<PAGE> 1
EXHIBIT 99
Latest News Release Page 1 of 3
[WILLIAMS LOGO]
================================================================================
07/28/00
================================================================================
WILLIAMS 2Q EARNINGS SOAR ON STRENGTH OF
ENERGY PERFORMANCE
TULSA -- Williams (NYSE: WMB) today reported unaudited second-quarter net income
of $351.8 million, or 78 cents per share on a diluted basis. Segment profit from
Williams' energy businesses more than doubled that of the same period last year,
driven primarily by higher income from electric power activities and continued
improvement in key energy markets. The consolidated results also include the
previously reported 25 cents per share gain on a Williams Communications
investment transaction.
During the second quarter of 1999, Williams reported net income of $18.1
million, or 4 cents per share on a diluted basis. Those results included an
after-tax loss of approximately $35 million, or 8 cents per share, related to
the sale of the company's conferencing business.
"We believe 2000 will be a landmark year for our energy businesses," said Keith
E. Bailey, chairman, president and chief executive officer. "The second-quarter
energy results, led by a major series of successes in our energy marketing and
trading area, were even better than those reported for the first quarter, which
was a record for us. The positive momentum in the energy sector is continuing
into the third quarter and, barring a significant deterioration of commodity
margins, we anticipate continued strong performance over the balance of 2000.
"As our communications business reported yesterday, we are entering the stretch
run in deploying the country's largest next-generation fiber-optic network, with
completion scheduled for year end. Network revenues are growing, and the
continuing expansion of our book of business further validates the demand for
value-added broadband products and services.
"All of this combined to produce consolidated results that were well ahead of
market expectations and, we believe, more fully reflect the earnings capacity of
Williams," Bailey said. "We are obviously proud of our performance and more
optimistic than at any time in our recent history about our potential."
For the first six months of 2000, Williams reported unaudited net income of
$451.5 million, or $1.01 per share on a diluted basis. For the same period of
1999, Williams reported unaudited net income of $71 million, or 16 cents per
share on a diluted basis.
Following is a summary of Williams' major business groups:
Gas Pipeline, which provides natural gas transportation and storage services
through systems that span the United States, reported second-quarter 2000
segment profit of $215.2 million, compared with $175.4 million during the same
period a year ago.
The increase in segment profit was primarily the result of approximately $64
million in reductions to rate refund liabilities that followed favorable rulings
regarding regulatory proceedings, as well as the benefit of higher rates on the
Transco system and the contribution of new project investments. Last
<PAGE> 2
Latest News Release Page 2 of 3
year's second-quarter results included a favorable adjustment to rate refund
liabilities of approximately $38 million.
For the first six months of 2000, segment profit was $412.5 million, compared
with $362.2 million during the same period last year.
Energy Services, which provides a full spectrum of traditional and leading-edge
energy products and services, reported second-quarter 2000 segment profit of
$411.6 million, compared with $105.9 million during the same period a year ago.
Each business unit reported increased quarter-over-quarter segment profit.
Energy Services' nearly 300 percent improvement for the quarter was led by a
$256 million increase in segment profit from the energy marketing and trading
business, resulting primarily from significantly higher electric power services
margins from increased contract origination revenues, changes in forward power
market prices and increased power trading volumes. In addition, Energy Services
benefited from a 63 percent rise in natural gas liquids average prices over
those for the same period last year, and from higher processing and refining
volumes and margins.
For the first six months of 2000, segment profit was $616.7 million, compared
with $231 million during the same period last year.
Communications, which includes a national fiber-optic network, single-source
communications systems integration and multiple technology applications for
businesses, reported second-quarter 2000 segment profit of $114.2 million,
compared with a loss of $76.1 million during the same period a year ago.
Network's segment profit increased $186.7 million, reflecting approximately $251
million additional income from investments. Network revenues for the second
quarter were 51 percent higher than the comparable period a year ago. Increased
costs associated with constructing and staffing the network, in addition to
servicing the growing customer base as business transitions to the completed
network, more than offset the revenue increase. Income from investments includes
a gain of approximately $215 million from the conversion of Williams' investment
in Concentric Network for common stock of NEXTLINK Communications, Inc.,
pursuant to a merger of those companies in the second quarter.
Solutions' segment loss increased by $26.1 million, reflecting the impact of
lower revenues from new systems sales and upgrades, and higher provision for bad
debt expenses.
Strategic Investments' segment loss decreased by $34.1 million, due primarily to
second-quarter 1999 charges of approximately $27 million pursuant to
management's decision to sell certain network applications and conferencing
businesses.
For the first six months of 2000, total segment profit for Communications was
$44 million, compared with a loss of $127.6 million during the same period last
year.
CONFERENCE CALL
Keith Bailey will discuss second-quarter earnings during a conference call
scheduled for 10 a.m. Eastern on Friday, July 28. To participate, dial:
- Domestic: (800) 482-5519
- International: (303) 267-1002
<PAGE> 3
Latest News Release Page 3 of 3
- Request "Williams Analyst Conference Call"
For replays available through the end of day Friday, dial:
- Domestic: (800) 625-5288
- International: (303) 804-1855
- Conference ID 750501
ABOUT WILLIAMS (NYSE: WMB)
Williams, through its subsidiaries, connects businesses to energy and
communications. The company delivers innovative, reliable products and services
through its extensive networks of energy-distributing pipelines and high-speed
fiber-optic cables. Williams information is available at
http://www.williams.com.
Portions of this document may constitute "forward-looking statements" as defined
by federal law. Although the company believes any such statements are based on
reasonable assumptions, there is no assurance that actual outcomes will not be
materially different. Any such statements are made in reliance on the "safe
harbor" protections provided under the Private Securities Reform Act of 1995.
Additional information about issues that could lead to material changes in
performance is contained in the company's annual reports filed with the
Securities and Exchange Commission.
<PAGE> 4
FINANCIAL HIGHLIGHTS [WILLIAMS LOGO]
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
------------------------- --------------------------
(Millions, except per-share amounts) 2000 1999* 2000 1999*
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues $ 2,859.1 $ 1,993.0 $ 5,286.8 $ 3,937.1
Income before cumulative effect of change in accounting principle $ 351.8 $ 18.1 $ 473.1 $ 76.6
Cumulative effect of change in accounting principle $ -- $ -- $ (21.6) $ (5.6)
Net income $ 351.8 $ 18.1 $ 451.5 $ 71.0
Basic earnings per common share:
Income before cumulative effect of change in accounting principle $ .79 $ .04 $ 1.07 $ .17
Cumulative effect of change in accounting principle $ -- $ -- $ (.05) $ (.01)
Net income $ .79 $ .04 $ 1.02 $ .16
Average shares (thousands) 443,778 435,052 443,331 433,580
Diluted earnings per common share:
Income before cumulative effect of change in accounting principle $ .78 $ .04 $ 1.06 $ .17
Cumulative effect of change in accounting principle $ -- $ -- $ (.05) $ (.01)
Net income $ .78 $ .04 $ 1.01 $ .16
Average shares (thousands) 448,617 441,746 448,361 439,382
Shares outstanding at June 30 (thousands) 442,684 434,018
</TABLE>
* Certain amounts have been restated to reflect fourth-quarter 1999 change in
valuation method for certain non-trading crude oil and refined products
inventories (See Note 1 of Notes to Consolidated Statement of Income).
SECOND QUARTER 2000
<PAGE> 5
CONSOLIDATED STATEMENT OF INCOME [WILLIAMS LOGO]
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
---------------------- ----------------------
(Millions, except per-share amounts) 2000 1999* 2000 1999*
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
REVENUES Gas Pipeline $ 492.0 $ 424.5 $ 973.3 $ 891.4
Energy Services 2,456.9 1,368.2 4,427.4 2,509.5
Communications 522.7 505.2 1,063.9 1,012.1
Other 33.4 23.8 66.8 30.0
Intercompany eliminations (645.9) (328.7) (1,244.6) (505.9)
--------- --------- --------- ---------
Total revenues 2,859.1 1,993.0 5,286.8 3,937.1
--------- --------- --------- ---------
SEGMENT Costs and operating expenses 1,956.8 1,435.9 3,759.4 2,834.4
COSTS AND Selling, general and administrative expenses 393.8 323.8 731.7 628.5
EXPENSES Other expense - net 13.7 33.1 14.2 30.6
--------- --------- --------- ---------
Total segment costs and expenses 2,364.3 1,792.8 4,505.3 3,493.5
--------- --------- --------- ---------
General corporate expenses 20.9 16.6 40.3 33.5
--------- --------- --------- ---------
OPERATING Gas Pipeline 215.2 175.4 412.5 362.2
INCOME (LOSS) Energy Services 411.6 105.9 616.7 231.0
Communications (137.1) (76.1) (259.0) (127.6)
Other 5.1 (5.0) 11.3 (22.0)
General corporate expenses (20.9) (16.6) (40.3) (33.5)
--------- --------- --------- ---------
Total operating income 473.9 183.6 741.2 410.1
--------- --------- --------- ---------
Interest accrued (216.6) (134.6) (444.7) (277.9)
Interest capitalized 51.0 17.5 88.6 26.9
Investing income 280.4 5.6 380.9 12.3
Minority interest in (income) loss and preferred
returns of consolidated subsidiaries (.8) (3.4) 13.0 (4.0)
Other income (expense) - net 1.2 (1.1) 5.6 .2
--------- --------- --------- ---------
Income before income taxes and cumulative effect
of change in accounting principle 589.1 67.6 784.6 167.6
Provision for income taxes 237.3 49.5 311.5 91.0
--------- --------- --------- ---------
Income before cumulative effect of change in
accounting principle 351.8 18.1 473.1 76.6
Cumulative effect of change in accounting principle -- -- (21.6) (5.6)
--------- --------- --------- ---------
Net income 351.8 18.1 451.5 71.0
Preferred stock dividends -- .9 -- 2.5
--------- --------- --------- ---------
Income applicable to common stock $ 351.8 $ 17.2 $ 451.5 $ 68.5
========= ========= ========= =========
EARNINGS Basic earnings per common share:
PER SHARE Income before cumulative effect of change in
accounting principle $ .79 $ .04 $ 1.07 $ .17
Cumulative effect of change in accounting principle -- -- (.05) (.01)
--------- --------- --------- ---------
Net income $ .79 $ .04 $ 1.02 $ .16
========= ========= ========= =========
Diluted earnings per common share:
Income before cumulative effect of change in
accounting principle $ .78 $ .04 $ 1.06 $ .17
Cumulative effect of change in accounting principle -- -- (.05) (.01)
--------- --------- --------- ---------
Net income $ .78 $ .04 $ 1.01 $ .16
========= ========= ========= =========
</TABLE>
* Certain amounts have been restated as described in Note 1 of Notes to
Consolidated Statement of Income.
See accompanying notes.
SECOND QUARTER 2000
<PAGE> 6
NOTES TO CONSOLIDATED STATEMENT OF INCOME [WILLIAMS LOGO]
(UNAUDITED)
1. BASIS OF PRESENTATION
During first-quarter 2000, management of certain activities related to the
marketing of products from the Alaska refinery were transferred from Energy
Marketing & Trading to Petroleum Services. Prior year amounts for Petroleum
Services and Energy Marketing & Trading have been restated to reflect the
transfer of these operations.
In fourth-quarter 1999, Williams conformed its accounting for all of its
inventories of non-trading crude oil and refined products to the average-cost
method or market, if lower, the method used for the majority of such
inventories. Previously, certain of these inventories were carried on the
last-in, first-out cost method. All previously reported results have been
restated to reflect the retroactive application of this accounting change. The
accounting change increased net income for the three and six months ended June
30, 1999, by $1.1 million and $3.7 million, respectively. Diluted earnings per
share for the six months ended June 30, 1999, increased $.01 per share as a
result of the accounting change.
Segment profit of operating companies may vary by quarter. Based on current
rate structures and/or historical maintenance schedules of certain of its
pipelines, Gas Pipeline generally experiences lower segment profits in the
second and third quarters as compared with the first and fourth quarters.
Certain other amounts in the Consolidated Statement of Income for 1999 have
been reclassified to conform to the current classifications.
2. SEGMENT REVENUES AND PROFIT (LOSS)
Segment revenues and profit (loss) for the three and six months ended June
30, 2000 and 1999, are as follows:
<TABLE>
<CAPTION>
Three months ended June 30,
Revenues Segment Profit (Loss)
-------------------- --------------------
(millions) 2000 1999* 2000 1999*
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Gas Pipeline $ 492.0 $ 424.5 $ 215.2 $ 175.4
-------- -------- -------- --------
Energy Services:
Energy Marketing
& Trading 967.5 376.6 268.8 13.2
Exploration & Production 71.7 43.0 10.0 7.0
Midstream Gas & Liquids 323.7 237.3 71.9 53.6
Petroleum Services 1,094.0 711.3 62.4 34.8
Merger-related costs and
non-compete amortization -- -- (1.5) (2.7)
-------- -------- -------- --------
Total Energy Services 2,456.9 1,368.2 411.6 105.9
-------- -------- -------- --------
Communications:
Network 146.3 96.7 161.0 (25.7)
Broadband Media 38.9 40.9 (8.6) (4.2)
Solutions 339.3 359.4 (34.7) (8.6)
Strategic Investments (1.8) 8.2 (3.5) (37.6)
-------- -------- -------- --------
Total Communications 522.7 505.2 114.2 (76.1)
-------- -------- -------- --------
Other 33.4 23.8 5.1 (5.0)
Intercompany eliminations (645.9) (328.7) -- --
-------- -------- -------- --------
Total Segments $2,859.1 $1,993.0 $ 746.1 $ 200.2
-------- -------- -------- --------
</TABLE>
* Certain amounts have been restated or reclassified as described in Notes 1
and 2.
<TABLE>
<CAPTION>
Six months ended June 30,
Revenues Segment Profit (Loss)
-------------------- --------------------
(millions) 2000 1999* 2000 1999*
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Gas Pipeline $ 973.3 $ 891.4 $ 412.5 $ 362.2
-------- -------- -------- --------
Energy Services:
Energy Marketing
& Trading 1,572.8 731.7 343.0 55.2
Exploration & Production 127.5 70.5 21.4 11.7
Midstream Gas & Liquids 651.2 455.0 156.4 100.2
Petroleum Services 2,075.9 1,252.3 100.1 70.7
Merger-related costs and
non-compete amortization -- -- (4.2) (6.8)
-------- -------- -------- --------
Total Energy Services 4,427.4 2,509.5 616.7 231.0
-------- -------- -------- --------
Communications:
Network 276.9 216.8 102.7 (48.2)
Broadband Media 79.1 80.3 (14.6) (9.9)
Solutions 712.5 699.9 (56.8) (17.7)
Strategic Investments (4.6) 15.1 12.7 (51.8)
-------- -------- -------- --------
Total Communications 1,063.9 1,012.1 44.0 (127.6)
-------- -------- -------- --------
Other 66.8 30.0 11.3 (22.0)
Intercompany eliminations (1,244.6) (505.9) -- --
-------- -------- -------- --------
Total Segments $5,286.8 $3,937.1 $1,084.5 $ 443.6
-------- -------- -------- --------
</TABLE>
* Certain amounts have been restated or reclassified as described in Notes 1
and 2.
SECOND QUARTER 2000
<PAGE> 7
NOTES TO CONSOLIDATED STATEMENT OF INCOME (CONTINUED) [WILLIAMS LOGO]
(UNAUDITED)
2. SEGMENT REVENUES AND PROFIT (LOSS) (continued)
Prior year amounts of Communications' operating segments have been restated
to reflect first-quarter 2000 segment realignment.
As a result of the assumption of investment management activities within
the operating segments, the definition of segment profit (loss) was modified
during first-quarter 2000 to include income (loss) from investments resulting
from the management of investments in equity instruments. This income (loss)
from investments is reported in investing income in the Consolidated Statement
of Income. The prior year segment information has been restated to conform to
the current year presentation. The primary components of income from investments
included in segment profit (loss) are the gains from certain marketable equity
securities (in Network) and the gain on the sale of investments in ATL-Algar
Telecom Leste, S.A. (in Strategic Investments) (see Note 4).
Based on Federal Energy Regulatory Commission and judicial rulings received
in 2000 regarding regulatory proceedings, two of the gas pipelines made
reductions to certain rate refund liabilities and related interest accruals
totaling approximately $75 million, of which $63.8 million is included in Gas
Pipeline's segment revenues and segment profit for second-quarter 2000. The
balance of $11.2 million is included as a reduction of interest accrued.
Energy Marketing & Trading's segment profit for second- quarter 2000
reflects a $255.6 million increase resulting primarily from significantly higher
electric power services margins from increased contract origination revenues,
changes in forward power market prices and increased power trading volumes.
Based on second-quarter 1999 regulatory proceedings involving
rate-of-return methodology, three of the gas pipelines made reductions to
certain rate refund liabilities and related interest accruals totaling
approximately $51 million, of which $38.2 million is included in Gas Pipeline's
segment revenues and segment profit for second-quarter 1999. The balance is
included primarily as a reduction of interest accrued.
The following table reflects the reconciliation of operating income (loss)
as reported in the Consolidated Statement of Income to segment profit (loss).
<TABLE>
<CAPTION>
Three months ended June 30, 2000 Three months ended June 30, 1999
Operating Income Operating Income
Income from Segment Income from Segment
(millions) (Loss) Investments Profit (Loss) (Loss) Investments Profit (Loss)
---------- ------ ----------- ------------- ------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Gas Pipeline $215.2 $ -- $215.2 $175.4 $ -- $175.4
Energy Services 411.6 -- 411.6 105.9 -- 105.9
Communications (137.1) 251.3 114.2 (76.1) -- (76.1)
Other 5.1 -- 5.1 (5.0) -- (5.0)
------ ------ ------ ------ ------ ------
Total segments 494.8 $251.3 $746.1 200.2 $ -- $200.2
------ ------ ------ ------ ------ ------
General corporate
expenses (20.9) (16.6)
------ ------
Total operating
income $473.9 $183.6
====== ======
</TABLE>
<TABLE>
<CAPTION>
Six months ended June 30, 2000 Six months ended June 30, 1999
Operating Income Operating Income
Income from Segment Income from Segment
(millions) (Loss) Investments Profit (Loss) (Loss) Investments Profit (Loss)
---------- ------ ----------- ------------- ------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Gas Pipeline $412.5 $ - $ 412.5 $362.2 $ - $362.2
Energy Services 616.7 - 616.7 231.0 - 231.0
Communications (259.0) 303.0 44.0 (127.6) - (127.6)
Other 11.3 - 11.3 (22.0) - (22.0)
------ ------ -------- ------ ----- ------
Total segments 781.5 $303.0 $1,084.5 443.6 $ - $443.6
------ ------ -------- ------ ----- ------
General corporate
expenses (40.3) (33.5)
------ ------
Total operating
income $741.2 $410.1
====== ======
</TABLE>
3. ASSET IMPAIRMENT
Included in second-quarter 1999 other expense-net within segment costs and
expenses and Strategic Investments' segment loss are pre-tax charges totaling
$26.7 million relating to management's second-quarter 1999 decision and
commitment to sell certain audio and video conferencing and closed-circuit video
broadcasting businesses. The $26.7 million charge consisted of a $22.8 million
impairment of the assets to fair value based on the expected net proceeds of
approximately $50 million and $3.9 million in exit costs consisting of
contractual obligations related to the sales of these businesses. The sales were
completed later in 1999 with an additional $1.7 million impairment charge
recorded. These transactions resulted in an income tax provision of
approximately $7.9 million, which reflects the impact of goodwill not deductible
for tax purposes. Segment losses for the operations related to these assets for
the three and six months ended June 30, 1999, were approximately $5 million and
$9.1 million, respectively.
SECOND QUARTER 2000
<PAGE> 8
NOTES TO CONSOLIDATED STATEMENT OF INCOME (CONTINUED) [WILLIAMS LOGO]
(UNAUDITED)
4. INVESTING INCOME
In second-quarter 2000, Williams recognized a gain of $214.7 million
resulting from the conversion of Williams' shares of Concentric Network
Corporation's common stock into shares of NEXTLINK Communications, Inc.'s common
stock pursuant to a merger of those companies in June 2000.
Williams sold a portion of its investment in certain marketable equity
securities for gains of $36.6 million and $68.1 million for the three and six
months ended June 30, 2000, respectively.
In a series of transactions during first-quarter 2000, Williams sold a
portion of its investment in ATL-Algar Telecom Leste S.A. (ATL) for
approximately $168 million in cash to SBC Communications, Inc., which became a
related party in first-quarter 2000. This investment had a carrying value of $30
million. Williams recognized a gain on the sale of $16.5 million and deferred a
gain of approximately $121 million associated with $150 million of the proceeds,
which were subsequently advanced to ATL.
In addition to those items noted above, investing income also includes
interest income primarily related to short-term investments and notes
receivable.
5. CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE
In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin No. 101 (SAB 101), "Revenue Recognition in Financial
Statements." Among other things, SAB 101 clarifies certain conditions regarding
the culmination of an earnings process and customer acceptance requirements in
order to recognize revenue. Prior to January 1, 2000, Solutions' revenue
recognition policy had been to recognize revenues on new systems sales and
upgrades under the percentage-of-completion method. A portion of the revenues on
the contracts were initially recognized upon delivery of equipment with the
remaining revenues under the contract being recognized over the installation
period based on the relationship of incurred labor to total estimated labor. In
light of the new guidance issued in SAB 101, effective January 1, 2000,
Solutions changed its method of accounting for new systems sales and upgrades
from the percentage-of-completion method to the completed contract method. The
provisions of SAB 101 permit Solutions to treat this change in accounting
principle as a cumulative effect adjustment consistent with rules issued under
Accounting Principles Board Opinion No. 20. The cumulative effect of the
accounting change resulted in a charge to first-quarter 2000 of $21.6 million
(net of income tax benefits of $14.9 million and minority interest of $21
million). Solutions recognized $63.2 million and $201.4 million of revenue for
the three and six months ended June 30, 2000, respectively, for contracts
completed in 2000 which were previously reported under the
percentage-of-completion method.
Effective January 1, 1999, Williams adopted Statement of Position (SOP)
98-5, "Reporting on the Costs of Start-Up Activities." The SOP requires that all
start-up costs be expensed as incurred and the expense related to the initial
application of this SOP of $5.6 million (net of a $3.6 million benefit for
income taxes) is reported as the cumulative effect of change in accounting
principle in first-quarter 1999.
SECOND QUARTER 2000
<PAGE> 9
OPERATING STATISTICS [WILLIAMS LOGO]
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
--------------------- ---------------------
2000 1999 2000 1999
------ ------ ------ ------
<S> <C> <C> <C> <C>
Gas Pipeline:
Central
Throughput (TBtu) 56.3 61.0 160.4 169.9
Average daily transportation volumes (TBtu) .6 .7 .9 .9
Average daily firm reserved capacity (TBtu) 2.1 2.2 2.2 2.1
Kern River Gas Transmission
Throughput (TBtu) 74.1 73.7 153.4 151.8
Average daily transportation volumes (TBtu) .8 .8 .8 .8
Average daily firm reserved capacity (TBtu) .7 .7 .7 .7
Northwest Pipeline
Throughput (TBtu) 164.7 174.1 371.0 365.9
Average daily transportation volumes (TBtu) 1.8 1.9 2.0 2.0
Average daily firm reserved capacity (TBtu) 2.6 2.5 2.6 2.6
Texas Gas Transmission
Throughput (TBtu) 158.7 165.3 377.6 401.2
Average daily transportation volumes (TBtu) 1.7 1.8 2.1 2.2
Average daily firm reserved capacity (TBtu) 1.7 1.8 2.3 2.3
Transcontinental Gas Pipe Line
Throughput (TBtu) 416.0 379.1 905.1 835.8
Average daily transportation volumes (TBtu) 4.6 4.2 5.0 4.6
Average daily firm reserved capacity (TBtu) 6.2 6.2 6.4 6.1
Communications (at June 30):
Network
Planned route miles:
Single fiber network route miles 9,700
Other route miles wholly owned 12,800
Route miles under the asset defeasance program 3,300
Route miles jointly owned 1,300
Route miles through dark fiber rights 6,800
--------
Total planned route miles *33,900
Planned retained fiber miles 400,000
Route miles in operation 24,948 18,612
Route miles lit 25,811 18,762
Cable miles in the ground 28,439 21,361
</TABLE>
* Planned route miles are anticipated to total approximately 33,000 route miles
by the end of 2000, with the remaining route miles to be completed by the end
of first-quarter 2001.
SECOND QUARTER 2000
<PAGE> 10
OPERATING STATISTICS (CONTINUED) [WILLIAMS LOGO]
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
--------------------- ---------------------
2000 1999 2000 1999
------ ------ ------ ------
<S> <C> <C> <C> <C>
Energy Services:
Energy Marketing & Trading
Physical Trading
Natural gas (Bcf/d) 3.3 3.2 3.6 3.7
Power (GWh) 23,903 17,122 49,580 28,604
Exploration & Production
Natural gas production (TBtu) 15.5 14.2 32.3 26.7
Midstream Gas & Liquids
Field Services
Gathering volumes (TBtu) 513.1 540.7 1,040.2 1,070.6
Processing volumes (TBtu) 139.1 130.4 284.0 268.0
Natural gas liquids sales (million gallons) 287.3 165.2 562.2 338.6
Natural Gas Liquids Pipeline
Barrel miles - total system (billions) 35.3 34.3 71.5 65.6
Mid-America Pipeline deliveries (million barrels) 67.0 68.2 138.2 136.5
Seminole Pipeline deliveries (million barrels) 26.0 24.6 50.7 45.1
Rocky Mountain Extension deliveries (million barrels) 11.7 9.1 21.8 15.2
Petroleum Services
Petroleum Products Pipeline
Shipments (million barrels) 57.5 57.0 108.4 104.9
Barrel miles (billions) 18.7 16.4 31.9 30.6
Ethanol sales (million gallons) 53.3 48.6 108.2 89.1
Refining (crude runs)
Memphis (MBPD) 156.2 141.0 149.5 132.1
North Pole (MBPD) 185.3 185.7 188.3 177.1
Retail locations
Average monthly gasoline and diesel
sales per store (thousand gallons) 243.4 194.2 237.5 186.8
Average number of stores 273 259 273 258
</TABLE>
SECOND QUARTER 2000
