ONEOK (OKE) inherited a large Barnett G&P position through its $7.6B EnLink Midstream acquisition, but parts of the footprint offer limited strategic value as OKE doubles down on growth basins. After an active year of dealmaking, we see an opportunity for OKE to delever by selling a non-core asset.
East Daley’s “G&P System Analysis” dashboard in Energy Data Studio shows the ENLC–East Johnson system moving ~50 MMcf/d on average in 2025, declining to ~45 MMcf/d by YE28. The system gathers dry gas, creating no NGL uplift for OKE and offering limited integration with its long-haul gas pipelines.
ONEOK has shown a willingness to divest non-core assets. In 4Q24, it sold Guardian Pipeline, Midwestern Gas Transmission and Viking Gas Transmission to DT Midstream (DTM) for $1.2B. The company continues to prioritize capital deployment toward the Permian, its NGL value chain and integrating the Magellan Midstream assets. Selling the East Johnson system would help OKE meet its 3.5x long-term leverage target, as well as recycle cash into projects with more synergies to its core operations.
A natural buyer is a Barnett-focused operator like Colt Midstream. East Daley’s “G&P System Analysis” in Energy Data Studio dashboard shows Colt’s gathering footprint is adjacent to the East Johnson system, presenting a potential bolt-on opportunity. The system’s relatively small footprint may be better suited for a private buyer like Colt that specializes in mature, low-growth gas assets. Colt could reduce per-unit Opex by consolidating operations and increasing throughput optionality across its Barnett assets.
Investor Takeaway: OKE could raise cash and unlock value by trimming dry gas assets that lack integration with its liquids-rich strategy. A sale of East Johnson would streamline the Barnett portfolio while shifting capital toward higher-return basins. A buyer like Colt Midstream would be well positioned to extract more value from these declining but durable volumes. – Garrett Streit Tickers: DTM, OKE.
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