net of capitalized interest | | | | | | $ | [removed: (712.9)] [added: (732.9)] | | | | | $ | [removed: (491.8)] [added: (712.9)] | | | | | $ | [removed: (469.6)] [added: (491.8)] | | | | | [removed: 221.1] [added: 20.0] | | | | | | [removed: 22.2] [added: 221.1] | | |

| Net income | | | | | | $ | [removed: 612.8] [added: 1,499.7] | | | | | $ | [removed: 1,278.6] [added: 612.8] | | | | | $ | [removed: 1,155.0] [added: 1,278.6] | | | | | [removed: (665.8)] [added: 886.9] | | | | | | [removed: 123.6] [added: (665.8)] | | |

| Diluted EPS | | | | | | $ | [removed: 1.42] [added: 3.35] | | | | | $ | [removed: 3.07] [added: 1.42] | | | | | $ | [removed: 2.78] [added: 3.07] | | | | | [removed: (1.65)] [added: 1.93] | | | | | | [removed: 0.29] [added: (1.65)] | | |

| Adjusted EBITDA | | | | | | $ | [removed: 2,723.7] [added: 3,379.7] | | | | | $ | [removed: 2,580.2] [added: 2,723.7] | | | | | $ | [removed: 2,447.5] [added: 2,580.2] | | | | | [removed: 143.5] [added: 656.0] | | | | | | [removed: 132.7] [added: 143.5] | | |

| Capital expenditures | | | | | | $ | [removed: 2,195.4] [added: 696.9] | | | | | $ | [removed: 3,848.3] [added: 2,195.4] | | | | | $ | [removed: 2,141.5] [added: 3,848.3] | | | | | [removed: (1,652.9)] [added: (1,498.5)] | | | | | | [removed: 1,706.8] [added: (1,652.9)] | | |

See reconciliation of net income to adjusted EBITDA [removed: and distributable cash flow] in the “Non-GAAP [added: Financial] Measures” section.

[removed: 2020] [added: 2021] vs. [removed: 2019] [added: 2020] - Operating income [removed: decreased $553.0 million] [added: increased $1.2 billion] primarily as a result of the following:

Market Conditions - We experienced earnings growth from increased volumes in 2021, compared with 2020, due primarily to increased producer activity and rising gas-to-oil ratios in the Rocky Mountain region, production curtailments in 2020, increased ethane production in the Rocky Mountain region and higher commodity prices in both our Natural Gas Gathering and Processing and Natural Gas Liquids segments, highlighting both the resiliency of our integrated assets and the economic recovery from the pandemic.

Ethane Production - Price differentials between ethane and natural gas can cause natural gas processors to extract ethane or leave it in the natural gas stream, known as ethane rejection.

We estimate that there are more than 225 MBbl/d of discretionary ethane, consisting of more than 125 MBbl/d in the Rocky Mountain region and approximately 100 MBbl/d in the Mid-Continent region, that can be recovered and transported on our system.

Ethane recovery opportunities will fluctuate based on regional natural gas pricing and ethane economics.

(b) - In November 2021, we announced that we restarted construction of the Demicks Lake III natural gas processing plant.

Upon announcement, the expected cost to complete was approximately $140 million.

(c) - In November 2021, we announced that we restarted construction of the MB-5 NGL fractionator.

Upon announcement, the expected cost to complete was approximately $250 million.

Debt Repayments \- In November 2021, we redeemed the remaining $536.1 million of our $700 million, 4.25% senior notes due February 2022 at 100% of the principal amount, plus accrued and unpaid interest, with cash on hand and short-term borrowings.

In June 2021, we repaid the remaining $11.7 million of Guardian Pipeline’s senior notes due December 2022 with cash on hand.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

These increases were offset partially by a decrease of $46.2 million from the impact of Winter Storm Uri in exchange services;

*•Natural Gas Gathering and Processing* - increases of $143.5 million due primarily to lower realized prices in 2020 impacting our fee with POP contracts and $115.8 million from higher volumes due primarily to increased production and rising gas-to-oil ratios in the Rocky Mountain region in 2021 and production curtailments in 2020; *and*

- *Natural Gas Pipelines* - an increase of $109.1 million due to primarily to increased natural gas sales; *offset by*

These increases were offset partially by higher income taxes, higher interest expense related to lower capitalized interest and lower equity AFUDC due to completed projects, lower equity in net earnings from investments and a gain in 2020 on extinguishment of debt related to open market repurchases.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| NGL and condensate sales | | | | | | $ | 2,821.2 | | | | | $ | 889.4 | | | | | $ | 1,224.4 | | | | | 1,931.8 | | | | | | (335.0) | | |

- an increase of $7.3 million from a gain on the partial sale of an equity investment; *offset by*

- an increase of $31.4 million in operating costs due primarily to higher employee costs related to short-term incentives.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

- an increase of $421.4 million in exchange services (excluding the impact of Winter Storm Uri discussed below) due primarily to:

◦$261.6 million in higher volumes primarily in the Rocky Mountain region, Mid-Continent region and Permian Basin, offset partially by lower volumes in the Barnett Shale,

◦$98.9 million related to wider commodity price differentials,

◦$63.8 million in lower transportation costs in the Rocky Mountain region, and

◦$12.9 million related to recognition of proceeds previously considered a gain contingency; *and*

*•*an increase of $98.3 million in optimization and marketing due primarily to wider location and commodity price differentials, increased activities during Winter Storm Uri and higher optimization volumes; *offset by*

- the negative impact of Winter Storm Uri of $46.2 million in exchange services due primarily to decreased volumes across our operations and higher electricity costs;

- an increase of $103.0 million in operating costs due primarily to increased property taxes associated with our completed capital-growth projects, higher employee costs related to short-term incentives and higher outside services; *and*

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

- an increase of $109.1 million due primarily to higher average natural gas prices on 5.2 Bcf of natural gas sales in the first quarter 2021 of volumes previously held in inventory, compared with 1.2 Bcf in the first quarter 2020; *and*

Capital expenditures increased in 2021 due primarily to capital-growth projects.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| Reconciliation of net income to adjusted EBITDA | | | | | | (*Thousands of dollars)* | | | | | | | | | | | | | | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

We do not expect this working capital deficit to have an adverse impact to our cash flows or operations.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

Debt Repayments - In November 2021, we redeemed the remaining $536.1 million of our $700 million, 4.25% senior notes due February 2022 at 100% of the principal amount, plus accrued and unpaid interest, with cash on hand and short-term borrowings.

COVID-19 - While we are still experiencing global and regional economic disruption due primarily to COVID-19, our producers have reversed curtailments that were put in place during the second quarter 2020, bringing volumes back to pre-COVID-19 levels as prices significantly improved from second quarter 2020 lows.

The full impact of the continued global and regional economic disruption will depend on the unknown duration and severity of COVID-19, and, among other things, the impact of governmental actions imposed in response to COVID-19, the pace and scale of economic recovery and corresponding demand for crude oil, and the impacts to commodity prices.

We continue to monitor producers’ drilling, completion and production plans, which are increasingly positive as commodity prices have stabilized and improved, and our expectations for 2021 include the potential for an improving pace of drilling and completion activity.

In this challenging market environment, we expect to maintain sufficient liquidity and financial stability into 2021 due to cash on hand from our June 2020 equity issuance, cash flows from operations and access to our undrawn $2.5 Billion Credit Agreement.

We have no debt maturities prior to 2022, and our investment-grade credit ratings have remained stable.

Sustainability - In 2020, we were included in the Dow Jones Sustainability North America Index for the second consecutive year and added to the Dow Jones Sustainability World Index (DJSI World), which recognize companies for industry-leading

environmental, social and governance performance.

We are currently the only North American energy company included in the DJSI World group of global sustainability leaders.

We continue to look for ways to reduce our environmental impact and utilize more efficient technologies.

We are preparing for the future energy transition and our role in meeting the world’s energy needs in an environmentally responsible way.

We have completed significant capital-growth projects that include NGL pipelines, NGL fractionators, natural gas processing plants and related natural gas and NGL infrastructure.

These projects provide us the capacity to benefit from future supply growth without significant capital investment.

In the first quarter 2020, due to the decline in commodity prices and economic demand disruption caused by COVID-19, we suspended our announced plans to construct the Demicks Lake III natural gas processing plant, the fourth expansion of the ONEOK West Texas NGL pipeline system, and reduced the scope of the expansion of our Elk Creek pipeline and various other paused projects.

These projects can be restarted quickly when producer activity warrants additional infrastructure.

| | | | Supported by acreage dedications with long-term primarily fee-based contracts | | | | | | | | |

| Bear Creek plant expansion and related infrastructure | | | 200 MMcf/d processing plant expansion and related gathering infrastructure in the Williston Basin | | | $405 | | | Paused (c) | | |

| Elk Creek pipeline and related infrastructure | | | 900-mile NGL pipeline from the Williston Basin to the Mid-Continent region, with capacity of up to 240 MBbl/d, and related infrastructure | | | $1,400 | | | Completed December 2019 | | |

| | | | Anchored by long-term contracts | | | | | | | | |

| | | | Expansion capability up to 400 MBbl/d with additional pump facilities | | | | | | | | |

| Arbuckle II pipeline and related infrastructure | | | 530-mile NGL pipeline from the STACK area to Mont Belvieu, Texas, and related infrastructure | | | $1,360 | | | Completed March 2020 | | |

| | | | Supported by long-term contracts | | | | | | | | |

| | | | Expansion capability up to 1 MMBbl/d | | | | | | | | |

| MB-4 fractionator and related infrastructure | | | 125 MBbl/d NGL fractionator in Mont Belvieu, Texas, and related infrastructure, which includes additional NGL storage in Mont Belvieu | | | $575 | | | Completed March 2020 (d) | | |

| | | | Fully contracted with long-term contracts | | | | | | | | |

| Connecting ONEOK West Texas NGL pipeline system to the Arbuckle II pipeline | | | | | | | | | | | |

| | | | Supported by long-term dedicated production from six third-party processing plants expected to produce up to 60 MBbl/d | | | | | | | | |

| Bakken NGL pipeline extension | | | 75-mile NGL pipeline in the Williston Basin connecting to a third-party processing plant | | | $100 | | | Completed August 2020 | | |

| | | | Supported by a long-term contract with a minimum volume commitment | | | | | | | | |

| Arbuckle II extension project and additional gathering infrastructure | | | Provide additional takeaway capacity in the STACK area | | | $240 | | | Completed | | |

| Allow increasing volumes on the Elk Creek pipeline access to fractionation capacity at Mont Belvieu, Texas | | | | | | August 2020 | | | | | |

| Arbuckle II pipeline expansion | | | Increasing mainline capacity with additional pump facilities | | | $60 | | | Paused (c) | | |

| | | | Fully contracted with long-term contracts | | | | | | | | |

| ONEOK West Texas NGL pipeline expansion | | | Increasing mainline capacity by 40 MBbl/d | | | $145 | | | Paused (c) | | |

| Supported by long-term dedicated production from third-party processing plants expected to produce up to 45 MBbl/d | | | | | | | | | | | |

| Mid-Continent fractionation facility expansions | | | 65 MBbl/d of expansions at our Mid-Continent NGL facilities | | | $150 | | | Paused (c) | | |

(b) - Projects listed exclude our suspended capital-growth projects, which include the Demicks Lake III natural gas processing plant, the fourth expansion of the ONEOK West Texas NGL pipeline system and a reduction in the scope of the expansion of the Elk Creek pipeline.

(c) - Given the current environment, we paused the majority of construction activities on these projects and do not expect to complete construction by the original target completion date.

(d) - We completed 75 MBbl/d in December 2019 and completed the remaining 50 MBbl/d in March 2020.

(e) - We completed expansions to increase mainline capacity by approximately 45 MBbl/d in the first quarter 2020 and completed the remaining portion of this project in the second quarter 2020, which was delayed due to weather.

We expect ethane production to continue to fluctuate throughout 2021.

Under certain fee with POP contracts, our contractual fees and POP percentage may increase or decrease if [removed: production volumes, delivery pressures or commodity prices change relative to specified thresholds.]

The following table presents the effect a hypothetical 10% change in the underlying commodity prices would have on the estimated fair value of our commodity derivative instruments [removed: for] [added: as of] the [removed: periods] [added: dates] indicated:

| Commodity Contracts | | | December 31, [removed: 2020] [added: 2021] | | | | | | December 31, [removed: 2019] [added: 2020] | | |

| Crude oil and NGLs | | | $ | [removed: 20.0] [added: 40.6] | | | | | $ | [removed: 26.1] [added: 20.0] | |

| Natural gas | | | [removed: 10.6] [added: 11.5] | | | | | | [removed: 12.7] [added: 10.6] | | |

| Total change in estimated fair value of commodity contracts | | | $ | [removed: 30.6] [added: 52.1] | | | | | $ | [removed: 38.8] [added: 30.6] | |

| | | | | | | Year Ending December 31, [removed: 2021] [added: 2022] | | | | | | | | | | | | | | | | | |

| NGLs - excluding ethane (*MBbl/d*) - Conway/Mont Belvieu | | | | | | [removed: 10.4] [added: 0.9] | | | | | | $ | [removed: 0.51] [added: 1.11] | | / gallon | | | | | | [removed: 60%] [added: 5%] | | |

| Condensate (*MBbl/d*) - WTI-NYMEX | | | | | | [removed: 2.9] [added: 0.2] | | | | | | $ | [removed: 42.87] [added: 74.95] | | / Bbl | | | | | | [removed: 74%] [added: 7%] | | |

| Natural gas (*BBtu/d*) - NYMEX and basis | | | | | | [removed: 118.6] [added: 109.5] | | | | | | $ | [removed: 2.64] [added: 3.27] | | / MMBtu | | | | | | 75% | | |

Our Natural Gas Gathering and Processing segment’s commodity price sensitivity is estimated as a hypothetical change in the price of NGLs, crude oil and natural gas at December 31, [removed: 2020.][added: 2021.]

- a $0.01 per gallon change in the composite price of NGLs, excluding ethane, would change adjusted EBITDA for the [removed: year] [added: years] ending December 31, [removed: 2021,] [added: 2022 and 2023,] by [added: $2.6 million and] $2.7 [removed: million;][added: million, respectively;]

- a $1.00 per barrel change in the price of crude oil would change adjusted EBITDA for the [removed: year] [added: years] ending December 31, [removed: 2021,] [added: 2022 and 2023,] by [removed: $1.4 million;] [added: $0.8 million] and [added: $0.9 million, respectively; and]

- a $0.10 per MMBtu change in the price of residue natural gas would change adjusted EBITDA for the [removed: year] [added: years] ending December 31, [removed: 2021,] [added: 2022 and 2023,] by [removed: $5.8 million.][added: $5.3 million and $5.5 million, respectively.]

We [added: may] manage interest-rate risk through the use of fixed-rate debt, floating-rate debt and [removed: interest-rate swaps.][added: interest-]

At December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] we had forward-starting interest-rate swaps with notional amounts totaling $1.1 billion [removed: and $1.8 billion, respectively,] to hedge the variability of interest payments on a portion of our forecasted debt issuances.

At December 31, [added: 2021 and] 2020, we had derivative liabilities of [removed: $203.4] [added: $145.5] million [added: and $203.4 million, respectively,] related to these interest-rate swaps.

The following table presents the effect of a 10% hypothetical change in interest rates on the estimated fair value of our [removed: interest- rate] [added: interest-rate] derivative instruments [removed: for] [added: as of] the [removed: periods] [added: dates] indicated:

| | | | December 31, [removed: 2020] [added: 2021] | | | | | | December 31, [removed: 2019] [added: 2020] | | |

| Forward-starting interest-rate swaps | | | $ | [removed: 12.9] [added: 19.6] | | | | | $ | [removed: 40.5] [added: 12.9] | |

In [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] approximately 90% of the downstream commodity sales in our Natural Gas Gathering and Processing segment were made to customers rated investment-grade by S&P, approved through comparable internal counterparty analysis, or were secured by letters of credit or other collateral.

In [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] approximately [removed: 75%] [added: 70%] and [removed: 80%,] [added: 75%,] respectively, of this segment’s commodity sales were made to customers rated investment-grade by S&P, approved through comparable internal counterparty analysis, or were secured by letters of credit or other collateral.

In [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] approximately 85% of our revenues in this segment were from customers rated investment-grade by S&P, approved through comparable internal counterparty analysis, or were secured by letters of credit or other collateral.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

production volumes, delivery pressures or commodity prices change relative to specified thresholds.

In certain commodity price environments, our contractual fees on these fee with POP contracts may decrease, which would impact the average fee rate in our Natural Gas Gathering and Processing segment.

| NGLs - excluding ethane (*MBbl/d*) - Conway/Mont Belvieu | | | | | | 11.7 | | | | | | $ | 0.96 | | / gallon | | | | | | 69% | | |

| Condensate (*MBbl/d*) - WTI-NYMEX | | | | | | 1.6 | | | | | | $ | 63.10 | | / Bbl | | | | | | 72% | | |

| | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | Year Ending December 31, 2023 | | | | | | | | | | | | | | | | | |

| | | | | | | Volumes Hedged | | | | | | Average Price | | | | | | | | | Percentage Hedged | | |

| Natural gas (*BBtu/d*) - NYMEX and basis | | | | | | 17.3 | | | | | | $ | 5.06 | | / MMBtu | | | | | | 11% | | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

rate swaps.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

In 2020, we settled $750 million of our forward-starting interest-rate swaps related to our underwritten public offerings of $1.75 billion senior unsecured notes and the remaining $1.3 billion of our interest-rate swaps used to hedge our LIBOR-based interest payments upon repayment of the remaining balance of our $1.5 Billion Term Loan Agreement.

At December 31, 2019, we had interest-rate swaps with notional amounts totaling $1.3 billion to hedge the variability of our LIBOR-based interest payments, all of which have settled as of December 31, 2020.

At December 31, 2019, we had derivative assets of $0.6 million and derivative liabilities of $201.9 million related to these interest-rate swaps.

We are incorporated under the laws of the state of Oklahoma, and our common stock is listed on the NYSE under the trading symbol “OKE.” We are a leading midstream service provider and own one of the nation’s premier NGL systems, connecting NGL supply in the Rocky Mountain, Permian and Mid-Continent regions with key market centers and [added: own] an extensive network of natural gas gathering, processing, storage and transportation assets.

| | | | Legend | | | | | | | | | [removed: ] [added: ] | | | | | |

| Raw natural gas is typically gathered at the wellhead, compressed and transported through pipelines to our processing facilities. Most raw natural gas produced at the wellhead [added: also] contains a mixture of NGL components, including ethane, propane, iso-butane, normal butane and natural gasoline. | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | [removed: ] [added: ] | | | | | |

[removed: The] [added: Although the] energy industry has experienced many up and down cycles, [removed: and as a result,] we have positioned ourselves to [removed: minimize] [added: reduce] exposure to direct commodity price volatility.

Each of our three [removed: segments’ earnings] [added: segments] are primarily fee-based, and our consolidated earnings were [removed: more than] [added: approximately] 90% fee-based in [removed: 2020.][added: 2021.]

In addition, [removed: although] our Natural Gas Gathering and Processing and Natural Gas Liquids segments [removed: generate primarily fee-based earnings, those segments’ results of operations] are exposed to volumetric risk as a result of [removed: production curtailments, reduced] drilling and completion activity, [removed: declining] [added: normal volumetric] well [removed: productivity,] [added: decline,] severe weather disruption, operational outages and crude oil, NGL and natural gas demand.

[removed: In continued response] [added: As we continue] to [removed: COVID-19,] [added: monitor the COVID-19 pandemic,] we remain committed to managing the impact of the pandemic on our employees.

[removed: As] [added: We continue to protect our workforce and, as] always, we remain focused on operating our assets safely, reliably and in an environmentally responsible manner.

ONEOK is a critical infrastructure business as defined by [removed: the United States Department of] Homeland [removed: Security,] [added: Security] and, therefore, our workforce has remained fully engaged [removed: in the midst of] [added: within] federal, state and local government issued guidelines and safety-related ordinances.

[removed: We continue to practice remote work procedures when possible] [added: With respect] to [removed: protect the safety of] [added: COVID-19, we began implementing] our [removed: employees and their families] [added: return to office plan in early 2022,] and [removed: have taken extra] [added: we will continue to take safety] precautions for our employees who work in the field or [removed: need to] report to a ONEOK facility, such as increased facility access restrictions, workspace modifications, social distancing, face covering protocols and sanitation procedures.

Natural Gas - In our Natural Gas Gathering and Processing segment, gathered and processed volumes [removed: decreased] in [removed: 2020,] [added: the Rocky Mountain region increased in 2021,] compared with [removed: 2019,] [added: 2020,] due primarily to [removed: natural] [added: increased producer activity, rising gas-to-oil ratios and the impact of curtailed] production [removed: declines] in [removed: the Mid-Continent region.][added: 2020.]

[removed: These plants] [added: In November 2021, we announced the completion of our Bear Creek plant expansion, which] increased our total processing capacity to approximately [removed: 1.5] [added: 1.7] Bcf/d in the Williston Basin.

In our Natural Gas Pipelines segment, our assets are connected to key supply areas and demand centers, including export markets in Mexico via [removed: our] Roadrunner [removed: joint venture] and supply areas in Canada and the United States via our interstate and intrastate natural gas pipelines and [removed: our] Northern Border [removed: Pipeline joint venture,] [added: Pipeline,] which [removed: enables] [added: enable] us to provide essential natural gas transportation and storage [removed: services to end users.][added: services.]

Continued demand from local distribution companies, electric-generation facilities and large industrial companies resulted in low-cost expansions [removed: in 2019 and 2020] that position us well to provide additional [removed: expansions for] [added: services to] our customers [removed: in 2021.][added: when needed.]

[removed: - Operate in a safe, reliable and environmentally responsible manner - environmental, safety] [added: Safety] and [removed: health continues] [added: environmental responsibility continue] to be a primary focus for us, and our emphasis on personal and process safety has produced improving trends in the key indicators we track.

We [removed: also] continue to [removed: seek] [added: look for] ways to reduce our environmental impact [removed: by conserving resources] and [removed: utilizing] [added: utilize] more efficient technologies.

*Mid-Continent region* - The Mid-Continent region includes the oil-producing, NGL-rich STACK and SCOOP areas and the Cana-Woodford Shale, Woodford Shale, Springer Shale, Meramec, Granite Wash and Mississippian Lime formations of Oklahoma and Kansas, and the Hugoton [removed: and Central Kansas Uplift Basins of Kansas.][added: Basin.]

- [removed: 18,900] [added: 17,500] miles of natural gas gathering pipelines;

- [removed: ten] [added: 13] natural gas processing plants with [removed: 1.0] [added: 1.7] Bcf/d of processing capacity in the [removed: Mid-Continent] [added: Rocky Mountain] region, and [removed: 12] [added: nine] natural gas processing plants with [removed: 1.5] [added: 0.9] Bcf/d of processing capacity in the [removed: Rocky Mountain region;] [added: Mid-Continent region,] and [added: up to 150 MMcf/d of processing capacity in the Mid-Continent region through a long-term processing services agreement with an unaffiliated third party; and]

- 14 MBbl/d of NGL fractionation capacity [added: and 26 MBbl/d of de-ethanizer capacity] at various natural gas processing plants.

Utilization - The utilization rates for our natural gas processing plants were [added: 69% and] 66% [added: for 2021] and [removed: 84%] [added: 2020, respectively, which includes 81% and 70% in the Rocky Mountain region] for [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively.

We calculate utilization rates using a weighted-average approach, adjusting for the dates that assets were placed in [added: or removed from] service.

We believe our natural gas gathering facilities [removed: and operations] [added: upstream of our natural gas processing plants] meet the criteria used by the FERC for nonjurisdictional natural gas gathering facility status.

- [removed: 9,130] [added: 9,120] miles of gathering pipelines with operating capacity of [removed: 1,760] [added: 1,790] MBbl/d, including 6,330 miles of FERC-regulated pipelines with operating capacity of [removed: 1,460] [added: 1,490] MBbl/d;

[removed: Many] [added: Some] of these exchange volumes are under contracts with minimum volume commitments that provide a minimum level of revenues regardless of volumetric throughput.

Our exchange services activities are primarily fee-based and include [added: some rate-regulated tariffs; however, we also capture certain product price differentials through the fractionation process.]

- Optimization and marketing - We utilize our assets, contract portfolio and market knowledge to capture location, product and seasonal price differentials through the purchase and sale of [added: unfractionated] NGLs and NGL products.

In [removed: many] [added: the majority] of our exchange services contracts, we purchase the unfractionated NGLs at the tailgate of the processing plant and deduct contractual fees related to the transportation and fractionation services we must perform before we can sell them as NGL products.

The utilization rates for [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively, were as follows:

- our NGL gathering pipelines were 61% and [removed: 78%;][added: 61%;]

- our NGL distribution pipelines were 51% and [removed: 63%;] [added: 51%;] and

- our NGL fractionators were [removed: 77%] [added: 91%] and [removed: 84%.][added: 77%.]

- Viking Gas Transmission, which is a bidirectional system that interconnects with a [removed: TransCanada] [added: TC Energy] Corporation pipeline at the United States border near Emerson, Canada, and ANR Pipeline Company near Marshfield, Wisconsin;

- Guardian Pipeline, which interconnects with several pipelines at the Chicago Hub near Joliet, Illinois, and with local natural gas distribution [added: and electric generation] companies in Wisconsin; and

*Intrastate [removed: Pipelines*] [added: Pipelines and Storage*] - Our intrastate natural gas pipeline assets in Oklahoma transport natural gas throughout the state and have access to the major natural gas production areas in the Mid-Continent region, which include the STACK and SCOOP areas and the Cana-Woodford Shale, Woodford Shale, Springer Shale, Meramec, Granite Wash and Mississippian Lime formations.

- 1,500 miles of FERC-regulated interstate natural gas pipelines with 3.5 Bcf/d of [removed: peak] transportation capacity;

- 5,100 miles of state-regulated intrastate transmission pipelines with [removed: peak] transportation capacity of 4.3 Bcf/d; and

Utilization - Our natural gas pipelines were [removed: 96%] [added: 95%] and [removed: 98%] [added: 96%] subscribed in [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively, and our natural gas storage facilities were [removed: 71%] [added: 70%] and [removed: 64%] [added: 71%] subscribed in [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively.

[removed: In] Oklahoma, natural gas storage operations are not subject to rate regulation by the state, and we have market-based rate authority from the FERC for certain types of services.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

Business Update and Market Conditions - We experienced earnings growth from increased volumes in 2021, compared with 2020, due primarily to increased producer activity and rising gas-to-oil ratios in the Rocky Mountain region, production curtailments in 2020, increased ethane production in the Rocky Mountain region and higher commodity prices, in both our Natural Gas Gathering and Processing and Natural Gas Liquids segments, highlighting both the resiliency of our integrated assets and the economic recovery from the pandemic.

We expect volumes to increase in 2022 due to continued increases in producer activity, continued rising gas-to-oil ratios in the Rocky Mountain region, the recent completion of our Bear Creek plant expansion and increased ethane demand from the petrochemical industry.

In our Natural Gas Liquids segment, we are primarily exposed to commodity price risk resulting from the relative values of the various NGL products to each other, the value of NGLs in storage and the relative value of NGLs to natural gas.

In the first quarter 2021, Winter Storm Uri brought significant challenges to the energy industry and our operating areas.

Our employees were proactive in preparing for the severe winter weather, made the necessary adjustments to keep our assets operational and provided exceptional service to meet the needs of our customers during the difficult weather conditions.

Increased demand for natural gas, propane and electricity, coupled with supply reductions from producer wellhead freeze-offs and power outages impacting processing plants in the Mid-Continent and Rocky Mountain regions and the Permian Basin and fractionators in the Mid-Continent region, resulted in high commodity prices at certain market hubs, particularly in the Mid-Continent region and in Texas.

Commodity prices quickly returned to previous levels as the weather improved and natural gas supply returned.

Winter Storm Uri impacted all three of our operating segments, resulting in a net positive impact to our financial results, primarily in the first quarter 2021, as our ability to meet increased demand for natural gas and to provide services during the period offset the unfavorable volume impacts and higher electricity costs.

Our well-positioned natural gas storage assets and market connected pipelines in our Natural Gas Pipelines segment were able to meet critical needs during this period of severe winter weather.

The reliability of our interstate and intrastate assets, including storage, enabled us to continue to provide our customers access to transportation services, park-and-loan services and additional natural gas supply, if available, which improved our financial results.

However, this was partially offset by producer wellhead freeze-offs, which reduced February volumes in our Natural Gas Gathering and Processing and Natural Gas Liquids segments.

We began implementing our return to office plan in early 2022, and we will continue to take safety precautions for our employees who work in the field or report to a ONEOK facility.

Sustainability and Social Responsibility - In 2021 and 2022, we qualified for inclusion in the S&P Global Sustainability Yearbook.

In addition, we received a perfect score of 100 in the Human Rights Campaign 2021 Corporate Equality Index, were upgraded from A to AA at MSCI Inc. ESG ratings, were named a Top 100 U.S. Companies Supporting Healthy Communities and Families, were listed as one of America’s Most Responsible Companies for 2022 by Newsweek and were ranked in the top 10% in the Refiners and Pipelines industry group in Sustainalytics ESG Risk Ranking.

We have an environmental sustainability team that accelerated our ongoing environmental stewardship efforts and is exploring ways to lower our GHG emissions even further.

We are dedicated to the evaluation and development of renewable energy and low-carbon projects and are actively

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

researching opportunities that will complement our extensive midstream assets and expertise, strengthening the role we expect to play in the transformation to a lower-carbon economy.

In September 2021, we announced a 30% absolute GHG emissions reduction target, or 2.2 million metric tons, of our combined Scope 1 and Scope 2 emissions by 2030, compared with 2019 base-year levels.

Scope 1 and 2 emissions represent our total operational emissions, including direct emissions from sources we operate and indirect emissions from the generation of purchased power.

We anticipate several potential pathways toward achieving our emissions reduction target, which could include the electrification of certain natural gas compression assets across our operations, methane mitigation through best management practices and system optimizations.

Additionally, we are identifying potential opportunities to collaborate with utilities and power generators to accelerate the availability of lower-carbon power options across our operations.

We will maintain a disciplined capital approach and will continue to discuss our total capital expenditures and provide our expected total capital spend annually in the “Liquidity and Capital Resources” section in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in this, and future, Annual Reports.

In addition, as we expect to continue to benefit from increased producer activity and continued rising gas-to-oil ratios in the Rocky Mountain region, we recently announced plans to restart construction on our 200 MMcf/d Demicks Lake III natural gas processing plant.

Upon completion of Demicks Lake III, which is expected in the first quarter 2023, our total processing capacity will be approximately 1.9 Bcf/d in the Williston Basin.

In the Mid-Continent region, we are experiencing increased producer drilling activity in 2022 in the SCOOP and STACK areas.

Our ability to provide reliable service throughout the extreme weather conditions of Winter Storm Uri highlighted the importance of market-connected pipelines and storage assets and the value of these services.

In addition, during the first quarter 2021, we sold natural gas that we owned and held in storage, which benefited our segment’s financial results.

We continue to monitor market conditions and sell our natural gas in storage during favorable market conditions.

During the extreme winter weather periods, we maximized natural gas storage withdrawals for firm service customers serving critical needs.

NGLs - In our Natural Gas Liquids segment, NGL volumes increased in 2021, compared with 2020, due primarily to increased production in the Rocky Mountain region, Mid-Continent region and Permian Basin, increased ethane production in the Rocky Mountain region and the impact of curtailed production across our system in 2020, offset partially by the impact of Winter Storm Uri in 2021 and lower volumes in the Barnett Shale.

In response to increased producer activity and the expected increased demand for ethane as two new petrochemical plants come online in 2022, we recently announced plans to restart construction on our 125 MBbl/d MB-5 fractionator in Mont Belvieu, Texas, which is fully contracted.

MB-5 is expected to be completed in the third quarter 2023 and will increase our NGL fractionation capacity to more than 1 MMBbl/d across our entire system.

Our mission is to deliver energy products and services vital to an advancing world.

Our vision is to create exceptional value for our stakeholders by providing solutions for a transforming energy future.

Our business strategy is focused on:

- Zero incidents - we commit to a zero-incident culture for the well-being of our employees, contractors and communities.

- Highly engaged workforce - we strive to be an employer of choice and continue to focus on attracting, selecting and retaining talent, advancing an inclusive, diverse and engaged culture and developing individuals and leaders.

- Sustainable business model - we aim to maintain prudent financial strength and flexibility while operating a safe, reliable and resilient asset base.

Business Update, Market Conditions and COVID-19 - Late in the first quarter 2020, the energy industry experienced historic events that led to a simultaneous demand and supply disruption.

The World Health Organization declared COVID-19 a global pandemic and recommended containment and mitigation measures worldwide, which contributed to a massive economic slowdown and decreased demand for crude oil.

In addition, Saudi Arabia and Russia increased production of crude oil as the two countries competed for market share.

As a result, the global supply of crude oil significantly exceeded demand and led to a collapse in crude oil prices.

Crude oil prices and the related impact on crude oil drilling impacts our business due to associated natural gas, which is natural gas produced by oil wells.

Associated natural gas contains NGLs.

The decline of crude oil prices resulted in crude oil and associated natural gas and NGL production being curtailed in the second quarter 2020.

We are still experiencing global and regional economic disruptions due primarily to COVID-19; however, in the third quarter 2020, many of our producers reversed curtailments, bringing volumes back to pre-COVID-19 levels as prices and demand significantly improved from second quarter 2020 lows.

The full impact of the continued global and regional economic disruption will depend on the unknown duration and severity of COVID-19 and, among other things, the impact of governmental actions imposed in response to COVID-19, the pace and scale of economic recovery and corresponding demand for crude oil and the impacts to commodity prices.

We continue to monitor producers’ drilling, completion and production plans, which are increasingly positive as commodity prices have stabilized and improved, and our expectations for 2021 include the potential for an improving pace of drilling and completion activity.

Under certain fee with POP contracts, our contractual fees and POP percentage may increase or decrease if production volumes, delivery pressures or commodity prices change relative to specified thresholds.

We continue to take actions for safe operations, to protect our workforce and to implement appropriate cost reduction measures.

We reduced our 2020 capital-growth expenditures by approximately $1.7 billion, compared with 2019, driven primarily by our previously completed, paused and suspended capital-growth projects.

We also significantly reduced our operating expenses in 2020, compared with 2019, primarily as a result of reduced outside services from contractors, asset optimizations and lower employee-related costs.

We continue to monitor the COVID-19 outbreak and have implemented our business continuity plans.

In the first quarter 2020, the CARES Act was signed into law in response to the COVID-19 pandemic, and we opted into the CARES Act payroll tax deferral program, which will modestly benefit us, and the 401(k) penalty-free hardship withdrawal and loan deferral programs for our employees.

In 2020, due to the commodity price and market environment, we experienced a significant decline in our share price and market capitalization, and performed a Step 1 analysis to test our goodwill for impairment and evaluated certain long-lived asset groups and equity investments for impairment.

As a result, we incurred $644.9 million in noncash impairment charges, which had an adverse impact on our financial results for the year ended December 31, 2020.

We expect to maintain sufficient liquidity and financial stability into 2021 due to cash on hand from our June 2020 equity issuance, cash flows from operations and access to our undrawn $2.5 Billion Credit Agreement.

Production curtailments from many of our crude oil and natural gas producers impacted volumes in the second quarter 2020, however in the third quarter 2020, many of our producers returned production and our captured natural gas returned to pre-COVID-19 levels as commodity prices strengthened.

We expect to maintain pre-COVID-19 volume levels in the Rocky Mountain region through 2021, assuming no increase in producer activity, due to the completion of previously drilled but uncompleted wells, the capture of natural gas previously flared and rising gas-to-oil ratios.

In addition, as prices and volumes continue to strengthen, we have the processing capacity to benefit from production growth without significant capital investment due to the completion of our Demicks Lake I and II natural gas processing plants, which were placed in service in the fourth quarter 2019 and the first quarter 2020, respectively.

Production growth may be impacted by the current litigation challenging the validity of an easement for the Dakota Access Pipeline (DAPL), which is used to transport crude oil from the Williston Basin to markets in the Mid-Continent region and Gulf Coast.

If DAPL operations are suspended, production growth could be limited due to increased crude oil transportation costs and pipeline capacity constraints in the region, which could impact us due to the associated natural gas and NGLs.

However, we expect limited impact to our producers due to alternative available crude pipeline capacity and existing rail infrastructure out of the Rocky Mountain region.

Our natural gas transportation capacity contracted was not significantly impacted by market conditions and COVID-19 in 2020, as our end users rely on natural gas to support their business regardless of commodity price fluctuations.

We continued to experience stable fee-based earnings throughout 2020 with transportation capacity more than 95% contracted with firm commitments, and we expect these stable fee-based earnings to continue into 2021 at similarly contracted levels.

NGLs - In our Natural Gas Liquids segment, NGL volumes increased for the year ended December 31, 2020, compared with the same period in 2019, due primarily to increased volumes in the Rocky Mountain region, where we are the largest NGL takeaway provider.

While we saw significant declines in volumes in the second quarter 2020, due to reduced demand as a result of COVID-19, by the third quarter 2020 average volumes exceeded pre-COVID-19 levels.

NGL volumes were also favorably impacted by ethane production driven by improved ethane recovery economics due to increased demand from petrochemical manufacturers.

We expect the improved NGL volumes to continue into 2021, and to benefit without significant capital investment, from our integrated assets, which were strengthened through our recently completed capital-growth projects.

Our Elk Creek pipeline was completed in two phases during the second half of 2019.

In 2020, we completed an extension of our Bakken NGL pipeline, the construction and extension of our Arbuckle II pipeline and the construction of our 125 MBbl/d MB-4 fractionator.

Our primary business strategy is to maintain prudent financial strength and flexibility while growing our fee-based earnings and sustaining our dividends per share with a focus on safe, reliable, environmentally responsible, legally compliant and reliable operations for our customers, employees, contractors and the public through the following:

We are preparing for the future energy transition and our role in meeting the world’s energy needs in an environmentally responsible way.

In 2020, we were included in the Dow Jones Sustainability North America Index for the second consecutive year and added to the Dow Jones Sustainability World Index, which recognize companies for industry-leading environmental, social and governance performance;

- Pursue organic investments in our existing operating regions to support earnings growth - we expect earnings growth and dividend stability provided by significant earnings power and available operating capacity from our recently

completed capital-growth projects.

As producer activity warrants additional infrastructure, we have the option for low-cost expansions of existing infrastructure to accommodate increasing volumes;

- Manage our balance sheet and maintain investment-grade credit ratings - we seek to maintain investment-grade credit ratings, pay down debt and internally fund capital-growth projects, when producer activity levels warrant additional infrastructure.

For the fiscal year ended December 31, [removed: 2020.][added: 2021.]

Aggregate market value of registrant’s common stock held by non-affiliates based on the closing trade price on June 30, [removed: 2020,] [added: 2021,] was [removed: $14.5] [added: $24.4] billion.

On February [removed: 16, 2021,] [added: 22, 2022,] the Company had [removed: 444,983,595] [added: 446,213,285] shares of common stock outstanding.

Portions of the definitive proxy statement to be delivered to shareholders in connection with the Annual Meeting of Shareholders to be held May [removed: 26, 2021,] [added: 25, 2022,] are incorporated by reference in Part III.

[removed: 2020] [added: 2021] ANNUAL REPORT

| [Part [removed: I.](#i37abe3ac44cc47fc827eeb4bc0b992f0_13)] [added: I.](#ib56725b8b26746a0828c8d94b670d72c_13)] | | | | | | | | | Page No. | | |

| [Item [removed: 1.](#i37abe3ac44cc47fc827eeb4bc0b992f0_16)] [added: 1.](#ib56725b8b26746a0828c8d94b670d72c_16)] | | | [removed: [Business](#i37abe3ac44cc47fc827eeb4bc0b992f0_16)] [added: [Business](#ib56725b8b26746a0828c8d94b670d72c_16)] | | | | | | [removed: [5](#i37abe3ac44cc47fc827eeb4bc0b992f0_16)] [added: [5](#ib56725b8b26746a0828c8d94b670d72c_16)] | | |

| [Item [removed: 1A.](#i37abe3ac44cc47fc827eeb4bc0b992f0_49)] [added: 1A.](#ib56725b8b26746a0828c8d94b670d72c_49)] | | | [Risk [removed: Factors](#i37abe3ac44cc47fc827eeb4bc0b992f0_49)] [added: Factors](#ib56725b8b26746a0828c8d94b670d72c_49)] | | | | | | [removed: [21](#i37abe3ac44cc47fc827eeb4bc0b992f0_49)] [added: [21](#ib56725b8b26746a0828c8d94b670d72c_49)] | | |

| [Item [removed: 1B.](#i37abe3ac44cc47fc827eeb4bc0b992f0_52)] [added: 1B.](#ib56725b8b26746a0828c8d94b670d72c_52)] | | | [Unresolved Staff [removed: Comments](#i37abe3ac44cc47fc827eeb4bc0b992f0_52)] [added: Comments](#ib56725b8b26746a0828c8d94b670d72c_52)] | | | | | | [removed: [33](#i37abe3ac44cc47fc827eeb4bc0b992f0_52)] [added: [34](#ib56725b8b26746a0828c8d94b670d72c_52)] | | |

| [Item [removed: 2.](#i37abe3ac44cc47fc827eeb4bc0b992f0_55)] [added: 2.](#ib56725b8b26746a0828c8d94b670d72c_55)] | | | [removed: [Properties](#i37abe3ac44cc47fc827eeb4bc0b992f0_55)] [added: [Properties](#ib56725b8b26746a0828c8d94b670d72c_55)] | | | | | | [removed: [33](#i37abe3ac44cc47fc827eeb4bc0b992f0_55)] [added: [35](#ib56725b8b26746a0828c8d94b670d72c_55)] | | |

| [Item [removed: 3.](#i37abe3ac44cc47fc827eeb4bc0b992f0_58)] [added: 3.](#ib56725b8b26746a0828c8d94b670d72c_58)] | | | [Legal [removed: Proceedings](#i37abe3ac44cc47fc827eeb4bc0b992f0_58)] [added: Proceedings](#ib56725b8b26746a0828c8d94b670d72c_58)] | | | | | | [removed: [33](#i37abe3ac44cc47fc827eeb4bc0b992f0_58)] [added: [35](#ib56725b8b26746a0828c8d94b670d72c_58)] | | |

| [Item [removed: 4.](#i37abe3ac44cc47fc827eeb4bc0b992f0_61)] [added: 4.](#ib56725b8b26746a0828c8d94b670d72c_61)] | | | [Mine Safety [removed: Disclosures](#i37abe3ac44cc47fc827eeb4bc0b992f0_61)] [added: Disclosures](#ib56725b8b26746a0828c8d94b670d72c_61)] | | | | | | [removed: [33](#i37abe3ac44cc47fc827eeb4bc0b992f0_61)] [added: [35](#ib56725b8b26746a0828c8d94b670d72c_61)] | | |

| [Part [removed: II.](#i37abe3ac44cc47fc827eeb4bc0b992f0_64)] [added: II.](#ib56725b8b26746a0828c8d94b670d72c_64)] | | | | | | | | | | | |

| [Item [removed: 5.](#i37abe3ac44cc47fc827eeb4bc0b992f0_67)] [added: 5.](#ib56725b8b26746a0828c8d94b670d72c_67)] | | | [Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#i37abe3ac44cc47fc827eeb4bc0b992f0_67)] [added: Securities](#ib56725b8b26746a0828c8d94b670d72c_67)] | | | | | | [removed: [33](#i37abe3ac44cc47fc827eeb4bc0b992f0_67)] [added: [35](#ib56725b8b26746a0828c8d94b670d72c_67)] | | |

| [Item [removed: 7.](#i37abe3ac44cc47fc827eeb4bc0b992f0_73)] [added: 7.](#ib56725b8b26746a0828c8d94b670d72c_73)] | | | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#i37abe3ac44cc47fc827eeb4bc0b992f0_73)] [added: Operations](#ib56725b8b26746a0828c8d94b670d72c_73)] | | | | | | [removed: [35](#i37abe3ac44cc47fc827eeb4bc0b992f0_73)] [added: [37](#ib56725b8b26746a0828c8d94b670d72c_73)] | | |

| [Item [removed: 7A.](#i37abe3ac44cc47fc827eeb4bc0b992f0_115)] [added: 7A.](#ib56725b8b26746a0828c8d94b670d72c_115)] | | | [Quantitative and Qualitative Disclosures about Market [removed: Risk](#i37abe3ac44cc47fc827eeb4bc0b992f0_115)] [added: Risk](#ib56725b8b26746a0828c8d94b670d72c_115)] | | | | | | [removed: [54](#i37abe3ac44cc47fc827eeb4bc0b992f0_115)] [added: [51](#ib56725b8b26746a0828c8d94b670d72c_115)] | | |

| [Item [removed: 8.](#i37abe3ac44cc47fc827eeb4bc0b992f0_121)] [added: 8.](#ib56725b8b26746a0828c8d94b670d72c_118)] | | | [Financial Statements and Supplementary [removed: Data](#i37abe3ac44cc47fc827eeb4bc0b992f0_121)] [added: Data](#ib56725b8b26746a0828c8d94b670d72c_118)] | | | | | | [removed: [57](#i37abe3ac44cc47fc827eeb4bc0b992f0_121)] [added: [54](#ib56725b8b26746a0828c8d94b670d72c_118)] | | |

| [Item [removed: 9.](#i37abe3ac44cc47fc827eeb4bc0b992f0_262)] [added: 9.](#ib56725b8b26746a0828c8d94b670d72c_202)] | | | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#i37abe3ac44cc47fc827eeb4bc0b992f0_262)] [added: Disclosure](#ib56725b8b26746a0828c8d94b670d72c_202)] | | | | | | [removed: [106](#i37abe3ac44cc47fc827eeb4bc0b992f0_262)] [added: [100](#ib56725b8b26746a0828c8d94b670d72c_202)] | | |

| [Item [removed: 9A.](#i37abe3ac44cc47fc827eeb4bc0b992f0_265)] [added: 9A.](#ib56725b8b26746a0828c8d94b670d72c_205)] | | | [Controls and [removed: Procedures](#i37abe3ac44cc47fc827eeb4bc0b992f0_265)] [added: Procedures](#ib56725b8b26746a0828c8d94b670d72c_205)] | | | | | | [removed: [106](#i37abe3ac44cc47fc827eeb4bc0b992f0_265)] [added: [100](#ib56725b8b26746a0828c8d94b670d72c_205)] | | |

| [Item [removed: 9B.](#i37abe3ac44cc47fc827eeb4bc0b992f0_268)] [added: 9B.](#ib56725b8b26746a0828c8d94b670d72c_208)] | | | [Other [removed: Information](#i37abe3ac44cc47fc827eeb4bc0b992f0_268)] [added: Information](#ib56725b8b26746a0828c8d94b670d72c_208)] | | | | | | [removed: [106](#i37abe3ac44cc47fc827eeb4bc0b992f0_268)] [added: [100](#ib56725b8b26746a0828c8d94b670d72c_208)] | | |

| [Item [removed: 10.](#i37abe3ac44cc47fc827eeb4bc0b992f0_274)] [added: 10.](#ib56725b8b26746a0828c8d94b670d72c_214)] | | | [Directors, Executive Officers and Corporate [removed: Governance](#i37abe3ac44cc47fc827eeb4bc0b992f0_274)] [added: Governance](#ib56725b8b26746a0828c8d94b670d72c_214)] | | | | | | [removed: [107](#i37abe3ac44cc47fc827eeb4bc0b992f0_274)] [added: [101](#ib56725b8b26746a0828c8d94b670d72c_214)] | | |

| [Item [removed: 11.](#i37abe3ac44cc47fc827eeb4bc0b992f0_277)] [added: 11.](#ib56725b8b26746a0828c8d94b670d72c_217)] | | | [Executive [removed: Compensation](#i37abe3ac44cc47fc827eeb4bc0b992f0_277)] [added: Compensation](#ib56725b8b26746a0828c8d94b670d72c_217)] | | | | | | [removed: [107](#i37abe3ac44cc47fc827eeb4bc0b992f0_277)] [added: [101](#ib56725b8b26746a0828c8d94b670d72c_217)] | | |

| [Item [removed: 12.](#i37abe3ac44cc47fc827eeb4bc0b992f0_280)] [added: 12.](#ib56725b8b26746a0828c8d94b670d72c_220)] | | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#i37abe3ac44cc47fc827eeb4bc0b992f0_280)] [added: Matters](#ib56725b8b26746a0828c8d94b670d72c_220)] | | | | | | [removed: [108](#i37abe3ac44cc47fc827eeb4bc0b992f0_280)] [added: [101](#ib56725b8b26746a0828c8d94b670d72c_220)] | | |

| [Item [removed: 13.](#i37abe3ac44cc47fc827eeb4bc0b992f0_283)] [added: 13.](#ib56725b8b26746a0828c8d94b670d72c_223)] | | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#i37abe3ac44cc47fc827eeb4bc0b992f0_283)] [added: Independence](#ib56725b8b26746a0828c8d94b670d72c_223)] | | | | | | [removed: [108](#i37abe3ac44cc47fc827eeb4bc0b992f0_283)] [added: [102](#ib56725b8b26746a0828c8d94b670d72c_223)] | | |

| [Item [removed: 14.](#i37abe3ac44cc47fc827eeb4bc0b992f0_286)] [added: 14.](#ib56725b8b26746a0828c8d94b670d72c_226)] | | | [Principal Accounting Fees and [removed: Services](#i37abe3ac44cc47fc827eeb4bc0b992f0_286)] [added: Services](#ib56725b8b26746a0828c8d94b670d72c_226)] | | | | | | [removed: [108](#i37abe3ac44cc47fc827eeb4bc0b992f0_286)] [added: [102](#ib56725b8b26746a0828c8d94b670d72c_226)] | | |

| [Item [removed: 15.](#i37abe3ac44cc47fc827eeb4bc0b992f0_292)] [added: 15.](#ib56725b8b26746a0828c8d94b670d72c_232)] | | | [Exhibits, Financial Statement [removed: Schedules](#i37abe3ac44cc47fc827eeb4bc0b992f0_292)] [added: Schedules](#ib56725b8b26746a0828c8d94b670d72c_232)] | | | | | | [removed: [109](#i37abe3ac44cc47fc827eeb4bc0b992f0_292)] [added: [103](#ib56725b8b26746a0828c8d94b670d72c_232)] | | |

| [Item [removed: 16.](#i37abe3ac44cc47fc827eeb4bc0b992f0_295)] [added: 16.](#ib56725b8b26746a0828c8d94b670d72c_235)] | | | [Form 10-K [removed: Summary](#i37abe3ac44cc47fc827eeb4bc0b992f0_295)] [added: Summary](#ib56725b8b26746a0828c8d94b670d72c_235)] | | | | | | [removed: [117](#i37abe3ac44cc47fc827eeb4bc0b992f0_295)] [added: [110](#ib56725b8b26746a0828c8d94b670d72c_235)] | | |

| Annual Report | | | Annual Report on Form 10-K for the year ended December 31, [removed: 2020] [added: 2021] | | |

| COVID-19 | | | Coronavirus disease [removed: 2019] [added: 2019, including variants thereof] | | |

Forward-looking statements may include words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “goal,” [added: “target,”] “guidance,” “intend,” “may,” “might,” “outlook,” “plan,” “potential,” “project,” “scheduled,” “should,” “will,” “would” and other words and terms of similar meaning.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| [Item 6.](#ib56725b8b26746a0828c8d94b670d72c_70) | | | [\[Reserved\]](#ib56725b8b26746a0828c8d94b670d72c_70) | | | | | | [36](#ib56725b8b26746a0828c8d94b670d72c_70) | | |

| [Item 9C.](#ib56725b8b26746a0828c8d94b670d72c_2094) | | | [Disclosure Regarding Foreign Jurisdictions that Prevent](#ib56725b8b26746a0828c8d94b670d72c_2094) [Inspections](#ib56725b8b26746a0828c8d94b670d72c_2094) | | | | | | [100](#ib56725b8b26746a0828c8d94b670d72c_2094) | | |

| [Part III.](#ib56725b8b26746a0828c8d94b670d72c_211) | | | | | | | | | | | |

| [Part IV.](#ib56725b8b26746a0828c8d94b670d72c_229) | | | | | | | | | | | |

| [Signatures](#ib56725b8b26746a0828c8d94b670d72c_238) | | | | | | | | | [111](#ib56725b8b26746a0828c8d94b670d72c_238) | | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| Btu | | | British thermal unit | | |

| ESG | | | Environmental, social and governance | | |

| Guardian Pipeline | | | Guardian Pipeline, L.L.C., a wholly owned subsidiary of ONEOK, Inc. | | |

| Homeland Security | | | United States Department of Homeland Security | | |

| | | | | | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| | | | | | |

| SOFR | | | Secured Overnight Financing Rate | | |

| | | | | | |

| | | | | | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| [Item 6.](#i37abe3ac44cc47fc827eeb4bc0b992f0_2529) | | | [Selected Financial Data](#i37abe3ac44cc47fc827eeb4bc0b992f0_2529) | | | | | | [35](#i37abe3ac44cc47fc827eeb4bc0b992f0_2529) | | |

| [Part III.](#i37abe3ac44cc47fc827eeb4bc0b992f0_271) | | | | | | | | | | | |

| [Part IV.](#i37abe3ac44cc47fc827eeb4bc0b992f0_289) | | | | | | | | | | | |

| [Signatures](#i37abe3ac44cc47fc827eeb4bc0b992f0_298) | | | | | | | | | [118](#i37abe3ac44cc47fc827eeb4bc0b992f0_298) | | |

| CARES Act | | | Coronavirus Aid, Relief, and Economic Security Act | | |

| ONEOK Partners Term Loan Agreement | | | The senior unsecured three-year $1.0 billion term loan agreement dated January 8, 2016, as amended | | |

| ONEOK West Texas NGL | | | ONEOK West Texas NGL pipeline and Mesquite pipeline (formerly known as West Texas LPG pipeline and Mesquite pipeline) | | |

| Tax Cuts and Jobs Act | | | H.R. 1, the tax reform bill, signed into law on December 22, 2017 | | |

| Topic 606 | | | Accounting Standards Update 2014-09, “Revenue from Contracts with Customers” | | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

At February [removed: 16, 2021,] [added: 22, 2022,] there were [removed: 13,844] [added: 13,198] holders of record of our [removed: 444,983,595] [added: 446,213,285] outstanding shares of common stock.

The following performance graph compares the performance of our common stock with the S&P 500 Index, the Alerian Midstream Energy Select Index and a ONEOK Peer Group during the period beginning on December 31, [removed: 2015,] [added: 2016,] and ending on December 31, [removed: 2020.][added: 2021.]

at December 31, [removed: 2015,] [added: 2016,] and at the End of Every Year Through December 31, [removed: 2020.][added: 2021.]

| | | | | | | [removed: 2016] [added: 2017] | | | | | | [removed: 2017] [added: 2018] | | | | | | [removed: 2018] [added: 2019] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2020] [added: 2021] | | |

(a) - The ONEOK Peer Group is composed of the following companies: DCP Midstream, LP; [removed: Enable Midstream Partners, LP;] Energy Transfer LP; EnLink Midstream, LLC; Enterprise Products Partners L.P.; Kinder Morgan, Inc.; Magellan Midstream Partners, L.P.; MPLX LP; NuStar Energy L.P.; Plains All American Pipeline, L.P.; Targa Resources Corp.; and The Williams Companies, Inc.

(b) - The Alerian Midstream Energy Select Index measures the composite performance of approximately [removed: 36] [added: 33] North American energy infrastructure companies who are engaged in midstream activities involving energy commodities.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| ONEOK, Inc. | | | | | | $ | 97.92 | | | | | $ | 104.07 | | | | | $ | 153.80 | | | | | $ | 87.11 | | | | | $ | 143.59 | |

| S&P 500 Index | | | | | | $ | 121.83 | | | | | $ | 116.49 | | | | | $ | 153.17 | | | | | $ | 181.35 | | | | | $ | 233.41 | |

| ONEOK Peer Group (a) | | | | | | $ | 93.45 | | | | | $ | 77.86 | | | | | $ | 87.11 | | | | | $ | 64.37 | | | | | $ | 91.97 | |

| Alerian Midstream Energy Select Index (b) | | | | | | $ | 100.76 | | | | | $ | 82.95 | | | | | $ | 101.49 | | | | | $ | 77.72 | | | | | $ | 109.39 | |

| ONEOK, Inc. | | | | | | $ | 249.37 | | | | | $ | 244.18 | | | | | $ | 259.53 | | | | | $ | 383.51 | | | | | $ | 217.21 | |

| S&P 500 Index | | | | | | $ | 111.96 | | | | | $ | 136.40 | | | | | $ | 130.42 | | | | | $ | 171.49 | | | | | $ | 203.04 | |

| ONEOK Peer Group (a) | | | | | | $ | 148.02 | | | | | $ | 138.01 | | | | | $ | 117.37 | | | | | $ | 127.36 | | | | | $ | 90.69 | |

| Alerian Midstream Energy Select Index (b) | | | | | | $ | 143.55 | | | | | $ | 144.65 | | | | | $ | 119.08 | | | | | $ | 145.69 | | | | | $ | 111.56 | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

The following table sets forth our selected financial data for the periods indicated:

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | Years Ended December 31, | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | 2020 | | | | | | 2019 | | | | | | 2018 | | | | | | 2017 | | | | | | 2016 | | |

| | | | | | | (*Millions of dollars, except per share data*) | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Revenues | | | | | | $ | 8,542.2 | | | | | $ | 10,164.4 | | | | | $ | 12,593.2 | | | | | $ | 12,173.9 | | | | | $ | 8,920.9 | |

| Net income | | | | | | $ | 612.8 | | | | | $ | 1,278.6 | | | | | $ | 1,155.0 | | | | | $ | 593.5 | | | | | $ | 743.5 | |

| Total assets | | | | | | $ | 23,078.8 | | | | | $ | 21,812.1 | | | | | $ | 18,231.7 | | | | | $ | 16,845.9 | | | | | $ | 16,138.8 | |

| Long-term debt, including current maturities | | | | | | $ | 14,236.1 | | | | | $ | 12,487.4 | | | | | $ | 9,381.0 | | | | | $ | 8,524.3 | | | | | $ | 8,330.6 | |

| EPS - total | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Basic | | | | | | $ | 1.42 | | | | | $ | 3.09 | | | | | $ | 2.80 | | | | | $ | 1.30 | | | | | $ | 1.67 | |

| Diluted | | | | | | $ | 1.42 | | | | | $ | 3.07 | | | | | $ | 2.78 | | | | | $ | 1.29 | | | | | $ | 1.66 | |

| Dividends declared per share of common stock | | | | | | $ | 3.74 | | | | | $ | 3.53 | | | | | $ | 3.245 | | | | | $ | 2.72 | | | | | $ | 2.46 | |

Changes in commodity prices and sales volumes affect both revenue and cost of sales and fuel, and, therefore, the changes in revenue in the above table are largely offset in cost of sales and fuel.

In 2020, we incurred $644.9 million in noncash impairment charges, which had an adverse impact on our financial results for the year ended December 31, 2020.

In 2017, we recorded noncash impairment charges of $20.2 million.

Upon adoption of Topic 606 in January 2018, we determined that certain Natural Gas Gathering and Processing segment fee with POP contracts and Natural Gas Liquids segment exchange services contracts that include the purchase of commodities are supplier contracts.

Contractual fees in these identified contracts are recorded as a reduction of the commodity purchase price in cost of sales and fuel.

In 2017 and prior periods, these fees were recorded as services revenue.

In 2017, we recorded a one-time noncash charge to net income through income tax expense of $141.3 million, related to the revaluation of our deferred tax balances and a valuation allowance on certain state net operating loss and tax credit carryforwards resulting from the enactment of the Tax Cuts and Jobs Act.

We have audited the accompanying consolidated balance sheets of ONEOK, Inc. and its subsidiaries (the “Company”) as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020, and] the related consolidated statements of income, of comprehensive income, of changes in equity and of cash flows for each of the three years in the period ended December 31, [removed: 2020,] [added: 2021,] including the related notes (collectively referred to as the “consolidated financial statements”).

We also have audited the [removed: Company's] [added: Company’s] internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework* (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2020] [added: 2021,] in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework* (2013) issued by the COSO.

A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the [added: company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.]

Critical Audit [removed: Matters][added: Matter]

The critical audit [removed: matters] [added: matter] communicated below [removed: are matters] [added: is a matter] arising from the current period audit of the consolidated financial statements that [removed: were] [added: was] communicated or required to be communicated to the audit committee and that (i) [removed: relate] [added: relates] to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit [removed: matters] [added: matter] below, providing [added: a] separate [removed: opinions] [added: opinion] on the critical audit [removed: matters] [added: matter] or on the accounts or disclosures to which [removed: they relate.][added: it relates.]

As described in Notes A and B to the consolidated financial statements, the Company’s level 3 commodity contracts derivative assets and liabilities total [removed: $103.8] [added: $9.3] million and [removed: $135.1] [added: $123.6] million, respectively, as of December 31, [removed: 2020.][added: 2021.]

Fair value measurements classified as Level 3 are composed predominantly of exchange-cleared and over-the-counter derivatives to hedge NGL price [removed: risk and natural gas basis] risk.

[removed: The Company recorded noncash impairment charges of $382.2 million] [added: Impairment Charges - In 2020] in [removed: its] [added: our] Natural Gas Gathering and Processing segment, [added: we recorded noncash impairment charges to intangible assets] of [removed: which a portion includes a] [added: $19.9 million related to supply contracts associated with our] natural gas processing plant [removed: and infrastructure] in the Powder River [removed: Basin and its related supply contracts.][added: Basin, which was also impaired.]

| | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | |

| Commodity sales | | | | | | $ | [removed: 7,255,259] [added: 15,180,264] | | | | | $ | [removed: 8,916,047] [added: 7,255,259] | | | | | $ | [removed: 11,395,642] [added: 8,916,047] | |

| Services | | | | | | [removed: 1,286,983] [added: 1,360,045] | | | | | | [removed: 1,248,320] [added: 1,286,983] | | | | | | [removed: 1,197,554] [added: 1,248,320] | | |

| Total revenues (Note P) | | | | | | [removed: 8,542,242] [added: 16,540,309] | | | | | | [removed: 10,164,367] [added: 8,542,242] | | | | | | [removed: 12,593,196] [added: 10,164,367] | | |

| Cost of sales and fuel (exclusive of items shown separately below) | | | | | | [removed: 5,110,146] [added: 12,256,655] | | | | | | [removed: 6,788,040] [added: 5,110,146] | | | | | | [removed: 9,422,708] [added: 6,788,040] | | |

| Operations and maintenance | | | | | | [removed: 761,176] [added: 900,420] | | | | | | [removed: 863,708] [added: 761,176] | | | | | | [removed: 803,146] [added: 863,708] | | |

| Depreciation and amortization | | | | | | [removed: 578,662] [added: 621,701] | | | | | | [removed: 476,535] [added: 578,662] | | | | | | [removed: 428,557] [added: 476,535] | | |

| Impairment charges [removed: (Note A)] [added: (Notes D and E)] | | | | | | [removed: 607,200] [added: —] | | | | | | [removed: —] [added: 607,200] | | | | | | — | | |

| General taxes | | | | | | [removed: 125,028] [added: 166,668] | | | | | | [removed: 119,156] [added: 125,028] | | | | | | [removed: 103,922] [added: 119,156] | | |

| (Gain) loss on sale of assets | | | | | | [removed: (1,327)] [added: (1,394)] | | | | | | [removed: 2,575] [added: (1,327)] | | | | | | [removed: (601)] [added: 2,575] | | |

| Operating income | | | | | | [removed: 1,361,357] [added: 2,596,259] | | | | | | [removed: 1,914,353] [added: 1,361,357] | | | | | | [removed: 1,835,464] [added: 1,914,353] | | |

| Equity in net earnings from investments (Note M) | | | | | | [removed: 143,241] [added: 122,520] | | | | | | [removed: 154,541] [added: 143,241] | | | | | | [removed: 158,383] [added: 154,541] | | |

| Impairment of equity investments (Note [removed: A)] [added: M)] | | | | | | [removed: (37,730)] [added: —] | | | | | | [removed: —] [added: (37,730)] | | | | | | — | | |

| Allowance for equity funds used during construction | | | | | | [removed: 23,662] [added: 1,682] | | | | | | [removed: 64,815] [added: 23,662] | | | | | | [removed: 7,962] [added: 64,815] | | |

| Interest expense (net of capitalized interest of [removed: $75,436, $107,275] [added: $25,150, $75,436] and [removed: $28,062,] [added: $107,275,] respectively) | | | | | | [removed: (712,886)] [added: (732,924)] | | | | | | [removed: (491,773)] [added: (712,886)] | | | | | | [removed: (469,620)] [added: (491,773)] | | |

| Income before income taxes | | | | | | [removed: 802,316] [added: 1,984,204] | | | | | | [removed: 1,650,991] [added: 802,316] | | | | | | [removed: 1,517,935] [added: 1,650,991] | | |

| Income taxes (Note L) | | | | | | [removed: (189,507)] [added: (484,498)] | | | | | | [removed: (372,414)] [added: (189,507)] | | | | | | [removed: (362,903)] [added: (372,414)] | | |

| Net income | | | | | | [removed: 612,809] [added: 1,499,706] | | | | | | [removed: 1,278,577] [added: 612,809] | | | | | | [removed: 1,155,032] [added: 1,278,577] | | |

| [removed: Net] [added: Net] income [removed: attributable to ONEOK] | | | | | | [removed: 612,809] [added: $] | [added: 1,499,706] | | | | | [removed: 1,278,577] [added: $] | [added: 612,809] | | | | | [removed: 1,151,703] [added: $] | [added: 1,278,577] | |

| Net income available to common shareholders | | | | | | $ | [removed: 611,709] [added: 1,498,606] | | | | | $ | [removed: 1,277,477] [added: 611,709] | | | | | $ | [removed: 1,150,603] [added: 1,277,477] | |

| Basic EPS (Note I) | | | | | | $ | [removed: 1.42] [added: 3.36] | | | | | $ | [removed: 3.09] [added: 1.42] | | | | | $ | [removed: 2.80] [added: 3.09] | |

| Diluted EPS (Note I) | | | | | | $ | [removed: 1.42] [added: 3.35] | | | | | $ | [removed: 3.07] [added: 1.42] | | | | | $ | [removed: 2.78] [added: 3.07] | |

| Basic | | | | | | [removed: 431,105] [added: 446,403] | | | | | | [removed: 413,560] [added: 431,105] | | | | | | [removed: 411,485] [added: 413,560] | | |

| Diluted | | | | | | [removed: 431,782] [added: 447,403] | | | | | | [removed: 415,444] [added: 431,782] | | | | | | [removed: 414,195] [added: 415,444] | | |

| | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | |

| Net income | | | | | | $ | [removed: 612,809] [added: 1,499,706] | | | | | $ | [removed: 1,278,577] [added: 612,809] | | | | | $ | [removed: 1,155,032] [added: 1,278,577] | |

| Change in fair value of derivatives, net of tax of [removed: $49,292, $44,149] [added: $60,896, $49,292] and [removed: $1,694,] [added: $44,149,] respectively | | | | | | [removed: (165,023)] [added: (203,868)] | | | | | | [removed: (147,803)] [added: (165,023)] | | | | | | [removed: (5,673)] [added: (147,803)] | | |

| Derivative amounts reclassified to net income, net of tax of [removed: $(6,313), $6,058] [added: $(69,134), $(6,313)] and [removed: $(11,013),] [added: $6,058,] respectively | | | | | | [removed: 21,097] [added: 228,999] | | | | | | [removed: (21,057)] [added: 21,097] | | | | | | [removed: 36,870] [added: (21,057)] | | |

| Change in retirement and other postretirement benefit plan obligations, net of tax of [removed: $7,812, $2,910] [added: $(14,929), $7,812] and [removed: $(1,425),] [added: $2,910,] respectively | | | | | | [removed: (26,154)] [added: 49,976] | | | | | | [removed: (9,696)] [added: (26,154)] | | | | | | [removed: 4,771] [added: (9,696)] | | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

March 1, 2022

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| Other income (expense) | | | | | | (3,333) | | | | | | 24,672 | | | | | | 9,055 | | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| | | | | | | 2021 | | | | | | 2020 | | |

| Cash and cash equivalents | | | | | | $ | 146,391 | | | | | $ | 524,496 | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| | | | | | | 2021 | | | | | | 2020 | | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| NGLs and natural gas in storage, net of commodity imbalances | | | | | | (105,038) | | | | | | 172,316 | | | | | | (10,193) | | |

| Other | | | | | | (19,551) | | | | | | (56,949) | | | | | | (88,537) | | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| December 31, 2021 | | | | | | 20,000 | | | | | | 474,916,234 | | | | | | $ | — | | | | | $ | 4,749 | | | | | $ | 7,213,861 | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| Net income | | | | | | — | | | | | | 1,499,706 | | | | | | — | | | | | | 1,499,706 | | |

| Common stock issued | | | | | | — | | | | | | — | | | | | | 32,202 | | | | | | 38,882 | | |

| Common stock dividends - $3.74 per share (Note G) | | | | | | — | | | | | | (1,498,606) | | | | | | — | | | | | | (1,666,751) | | |

| December 31, 2021 | | | | | | $ | (471,351) | | | | | $ | — | | | | | $ | (732,096) | | | | | $ | 6,015,163 | |

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

We use the output method

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

Many of the contract types described above contain additional fees or charges payable by customers for nonperformance (e.g., minimum volume commitments or product specifications), which are considered to be variable consideration.

These fees and charges are not recorded until it is probable that a significant reversal of the associated revenue will not occur.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

Our qualitative goodwill impairment analysis performed as of July 1, 2021, did not result in an impairment charge nor did our analysis reflect any reporting units at risk, and subsequent to that date, no event has occurred indicating that the implied fair value of each of our reporting units is less than the carrying value of its net assets.

If further testing is necessary or a quantitative test is elected, we perform a Step 1 analysis.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

The impact of adopting this standard was not material.

| | | | | | | December 31, 2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Financial contracts | | | | | | $ | 22,019 | | | | | $ | 172,833 | | | | | $ | 9,309 | | | | | $ | 204,161 | | | | | $ | (204,161) | | | | | $ | — | |

| Total derivative assets | | | | | | $ | 22,019 | | | | | $ | 172,833 | | | | | $ | 9,309 | | | | | $ | 204,161 | | | | | $ | (204,161) | | | | | $ | — | |

| Financial contracts | | | | | | $ | (67,226) | | | | | $ | (112,922) | | | | | $ | (123,592) | | | | | $ | (303,740) | | | | | $ | 303,740 | | | | | $ | — | |

| Total derivative liabilities | | | | | | $ | (67,226) | | | | | $ | (258,446) | | | | | $ | (123,592) | | | | | $ | (449,264) | | | | | $ | 303,740 | | | | | $ | (145,524) | |

*Change in Accounting Principle*

As discussed in Note A to the consolidated financial statements, the Company changed the manner in which it accounts for revenue from contracts with customers in 2018.

company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

*Long-Lived Asset Impairment – Asset Group in the Powder River Basin*

As described in Notes A and B to the consolidated financial statements, the Company’s net property, plant and equipment balance was $19.2 billion as of December 31, 2020.

Management assesses the Company’s long-lived assets for impairment whenever events or changes in circumstances indicate that an asset’s carrying amount may not be recoverable.

An impairment is indicated if the carrying amount of a long-lived asset exceeds the sum of the undiscounted future cash flows expected to result from the use and eventual disposition of the asset.

If an impairment is indicated, the Company will record an impairment loss equal to the difference between the carrying value and the fair value of the long-lived asset.

In 2020, Management evaluated the Natural Gas Gathering and Processing segment asset groups and determined that the carrying value of certain long-lived asset groups were not recoverable and exceeded their estimated fair value.

To estimate the fair value, Management used the income approach.

Under the income approach, the discounted cash flow analysis included the following inputs that are not readily available: a discount rate reflective of industry cost of capital, estimated contract rates, volumes, operating margins, operating and maintenance costs, and capital expenditures.

The principal considerations for our determination that performing procedures relating to long-lived asset impairments of an asset group in the Powder River Basin is a critical audit matter are (i) the significant judgment by management when developing the fair value of the long-lived asset and (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to volumes and operating margins.

These procedures included testing the effectiveness of controls relating to management’s long-lived asset impairment assessment, including the controls over the valuation of long-lived assets.

These procedures also included, among others (i) testing management’s process for developing the fair value estimate of an asset group in the Powder River Basin; (ii) evaluating the appropriateness of the discounted cash flow model; (iii) testing the completeness and accuracy of underlying data used in the model; and (iv) evaluating the reasonableness of the significant assumptions used by management related to the volumes and operating margins.

Evaluating management’s assumptions related to the volumes and operating margins involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the asset group and (ii) whether these assumptions were consistent with evidence obtained in other areas of the audit.

February 23, 2021

| | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | | | | | | |

| Other income | | | | | | 43,745 | | | | | | 27,058 | | | | | | 674 | | |

| Other expense | | | | | | (19,073) | | | | | | (18,003) | | | | | | (14,928) | | |

| Less: Net income attributable to noncontrolling interests | | | | | | — | | | | | | — | | | | | | 3,329 | | |

| Less: Comprehensive income attributable to noncontrolling interests | | | | | | — | | | | | | — | | | | | | 3,329 | | |

| Comprehensive income attributable to ONEOK | | | | | | $ | 435,360 | | | | | $ | 1,092,816 | | | | | $ | 1,190,095 | |

| NGLs and natural gas in storage | | | | | | 77,116 | | | | | | (8,259) | | | | | | 38,456 | | |

| Commodity imbalances | | | | | | 95,200 | | | | | | (1,934) | | | | | | (44,302) | | |

| Accrued interest | | | | | | 54,403 | | | | | | 29,373 | | | | | | 26,068 | | |

| Distributions to noncontrolling interests | | | | | | — | | | | | | — | | | | | | (3,500) | | |

| Borrowing (repayment) of short-term borrowings, net | | | | | | (220,000) | | | | | | 220,000 | | | | | | (614,673) | | |

| Debt financing costs | | | | | | (28,247) | | | | | | (29,747) | | | | | | (13,441) | | |

| Acquisition of noncontrolling interests | | | | | | — | | | | | | — | | | | | | (195,000) | | |

| Other, net | | | | | | (28,702) | | | | | | (58,790) | | | | | | (2,481) | | |

| Cash and cash equivalents at beginning of period | | | | | | 20,958 | | | | | | 11,975 | | | | | | 37,193 | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | ONEOK Shareholders’ Equity | | | | | | | | | | | | | | | | | | | | | | | | | | |

| January 1, 2018 | | | | | | 423,166,234 | | | | | | 20,000 | | | | | | $ | 4,232 | | | | | $ | — | | | | | $ | 6,588,878 | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

Based on our evaluation under that framework, our management concluded that our internal control over financial reporting was effective as of December 31, [removed: 2020.][added: 2021.]

The effectiveness of our internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which is included herein (Item 8).

There have been no changes in our internal control over financial reporting during the quarter ended December 31, [removed: 2020,] [added: 2021,] that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART III

Not applicable.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

PART III

Information concerning our directors is set forth in our [removed: 2021] [added: 2022] definitive Proxy Statement and is incorporated herein by this reference.

Information on compliance with Section 16(a) of the Exchange Act is set forth in our [removed: 2021] [added: 2022] definitive Proxy Statement and is incorporated herein by this reference.

Information concerning the code of ethics, or code of business conduct, is set forth in our [removed: 2021] [added: 2022] definitive Proxy Statement and is incorporated herein by this reference.

Information concerning the Nominating Committee procedures is set forth in our [removed: 2021] [added: 2022] definitive Proxy Statement and is incorporated herein by this reference.

Information concerning the Audit Committee is set forth in our [removed: 2021] [added: 2022] definitive Proxy Statement and is incorporated herein by this reference.

Information concerning the Audit Committee Financial Experts is set forth in our [removed: 2021] [added: 2022] definitive Proxy Statement and is incorporated herein by this reference.

Information on executive compensation is set forth in our [removed: 2021] [added: 2022] definitive Proxy Statement and is incorporated herein by this reference.

Information concerning the ownership of certain beneficial owners is set forth in our [removed: 2021] [added: 2022] definitive Proxy Statement and is incorporated herein by this reference.

Information on security ownership of directors and officers is set forth in our [removed: 2021] [added: 2022] definitive Proxy Statement and is incorporated herein by this reference.

The following table sets forth certain information concerning our equity compensation plans as of December 31, [removed: 2020:][added: 2021:]

| Equity compensation plans approved by security holders (1) | | | | | | [removed: 2,854,622] [added: 3,237,097] | | | | | | | | | | | | — | | | | | | | | | [removed: 7,937,940] [added: 6,077,029] | | | | | |

| Equity compensation plans not approved by security holders (2) | | | | | | [removed: 295,620] [added: 330,901] | | | | | | | | | $ | | | [removed: 38.38] [added: 58.76] | | | | | | | | | — | | | | | |

Column (c) includes [removed: 1,031,485,] [added: 573,622,] 130,204 and [removed: 6,776,251] [added: 5,373,203] shares available for future issuance under our Employee Stock Purchase Plan, Employee Stock Award Program and Equity Incentive Plan, respectively.

The price used for these plans to calculate the weighted-average exercise price in the table is [removed: $38.38,] [added: $58.76,] which represents the [removed: 2020] [added: 2021] year-end closing price of our common stock on the NYSE.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| Total | | | | | | 3,567,998 | | | | | | | | | $ | | | 58.76 | | | | | | | | | 6,077,029 | | | | | |

| Total | | | | | | 3,150,242 | | | | | | | | | $ | | | 38.38 | | | | | | | | | 7,937,940 | | | | | |

Information on certain relationships and related transactions and director independence is set forth in our [removed: 2021] [added: 2022] definitive Proxy Statement and is incorporated herein by this reference.

Information concerning the principal accountant’s fees and services is set forth in our [removed: 2021] [added: 2022] definitive Proxy Statement and is incorporated herein by this reference.

[Table of Cont](#ib56725b8b26746a0828c8d94b670d72c_7)[ents](#ib56725b8b26746a0828c8d94b670d72c_7)

| | | | (a) | | | Report of Independent Registered Public Accounting Firm [added: (PCAOB ID: 238)] | | | [removed: 57-59] [added: 54-55] | | |

| | | | (b) | | | Consolidated Statements of Income for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: 60] [added: 56] | | |

| | | | (c) | | | Consolidated Statements of Comprehensive Income for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: 61] [added: 57] | | |

| | | | (d) | | | Consolidated Balance Sheets as of December 31, [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] | | | [removed: 62-63] [added: 58-59] | | |

| | | | (e) | | | Consolidated Statements of Cash Flows for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: 65] [added: 61] | | |

| | | | (f) | | | Consolidated Statements of Changes in Equity for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: 66-67] [added: 62-63] | | |

| | | | (g) | | | Notes to Consolidated Financial Statements | | | [removed: 68-106] [added: 64-100] | | |

| | | | 3.1 | | | [Amended and Restated Bylaws of ONEOK, Inc. (incorporated by reference from Exhibit 3.1 to ONEOK, Inc.’s Current Report on Form 8-K filed [removed: September 20, 2018] [added: February 2](http://www.sec.gov/Archives/edgar/data/0001039684/000103968422000012/0001039684-22-000012-index.htm)[8](http://www.sec.gov/Archives/edgar/data/0001039684/000103968422000012/0001039684-22-000012-index.htm)[, 2022] (File No. [removed: 1-13643)).](http://www.sec.gov/Archives/edgar/data/1039684/000103968418000068/amendedbylawssept2018.htm)] [added: 1-13643)).](http://www.sec.gov/Archives/edgar/data/0001039684/000103968422000012/0001039684-22-000012-index.htm)] | | |

| | | | 4.6 | | | [removed: [First] [added: [Second] Supplemental Indenture dated September [removed: 24,] [added: 25,] 1998, between ONEOK, Inc. and Chase Bank of Texas, as trustee, with respect to the [removed: 6.50% Senior Insured Quarterly Notes] [added: 6.875% Debentures] due 2028 (incorporated by reference from Exhibit [removed: 5(a)] [added: 5(b)] to ONEOK, Inc.’s Current Report on Form 8-K/A filed October 2, 1998 (File No. 1-13643)).](http://www.sec.gov/Archives/edgar/data/1039684/0000950134-98-007916.txt) | | |

| | | | [removed: 4.7] [added: 4.25] | | | [Second Supplemental [removed: Indenture] [added: Indenture,] dated [removed: September 25, 1998,] [added: August 21, 2015,] between ONEOK, Inc. and [removed: Chase] [added: U.S.] Bank [removed: of Texas,] [added: National Association,] as trustee, with respect to the [removed: 6.875% Debentures] [added: 7.50% Notes] due [removed: 2028] [added: 2023] (incorporated by reference [removed: from] [added: to] Exhibit [removed: 5(b)] [added: 4.1] to ONEOK, Inc.’s Current Report on Form [removed: 8-K/A] [added: 8-K] filed [removed: October 2, 1998] [added: August 21, 2015] (File No. [removed: 1-13643)).](http://www.sec.gov/Archives/edgar/data/1039684/0000950134-98-007916.txt)] [added: 1-13643)).](http://www.sec.gov/Archives/edgar/data/1039684/000119312515298822/d49714dex41.htm)] | | |