Good day, and welcome to ONEOK's Fourth Quarter 2024 Earnings Call. All participants will be in a listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note, this event is being recorded. I would now like to turn the conference over to Andrew Ziola, Vice President and Investor Relations. Please go ahead.

Thank you, White, and good morning, and welcome to ONEOK's fourth quarter year-end 2024 earnings call. After the markets closed yesterday, we issued news releases announcing our 2024 results and our 2025 guidance and 2026 outlook. Those materials are on our website. After our prepared remarks, management will be available to take your questions. Statements made during this call that might include ONEOK's expectations or predictions should be considered forward-looking statements and are covered by the safe harbor provision of the Securities Acts of 1933 and 1934. Actual results could differ materially from those projected in forward-looking statements. For a discussion of factors that could cause actual results to differ, please refer to our SEC filings. Just a reminder for Q&A, we ask that you limit yourself to one question and a follow-up in order to fit in as many of you as we can. With that, I'll turn the call over to Pierce Norton, President and Chief Executive Officer. Pierce?

Thanks, Andrew. Good morning, and thank you for joining us. On today's call is Walt Hulse, Chief Financial Officer, Treasurer, Executive Vice President of Investor Relations and Corporate Development; and Sheridan Swords, Executive Vice President and Chief Commercial Officer. Also on the call today is Randy Lentz, Executive Vice President and Chief Operating Officer. Randy joined us from Medallion Midstream, and we welcome him to the ONEOK team. Yesterday, we announced higher fourth quarter and full year 2024 earnings driven by contributions from multiple strategic acquisitions, volume growth, and continued execution on the synergies identified in our refined products and crude oil businesses acquired in 2023. We also announced 2025 financial guidance, and they provided a 2026 growth outlook. For 2025, we expect strong earnings growth driven by our expanded operations, completed projects and higher volumes. For our 2026 growth outlook, we expect greater than 15% earnings per share growth and adjusted EBITDA growth approaching 10% compared with our 2025 guidance midpoints. Walt and Sheridan will provide additional details on those guidance and the growth outlook shortly. Over the past two years, ONEOK has executed on our intentional and disciplined growth strategy, creating unique opportunities with our more regionally diversified product and service offerings and delivering value across our expanded footprint. We've transformed our company in multiple ways, making it even stronger, more resilient and better positioned to play a leading role in contributing to the energy transition. I'll touch on a few of these key areas that we believe will drive our continued success and further enhance our strategic competitive advantage. First, we've significantly grown our integrated operations, both in terms of our product mix, demand pull versus supply push drivers and geographic diversity. We've added refined products, crude oil transportation and crude oil gathering to our integrated value chain and we've significantly extended and expanded our presence in the Permian Basin and Louisiana. Second, we've added significant operational scale through our now approximately 60,000 mile pipeline network enhancing our connectivity with key producers, basins and market centers. The scale and integrated connectivity further strengthen our resilience and position ONEOK for success across various market cycles. Third, we continue to prioritize organic growth opportunities by expanding and extending our now even larger asset base. Key projects have included NGL pipeline expansions in the Bakken and Permian Basins, additional NGL fractionation capacity in Mont Belvieu and the Mid-Continent refined products pipeline expansions into the Denver market and natural gas storage expansions in Oklahoma and Texas. Most recently, we announced an LPG export project joint venture with MPLX. With LPG exports added to our service mix, we will provide an integrated NGL wellhead-to-water solution for our customers enhancing our product offerings. Fourth, we continue to prioritize innovation, commercial development and customer service across our operations. Numerous additional project opportunities remain in very good stages of development. These unannounced projects span across regions and products, and they include synergy projects and traditional growth opportunities. Examples include projects to interconnect and optimize recently acquired assets, pipeline and facility expansions in key basins, additional natural gas infrastructure driven by continued demand for the AI-driven data centers and LNG demand and debottlenecking projects across our operations to accommodate growth are just to name a few. Finally, we remain committed to returning meaningful value to our investors. We've proven our ability to sustain and grow our long-standing dividend, invest in high-return growth projects and maintain financial flexibility, including the ability to begin executing on our share repurchase authorization. We've provided 11 consecutive years of adjusted EBITDA growth and our 2025 adjusted EBITDA guidance is well over double what it was just three years ago. All of these successes and extraordinary growth and the scale of ONEOK's transformation doesn't happen overnight, and it doesn't happen without the dedication of our employees. Their continued focus on safety, service and innovation has enabled this level of change to occur and will continue to drive additional meaningful growth and value across our operations. I'll now turn it over to Walt and Sheridan to provide their financial and commercial updates. Walt?

Thank you, Pierce. I'll start with a brief overview of our fourth quarter and full year financial performance and then move on to our '25 guidance and 2026 outlook. 2024 results were in line with our guidance expectations that we increased in both the first and third quarters of 2024. Net income attributable to ONEOK totaled $923 million or $1.57 per share in the fourth quarter 2024 and totaled $3 billion or $5.17 per share for the full year. Adjusted EBITDA totaled nearly $2.2 billion in the fourth quarter 2024 and more than $6.7 billion for the full year. These results include $375 million of adjusted EBITDA and $73 million of transaction costs related to the EnLink and Medallion acquisitions that we began consolidating in October. As of December 31, we had more than $730 million in cash on hand, no commercial paper outstanding and no borrowings outstanding under our credit agreement. Our fourth quarter 2024 annualized run rate net debt-to-EBITDA ratio was 3.6x. We continue to demonstrate our ability to utilize various capital allocation levers in 2024 by returning nearly $2.5 billion of value to shareholders through dividends and share repurchases. We repurchased $172 million of stock in the fourth quarter and in January 2025, we increased our quarterly dividend by 4%. Now moving on to our guidance. As Pierce mentioned, in addition to yesterday's earnings announcement, we provided a detailed 2025 financial and volume guidance and a 2026 growth outlook. For 2025, we expect an 8% increase in earnings per share to a midpoint of $5.37 compared with 2024 when excluding one-time items in 2024, such as transaction related costs and divestitures. This EPS guidance does not include an assumption for share repurchases, but we remain committed to executing on our Board approved $2 billion share repurchase program over the course of these next few years. From an adjusted EBITDA perspective, we expect a 21% increase in adjusted EBITDA in 2025 to $8.225 billion, excluding approximately $50 million of transaction costs compared with 2024. Key drivers of our 2025 guidance include higher earnings driven by a full year of earnings from recent acquisitions, volume growth from increases in production and completed growth projects and fee-based earnings. Our 2025 financial guidance also includes approximately $250 million of incremental commercial and cost synergies related to our acquisitions of Magellan, Medallion and EnLink. This is additive to what we've already realized through the end of 2024. As it relates to capital expenditures, our guidance assumes a range of $2.8 billion to $3.2 billion which includes growth and maintenance capital. This range reflects the investments necessary to accommodate expected increases in production and invest in attractive return growth projects such as our recently announced LPG export dock. Our 2026 outlook of greater than 15% earnings per share growth and adjusted EBITDA growth approaching 10% compared with the 2025 guidance midpoint is driven by expected volumes from increased production and recently completed synergy and growth projects. Key contributors include a full year of earnings from the Elk Creek and West Texas NGL pipeline expansions and synergy projects completed in 2025 and along with a partial year benefit from the completion of the Denver area refined products expansion and the connection of our Mont Belvieu assets to the Houston Ship Channel distribution assets. We also expect to realize additional synergies in 2026. I'll now turn the call over to Sheridan for a commercial update.

Thank you, Walt. We saw a strong year-over-year performance in 2024. The refined products and crude segment contributed its first full year of earnings, benefiting from higher average refined product tariff rates, blending and marketing opportunities, as well as higher earnings on our long-haul crude oil pipelines. Continued strength in Rocky Mountain volumes during the year continue to support earnings with NGL raw feed throughput volumes up 8% and natural gas volumes processed up 6% in the region. The Natural Gas Pipeline segment exceeded the high end of its 2024 financial guidance even excluding divestitures and acquisitions. The segment's outperformance continues to be driven by strong demand for our intrastate pipeline and storage services. Turning to 2025. And starting with the natural gas liquids segment, we expect higher year-over-year adjusted EBITDA and raw feed throughput volumes to be driven primarily by growth out of the Permian and Rocky Mountain regions. We have assumed high levels of ethane recovery continue in the Permian Basin and partial recovery in the Mid-Continent. We also expect to see continued opportunities to incentivize ethane recovery in the Rocky Mountain region. In the Permian Basin, we expect recently completed and connected third-party processing plants, new contracts and increasing volume from legacy EnLink plants to contribute to higher volumes feeding our West Texas NGL pipeline. As legacy EnLink contracts roll off in future years, significant incremental volume is expected to move to our Permian NGL system. Recently completed NGL growth projects will contribute to higher volumes and earnings in 2025 including MB-6 and expansions of our Elk Creek and West Texas NGL pipelines in the Williston and Permian Basin. We also expect increasing contributions from the acquired Easton Energy assets as we complete connections to our Houston-based system in 2025, helping us to realize additional synergies. As Pierce mentioned earlier this month, we announced strategic joint venture projects to construct a 400,000 barrel per day LPG export terminal in Texas City, Texas, and a pipeline connecting ONEOK's Mont Belvieu storage facility to the new terminal. Our collaboration with MPLX on this project enables us to provide a new wellhead to water solution to customers across our entire system. The world scale dock has multiple strategic benefits over other currently operating facilities, including a premier open water location, brownfield economics, timing and cost benefits driven by the proximity to the existing Marathon refinery and infrastructure and strategic access to our NGL storage in Mont Belvieu. The project is expected to be completed in early 2028. In the refined products and crude segment, we expect continued growth in refined products margins and a significant increase in crude oil volumes driven by our added crude oil gathering infrastructure from both the Medallion and EnLink acquisitions. We expect to fill existing gathering capacity over time, which will feed and fill our long-haul crude oil pipelines connecting key supply areas with critical refining and marketing centers. We also expect continued benefits from the ability to execute certain blending related commercial and cost synergies between the natural gas liquids and refined product businesses. We expect these types of synergies to ramp up as projects come online this year. Moving to the natural gas gathering and processing segment. We expect volume growth in all of our regions across our footprint in 2025. We guided to Rocky Mountain region volume growth up 8.5% at the midpoint compared to 2024 and an average of more than 1.7 Bcf per day in 2025. Williston Basin volumes continue to benefit from increasing efficiencies that have been well documented by our producer customers: strong gas-to-oil ratios and overall producer activity. Part of those efficiencies that we continue to benefit from is the drilling of longer laterals and higher well performance on traditional laterals without the need for as many well connects. In 2025, we expect 35% of our well connections to be with 3-mile laterals as opposed to traditional shorter laterals. Through recent acquisitions, we've extended our gathering and processing assets into the strategic and growing Permian Basin and added assets in the Mid-Continent. In the Mid-Continent, we expect volume growth in addition to the full year impact of the acquisition with average annual volume of nearly 2.5 Bcf per day in 2025. Projects are already underway to connect and optimize assets. As Pierce mentioned, these synergies are captured in the 2026 outlook Walt provided. In the Permian Basin, we expect natural gas processing volumes to average approximately 1.6 Bcf per day at the midpoint. We are in the process of relocating a 150 million cubic feet per day legacy EnLink natural gas processing plant to the region from North Texas, which we expect to be completed in the first quarter of 2026. And we continue looking at expected infrastructure needs going forward as existing customers and potential opportunities provide line of sight for strong growth in the coming years. In the Natural Gas Pipelines segment, our assets are well positioned to benefit from industrial demand growth driven by data centers, LNG exports and ammonia facilities. Our newly acquired assets in Louisiana provide direct connectivity to major LNG exporters and industrial customers. There are also approximately 30 potential power plant expansion projects across our footprint that could provide more than 4 Bcf per day of incremental demand if they move forward. Natural gas storage expansions continue to be an opportunity for us as well with key projects ongoing in Oklahoma and in Louisiana. Pierce, that concludes my remarks.

Thank you, Sheridan, and thank you, Walt. We are proud of our strong performance over the past year. Through strategic acquisitions and organic initiatives, we've extended our reach and built a platform for future growth that leaves us poised for continued success. The potential before us is significant and we remain committed to delivering the value to our employees, shareholders, customers and communities. Before we close, I want to recognize our employees' efforts related to the recent severe cold across our footprint. As always, our teams demonstrated incredible commitment and dedication to maintaining safety and delivering reliable service regardless of the challenging conditions. This unwavering focus on safety and customer service is a testament to the character and resilience of our people. I want to thank all of our employees for their hard work and dedication throughout another year of significant change and growth. It is their commitment and passion that drive our success and make us stronger as an organization. Thank you to our shareholders for your continued trust and support. We're excited about the journey ahead and look forward to sharing our progress with you in the future. Operator, we're now ready for questions.

Thank you. We will now begin the question-and-answer session. The first question will come from Theresa Chen with Barclays.

Would you be able to provide some additional details behind bridging the 2025 to 2026 guidance? Sounds like much of it is driven by project contribution, but are there other details and color around synergies or assumptions on volume and pricing you can share at this point?

Well, Theresa, what we're really seeing is the benefit of the synergy capital we've been spending primarily to connect the Easton assets with our assets down in Mont Belvieu and along the Houston channel. Those projects should be completed in 2025, and we'll realize the full benefit in 2026. We'll also start to see other projects wrap up in late 2025 or early 2026 and begin contributing. So this final phase of capital investment is coming at a great time.

Pardon me, ladies and gentlemen, it appears we have lost connection to our speaker line. Please stand by while we reconnect. Thank you. Ladies and gentlemen, the speakers are back. And Theresa, you may go ahead, I believe you were asking a question.

Yes. If we want to move on to the second question, I just wanted to unpack two components of your organic project backlog a little bit more. On the LPG side, can you speak more to the strategic benefits behind your export JV with MPLX and how exactly will ONEOK and MPLX be competitive versus the incumbent from export economics? And then secondly, within your refined product portfolio, what other capacity additions are there like the Denver pipeline expansion? And beyond the initial 35,000 barrels per day, how much can you actually send up that 16-inch line given the pretty significant cost of the project?

Yes, Theresa, this is Sheridan. I'll start with the LPG dock. We are excited to collaborate with a great partner like MPLX on this strategic project for both companies. And our strategic rationale is really, you could say, location, location, location. The first location is, as I mentioned before, we have access to the open waters. We're within two hours of open waters at this location, significantly better than the other docks in the area. This location, because we're next to Marathon's refinery, is a brownfield construction site, where we have a lot of other infrastructure there that greatly reduces the cost of this venture. And then, obviously, the location to our NGL system and storage where we easily can get our products into their existing dock as we go there. We have been looking at this for a long time, we've been intentional and disciplined about going forward with this type of a project. I mean we've been evaluating it for over eight years. And at this time, we're really comfortable with where this project sits today and how we can compete into the marketplace as well as it advances our wellhead to water strategy across our entire system. And with a project that actually we can grow into as this dock and pipeline are both expandable beyond the 400,000 barrels a day. So, that's really how we think about this dock and the strategic significance and how we can compete in the marketplace as we continue to go forward. As we talk about the Denver expansion as we get going forward, the Denver expansion, we put a 16-inch pipeline. And we've said that we have commitments up to 35,000 barrels a day. Obviously, a 16-inch pipeline can move a lot more volume than that. But as that area grows in demand or if supply in that area is disrupted in any way, from refinery closures, we can capital-efficiently increase the capacity of that pipeline by adding more pumps all the way up to as much as 250,000 barrels a day, if so needed, depending on the demand.

And our next question will come from Jean Ann Salisbury with Bank of America.

I guess just a follow-up on Theresa's question about the LPG export dock. It seems like LPG ports are getting overbuilt and spot rates could fall significantly. Can you just speak about your assumptions for uncontracted rates, whether you share that view and whether in your numbers, the uncontracted capacity is a meaningful contributor to the economics that you're projecting?

Jean Ann, what I would tell you is, this is coming on in 2028, we think about LPG dock. And as we continue to look at the growth across our entire system, especially coming out of the Permian, we see a significant amount of LPGs coming on the market. And we already control a significant amount of that volume that is going across other docks today that we will be able to divert to the dock. So, we don't share the view that docks are going to be overbuilt when we get out into the 2028 time frame when this dock will be up; we'll be able to compete very well with it. We have not assumed a premium on our spot rate. We have assumed a typical market rate on any spot volume that we've included in our economics. So nothing that is out of line with what we're seeing today.

Okay. That's helpful. And then things are looking bullish for gas price over the next couple of years. Rig count in the Haynesville has been flattish, but maybe creeping up in the Mid-Con. From what you're hearing from customers, do you think that the gas strip is high enough that we could see material gas growth in the next year or two in the Mid-Con, which I don't think most are anticipating?

Well, as we've been talking to our customers in the Mid-Continent and looking at rig activity and everything else, we definitely are seeing increased activity in the Mid-Continent. And that's really one of the things that is driving our increased volume outlook as we look forward is the increased drilling activity we are seeing in conversations with our producers. So, I think you are seeing a little bit of an uptick from there given the gas price.

Theresa, this is Pierce. The only thing that I would add to that is the demand fall that we're seeing basically in the industry. I mean recently the industry brought on 16 Bcf a day of export capabilities coming on LNG. That's expected to expand to somewhere around 30 Bcf depending on different projections out there. But yes, I could give you 6 Bcf a day. And then you still have coal plant conversions. So, all of that is going to kind of point to somewhere around plus 20%, maybe 25% growth in the demand for natural gas in the future. That comes with natural gas liquids. So, I think that's going to help with the prices as well.

And our next question will come from Jeremy Tonet with JPMorgan. Please go ahead.

This is Vrathan Reddy on for Jeremy. For the '25 CapEx guide, could you help us bridge spend on the three larger projects in your backlog versus those smaller capital opportunities such as well connections and synergy-related opportunities?

Trying to decide who was going to take that question. This is Walt. We have the three larger projects being the Medford frac, which is kind of in its heavy build stage at the moment as we move forward. The Denver pipeline, also kind of in that phase. The addition of the plant down in North Texas, which is a reasonably quick and concentrated spend during that period. We're wrapping up the Easton acquisition. So that's the kind of focus there in '25. Clearly, as some of those projects come on, some of that capital intensity will fall away. We'll have the dock project kind of ramping up in '26 and hit a stride as you get out in the next couple of years after that. But towards the back half of this year, we'll have a pretty good spend rate as well. So that's really the gist of it. A lot of the other capital we're spending around synergies and the like, they are very small, extremely high return projects that we've been working on to connect the refined products and the NGL system to really enhance the ability to move product around the system to be more efficient in blending activities and the like. So, those are coming to completion, and those are going to be additive in kind of singles and doubles across the way as we build out those synergies for '25 and '26.

Perfect. And then, the materials highlighted roughly 30 potential power plant expansion projects across your footprint, including the data centers. Just curious, if you can provide an update on commercial development and how that's progressed and just ONEOK's strategic positioning with EnLink in the portfolio now?

Yes. This is Sheridan again. And what I would say is, obviously, all 30 are at different stages that we're talking to, some are further along than others. We do think we have a very good competitive advantage when we look at a lot of these data centers and that is especially in our Oklahoma and Texas assets that we're sitting so close to supply that really cuts down on the transportation costs as we go forward and with our integrated network to be able to draw from many different plants in that area. It's the same thing in Oklahoma. So, we're working on that. There are some—as you would expect—some are progressing more than others; not all of them will get done. Of that 30%, that is, as Pierce mentioned, about 4 Bcf of demand that we're looking at. We kind of look across the United States as roughly about three to six Bcf that we think will come into play. So, we're going to have a look at a majority of that volume and we're very confident we're going to get our fair share of the demand from data centers.

And the next question will come from Michael Blum with Wells Fargo. Please go ahead.

I wanted to ask about 2026 CapEx. I realize you're not giving an estimate here. But just directionally, obviously, you have a big pickup in '25. Given the larger size and scale of the Company now, is this kind of a new run rate for the Company?

Michael, I think we definitely are seeing kind of a peak here in '25 as we wrap up Medford and the Denver project is in full swing. Will we, as a larger company, have a higher run rate? Definitely. But I think that you will see it as some of those come off and some of the synergy capital that we've been spending complete, that our baseline will come down over '26 and into '27. But clearly, it will be higher than it would have been prior to the EnLink and Medallion acquisitions. We definitely want to make sure that we continue to make sure that we have capacity available for our customers in the Permian and some of the new markets that we're entering.

Okay. And then just wanted to ask a level set on synergies. Just wondering, if you can just sort of clarify for us where synergies are tracking for, let's say, Magellan and EnLink and Medallion versus your original targets that you laid out? And then specifically, the $250 million that you called out, is that incremental to what you had originally laid out? Or you're just saying this is the number for 2025.

So, in 2024, we had said that originally that we would have $175 million of synergies. Throughout the year, we signaled that we would exceed that amount, and we clearly have. You can look at the results in RP&C for '24 versus what would have been a '23 range. And we've definitely seen a benefit from some of that to come home. And so, we did better than the $175 million as we headed into '25. We had said that there would be an additional $125 million related to Magellan in 2025. And so, we're layering in another $125 million on top of that. Recognizing that we may have achieved some of those original planned 2025 Magellan synergies in 2024. So, I think that speaks to the increased opportunities that we've continued to see as the teams have gotten together to do those singles and doubles and really optimize the NGL and refined product systems to open up a lot of new opportunities.

And the next question will come from Manav Gupta with UBS. Please go ahead.

On your 2025 guide, can you help us understand what drives you towards the top end of the guide, especially for the natural gas liquids and refined products and crude segments? Like what could get you to $3.1 billion and $2.3 billion respectively in 2025 for those two segments?

I think that as you look at the business, because some of it is the timing of when we bring in some of these synergies. As we are able to get certain assets connected, we are going to bring those earnings home quicker. Clearly, there can be opportunities as our producers, if they see continued strength in commodity prices or gas prices here, they can help us out on that front. But I think that while we're not going to have to rely just on increased producer activity, I do think that we have the innovation of our team as they continue to look for opportunities to optimize those smaller synergies; there may only be a $10 million or $15 million add to EBITDA, but you do a bunch of them and they start to add up pretty quick.

Perfect. My quick follow-up here is now that you're operating with Medallion and EnLink, are there any operational opportunities that you are seeing which you did not see earlier when you actually did the deal—those positive surprises? Can you talk a little bit about any positive surprises from these two deals?

This is Sheridan. I would say as we continue—as we saw with Magellan—when we start getting our people together, the people that really run these assets, and they start talking to each other and working together, the synergy opportunities almost start just kind of boiling out. When we bought and we looked at the money we thought we could make before we bought it, we knew predominantly where they were going to come from. And we knew kind of what we thought was there, but we didn't know the scale of what that could be when you really get the people operating those assets to continue to go forward. We're seeing a bunch of opportunities in the Mid-Continent for G&P for quick connects between our two systems up there where we can get gas to more efficient gas plants that produces more NGLs or feed our NGL system. We knew that was there, but how fast we can get there and how big that is has been a really good surprise. You get down into the Permian. We've been able to very quickly put ourselves into position to be able to market crude oil in that area, which helps us to put more crude oil right away onto our long-haul pipelines. The speed that we were able to do that has been phenomenal. We've been really excited about that. And then a couple of things that we didn't even really consider were synergies between our EnLink crude oil system and our Medallion crude oil system have really been a positive mover for us; they found different ways to be able to connect those systems as we continue to go forward. Or even just simple things: we've had opportunities where an EnLink crew truck was driving to a Medallion terminal that we've been able to lower our crude trucking cost just by bringing it to closer locations to the wellhead. So, we continue to see that. And as Walt mentioned, how we get to the higher end of the 2025 guidance is how fast we can put these together and how new ones continue to come on, which is what we saw with the Magellan acquisition once the teams got together.

Next question will come from Keith Stanley with Wolfe Research. Please go ahead.

Wanted to follow up first on the 2026 EBITDA outlook and synergies. So, you said $250 million of incremental synergies this year. Is there a number you can provide for 2026? It sounds like a lot of the projects are coming on as incremental synergies versus this year?

Yes. We're not going to guide to a specific number at this point in time. It's kind of baked into our outlook. What I would say is that the further we get down the path with multiple acquisitions, some supply chain type of synergies start to blend together. When we're buying for the four companies together as opposed to just legacy ONEOK, they're a little bit less easy to identify where we should point them to—whether they're Magellan synergies or Medallion synergies or EnLink. So, some of those kinds of get grouped together, and we're just seeing a net benefit to the Company. So, at this point, in '26, we're going to just leave it at those synergies that we have identified today are baked into that number, and we'll continue to try to find more and refine that number as we get closer to when we provide actual guidance for '26. But that is our outlook today with what we know so far.

Great. And maybe on the export facility, can you give a sense of expected returns on the project or contracts that are in place today? And then separately on exports, just how it affects your strategy and how you're thinking about organic growth or M&A, particularly in the Permian, once you have this facility in place?

We'll start with the strategy: our strategy across our whole system, not just in the Permian, is to touch a barrel as many times as we can to be fully integrated so we can bring the most value to our customers. This is just one more leg in that integration that we think is critical to continue to be competitive in all the areas we operate. We continue to see a lot of demand for the dock as we go forward. Our returns are expected to be in the mid-teens to high-teens on this project based on current economics. But it is an integrated play where we aim to touch the barrel as many times as possible so we can offer a full suite of offerings to our producer customers.

This is Pierce. You had a question about M&A, in particular, in the Permian. We continue to be focused on the integration of the companies that we've bought so far, and we're focused on realizing those synergies across that footprint. Having said that, there's a couple of ways that things come on the market. One is strategic, which is usually public-to-public. And then the other one is through the private equity chain—there will probably be some of those things coming to market in the future. We look at everything, but it will be best to be seen whether or not to transact. We will be intentional and disciplined in the way that we approach all of our future M&A opportunities.

And the next question will come from Sunil Sibal with Seaport Global Securities. Please go ahead.

I was going in and out, so I'm not sure if this was covered, but I wanted to start off on the Permian side of things. I believe your processing capacity is around 1.7 Bcf per day there. Could you tell us what kind of utilization that is running at? And then downstream of the processing plants approximately how much of the NGL volumes you control from the marketing point of view?

What I would say on the 1.5 to 1.7 Bcf per day utilization is that we are moving a gas plant out of North Texas down into the Permian Basin, and we wouldn't be doing that unless we were anticipating that the capacity that we have in the Permian Basin today is going to be fully utilized as we go forward. That's how we think about volume in 2025. As it relates to downstream utilization on NGL pipe, we have plenty of capacity with the expansion of the West Texas NGL system that will be here this year up to 740,000 barrels a day with a lot of capacity that wasn't spoken for because we didn't need that much to sanction that project. What we're seeing is that the majority of the new volume that we are getting on the system and the majority of the volume on that system, we have the marketing rights; we control it. There are some legacy contracts with Magellan where they have a significant amount of volume that currently had marketing rights elsewhere, and when that volume rolls off contract, that will come over to our system at that time.

Okay. Got it. And then on the stock buybacks. I think in your previous guidance on leverage you were targeting exiting 2025 at 3.9x. And with the new guidance, you're talking about 3.5x leverage in 2026. So, it seems like you're making good progress there. Can you talk about the cadence of the stock buyback program that you have?

We are mindful to make sure that we get our debt metrics in line with our goals, and we're looking at the business as we go forward. That said, we have the full intention of completing the $2 billion of buybacks over the course of the program that the Board set forward. We saw a situation at year-end where we had the proceeds from the sale of assets to DTM, where we were sitting on a larger-than-normal amount of cash. As I mentioned before, even with those, we closed out the year with $773 million in cash on the balance sheet. So, we were opportunistic there to get started on that program, and we'll look at things during 2025. But clearly, I think that the bulk of the $2 billion will be back-weighted as we get in the final two years as our metrics hit our goals from a debt metric side.

The next question will come from Neal Dingmann with Truist Securities. Please go ahead.

I guess, you had a lot of discussions with the producers and their plans for 2025. To me, they all sound quite good or at least the same. Based on what you've heard now from producers and your conversations, do you still have the same expectations for production in some of your key areas as you did last year?

Yes. We've had a lot of conversations with our producers and what they're seeing going forward. I would say we are at or above where we thought we would be last year in many areas. Take the Bakken: consolidation there has enabled producers to drill longer laterals, which will bring more volume into our system. We're seeing that in the Mid-Continent as well, where gas prices are up and people are coming back in. All of this is reflected in our guidance. But I would say we're at or above where we thought we would be three or four months ago.

That's great to hear. And then just a quick follow-up on EnLink: now fully under your control, are you seeing opportunities to accelerate and how is customer demand looking there?

Yes. Especially in the Permian, we have a team out there highly focused on growing that Permian asset, and they're getting after it. We see a lot of opportunities. There are many RFPs coming out right now that we are looking at, and we are excited about what we see—bringing new plans online and seeing what else we can do with our integrated footprint. With EnLink and G&P, we're very optimistic; up in the Mid-Continent, we have a wider expanse across that area, especially on the western side where we see a lot of activity with the combination of the ONEOK and EnLink assets to serve those producers. The team is energized to continue to put these pieces together and grow with the activity we are seeing.

This concludes our question-and-answer session. I would like to turn the conference back over to Pierce Norton, CEO, for any closing remarks.

Thank you. Before I wrap up today, I want to take a moment to recognize two individuals who have contributed significantly to ONEOK's success over the years. Chuck Kelley is retiring after 25 years of service. Most recently, he was our Senior Vice President of Natural Gas Pipelines, but has also served in key leadership roles in energy services, corporate development and natural gas gathering and processing over the years. And Andrew Ziola, the Vice President of Investor Relations, after 20 years of dedicated service, has announced his retirement. Andrew has been an important part of the organization through significant change and progress. Many of you have known and worked with Andrew for years, and his presence will certainly be missed. Both of these gentlemen have made contributions that will have a lasting impact on our company. Please join me in congratulating them on an outstanding career and in wishing them the very best in their next exciting chapter. I'm also pleased to announce that Megan Patterson, who many of you know and who worked alongside Andrew for a number of years, will be stepping into Andrew's role. With that, I'll now turn the call over to Megan for closing remarks.

Thank you, Pierce. Our quiet period for the fourth quarter starts when we close our books in early April and extends until we release earnings in late April. We'll provide details for that conference call at a later date. The IR team will be available throughout the day today for any follow-ups. Thank you for joining us, and have a great day.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.