ONEOK Inc. (NYSE:OKE)

Gross property, plant and equipment exhibited a consistent upward trajectory over the five-year period, increasing from 18.03 billion USD in 2018 to 25.02 billion USD by the end of 2022. This growth is mirrored in the net property, plant and equipment, which rose from 14.77 billion USD to 19.95 billion USD during the same timeframe. The steady expansion of the asset base indicates a sustained period of capital investment across both regulated and nonregulated segments.

Nonregulated Asset Trends

Nonregulated assets grew from 10.81 billion USD in 2018 to 14.09 billion USD in 2022. The most significant growth was observed in processing and fractionation equipment, which increased by approximately 29% over the period. Gathering pipelines also showed steady growth, reaching 4.67 billion USD in 2022. A notable fluctuation is observed in construction work in process, which peaked in 2019 at 1.65 billion USD, declined through 2021, and rose again to 1.62 billion USD in 2022, suggesting the initiation of new large-scale projects toward the end of the period.

Regulated Asset Trends

Regulated assets experienced a more aggressive growth rate, expanding from 7.23 billion USD in 2018 to 10.93 billion USD in 2022. This growth was primarily driven by NGL transmission pipelines and related equipment, which nearly doubled from 4.68 billion USD in 2018 to a peak of 8.60 billion USD in 2021 before stabilizing. Natural gas transmission pipelines also saw a marked increase, particularly between 2021 and 2022, rising from 1.66 billion USD to 2.03 billion USD. The construction work in process for regulated assets dropped sharply after 2019, falling from 1.80 billion USD to 220.66 million USD by 2022, indicating the completion and capitalization of major infrastructure projects.

Depreciation and Asset Valuation

Accumulated depreciation and amortization increased steadily from 3.26 billion USD in 2018 to 5.06 billion USD in 2022. The growth in accumulated depreciation is commensurate with the increase in the gross asset base. However, the ratio of accumulated depreciation to gross property, plant and equipment remained relatively stable, moving from approximately 18.1% in 2018 to 20.2% in 2022, suggesting a balanced replacement and expansion cycle of assets.

The overall financial profile reveals a strategic shift toward increasing the proportion of regulated assets within the total PP&E portfolio. While nonregulated assets remained the larger component, the regulated segment grew at a faster relative pace, enhancing the company's asset base in sectors often subject to regulated rates of return.

The average age ratio of property, plant, and equipment exhibited a period of fluctuation between 2018 and 2020, followed by a consistent upward trajectory through the end of 2022. This trend suggests a gradual increase in the proportion of depreciated assets relative to the total gross asset value over the latter half of the observed period.

Initial Trend (2018–2020)

A moderate decline was observed between December 31, 2018, and December 31, 2019, with the ratio decreasing from 18.10% to 16.79%. This decline indicates a period where new asset acquisitions or capital improvements likely outpaced the rate of depreciation. The ratio remained relatively stable in 2020, recording a marginal increase to 16.98%.

Expansion Phase (2021–2022)

Beginning in 2021, a clear upward trend emerged, with the ratio rising to 18.89% and continuing its ascent to reach a five-year peak of 20.24% by December 31, 2022. This steady increase points to an aging asset base, reflecting a higher cumulative depreciation load relative to the current book value of the infrastructure.

Overall Asset Age Trajectory

The transition from 16.98% in 2020 to 20.24% in 2022 represents a cumulative increase of 3.26 percentage points over two years. This progression implies that the company's fixed assets are becoming older on average, which may indicate a shift in capital expenditure strategy or a slowing rate of asset replacement.

Between December 31, 2018, and December 31, 2022, a consistent upward trajectory is observed in the total scale of property, plant, and equipment, accompanied by a corresponding rise in accumulated depreciation and a fluctuating average age ratio.

Gross Asset Base Expansion

Gross property, plant and equipment increased steadily from 18.03 billion USD in 2018 to 25.02 billion USD by 2022. The most pronounced growth occurred between 2018 and 2019, where the asset base expanded by approximately 22%, indicating a period of significant capital expenditure or strategic acquisition.

Accumulated Depreciation and Amortization

Accumulated depreciation and amortization exhibited continuous growth over the five-year period, rising from 3.26 billion USD in 2018 to 5.06 billion USD in 2022. This trend reflects the ongoing systemic allocation of costs over the useful lives of the company's infrastructure and equipment.

Average Age Ratio Analysis

The average age ratio displays a U-shaped pattern. A decrease from 18.10% in 2018 to 16.79% in 2019 suggests that the infusion of new assets during that period effectively lowered the relative age of the overall asset portfolio. However, from 2020 through 2022, the ratio rose consistently, reaching a peak of 20.24%. This indicates that in the latter part of the analyzed period, the rate of asset aging has outpaced the rate of new capital additions, leading to an increase in the average age of the property, plant, and equipment.