MidAmerica Regulatory Conference

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Mid-America Regulatory Conference

• Oklahoma City June 18,2008

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Agenda

• ONEOK Has Changed
• Change Equals Choices
• Conservation
• Infrastructure Build-out

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ONEOK Has Changed
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Our Vision

• A Premier Energy Company

• A premier energy company creating exceptional
  value for all stakeholders by
• Re-bundling services across the value chain,
  primarily through vertical integration, to
  provide customers with premium services at lower
  costs
• Applying our capabilities as a gatherer,
  processor,
• transporter, marketer and distributor to
  natural gas and natural gas liquids
• and other commodities

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Our Vision A Journey by Design

• Value Creation Through Re-bundling - 1995

Natural Gas
Exploration Production
Gathering Processing
Markets
Pipelines/Storage
Natural Gas Liquids
1995 Financial Statistics Total revenue
949.9 million Net income 42.8 million
Total assets 1.2 billion
Pipelines/Storage
Markets
Gathering Fractionation
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Our Vision A Journey by Design

• Value Creation Through Re-bundling - Today

Natural Gas
Natural Gas Liquids
2007 Financial Statistics Total revenue
13.5 billion Net income 304.9 million
Total assets 11.1 billion
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Our Vision A Journey by Design

• Value Creation Through Re-bundling How We Got
  Here

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ONEOK Today

• Assets That Fit and Work Together

ONEOK Distribution ONEOK Energy Services
Leased Pipeline Capacity Leased
Storage Capacity ONEOK Partners ONEOK
Partners Growth Projects ONEOK is General
Partner 47.7 Owner
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Change Equals Choices
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Capital Expenditures

• Investing in the Future

1,270

• Efficient investment
• Complement existing infrastructure and core
  operating capabilities
• Incremental acquisition opportunities

884
376
Millions
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Distribution

• Integrated Strategy to Improve Profitability

• Return on equity
• 2005 Oklahoma rate case
• 2006 Kansas and Texas rate cases
• 2007 Five rate filings in Texas
• 2008 First quarter approved rate increases of
  4.2 million in Texas
• Capital recovery mechanisms in all three
  states
• Disciplined approach to capital investment
• Expense control and recovery
• Expense recovery mechanisms
• Continuous process improvement
• Pipeline integrity management recovery
• Pension and other post-employment benefit costs

Closing the Gap Significant progress since 2005
Gap
Gap
Allowed
Gap
Gap
Return on Equity ()
ROE calculations are consistent with utility
ratemaking in each jurisdiction and not
consistent with GAAP returns
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Conservation
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Business Environment
Rising natural gas prices
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Conservation
Rising natural gas prices

• Concern for the customer
• Current rate structure results in less margin as
  volumes are reduced
• ONEOK is committed to energy conservation

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Rate-structure Decoupling
Aligning interests with our customers

• We favor revenue decoupling
• Impact to the customer
• Receive a fixed-fee for service provided
• Reduced volatility in service component
• Natural gas is a pass-through cost
• Revenue decoupling in the U.S.
• Thirteen states passed decoupling mechanisms
• Four states pending approval

Source American Gas Association
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Infrastructure Build-out
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Business Environment
All-time high drilling activity

• Demand and commodity price environment have led
  to all-time highs in drilling activity

• Technology making unconventional drilling
  techniques economically viable

U.S. Natural Gas
Rig Count
Wells Drilled
Source EIA, Baker Hughes
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Infrastructure

• Drilling leads to natural gas infrastructure
  build-out

• Natural Gas Transmission Pipelines
• Expansion activity has tripled in past 5 years
• Expansion capacity of 23.3 Bcf/d approved in 2007
• 6.3 Bcf/d approved for 2008, with 22 projects
  pending approval
• Natural Gas Storage
• Majority of proposals in Southeast
• Capacity of 133.7 Bcf approved in 2007
• 67 Bcf approved so far for 2008, with 125.8 Bcf
  pending approval

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ONEOK Partners - Roadmap to Growth

• 1.6 Billion of internal growth projects under
  way, 2007-2009

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Overland Pass Pipeline

• 760-Mile Natural Gas Liquids Pipeline from Opal,
  Wyoming, to Conway, Kansas

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Conclusion

• Balance regulatory concerns and energy needs
• Be a leader in protecting the environment, safety
  and health of our employees, contractors,
  customers and the public
• Energy policy is needed
• Work together

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Questions Answers
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(No Transcript)
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Source EIA ??