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ONEOK Partners L.P. (OKS - Analyst Report) said that its board of directors approved a 2.5 cent increase in the quarterly distribution rate. The fresh distribution rate of 66 cents per unit will be effective from the second quarter of 2012 and is scheduled to be paid on August 15, 2012 to unitholders of record as of August 6, 2012.

The partnership’s new annualized cash distribution rate stands at $2.64 per unit, up from the earlier rate of $2.54 per unit by 3.9%. ONEOK Partners has time and again raised its distribution rate and the distribution level has surged by 65% since April 2006.

The partnership has been increasing its quarterly cash distribution rate on a regular basis. The partnership has raised its cash distribution rate by 2.5 cents in each of the first two quarters of 2012, which is in line with its goal of increasing the distribution rate by the same margin in every quarter of 2012. The partnership aims to gradually increase its quarterly cash distribution rate and realize a 15% to 20% annual distribution growth in 2013 and 2014.

The partnership revised its capital program and plans to invest $5.7 billion to $6.6 billion on investment projects through 2014. These developmental initiatives would add to ONEOK’s profitability in the long run which will enable it to provide higher returns to unitholders. ONEOK Partners’ natural gas liquids business (NGL) continues to do well, generating healthy distributable cash flow for the ongoing year.

We believe the partnership will continue to ride high on its NGL operations and growth projects which would aid in keeping investors interest strong in the coming years.

ONEOK Partners currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. The partnership closest competitor is Kinder Morgan Energy Partners L.P. (KMP - Analyst Report). The Zacks Consensus Estimate for the second quarter and full year 2012 are currently estimated at 70 cents per share and $2.91 per share, respectively.

Based in Tulsa, Oklahoma, ONEOK Partners is involved in the gathering, processing, storage and transportation of natural gas in the U.S. and owns one of the nation's premier natural gas liquids (NGL) systems, connecting NGL supply in the Mid-Continent and Rocky Mountain regions with key market centers.

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