On June 3, 2025, ONEOK, Inc. (NYSE: OKE) announced a strategic acquisition of the remaining 49.9% interest in Delaware G&P LLC, its Delaware Basin joint venture, from NGP XI Midstream Holdings, L.L.C. for \(940 million, comprising \)530 million in cash and $410 million in ONEOK common stock. This transaction closed on May 28, 2025, making ONEOK the sole owner of Delaware Basin JV, which operates natural gas gathering and processing facilities with a total processing capacity exceeding 700 million cubic feet per day in West Texas and New Mexico.
This acquisition aligns strongly with ONEOK’s growth strategy in the Permian Basin, a prolific energy production area. By consolidating full ownership, ONEOK positions itself to capitalize on increased production activity and infrastructure expansion opportunities, further strengthening its foothold in a region demonstrating robust upstream activity.
Financially, ONEOK generated total revenue of \(21.7 billion and operating income of approximately \)4.99 billion for fiscal year 2024, showcasing its substantial financial base to support such strategic investments. Revenue segments reflect dominance in commodity sales (\(17.78 billion) and significant operational throughput in liquids commodities (\)3.03 billion).
This acquisition enhances ONEOK’s asset base and is expected to drive incremental throughput volumes as producer activity in the Permian Basin remains high, with existing capacity nearing full utilization. According to ONEOK’s Q1 2025 earnings call, expansion projects including the West Texas NGL pipeline and Elk Creek pipeline are underway to meet growing demand, indicating synergistic organic growth alongside acquisitions.
The strategic acquisition is anticipated to accelerate earnings growth by increasing fee-based revenues and operational synergies. Analyst commentary highlighted the Permian Basin’s sustained rig count and infrastructure utilization, signaling positive forward cash flows and asset returns. Further, the company’s credit rating upgrades seen in 2023 underscore its financial resilience and borrowing capability to fund accretive growth.
In conclusion, ONEOK’s full ownership of Delaware Basin JV marks a pivotal step in its integrated Permian Basin platform development, augmenting its midstream gathering, processing, and transportation services. This move not only bolsters ONEOK’s revenue and EBITDA growth trajectory but also strategically positions it to leverage expanding energy demands and infrastructure needs in one of North America’s most critical energy hubs.
Source Document: ONEOK 8-K Report
Tags: OKE, ONEOK, FY2025, DelawareBasinAcquisition, PermianBasinGrowth, MidstreamEnergyStrategy