2020 ANNUAL REPORT the Williams Companies, Inc

2020 ANNUAL REPORT The Williams Companies, Inc. OUR MISSION Williams is committed to being the leader in providing infrastructure that safely delivers natural gas products to reliably fuel the clean energy economy. OUR CORE VALUES are engrained in how we do our work every day on behalf of our stakeholders. AT WILLIAMS, WE ARE:

AUTHENTIC SAFETY DRIVEN

RELIABLE RESPONSIBLE PERFORMERS STEWARDS

Front Cover: Willie B., Williams Safety & Health specialist IV, ARC Park, Ft. Worth, Texas. Table of Contents Forward-Looking Statements: Any statements included in this 2020 Annual Report that are not historical 1 Stockholder Letter facts, including, without limitation, statements regarding future market trends and results of operations are 3 Directors and Officers forward-looking statements within the meaning of applicable securities law. Such statements are subject to numerous risks and uncertainties beyond our control and our actual results may differ materially from our 5 Form 10-K forward-looking statements. Additional information concerning factors that may influence our results can be found in the Form 10-K under the heading “Part I, Item 1A. Risk Factors.” ALAN S. ARMSTRONG PRESIDENT AND CHIEF EXECUTIVE OFFICER

Dear Fellow Stockholders,

Williams achieved record results in ENGINEERING SAFETY INTO 2020 thanks to the attentiveness of our 2020, demonstrating how durable EVERYTHING WE DO employees, and we are setting the bar our business can be against multiple even higher for 2021. headwinds faced by our industry, Our safety driven culture shined including the COVID-19 pandemic through in 2020 as our employees MEETING TODAY’S ENERGY and associated oil price collapse, practiced extraordinary diligence NEEDS WHILE FOCUSING major customer bankruptcies and behind the scenes to ensure ON TOMORROW’S CLEAN a highly active hurricane season uninterrupted service to some of the ENERGY FUTURE in the Gulf of Mexico. This tumultuous most populated regions of the U.S. and 2020 market environment allowed smaller communities in between. We Driven by strong operational us to truly distinguish ourselves as often take our warm and well-lit homes performance, we set records in we surpassed guidance midpoints for granted, but it has taken great 2020 for both gathered volumes and in our key financial metrics and dedication, effort and resourcefulness contracted transmission capacity and once again produced positive free to keep our most basic energy needs achieved early in-service capacity for cash flow. available during these disruptive key pipeline expansion projects to times. Our teams quickly implemented serve growing demand for natural gas: As our 2020 performance clearly COVID-19 safety protocols and Transco’s Leidy South, an expansion illustrates, we’ve built a business that bolstered our robust contingency plans of Williams’ existing Pennsylvania is steady and predictable, thanks to to ensure reliability of our field assets infrastructure; Southeastern Trail, an intense focus on our natural gas- and control rooms. a Transco transmission expansion based strategy. Our best-in-class long project to serve growing demand in haul pipes are in the right places to These actions proved successful not the mid-Atlantic and southeastern meet critical energy needs and our only during the pandemic, but also U.S; and Bluestem, a natural gas formidable gathering assets are in during very active hurricane and wildfire liquids (NGL) transportation pipeline. low-cost basins that will be called on seasons. On top of these outside We credit the proactive engagement to meet growing natural gas demand. challenges, our employees completed and open communication with And as interest around a clean energy projects, performed maintenance and stakeholders throughout the permitting future accelerates, our strategy operated our assets in a way that sets and regulatory process as well as provides significant solutions we the industry standard. We significantly expeditious and COVID-safe project can execute on today. reduced our recordable injuries in execution for completing major

2020 Annual Report The Williams Companies, Inc. 1 ADAM H. ENVIRONMENTAL SPECIALIST III TRANSCO RIGHT-OF-WAY, DUSHORE, PENNSYLVANIA

projects ahead of schedule and putting the company on a positive relief and accelerating grants to first under budget. trajectory to be net zero carbon responders, food pantries and other emissions by 2050. With a near-term social service agencies. Looking ahead, we continue to see goal for 2030, Williams is leveraging the signs of strong demand for a its natural gas-focused strategy and Looking inward, we’re not only lower carbon energy future and our technology that is available today to recruiting and retaining a diverse expansive network serving our nation’s pursue pragmatic methane emissions workforce, but developing forward- most densely populated areas uniquely reduction opportunities through leak thinking leaders who will proudly lead positions us to meet these demands. detection and repair, work practice our company into a future where We are also beginning to integrate improvements, and equipment racism and gender inequality have renewable energy into our systems upgrades on a site-specific basis. been left in the dust where they with solar installations and renewable belong. We also continue to broaden natural gas (RNG). We are already In addition to setting aggressive, and diversify our Board of Directors increasing the delivery of RNG by nearer term and actionable climate with two new appointments. partnering with energy companies in targets, we are committed to Washington, Idaho, Ohio, and Texas to transparent reporting to ensure In the end, sustainable shareholder transport methane emissions captured stakeholders can hold us accountable. value is simple at Williams. It’s about from landfills or dairy farms. Williams was recognized across always striving to do the right thing — several key ESG ratings and rankings, and that has been one of our guiding Our solar initiative includes up to most importantly the CDP, for our tenets for more than 100 years. That $400 million in economically attractive commitment to transparency and promise is growing stronger by the projects across nine states spanning governance around climate change. day as we look to a low carbon future Williams’ footprint to supply power These high marks demonstrate while delivering affordable energy for the large electric power loads at that Williams is on the right track today. On behalf of the entire Williams our various pipelines and gathering to successfully sustain and evolve organization, thank you for your facilities. We expect the first of these our natural gas-focused business to continued trust and investment projects to start coming online in 2023. reduce emissions while delivering in Williams. long-term value to stakeholders. SETTING THE PACE FOR SUSTAINABLE BUSINESS From a social perspective, we’ve OPERATIONS always been committed to empowering the communities where In 2020, Williams was the first U.S. we operate, investing approximately midstream company to establish a $10 million annually through the climate commitment by setting a near- Williams Foundation. However, this term goal of 56% absolute reduction past year we leaned in even more, Alan S. Armstrong from 2005 levels in company-wide funding an additional $1 million to the President and Chief Executive Officer greenhouse gas emissions by 2030, Williams Foundation for COVID-19 March 18, 2021

2 The Williams Companies, Inc. 2020 Annual Report DIRECTORS AND OFFICERS

DIRECTORS BOARD COMMITTEES

ALAN S. ARMSTRONG SCOTT D. SHEFFIELD Audit Committee Tulsa, Oklahoma Irving, Texas President and Chief Chief Executive Officer, Stephen I. Chazen Executive Officer, Williams. Pioneer Natural Resources Company. Charles I. Cogut Director since 2011. Director since 2016. Michael A. Creel Stacey H. Doré STEPHEN W. BERGSTROM MURRAY D. SMITH Vicki L. Fuller The Woodlands, Texas Calgary, Alberta, Canada Peter A. Ragauss (Chair) Former President, President, Murray Smith Chief Executive Officer, and Associates; former Minister Compensation & Management and Executive Chairman of the Board of Energy for Alberta, Canada. Development Committee American Midstream Partners GP, LLC. Director since 2012. Stephen W. Bergstrom Chairman; Director since 2016. WILLIAM H. SPENCE Nancy K. Buese NANCY K. BUESE Allentown, Pennsylvania Rose M. Robeson Denver, Colorado Former Chairman, President and Chief Scott D. Sheffield (Chair) Executive Vice President Executive Officer, PPL Corporation. Murray D. Smith and Chief Financial Officer, Director since 2016. William H. Spence Newmont Corporation. Governance & HONORARY DIRECTOR Director since 2018. Sustainability Committee JOSEPH H. WILLIAMS STEPHEN I. CHAZEN Stephen W. Bergstrom Charleston, South Carolina Houston, Texas Stephen I. Chazen Chairman and Chief Executive President, Chief Executive Charles I. Cogut Officer for Williams from 1979 -94. Officer and Chairman, Stacey H. Doré Elected to the board in 1969. Magnolia Oil & Gas Corporation. Peter A. Ragauss Director since 2016. SENIOR OFFICERS William H. Spence (Chair) CHARLES I. COGUT ALAN S. ARMSTRONG Environmental, Health New York, New York President and Chief & Safety Committee Retired Partner, Simpson Executive Officer Thacher & Bartlett LLP. Nancy K. Buese Director since 2016. MICHEAL G. DUNN Michael A. Creel Executive Vice President Vicki L. Fuller MICHAEL A. CREEL and Chief Operating Officer Rose M. Robeson The Woodlands, Texas Scott D. Sheffield Former Chief Executive Officer, WALTER J. BENNETT Murray D. Smith (Chair) Enterprise Products Partners L.P. Senior Vice President, Director since 2016. Gathering & Processing

STACEY H. DORÉ JOHN D. CHANDLER Dallas, Texas Senior Vice President and President and CEO, Chief Financial Officer Sharyland Utilities Director since 2021. DEBBIE L. COWAN Senior Vice President and VICKI L. FULLER Chief Human Resources Officer Brooklyn, New York Former Chief Investment Officer, New SCOTT A. HALLAM York State Common Retirement Fund. Senior Vice President, Director since 2018. Transmission and Gulf of Mexico

PETER A. RAGAUSS CHAD A. TEPLY Houston, Texas Senior Vice President, Former Senior Vice President Project Execution and Chief Financial Officer, T. LANE WILSON Baker Hughes Incorporated. Senior Vice President Director since 2016. and General Counsel ROSE M. ROBESON CHAD J. ZAMARIN Centennial, Colorado Senior Vice President, Former Chief Financial Officer, Corporate Strategic Development DCP Midstream LLC. Director since 2020.

2020 Annual Report The Williams Companies, Inc. 3

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K (Mark One) ANNUAL REPORT PURSUANTTOSECTION13OR15(d) OF THE SECURITIES EXCHANGE ☑ ACT OF 1934 For the fiscal year ended December 31, 2020 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ☐ EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-4174 The Williams Companies, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Delaware 73-0569878 (State or Other Jurisdiction of (IRS Employer Incorporation or Organization) Identification No.) One Williams Center Tulsa Oklahoma 74172 (Address of Principal Executive Offices) (Zip Code) 918-573-2000 (Registrant’s Telephone Number, Including Area Code) Securities registered pursuant to Section 12(b)ofthe Act:

Title of Each Class TradingSymbol(s) Name of Each Exchange on Which Registered Common Stock, $1.00 par value WMB New York Stock Exchange Securities registered pursuant to Section 12(g) of theAct: None Indicate by check mark if the registrant is awell-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☑ No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.Yes ☐ No ☑ Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐ Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐ Indicate by check mark whether the registrant is alarge accelerated filer, an accelerated filer, anon-acceleratedfiler, asmaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☑ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐ If an emerging growth company, indicate by check mark if the registrant has electednot to use the extended transition period for complying with any new or revised financial accounting standards providedpursuant to Section 13(a) of the Exchange Act. ☐ Indicate by check mark whether the registrant has filed areport on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C.7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☑ Indicate by check mark whether the registrant is ashell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☑ The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold as of the last business day of the registrant’s most recently completed second quarter was approximately $23,078,419,375. The number of shares outstanding of the registrant’s common stock outstanding at February 19, 2021 was 1,213,790,391. DOCUMENTSINCORPORATED BY REFERENCE Portions of the Registrant’s Definitive Proxy Statement for the Registrant’s Annual Meeting of Stockholders to be held on April 27, 2021, are incorporated into Part III, as specifically set forth in Part III.

THE WILLIAMS COMPANIES, INC.

FORM10-K

TABLEOFCONTENTS

Page PART I Item 1. Business...... 4 General...... 4 Service Assets, Customers, and Contracts...... 5 Business Segments...... 7 Transmission &Gulf of Mexico...... 8 Northeast G&P...... 11 West...... 13 Other...... 15 Regulatory Matters...... 15 Environmental Matters...... 18 Competition...... 18 Human Capital Resources...... 19 Website Access to Reports and Other Information...... 21 Item 1A. Risk Factors...... 22 Item 1B. Unresolved Staff Comments...... 36 Item 2. Properties...... 37 Item 3. Legal Proceedings...... 37 Item 4. Mine Safety Disclosures...... 37 Information About Our Executive Officers...... 38 PART II Item 5. Market for Registrant’s Common Equity, Related StockholderMatters and Issuer Purchases of Equity Securities...... 40 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations...... 41 Item 7A. Quantitative and Qualitative Disclosures About Market Risk...... 65 Item 8. Financial Statements and Supplementary Data...... 66 Item 9. Changes in and Disagreementswith Accountants on Accounting and Financial Disclosure...... 138 Item 9A. Controls and Procedures...... 138 Item 9B. Other Information...... 141 PART III Item 10. Directors, Executive Officers and Corporate Governance...... 141 Item 11. Executive Compensation...... 141 Item 12. Security Ownership of Certain Beneficial Owners and Management and RelatedStockholder Matters...... 141 Item 13. Certain Relationships and Related Transactions, and Director Independence...... 142 Item 14. Principal Accountant Fees and Services...... 142 PART IV Item 15. Exhibits and Financial Statement Schedules...... 143 Item 16. Form 10-K Summary...... 152

1 DEFINITIONS

The following is alisting of certain abbreviations, acronyms, and otherindustry terminology thatmay be used throughout thisAnnual Report.

Measurements:

Barrel:One barrelofpetroleum productsthatequals42U.S. gallons Mbbls/d:One thousand barrels perday

Bcf :One billion cubicfeetofnatural gas Bcf/d:One billion cubic feetofnaturalgas per day MMcf/d:One million cubic feetper day

British Thermal Unit (Btu):Aunit of energy needed to raise the temperature of one pound of waterbyone degreeFahrenheit Tbtu:One trillion British thermal units

Dekatherms(Dth):Aunitofenergy equal to one million British thermal units Mdth/d:One thousand dekatherms perday MMdth:One million dekathermsorapproximatelyone trillion British thermalunits MMdth/d:One million dekathermsper day

Consolidated Entities: Caiman II: Caiman Energy II, LLC, (renamedBlueRacer Midstream Holdings, LLC, effective February 2, 2021) aformerequity-method investment whichisaconsolidated entityfollowing our November2020 acquisition of an additional ownership interest Cardinal: Cardinal Gas Services, L.L.C. Gulfstar One: Gulfstar One LLC Northwest Pipeline: Northwest Pipeline LLC Transco: Transcontinental GasPipe Line Company, LLC UEOM: Utica East Ohio Midstream LLC, previously aPartially OwnedEntityuntilacquiring remaining interest in March2019 Northeast JV: Ohio Valley MidstreamLLC,apartiallyowned venture thatincludesour Ohio Valley assets and UEOM WPZ: Williams Partners L.P.Effective August 10, 2018, we completed our merger with WPZ, pursuant to which we acquiredall outstanding common unitsofWPZ heldbyothers and Williams continued as the surviving entity.

Partially OwnedEntities:Entities in whichwedonot own a100 percent ownershipinterest and which, as of December31, 2020, we account for as equity-method investments, including principallythe following: Aux Sable: Aux Sable Liquid ProductsLP Blue Racer: Blue Racer Midstream LLC Constitution: Constitution Pipeline Company, LLC Discovery: Discovery ProducerServices LLC Gulfstream: GulfstreamNatural Gas System,L.L.C.

2 Jackalope: Jackalope GasGathering Services,L.L.C., which wassold in April 2019 LaurelMountain: LaurelMountainMidstream,LLC OPPL: Overland Pass Pipeline Company LLC RMM: Rocky Mountain MidstreamHoldings LLC Targa Train7: Targa Train7LLC

Government andRegulatory: EPA: Environmental Protection Agency Exchange Act, the: Securitiesand Exchange Actof1934, as amended FERC: FederalEnergy Regulatory Commission IRS: InternalRevenue Service SEC: Securities and Exchange Commission

Other: EBITDA: Earnings before interest, taxes, depreciation, and amortization Fractionation:The process by which amixed streamofnatural gas liquids is separatedintoconstituent products, such as ethane,propane,and butane GAAP:U.S. generallyacceptedaccounting principles LNG: Liquefiednatural gas; naturalgas which hasbeen liquefiedatcryogenic temperatures MVC: Minimum volume commitments NGLs: Naturalgas liquids; natural gas liquids resultfrom natural gas processing and crude oil refining and are used as petrochemicalfeedstocks, heating fuels, and gasoline additives, among otherapplications NGL margins:NGL revenues less Btu replacement cost, plant fuel, transportation, and fractionation WPZ Merger: The August 10, 2018, merger transactions pursuant to which we acquiredall outstanding common unitsofWPZ heldbyothers, merged WPZ intoWilliams, and Williams continued as the surviving entity.

The statements in this Annual Report that are not historical information, including statements concerning plans and objectives of management for future operations, economic performance or related assumptions, are forward-looking statements.Forward-looking statements may be identified by various forms of words such as “anticipates,” “believes,” “seeks,” “could,” “may,” “should,” “continues,” “estimates,” “expects,” “forecasts,” “intends,” “might,” “goals,” “objectives,” “targets,” “planned,” “potential,” “projects,” “scheduled,” “will,”“assumes,” “guidance,” “outlook,” “in-servicedate,” or othersimilar expressions and otherwords and terms of similar meaning. Although we believe that our expectations regarding future events are based on reasonableassumptions, we can givenoassurancethat such expectations or assumptions will be achieved. Additional information regarding forward-looking statements and important factors that could cause actual results to differmaterially from those in the forward-looking statements are describedunder PartI,Item1AinthisAnnual Report.

3 PARTI

Item 1. Business

In this report,Williams(which includesThe Williams Companies,Inc. and, unless the context otherwise indicates, allofour subsidiaries) is at timesreferredtointhe firstpersonas“we,” “us,” or “our.” We also sometimes refertoWilliamsasthe “Company.”

GENERAL

We are an energy infrastructure company committed to be the leaderinproviding infrastructure thatsafely delivers natural gas productstoreliably fuel the cleanenergy economy. We have operations in 15 supply areas that provide natural gas gathering, processing, and transmission services and natural gas liquids fractionation, transportation, and storage services to more than 600 customers. We own an interest in and operate over 30,000 milesofpipelines, 34 processing facilities, 9fractionation facilities, and approximately 23 million barrels of NGL storage capacity, handling approximately30percent of the nation’s natural gas volumes.

We were founded in 1908, originally incorporated under the lawsofthe state of Nevada in 1949 and reincorporatedunder the laws of the state of Delaware in 1987. Our common stocktrades on the NewYorkStock Exchange under the symbol “WMB.”Our operations are locatedinthe United States. Williams’ headquarters are located in Tulsa, Oklahoma, with othermajor offices in Salt Lake City, Utah; Houston, Texas; and Pittsburgh, Pennsylvania. Our telephone number is 918-573-2000.

4 Service Assets, Customers,and Contracts

InterstateNatural Gas Pipeline Assets

Our interstate natural gas pipelines,whichare presented in our Transmission &Gulf of Mexicosegmentas described under the heading “Business Segments,” are subject to regulation by the FERCand as such, our rates and charges for the transportation of natural gas in interstate commerceare subject to regulation. The rates are established through theFERC’s ratemaking process.

Our interstate natural gas pipelines transportand store natural gas forabroad mixofcustomers,including local natural gas distribution companies, publicutilities, municipalities, direct industrialusers,electricpower generators, and natural gas marketers and producers. Our interstate natural gas transmission businesses are fullycontracted under long-term firm reservation contracts with high credit qualitycustomers. These contractshave various expiration dates and account for the major portion of our regulated businesses, and are not exposed to crude oil prices. Additionally, we offer storage services and interruptibletransportation services under shorter-term agreements. Transco’s and Northwest Pipeline’s three largest customers in 2020 accounted for approximately 28 percent and 51 percent, respectively, of theirtotal operating revenues. Gathering, Processing, and Treating Assets

Our gathering, processing, and treating operations are presented withinour Transmission &Gulf of Mexico, Northeast G&P, and West reporting segmentsasdescribedunder theheading “BusinessSegments.”

Our gathering systemsreceive natural gas from producers’ crude oil and natural gas wells and gather these volumes to gas processing, treating, or redelivery facilities. Typically, natural gas,inits raw form, is not acceptable for transportation in major interstate natural gas pipelines or for commercial use as afuel.Our treating facilities

5 remove watervapor, carbon dioxide, and othercontaminants, and collect condensate. We are generally paidafee based on thevolume of natural gas gatheredand/or treated, generallymeasured in the Btuheating value.

In addition, natural gas contains various amounts of NGLs, which generally have ahigher value when separated from the natural gas stream. Ourprocessing plants extract the NGLs, which include ethane,primarily used in the petrochemicalindustry; propane,used for heating, fuel,and also in the petrochemicalindustry; and, normalbutane, isobutane, andnatural gasoline, primarilyused by the refining industry.

Our gas processing services generaterevenuesprimarilyfrom thefollowing types of contracts:

•Fee-based: We are paidafee based on the volumeofnatural gas processed, generally measured in the Btu heating value. Aportion of our fee-based processing revenue includesashare of the margins on the NGLs produced. For the yearended December31, 2020, approximately 80 percent of our NGL production volumes were underfee-based contracts.

•Noncash commodity-based: We also process gas under two typesofcommodity-based contracts, keep- whole and percent-of-liquids, where we receive consideration for our services in the form of NGLs. For a keep-whole arrangement we replacethe Btu content of the retained NGLs with natural gas purchases, also known as shrink replacement gas.For apercent-of-liquids arrangement, we deliver an agreed-upon percentage of the extracted NGLsand retainthe remainder. Retained NGLsare referred to as our equity NGL production. Per-unit NGL margins are calculatedbased on salesofour own equity volumes at the processing plants. For the yearended December31, 2020, approximately 20 percent of our NGL production volumeswereundernoncash commodity-based contracts.

Generally, our gathering and processing agreementsare long-term agreements, with terms ranging from month- to-month to the life of the producing lease. Certaincontracts include cost of servicemechanisms that are designed to support areturn on invested capital and allow our gathering rates to be adjusted, subjecttospecifiedcapsin certain cases, to account for variability in volume, capital expenditures, commodity pricefluctuations, compression and otherexpenses. We also have certain gas gathering and processing agreementswith MVC,whereby the customer is obligated to pay acontractuallydeterminedfee based on any shortfallbetween the actual gatheredand processedvolumes and theMVC for astatedperiod.

Demand for gas gathering and processing services is dependent on producers’ drilling activities, which is impactedbythe strength of the economy, commodity prices, and the resultingdemand for natural gas by manufacturing and industrial companiesand consumers. Our gathering, processing, and treating businesses do not have direct exposure to crude oil prices. Our on-shore natural gas gathering and processing businesses are substantiallyfocused on gas-directed drilling basins rather than crude oil,with abroad diversity of basins and customers served. Declinesincrude oil drilling would be expected to result in less associatednatural gas production, which could drive more demand for natural gas producedfrom gas-directedbasins we serve.

During 2020, our facilitiesgatheredand processedgas and crude oil for approximately230 customers. Our top tencustomers accountedfor approximately 73 percent of our gathering and processing fee revenues and NGL margins from our noncash commodity-based agreements. We believecounterpartycredit concerns in our gathering and processing businesses are significantlymitigated by the physicalnature of our services, where we gather at the wellheadand are therefore criticaltoaproducer’s ability to move product to market.

Crude OilTransportation and Production Handling Assets

Our crude oil transportation operations, which are presented in our Transmission &Gulf of Mexicosegment as described under the heading “BusinessSegments,” earn revenues typically by volumetric-based fee arrangements. Revenue sources have historicallyincludedacombination of fixed-fee,volumetric-based fee,and cost reimbursement arrangements. Generally, fixedfeesassociatedwith the production at our Gulf Coastproduction handling facilitiesare recognized on aunits-of-production basis.Certainfixedfeesassociatedwith the production at our Gulfstar One facility arerecognized based on contractuallydeterminedmaximum daily quantities. Our crude oil transportation businessissupported mostly by majoroil producers with long-cycleperspectives.

6 Keyvariables for allofour businesseswillcontinue to be:

•Obstacles to our expansion efforts, including delays or denialsofnecessary permitsand opposition to hydrocarbon-based energy development;

•Producerdrilling activitiesimpacting natural gas supplies supporting our gathering and processing volumes;

•Retainingand attracting customers by continuing to provide reliableservices;

•Revenue growth associatedwith additionalinfrastructure eithercompletedorcurrentlyunder construction;

•Prices impacting our commodity-based activities;

•Disciplined growth in our serviceareas.

BUSINESS SEGMENTS

Consistentwith themanner in which our chief operating decision maker evaluatesperformanceand allocates resources, our operations are conducted, managed, and presentedinPart IofthisAnnual Report withinthe following reportablesegments: Transmission &Gulf of Mexico, Northeast G&P, and West.

Our reportable segments are comprised of thefollowing business activities:

•Transmission &Gulf of Mexicoiscomprised of our interstate natural gas pipelines, Transco and Northwest Pipeline,aswell as natural gas gathering and processing and crude oil production handling and transportation assets in the Gulf Coastregion, including a51percent interest in Gulfstar One (a consolidatedvariable interest entity), which is aproprietary floating production system,a50percent equity-method investment in Gulfstream, anda60percent equity-method investment in Discovery.

•Northeast G&P is comprised of our midstreamgathering, processing, and fractionation businesses in the Marcellus Shale region primarily in Pennsylvaniaand New York, and the Utica Shale region of eastern Ohio, as well as a65percent interest in our Northeast JV (a consolidated variableinterest entity) which operatesinWestVirginia, Ohio, and Pennsylvania, a66percent interest in Cardinal (a consolidated variableinterest entity) which operatesinOhio, a69percent equity-method investment in Laurel Mountain, a99percent interest in CaimanII(aformerequity-method investment which is aconsolidatedentity following our November2020 acquisition of an additional ownershipinterest) which owns a50percent equity-method investment in Blue Racer, and AppalachiaMidstreamInvestments, awholly owned subsidiary thatowns equity-method investments withanapproximate average 66 percent interest in multiple gas gathering systemsinthe Marcellus Shale region.

•West is comprised of our gas gathering, processing, and treating operations in the Rocky Mountainregion of Colorado and Wyoming, the BarnettShale region of north-central Texas,the Eagle Ford Shale region of south Texas, the Haynesville Shaleregion of northwestLouisiana,and the Mid-Continent region which includesthe Anadarko, Arkoma, and Permian basins.Thissegment also includesour NGL and natural gas marketing business, storage facilities, an undivided 50 percent interest in an NGL fractionator near Conway, Kansas, a50percent equity-method investment in OPPL,a50percent equity-method investment in RMM, and a20percent equity-method investment in Targa Train 7.

•Other includes minor businessactivities thatare not reportablesegments, as well as corporate operations.

Detailed discussion of each of our reporting segments follows. For adiscussion of our ongoing expansion projects, see Part II, Item7.Management’s Discussion and Analysis of FinancialCondition and Resultsof Operations.

7 Transmission&Gulf of Mexico

Thissegmentincludes the Transcointerstate natural gas pipelinethat extends from the Gulf of Mexicotothe eastern seaboard, the NorthwestPipeline interstate natural gas pipeline, as well as natural gas gathering, processing and treating, crude oil production handling, and NGL fractionation assets within the onshore,offshore shelf, and deepwaterareas in and around the Gulf Coaststates of Texas, Louisiana,Mississippi, and Alabama.Thissegment also includesvarious petrochemicaland feedstockpipelines in theGulfCoast region.

Transco

Transco is an interstate natural gas transmission company thatowns and operatesa9,800-mile natural gas pipeline system,which is regulatedbythe FERC, extending from Texas, Louisiana,Mississippi, and the Gulf of Mexicothrough Alabama,Georgia,South Carolina,North Carolina,Virginia, Maryland, Delaware, Pennsylvania, and New Jerseytothe New YorkCitymetropolitanarea. The system serves customers in Texas and 12 southeast and Atlanticseaboard states, including major metropolitan areas in Georgia,North Carolina,Washington, D.C., Maryland, New York, NewJersey, and Pennsylvania.

At December 31, 2020, Transco’s system had asystem-wide delivery capacitytotaling approximately 17.9 MMdth/d. During 2020, Transco completedone fully-contractedexpansion and beganpartialearly serviceontwo additional fully-contractedexpansions, which addedmore than 0.5 MMdthoffirm transportation capacityper day to our pipeline. Transco’s system includes 57 compressor stations, four underground storage fields,and one LNG storage facility. Compression facilitiesatsea level-rated capacity totalapproximately2.3 million horsepower.

Transco has natural gas storage capacityinfour underground storage fields located on or nearits pipeline system or market areasand operatestwo of these storage fields. Transco also has storage capacityinanLNG storage facilitythatitowns and operates. The totalusable gas storage capacityavailabletoTransco and itscustomers in such underground storage fields and LNG storage facility andthrough storage servicecontracts is approximately 194 MMdthofnatural gas.AtDecember 31, 2020, Transco’s customers had stored in itsfacilitiesapproximately 148 MMdthofnatural gas.Storage capacitypermitsour customers to injectgas into storage during the summer and off-peakperiods for delivery during peakwinterdemand periods.

Northwest Pipeline

Northwest Pipeline is an interstatenatural gas transmissioncompany thatowns and operatesa3,900-mile natural gas pipeline system,which is regulatedbythe FERC, extending from the San Juan basin in northwestern New Mexicoand southwestern Colorado through Colorado, Utah, Wyoming, Idaho, Oregon, and Washington to a point on the Canadian border nearSumas,Washington. Northwest Pipeline providesservices for marketsin Washington, Oregon, Idaho, Wyoming, Nevada,Utah, Colorado, New Mexico, California, and Arizona,either directly or indirectly through interconnections with other pipelines.

At December 31, 2020, Northwest Pipeline’s systemhad long-term firm transportation and storage redelivery agreementswith aggregatecapacityreservations of approximately 3.8 MMdth/d. Northwest Pipeline’s system includes 42 transmission compressor stations having acombinedsea level-rated capacityofapproximately 473,000 horsepower.

Northwest Pipeline owns aone-third undivided interest in the Jackson Prairieunderground storage facility in Washington and contracts withathird partyfor natural gas storage services in the Clay basin underground field in Utah. Northwest Pipeline also owns and operatesanLNG storage facility in Washington. These storage facilities have an aggregateworking natural gas storage capacityof14.2 MMdth, which is substantiallyutilizedfor third- partynatural gas.These natural gas storage facilitiesenable NorthwestPipeline to balancedaily receipts and deliveriesand provide storage services to customers.

8 Gas Transportation, Processing, and Treating Assets

The following tables summarize the significant operatedassetsofthis segment:

Offshore Natural Gas Pipelines Inlet Pipeline Capacity Ownership Location Miles (Bcf/d) Interest Supply Basins Consolidated: Canyon Chief, including Blind Faith and Gulfstar extensions...... Deepwater Gulf of Mexico 156 0.5 100% Eastern Gulf of Mexico Norphlet...... Deepwater Gulf of Mexico 58 0.3 100% Eastern Gulf of Mexico Other Eastern Gulf...... Offshore shelf and other 46 0.2 100% Eastern Gulf of Mexico Seahawk...... Deepwater Gulf of Mexico 115 0.4 100% Western Gulf of Mexico Perdido Norte...... Deepwater Gulf of Mexico 105 0.3 100% Western Gulf of Mexico Other Western Gulf...... Offshore shelf and other 103 0.4 100% Western Gulf of Mexico Non-consolidated: (1) Discovery...... Central Gulf of Mexico 594 0.6 60% Western Gulf of Mexico

Natural Gas Processing Facilities NGL Inlet Production Capacity Capacity Ownership Location (Bcf/d) (Mbbls/d) Interest Supply Basins Consolidated: Markham...... Markham, TX 0.5 45 100% Western Gulf of Mexico Mobile Bay...... Coden, AL 0.7 35 100% Eastern Gulf of Mexico Non-consolidated: (1) Discovery...... Larose, LA 0.6 32 60% Western Gulf of Mexico ______(1) Includes 100 percent of the statistics associatedwithoperatedequity-method investments.

Crude OilTransportation and Production Handling Assets In addition to our natural gas assets, we own and operate four deepwatercrude oil pipelines and own production platformsserving the deepwaterinthe Gulf of Mexico. Our offshore floating production platformsprovide centralizedservices to deepwaterproducers such as compression, separation, production handling, waterremoval, and pipeline landings. The following tablessummarizethe significant crude oil transportation pipelines and production handling platformsofthis segment:

Crude Oil Pipelines

PipelineCapacity Ownership Miles (Mbbls/d) Interest Supply Basins Consolidated: Mountaineer, including Blind Faith and Gulfstar extensions...... 155 150 100% Eastern Gulf of Mexico BANJO...... 57 90 100% Western Gulf of Mexico Alpine...... 96 85 100% Western Gulf of Mexico Perdido Norte...... 74 150 100% Western Gulf of Mexico

9 Production Handling Platforms Crude/NGL Gas Inlet Handling Capacity Capacity Ownership (MMcf/d) (Mbbls/d) Interest Supply Basins Consolidated: Devils Tower...... 110 60 100% Eastern Gulf of Mexico Gulfstar IFPS (1)...... 172 80 51% Eastern Gulf of Mexico

Non-consolidated: (2) Discovery...... 75 10 60% Western Gulf of Mexico ______(1) Statistics reflect100 percent of theassets from our 51 percent interest in GulfstarOne. (2) Includes 100 percent of the statistics associatedwith operated equity-method investments.

Transmission &Gulf of MexicoOperating Statistics

2020 2019 2018 Consolidated: Interstatenaturalgas pipeline throughput (Tbtu/d)...... 15.1 15.3 14.0 Gathering volumes(Bcf/d) ...... 0.25 0.25 0.26 Plant inletnaturalgas volumes (Bcf/d) ...... 0.48 0.54 0.50 NGL production (Mbbls/d) (2)...... 29 32 32 NGL equity sales(Mbbls/d) (2)...... 576 Crude oiltransportation (Mbbls/d) (2)...... 121 136 140

Non-consolidated: (1) Interstatenaturalgas pipeline throughput (Tbtu/d)...... 1.2 1.2 1.3 Gathering volumes(Bcf/d)...... 0.30 0.36 0.26 Plant inletnaturalgas volumes (Bcf/d)...... 0.30 0.36 0.27 NGL production (Mbbls/d) (2)...... 21 25 20 NGL equity sales(Mbbls/d) (2)...... 664 ______(1) Includes 100 percent of the volumes associatedwithoperated equity-method investments. (2) Annualaverage Mbbls/d.

Certain Equity-Method Investments

Gulfstream

Gulfstreamisa745-mile interstatenatural gas pipeline system extending from the MobileBay areainAlabama to marketsinFlorida,which has acapacitytotransport 1.3 Bcf/d. We own, through asubsidiary, a50percent equity-method investment in Gulfstream. We share operating responsibilitiesfor Gulfstreamwith the other50 percent owner.

Discovery

We own a60percent interest in and operate the facilitiesofDiscovery. Discovery’s assets include a600 MMcf/d cryogenic natural gas processing plant nearLarose, Louisiana,a32Mbbls/dNGL fractionator plant near Paradis, Louisiana,and a594-mile offshore natural gas gathering and transportation system in the Gulf of Mexico.

10 Discovery’s mainline has agatheringinlet capacityof600 MMcf/d. Discovery’s assetsalsoinclude acrude oil production handling platform withcapacityof10Mbbls/d andgas handling and separation capacityof75MMcf/d.

Northeast G&P

Thissegmentincludesour natural gas gathering, compression, processing, and NGL fractionation businesses in the Marcellus and UticaShaleregions in Pennsylvania,WestVirginia,New York,and Ohio.

The following tablessummarizethe significant operatedassetsofthis segment: Natural Gas Gathering Assets Inlet PipelineCapacity Ownership Location Miles (Bcf/d) Interest Supply Basins Consolidated: Ohio, West Virginia, & Ohio Valley Midstream (1)...... Pennsylvania 216 0.8 65% Appalachian Utica East Ohio Midstream (1) (2). Ohio 53 0.5 65% Appalachian Susquehanna Supply Hub...... Pennsylvania &New York 462 4.3 100% Appalachian Cardinal (1)...... Ohio 378 0.8 66% Appalachian Flint...... Ohio 95 0.5 100% Appalachian

Non-consolidated: (3) Bradford Supply Hub...... Pennsylvania 733 4.0 66% Appalachian Marcellus South...... Pennsylvania &West Virginia 325 1.0 68% Appalachian Laurel Mountain...... Pennsylvania 1,145 0.9 69% Appalachian Blue Racer...... West Virginia &Ohio 723 1.5 50% Appalachian Natural Gas Processing Facilities NGL Inlet Production Capacity Capacity Ownership Location (Bcf/d) (Mbbls/d) Interest Supply Basins Consolidated: (1) Fort Beeler...... Marshall County, WV 0.5 62 65% Appalachian Oak Grove...... Marshall County, WV 0.4 50 65% Appalachian Kensington...... Columbiana Co., OH 0.6 68 65% Appalachian Leesville...... Carroll Co., OH 0.2 18 65% Appalachian

Non-Consolidated: (3) Berne...... Monroe Co., OH 0.4 60 50% Appalachian Natrium...... Marshall Co., WV 0.8 120 50% Appalachian ______(1) Statistics reflect100 percent of the assets from our 65 percent ownership in our Northeast JV and 66 percent ownership of Cardinal gathering system. (2) UEOM inlet capacityconsists of 1.3 Bcf/d of ahigh pressure gathering pipeline thatdelivers Cardinal gathering volumes to UEOM processing facilities. The listed inletcapacityof0.5 Bcf/d is incremental capacitytothe Cardinal gathering capacityof0.8 Bcf/d. (3) Includes 100 percent of the statistics associatedwith operated equity-method investments.

OtherNGL Operations

We own and operate a43Mbbls/dNGL fractionation facilityatMoundsville, West Virginia, de-ethanization and condensate facilitiesatour Oak Grove processing plant, acondensate stabilization facilitynearour Moundsville fractionator, and an ethane transportation pipeline. Our Oak Grove de-ethanizer is capableofhandling up to approximately 80 Mbbls/dofmixed NGLstoextractuptoapproximately 40 Mbbls/dofethane.Our condensate

11 stabilizers are capableofhandling approximately 17 Mbbls/d of field condensate.Wealsoown and operate 44 Mbbls/d of condensate stabilization capacity, a135 Mbbls/d NGL fractionation facility, approximately 970,000 barrels of NGL storage capacity, and other ancillary assets, including loading and terminalfacilitiesinOhio.

NGLsare extracted from the natural gas streaminour Oak Grove and Fort Beeler cryogenicprocessing plants. Ethane producedatour de-ethanizer is transportedtomarketsvia our 50-mile ethane pipeline from Oak Grove to Houston, Pennsylvania. The remaining mixed NGL stream from the de-ethanizer is thentransported via pipeline and fractionated at eitherour MoundsvilleorHarrison County, Ohio, fractionation facility. The resultingproductsare thentransported on truckorrail. Ohio Valley Midstreamprovidesresidue natural gas take away options for our customers with interconnections to three interstate transmission pipelines.

Northeast G&P Operating Statistics

2020 2019 2018 Consolidated: Gathering volumes(Bcf/d)...... 4.31 4.24 3.63 Plant inletnaturalgas volumes (Bcf/d)...... 1.32 1.04 0.52 NGL production (Mbbls/d) (1)...... 101 76 46 NGL equity sales(Mbbls/d) (1)...... 234

Non-consolidated: (2) Gathering volumes(Bcf/d)...... 4.78 4.29 3.76 ______(1) Annualaverage Mbbls/d. (2) Includes 100 percent of the volumes associatedwithoperatedequity-method investments, including the Laurel Mountain Midstream partnership; and the Bradford Supply Hub and aportion of the Marcellus South Supply Hub withinAppalachiaMidstreamInvestments. Beginning November18, 2020, we operate Blue Racer. Blue Racergatheringvolumes of 1.38 Bcf/d, plant inlet natural gas volumes of 0.95 Bcf/d, NGL production of 65 Mbbls/d, and NGL equity sales of 6Mbbls/d have beenexcluded.

Acquisition of UEOM and formation of Northeast JV

As of December31, 2018, we owned a62percent interest in UEOM which we accountedfor as an equity- method investment. On March 18, 2019, we signed and closed the acquisition of the remaining 38 percent interest in UEOM. As aresult of acquiring thisadditional interest, we obtainedcontrol of and now consolidateUEOM. (See Note 3–Acquisitions and DivestituresofNotes to ConsolidatedFinancialStatements).

In June 2019, we contributedour consolidated interests in UEOM and our Ohio Valley midstreambusinesstoa newly formedpartnership, and we retained 65 percent ownershipof, as wellasoperate and consolidate, the Northeast JV business.

Certain Equity-Method Investments

AppalachiaMidstream Investments

Through our AppalachiaMidstreamInvestments, we operate 100 percent of and own an approximate average 66 percent interest in the Bradford Supply Hub gathering system and own an approximate average 68 percent interest in the Marcellus South gathering system,togetherwhich consistofapproximately 1,058 milesofgathering pipeline in the Marcellus Shale region with the capacitytogather 5,031 MMcf/d of natural gas.The majority of our volumes in the region are gatheredfrom northern Pennsylvania, southwestern Pennsylvania, and the northwestern panhandle of West Virginiaincore areasofthe Marcellus Shale. We operate the assets under long-term,100 percent fixed-fee gathering agreementsthatinclude significant acreage dedications and, in the Bradford Supply Hub, acost of servicemechanism. Additionally, some Marcellus South agreementshave MVCs.

12 LaurelMountain

We own a69percent interestinajoint venture, Laurel Mountain, thatincludesa1,145-mile gathering system thatweoperate in western Pennsylvaniawith the capacitytogather 0.9 Bcf/dofnatural gas.LaurelMountain has a long-term, dedicated, volumetric-based fee agreement, with exposure to natural gas prices, to gather the anchor customer’s production in the western Pennsylvania areaofthe Marcellus Shale.

Blue Racer

Blue Racerisajoint venture to own, operate,develop, and acquire midstreamassets in theUtica Shale and certain adjacent areasinthe Marcellus Shale. BlueRacer’s assets include 723 milesofgathering pipelines, and the Natrium complexinMarshall County, West Virginia, with acryogenic processing capacityof800 MMcf/d and fractionation capacityofapproximately 134 Mbbls/d. Blue Raceralso owns the Berne complexinMonroe County, Ohio, with acryogenic processing capacityof400 MMcf/d, and NGL and condensate pipelinesconnecting Natrium to Berne.Blue Racerprovidesgathering, processing, and marketing serviceprimarily under percentage of liquids and fixed feeagreements.

West

Gas Gathering, Processing, and Treating Assets

The following tablessummarizethe significant operatedassets of thissegment:

Natural Gas Gathering Assets Inlet Pipeline Capacity Ownership Supply Basins/Shale Location Miles (Bcf/d) Interest Formations Consolidated: Wamsutter...... Wyoming 2,265 0.7 100% Wamsutter Southwest Wyoming...... Wyoming 1,614 0.5 100% Southwest Wyoming Piceance...... Colorado 352 1.8 (1) Piceance Barnett Shale...... Texas 840 0.5 100% Barnett Shale Eagle Ford Shale...... Texas 1,280 0.5 100% Eagle Ford Shale Haynesville Shale...... Louisiana 629 1.8 100% Haynesville Shale Permian...... Texas 103 0.1 100% Permian Mid-Continent...... Oklahoma &Texas 2,248 0.9 100% Miss-Lime, Granite Wash, Colony Wash, Arkoma

Non-consolidated: (2) Rocky Mountain Midstream...... Colorado 200 0.6 50% Denver-Julesburg

13 Natural Gas Processing Facilities NGL Inlet Production Capacity Capacity Ownership Location (Bcf/d) (Mbbls/d) Interest Supply Basins Consolidated: Echo Springs...... Echo Springs, WY 0.7 58 100% Wamsutter Opal...... Opal, WY 1.1 47 100% Southwest Wyoming Willow Creek...... Rio Blanco County, CO 0.5 30 100% Piceance Parachute...... Garfield County, CO 1.1 6100% Piceance

Non-consolidated: (2) Fort Lupton...... Colorado 0.3 50 50% Denver-Julesburg Keenesburg I...... Colorado 0.2 40 50% Denver-Julesburg ______(1) Includes our 60 percent ownership of agathering system in the Ryan Gulchareawith140 milesofpipeline and 0.2 Bcf/d of inlet capacity, and our 67 percent ownership of agathering system at Allen Point with8miles of pipeline and 0.1 Bcf/d of inlet capacity. We operate both systems. We own and operate 100 percent of the balanceofthe Piceance gathering assets. (2) Includes 100 percent of the statistics associatedwith operated equity-method investments. Marketing Services

We market gas and NGL productstoawide range of users in the energy and petrochemicalindustries. The NGL marketing businesstransports and marketsour equity NGLsfrom the production at our processing plants, and also marketsNGLs on behalf of third-partyNGL producers, including some of our fee-based processing customers, and the NGL volumes owned by Discovery and RMM. The NGL marketing businessbears the riskofpricechanges in these NGL volumes whiletheyare being transported to finalsalesdelivery points. In order to meet sales contract obligations, we maypurchase productsinthe spot market for resale.

OtherNGL Operations

We own interests in and/or operate NGL fractionation and storage assets in centralKansasnearConway. These assets include a50percent interest in an NGL fractionation facilitywith capacityofslightly more than 100 Mbbls/d and we own approximately 20 million barrels of NGL storage capacity. We also own a189-mile NGL pipeline from our fractionator nearConway, Kansas, to an interconnection withathird-party NGL pipeline system in Oklahoma.

West Operating Statistics

2020 2019 2018 Consolidated: (1) Gathering volumes(Bcf/d)...... 3.33 3.52 4.27 Plant inletnaturalgas volumes (Bcf/d)...... 1.25 1.48 2.01 NGL production (Mbbls/d) (2)...... 49 54 84 NGL equity sales(Mbbls/d) (2)...... 22 22 33 Non-Consolidated: (3) Gathering volumes(Bcf/d)...... 0.25 0.20 0.08 Plant inletnaturalgas volumes (Bcf/d)...... 0.25 0.20 0.08 NGL production (Mbbls/d) (2)...... 23 12 3 ______(1) 2020 and 2019 volumesreflectthe absenceofFour Corners assets due to thesaleinOctober2018. (2) Annualaverage Mbbls/d. (3) Includes 100 percent of the volumes associatedwithoperatedequity-method investments, including RMM and Jackalope.Jackalope was aconsolidatedentityinfirst- and second-quarter2018, an equity-method investment during third- andfourth-quarter2018 as well as first-quarter2019, and sold effective withsecond-quarter2019.

14 Sale of Four Corners Assets

In October2018, we completed the sale of our natural gas gathering and processing assets in the Four Corners areaofNew Mexico and Colorado. The system wascomprisedof3,742 milesofgathering pipeline with 1.8 Bcf/dof gas gathering inlet capacity andtwo processing facilitieswithacombined0.7 Bcf/d of natural gas processing inlet capacityand 41 Mbbls/d of NGL production capacity.

Certain Equity-MethodInvestments

Overland Pass Pipeline

We also operate and own a50percent interest in OPPL.OPPL is capableoftransporting 255 Mbbls/d of NGLs and includesapproximately 1,035 milesofNGL pipelineextending from Opal, Wyoming, to the Mid-Continent NGL market centernear Conway, Kansas, along withextensions intothe Piceance and Denver-Julesberg basins in Colorado and the Bakken Shale in the Willistonbasin in North Dakota.Our equity NGL volumes from our Wyoming plants and our Willow CreekfacilityinColorado are dedicated fortransport on OPPL under along-term transportation agreement. NGL volumes from our RMMequity-method investment are also transportedonOPPL.

Rocky MountainMidstream

During the third quarter of 2018, our joint venture, RMM, purchased anatural gas and crude oil gathering and natural gas processing businessinColorado’s Denver-Julesburg basin. As of December31, 2020, we operate and own 50 percent of RMM. RMM includesanatural gas gathering pipeline and an approximate 80-mile crude oil transportation pipeline.Italso includescrude oilstorage assets.

Targa Train7

We own a20percent interest in Targa Train 7, aMt. Belvieu fractionation train, which was placedintoservice in thefirst quarter of 2020.

Other

Other includescertain previously owned operations, minor business activitiesthatare not reportablesegments, as well as corporate operations.

REGULATORY MATTERS

FERC

Our gas pipelineinterstatetransmissionand storage activities aresubject to FERCregulation under the Natural Gas Act of 1938 (NGA) and under the Natural Gas PolicyAct of 1978, and, as such, our rates and charges for the transportation of natural gas in interstatecommerce,accounting, and the extension, enlargement, or abandonment of our jurisdictionalfacilities, among otherthings, are subject to regulation. Each of our gas pipelinecompaniesholds certificates of publicconvenience and necessity issuedbythe FERCauthorizing ownershipand operation of all pipelines, facilities, and propertiesfor which certificates are required under the NGA. FERCStandards of Conduct govern how our interstate pipelines communicateand do businesswith gas marketing employees. Among other things, the Standards of Conduct require that interstategas pipelines not operate theirsystemstopreferentially benefit gas marketing functions.

FERCregulation requires allterms andconditions of service, including the rates charged, to be filed with and approvedbythe FERCbefore any changes cangointoeffect.Our interstate gas pipeline companies establish rates through the FERC’s ratemakingprocess. In addition, our interstate gas pipelines mayenterintonegotiatedrate agreementswhere cost-based recourse rates are made available. Key determinants in the FERCratemakingprocess include:

•Costs of providing service,including depreciation expense;

15 •Allowed rate of return, including the equity component of thecapitalstructure andrelated incometaxes;

•Contract and volume throughput assumptions.

The allowed rate of return is determinedineachratecase. Rate design and the allocationofcosts between the reservation and commodity rates also impactprofitability. As aresult of these proceedings, certain revenues previously collectedmay be subjecttorefund.

We also own interests in and operate naturalgas liquids pipelines thatare regulatedbyvarious federal and state governmental agencies. Services providedonour interstate natural gas liquids pipelines are subjecttoregulation under the Interstate Commerce Act by the FERC, whichhas authorityover the terms and conditions of service; rates, including depreciation and amortization policies; and initiation of service. Our intrastate natural gas liquids pipelines providing common carrier service are subjecttoregulation by various stateregulatory agencies.

Pipeline Safety

Our gas pipelines aresubjecttothe Natural Gas PipelineSafety Act of 1968, as amended, the PipelineSafety Improvement Act of 2002, the PipelineSafety,Regulatory Certainty, and Jobs Creation Act of 2011 (Pipeline Safety Act), and the Protecting Our Infrastructure of Pipelinesand Enhancing SafetyAct of 2016, which regulatesafety requirementsinthe design, construction, operation, and maintenance of interstate natural gas transmission facilities. The United States DepartmentofTransportation Pipeline and Hazardous Materials SafetyAdministration (PHMSA) administers federal pipeline safety laws.

Federalpipeline safetylawsauthorizePHMSA to establish minimum safetystandards for pipeline facilitiesand persons engaged in the transportation of gas or hazardous liquids by pipeline. These safetystandards apply to the design, construction, testing, operation, and maintenance of gas and hazardous liquids pipelinefacilities affecting interstate or foreign commerce.PHMSA has also established reporting requirementsfor operators of gas and hazardous liquid pipeline facilities, as wellasprovisions for establishing the qualification of pipeline personnel and requirementsfor managing the integrityofgas transmission and distribution lines and certain hazardous liquid pipelines. To ensure compliancewith these provisions,PHMSA performspipeline safetyinspections and has the authoritytoinitiate enforcement actions.

In 2016, PHMSA published aproposed rulemaking thatwould impose new or more stringent requirements for certain natural gas pipelines including, expanding certain of PHMSA’s current regulatory safetyprogramsfor natural gas lines in high-population areas (also known as moderate consequenceareas (MCAs)) thatdonot qualify as high-consequence areas(HCAs) and requiring maximum allowableoperating pressure (MAOP) validation through re-verification of allhistoricalrecords for pipelines in service, which mayrequire natural gas pipelines installed before 1970 (previously excludedfrom certain pressure testingobligations) to be pressure tested.However, PHMSAhas since decidedtosplit this proposed rule (Mega Rule), intothreeseparate rulemaking proceedings. The first of these three rulemakings, relating to onshore gas transmissionpipelines, was published as afinalruleon October1,2019, and imposes numerous requirements, including MAOP reconfirmation, the periodic assessment of additional pipelinemileageoutside of HCAs, the reporting of exceedances of MAOP, and the consideration of seismicity as ariskfactor in integritymanagement. In accordance withthe finalrule,wehave developednew procedures and updated our existing pipeline safetyprogram to facilitatemeeting allrequirementswithinthe time frames stated.The remainingrulemakings comprising the Mega Ruleare expected to be issuedin2021 and will include revised pipeline repaircriteria as well as more stringent corrosion control requirements.

PHMSA also published new or more stringent rulesfor onshore hazardous liquids transportation lines in October2019 requiring integrityassessmentsonall onshore pipe thataccommodateinline inspection tools.

We are also expecting additional regulations due to new pipelinesafety legislationfinalizedinDecember2020 thatreauthorizedPHMSA pipeline safetyprograms. The new legislation includesmandates for PHMSA to publish finalrulesfor advancedleakdetection for gas pipelines, additionalrepair criteria for gas and hazardous liquids pipelines, updated operating and maintenance standards requirements applicable to large-scale liquefied natural gas facilities,certain Coastal Waters and CoastalBeachestobedesignatedasUSA ecologicalresourcesfor purposes of

16 determining whetherahazardous liquid pipeline is in ahigh consequence area,and the gas gathering portion of the proposedMega Rule.

Newregulations adoptedbyPHMSA mayimpose more stringent requirementsapplicabletointegrity management programsand otherpipeline safetyaspects of our operations, which couldcause us to incur increased capital and operating costs andoperational delays.

Pipeline IntegrityRegulations

We have an enterprise-wide Gas Integrity ManagementPlan that we believe meetsthe PHMSA finalrule that was issuedpursuant to the requirements of the PipelineSafety Improvement Act of 2002. The rule requiresgas pipeline operators to develop an integrity management program for gas transmission pipelines that could affect HCAs in the event of pipeline failure.The integritymanagement program includes abaseline assessment planalong with periodic reassessments to be completedwithinrequired time frames. In meeting the integrityregulations, we have identified HCAs and developedbaseline assessment plans.Ongoing periodic reassessments and initial assessmentsofany new HCAs have beencompleted. We estimatethatthe cost to be incurred in 2021 associated with thisprogram to be approximately $105 million. Management considers costs associatedwith compliancewith the rule to be prudent costs incurred in the ordinary course of businessand, therefore,recoverable through Northwest Pipeline’s and Transco’s rates.

We have an enterprise-wide Liquid IntegrityManagement Plan thatwebelieve meets thePHMSA finalrule that was issuedpursuant to the requirements of the PipelineSafety Improvement Act of 2002. The rule requiresliquid pipeline operators to develop an integrity management program for liquid transmission pipelines that could affect HCAs in the event of pipeline failure.The integritymanagement program includes abaseline assessment planalong with periodic reassessments expectedtobecompletedwithinrequired time frames. In meeting the integrity regulations, we utilized government defined HCAsand developedbaseline assessment plans.Wecompleted assessmentswithin the requiredtimeframes. We estimatethatthe cost to be incurred in 2021 associatedwith this program willbeapproximately $3 million. Ongoing periodic reassessments and initial assessmentsofany new HCAs are expectedtobecompletedwithinthe time frames requiredbythe rule.Management considers the costs associatedwith compliance with theruletobeprudent costs incurredinthe ordinary course of business.

State Gathering Regulations

Our onshore midstream gathering operations are subject to laws and regulations in the various states in which we operate.For example, the Texas Railroad Commission has the authoritytoregulatethe terms of servicefor our intrastate natural gas gathering businessinTexas. Although the applicable state regulations vary widely, they generally require thatpipeline rates and practicesbereasonable and nondiscriminatory, and mayinclude provisions covering marketing, pricing, pollution, environment, and humanhealthand safety. Some states, such as New York, have specific regulations pertaining to the design, construction, andoperations of gathering lineswithinsuch state.

Intrastate Liquids Pipelines in the GulfCoast

Our intrastate liquids pipelines in theGulf Coastare regulatedbythe Louisiana Public ServiceCommission, the Texas Railroad Commission, and various otherstateand federal agencies. These pipelines arealso subjecttothe liquid pipeline safetyand integrity regulations discussed above sinceboth Louisiana and Texas have adoptedthe integrity management regulations defined in PHMSA.

OCSLA

Our offshore gas and liquids pipelines located on the outercontinentalshelf are subject to the OuterContinental Shelf Lands Act, which providesinpart thatoutercontinentalshelf pipelines “must provide open and nondiscriminatoryaccesstoboth owner andnon-owner shippers.”

See PartII, Item8.FinancialStatements and Supplementary Data —Note 19 –Contingent Liabilitiesand CommitmentsofNotestoConsolidatedFinancialStatements for furtherdetailsonour regulatory matters. For additionalinformation regarding regulatory matters, pleasealso refertoPart 1, Item1A. “Risk Factors” — “The

17 operation of our businessesmight be adversely affected by regulatory proceedings, changesingovernment regulations or in their interpretation or implementation, or the introduction of new laws or regulations applicableto our businessesorour customers,” and “The natural gas sales, transportation, and storage operations of our gas pipelines are subject to regulation by the FERC,which couldhave an adverse impactontheir abilitytoestablish transportation and storage ratesthat would allow themtorecover the fullcostofoperating their respective pipelines and storage assets, including areasonable rate of return.”

ENVIRONMENTALMATTERS

Our operations are subject to federal environmental laws and regulations as well as thestate, local, and tribal laws and regulations adopted by the jurisdictions in which we operate.Wecould incur liability to governmentsor third partiesfor any unlawful discharge of pollutants intothe air, soil, or water, as wellasliability forcleanup costs. Materials couldbereleased into theenvironment in several ways including, but not limitedto:

•Leakagefrom gathering systems, underground gas storage caverns, pipelines, processing or treating facilities, transportation facilities, and storage tanks;

•Damagetofacilities resultingfrom accidents during normal operations;

•Damages to onshore and offshore equipment and facilities resulting from storm eventsornaturaldisasters;

•Blowouts, cratering, andexplosions.

In addition, we maybeliable for environmentaldamagecaused by former owners or operators of our properties.

We believecompliance withcurrent environmentallawsand regulations willnot have amaterial adverse effect on our capital expenditures, earnings, or current competitive position. However, environmentallawsand regulations couldaffect our businessinvarious ways from time to time,including incurring capital and maintenance expenditures, finesand penalties, and creating the needtoseek relieffrom the FERCfor rate increases to recover the costs of certain capitalexpendituresand operation and maintenanceexpenses.

For additionalinformation regarding thepotentialimpact of federal,state, tribal, or localregulatory measures on our businessand specific environmental issues, please refertoPart 1, Item1A. “Risk Factors” — “Our operations are subject to environmental laws and regulations, including lawsand regulations relating to climate change and greenhousegas emissions, whichmay expose us to significant costs,liabilities, and expenditures that couldexceed our expectations,” and Part II, Item7“Management’s Discussion and Analysis of FinancialCondition and Results of Operations —Environmental”and “Environmental Matters” in PartII, Item 8. FinancialStatementsand Supplementary Data —Note 19 –Contingent Liabilities andCommitments of Notes to ConsolidatedFinancial Statements.

COMPETITION

Gas Pipeline Business

The market for supplying natural gas is highlycompetitive and new pipelines, storage facilities, and other related services are expanding to servicethe growing demand for natural gas.Additionally, pipeline capacityin many growing natural gas supply basins is constrainedcausing competition to increase among pipeline companies as theystrive to connectthose basins to majornatural gas demand centers. In our business, we predominately competewith major intrastate and interstate natural gas pipelines. In thelast fewyears, local distribution companies have also started entering intothe long-haul transportation businessthrough joint venture pipelines. Theprincipleelements of competition in the interstate naturalgas pipeline business are basedonrates, reliability, quality of customerservice,diversity of supply, and proximity to customers and market hubs.

Significant entrancebarrierstobuildnew pipelines exist, including federal and growing state regulations and publicopposition against new pipeline builds, and these factors will continue to impactpotential competition for the

18 foreseeablefuture.However, we believe our past success in working withregulators and the public, the position of our existing infrastructure,established strategic long-term contracts, and the factthat our pipelines have numerous receipt and delivery pointsalong our systemsprovide us acompetitive advantage,especially along the eastern seaboard and northwestern United States. Midstream Business

Competition for natural gas gathering, processing, treating, transporting, and storing natural gas continues to increase as production from shalesand otherresource areascontinuestogrow. Our midstreamservices compete with similarfacilitiesthatare in the same proximityasour assets. We facecompetitionfrom companies of varying sizeand financial capabilities,including major and independent natural gas midstream providers, private equityfirms, and major integratedoil and natural gas companies that gather, transport, process, fractionate, store, and market natural gas and NGLs, as well as some larger exploration and production companies that are choosing to develop midstreamservices to handletheir own natural gas. Our gathering and processing agreementsare generally long-term agreementsthatmay include acreage dedication. Competition for natural gas volumes is primarily based on reputation, commercial terms (products retained or feescharged), arrayofservices provided, efficiencyand reliabilityofservices, location of gathering facilities, availablecapacity, downstreaminterconnects, and latent capacity. We believeour significant presencein traditionalprolific supply basins,our solid positions in growing shale plays,our expertise and reputation as a reliable operator, andour ability to offer integrated packages of services position us well against our competition.

For additional information regarding competition for our services or otherwise affecting our business, please refertoPart 1, Item1A. “Risk Factors” -“The financial condition of our natural gas transportation and midstream businesses is dependent on the continued availability of natural gas suppliesinthe supply basins that we access and demand for those supplies in the marketsweserve,” “Our industryishighly competitive and increasedcompetitive pressure could adversely affectour businessand operating results,” and “We may not be able to replace, extend, or add additional customercontracts or contractedvolumes on favorable terms, or at all,whichcouldaffectour financial condition, theamount of cash availabletopay dividends, and our ability to grow.”

HUMANCAPITAL RESOURCES

We are committed to maintaining an environment thatenablesustoattract,develop, and retainahighlyskilled and diverse group of talented employeeswho help promote long-term value creation.

Employees

As of February 1, 2021, we had 4,739 full-time employeeslocated throughout the UnitedStates. Of thistotal, approximately 21 percent are women and more than 14 percent are ethnically diverse. During 2020, our voluntary turnoverrate was 4.6 percent.

We encourage you to review our 2019 Sustainability Report available on our website for more information about our humancapital programs and initiatives. Nothing on our website shallbedeemedincorporated by references into this AnnualReport on Form 10-K.

WorkforceSafety

We continue to advance our safety-first culture by developing and empowering our employeestooperate our assets in asafe,reliable, andcustomer-focusedway. We strivetocontinuously improve safetyand achieve better performance than the industry benchmark. Whenasafety hazard is recognized, every employee is empoweredto stop work activitiesand make it right. Safety and environmental-focused goals and relatedmetrics comprise 10 percent of our annualincentive program for employees, providing an increased focus on activitiesthathelpusmeet enterprise safety commitments.

19 For 2019, these metrics included our Near MisstoIncident Ratio,emphasizing our safetyfocus on hazard recognition and reinforcing the importance of incident prevention, and our Late Post Startup Deliverablesmetric, emphasizing the importance of completing allpost startup deliverables associatedwith newly completedprojects. As disclosed in our 2020 Proxy Statement,weexceededour targetsfor these safetymetricsin2019, achieving a Near Miss to Incident ratio of 13.98:1, versus atarget between 9:1 and 10:1, and less than1percent of Late Post Startup Deliverables, versus atarget between 3percentand 4percent.For 2020, these metrics include our High Potential Near MisstoIncident Ratio,againemphasizing our safetyfocus on high potential hazard recognition and reinforcing the importance of incident prevention, and our environmentalmetricLoss of Primary Containment, focused on reducing greenhouse gases and considered aleading indicator to more significant process safety incidents.

WorkforceHealth &Development

Our employees are our most valued resource and the driving force behind our reputation as asafe, reliable companythat does the right thing, every time.Cultivating ahealthy work environment increases productivity and promotes long-term value creation. We provide acomprehensive totalrewards program that includes basesalary, an all-employee annual incentive program,retirement benefits, and healthbenefits, including awellness program.Weprovide employeeswith company-paid life insurance, disability coverage,and paidparentalleave for both birthand non-birthparents. Our annualincentive program is akey component of our commitment to aperformanceculture focused on recognizing and rewarding high performance. In order to attract and retaintop talent, we create an environment where employees feelfulfilled andsupported in their personaland professional development. We offer robust corporateand technicaltraining programs to support the professional development of our employees and add long-term value to our business. Additionally, we support strong employeeengagement by encouraging open dialogue regarding professional development. Performance is measured considering both the achieved results associatedwith attaining annualgoalsand observableskillsand behaviors based on our definedcompetenciesthat contributetoworkplaceeffectiveness and careersuccess. The Compensation and Management Development Committeeofour Board of Directors overseesthe establishment and administration of our compensation programs, including incentive compensation and equity-based plans. In response to the ongoing impactofCOVID-19, we took action to safeguard the health andsafetyofour employees, including allowing our employees to work remotely where possible,while implementingsafetyguidance and best practicesdesigned to protect the healthofthose entering our facilities. Diversity &Inclusion

We encourage adiverse and inclusive workforce,helping our employees reach theirfull potential and promoting innovation. By embracing differences—whetherrace, gender, nationality, ability, orientation, or generation—we bring the best out of our peopletodrive businessgrowth and long-term success. To support networking and professional development opportunities, we endorse employee resource groups, which allow more inclusivity by offering an opportunity for employees to network, gaindevelopment,and provide input to leaders on specific needs.Westrivefor diverse representationatall levelsthrough our talent management practicesand employeedevelopment programsasweare committed to helping allemployees develop. Diversity metrics are reported monthlytoour management team. We also have aDiversityand Inclusion Council, chairedbyour chief executive officer and including members of the executive officer team,organizational and operational leaders,and individualemployees, to promotepolicies, practices, and procedures that support the growth of ahigh-performing workforce where allindividuals canachieve their full potential.The council serves as the governing body over enterprise diversityand inclusion initiatives. Our Board of Directors includes 12 independent members, one-third of which are women. As part of the director selection and nominating process, the Governance and Sustainability Committeeannuallyassessesthe

20 Board’s diversityinsuch areas as geography, race, gender, ethnicity, and age.Westrivetomaintain aboard of directors with diverseoccupational and personalbackgrounds.

WEBSITEACCESS TO REPORTS AND OTHER INFORMATION

We fileour annualreport on Form 10-K, quarterlyreportsonForm 10-Q, current reportsonForm 8-K, proxy statements, andotherdocumentselectronically with theSEC underthe Exchange Act.

Our Internet websiteiswww.williams.com. We make available, free of charge, through the Investors tabofour Internet website our annualreport on Form 10-K, quarterlyreportsonForm 10-Q, current reportsonForm 8-K, and amendmentstothose reports filed or furnishedpursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonablypracticable afterweelectronicallyfilesuch materialwith, or furnish it to, the SEC.Our Corporate GovernanceGuidelines, Sustainability Report, Code of Ethicsfor Senior Officers, Board committee charters, and the Williams CodeofBusiness Conductare also availableonour Internet website. We will alsoprovide,free of charge, acopy of any of our corporate documentslistedabove upon writtenrequest to our Corporate Secretary, One Williams Center, Suite 4700, Tulsa, Oklahoma 74172.

21 Item1A. Risk Factors

FORWARD-LOOKINGSTATEMENTSAND CAUTIONARY STATEMENT FORPURPOSESOFTHE “SAFEHARBOR” PROVISIONS OF THE PRIVATESECURITIESLITIGATIONREFORMACT OF 1995

The reports, filings, and otherpublicannouncementsofWilliamsmay containorincorporatebyreference statementsthatdonot directly or exclusivelyrelatetohistorical facts. Such statements are“forward-looking statements” within themeaning of Section 27A of the Securities Act of 1933, as amended (Securities Act)and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statementsrelateto anticipatedfinancial performance, management’splans and objectivesfor future operations, businessprospects, outcomesofregulatory proceedings, market conditions, and othermatters. We make these forward-looking statementsinreliance on the safe harbor protections providedunder the Private Securities LitigationReform Act of 1995. All statements, otherthanstatementsofhistoricalfacts, includedinthisreport that address activities, events, or developmentsthatweexpect, believe, or anticipate willexistormay occur in the future,are forward-looking statements. Forward-looking statementscan be identifiedbyvarious forms of words such as “anticipates,” “believes,”“seeks,”“could,” “may,”“should,” “continues,” “estimates,” “expects,” “forecasts,” “intends,” “might,” “goals,” “objectives,” “targets,” “planned,” “potential,” “projects,” “scheduled,” “will,” “assumes,” “guidance,” “outlook,” “in-servicedate,” or othersimilarexpressions. These forward-looking statementsare based on management’s beliefs and assumptions and on information currentlyavailabletomanagement and include,among others, statementsregarding: •Levels of dividends to Williams stockholders; •Future credit ratings of Williams and itsaffiliates; •Amounts and nature of future capital expenditures; •Expansion andgrowth of our business andoperations; •Expectedin-service dates for capital projects; •Financial condition andliquidity; •Businessstrategy; •Cash flow from operations or resultsofoperations; •Seasonalityofcertain business components; •Naturalgas, natural gas liquids, and crude oilprices, supply, and demand; •Demandfor our services; •The impact of the coronavirus (COVID-19) pandemic. Forward-looking statementsare based on numerous assumptions, uncertainties, and risks thatcouldcause future events or resultstobemateriallydifferent from those stated or implied in thisreport.Many of the factors that will determine these resultsare beyond our ability to control or predict.Specific factors that could cause actual results to differfrom results contemplatedbythe forward-looking statementsinclude, among others, the following: •Availabilityofsupplies, marketdemand, and volatilityofprices; •Developmentand rateofadoption of alternative energy sources; •The impact of existing andfuture laws and regulations, the regulatory environment, environmental liabilities, and litigation, as well as our ability to obtain necessary permitsand approvals, and achieve favorable rateproceeding outcomes; •Our exposure to the credit risk of our customers and counterparties;

22 •Our ability to acquire new businessesand assets andsuccessfully integratethose operations and assets into existing businessesaswellassuccessfully expand our facilities, and to consummateassetsales on acceptable terms; •Whether weare abletosuccessfully identify, evaluate, andtimelyexecute our capital projectsand investment opportunities; •The strength andfinancial resourcesofour competitors and theeffects of competition; •The amount of cash distributions from andcapital requirementsofour investmentsand joint venturesin which we participate; •Whether we willbeabletoeffectively execute our financing plan; •Increasing scrutiny andchanging expectations from stakeholders with respect to our environmental,social, and governancepractices; •The physical and financialrisks associatedwith climatechange; •The impactsofoperationaland developmental hazards and unforeseen interruptions; •The risks resulting from outbreaks or other public healthcrises, including COVID-19; •Risksassociated withweather andnatural phenomena,including climateconditions and physical damage to our facilities; •Acts of terrorism, cybersecurityincidents, and relateddisruptions; •Our costs and funding obligations for defined benefitpension plans and otherpostretirement benefitplans; •Changesinmaintenance and construction costs,aswell as our ability to obtain sufficient construction- related inputs, including skilled labor; •Inflation, interest rates, and general economicconditions (including future disruptions and volatility in the globalcreditmarkets and theimpact of these events on customers and suppliers); •Risksrelatedtofinancing, including restrictions stemmingfrom debt agreements, future changesincredit ratings as determinedbynationallyrecognized credit ratingagencies, and the availabilityand cost of capital; •The ability of the membersofthe Organization of Petroleum Exporting Countries (OPEC) and otheroil exporting nations to agreetoand maintainoil priceand production controls and the impactondomestic production; •Changesinthe current geopoliticalsituation; •ChangesinU.S. governmentaladministration and policies; •Whether we areable to paycurrent andexpected levels of dividends; •Additionalrisks describedinour filings with theSecuritiesand Exchange Commission. Given the uncertaintiesand risk factors that could cause our actualresultstodiffermateriallyfrom those contained in any forward-looking statement,wecaution investors not to unduly relyonour forward-looking statements. We disclaimany obligations to and do not intend to updatethe above list or announcepubliclythe result of any revisions to anyofthe forward-looking statementstoreflectfuture eventsordevelopments. In addition to causing our actualresultstodiffer, the factors listed above and referred to below maycause our intentions to change from those statementsofintention set forth in thisreport.Such changes in our intentions may also cause our resultstodiffer. We maychange our intentions, at any time and without notice,based upon changes in such factors, our assumptions, or otherwise. Because forward-looking statementsinvolve risks and uncertainties, we caution thatthere are important factors, in addition to those listed above,thatmay cause actual results to differmateriallyfrom those contained in the forward-looking statements. Thesefactors are describedinthe following section.

23 RISK FACTORS

You should carefully considerthe following risk factors in addition to the otherinformation in thisreport.Each of these factors could adversely affect our business, prospects, financial condition, resultsofoperations, cash flows, and, in some cases our reputation. The occurrence of any of suchrisks couldalsoadversely affect the value of an investment in our securities. Risks RelatedtoOur Business The financial condition of our natural gas transportation and midstream businessesisdependent on the continuedavailability of natural gas suppliesinthe supply basinsthat we access and demand for thosesupplies in themarkets we serve. Our ability to maintainand expand our natural gas transportation and midstreambusinesses depends on the level of drilling and production by third partiesinour supply basins.Production from existing wellsand natural gas supply basins withaccesstoour pipeline and gathering systemswill naturallydeclineover time.The amount of natural gas reserves underlying these existing wellsmay also be less thananticipated, and the rateatwhich production from these reserves declines maybegreaterthananticipated. We do not obtain independent evaluations of natural gas reserves connectedtoour systemsand processing facilities. Accordingly, we do not have independent estimatesoftotal reservesdedicatedtoour systemsorthe anticipated life of such reserves. In addition, low prices for natural gas,regulatory limitations, including environmentalregulations, or the lack of availablecapital have,and maycontinue to, adversely affect the development and production of existing or additional natural gas reserves and the installation of gathering, storage,and pipeline transportation facilities. The import and export of natural gas supplies mayalso be affected by such conditions. Low natural gas prices in one or more of our existing supply basins,whethercaused by alackofinfrastructure or otherwise,couldalsoresult in depressednatural gas production in such basins and limitthe supply of natural gas madeavailable to us. The competition for natural gas supplies to serve othermarketscouldalsoreducethe amount of natural gas supply for our customers. Afailure to obtain access to sufficient natural gas supplies willadverselyimpactour ability to maximizethe capacities of our gathering, transportation, andprocessing facilities. Demand for our services is dependent on the demand for gas in the marketsweserve. Alternative fuel sources such as electricity,coal,fuel oils, or nuclearenergy, as wellastechnologicaladvancesand renewable sourcesof energy, couldreducedemandfor natural gas in our markets and have an adverse effect on our business. Afailure to obtain access to sufficient natural gas supplies or areduction in demand for our services in the marketsweserve couldresult in impairments of our assets and have amaterial adverse effect on our business, financial condition, resultsofoperations, and cash flows. Prices for natural gas, NGLs, oil,and other commodities, are volatileand this volatilityhas and could continue to adversely affectour financial condition, results of operations, cash flows, access to capital,and abilityto maintain or grow our businesses. Our revenues, operating results, future rateofgrowth, and the value of certain componentsofour businesses depend primarily upon the prices of natural gas,NGLs,oil, or othercommodities, and the differencesbetween prices of these commoditiesand couldbemateriallyadversely affected by an extendedperiod of low commodityprices, or adecline in commodity prices. Price volatility has and couldcontinue to impactboth the amount we receive for our products and services and the volumeofproducts and services we sell. Pricesaffect the amount of cash flow availablefor capital expendituresand our ability to borrow moneyorraiseadditional capital. Pricevolatility has and could continue to have an adverse effect on our business, results of operations, financialcondition, andcashflows. The marketsfor naturalgas, NGLs, oil,and othercommodities are likelytocontinue to be volatile.Wide fluctuations in prices might resultfrom one or more factors beyond our control, including: •Imbalances in supply and demand whetherrising from worldwide or domestic supplies of and demand for natural gas, NGLs, oil, andrelatedcommodities; •Turmoilinthe Middle East and other producing regions;

24 •The activitiesofOPEC and othercountries, whetheractingindependentlyoforinformally alignedwith OPEC, which have significant oil,natural gas or othercommodity production capabilities,including Russia; •The levelofconsumer demand; •The price and availabilityofothertypesoffuels or feedstocks; •The availabilityofpipeline capacity; •Supply disruptions, including plant outages and transportation disruptions; •The price and quantity of foreign importsand domesticexports of natural gas and oil; •Domestic and foreign governmentalregulations and taxes; •The creditofparticipantsinthe marketswhere products are bought andsold. We are exposed to the creditriskofour customersand counterparties, and our credit risk management will not be able to completelyeliminate such risk. We are subjecttothe riskofloss resulting from nonpayment and/or nonperformancebyour customers and counterparties in the ordinary course of our business. Generally, our customers are rated investment grade,are otherwise consideredcreditworthy, are requiredtomakeprepayments or provide security to satisfy credit concerns, or are dependent upon us, in some cases without areadily available alternative,toprovide necessary services. However, our credit procedures and policies cannot completely eliminate customerand counterparty credit risk. Our customersand counterparties include industrial customers, local distribution companies, natural gas producers, and marketers whose creditworthiness maybesuddenly and disparately impactedby, among otherfactors, commodity pricevolatility, deteriorating energy market conditions, and publicand regulatory opposition to energy producing activities. In alow commoditypriceenvironment certain of our customers have beenorcouldbenegatively impacted, causing themsignificant economicstressresulting, in some cases, in acustomer bankruptcy filing or an effort to renegotiateour contracts. To the extent one or more of our key customers commences bankruptcy proceedings, our contracts withsuch customers may be subject to rejection under applicableprovisions of the United States BankruptcyCode or, if we so agree, mayberenegotiated. Further, during any such bankruptcy proceeding, prior to assumption, rejection or renegotiation of such contracts, the bankruptcycourt maytemporarily authorizethe payment of value for our services less than contractuallyrequired, which couldhave amaterial adverse effect on our business, resultsofoperations, cash flows, and financial condition. If we failtoadequately assess the creditworthiness of existing or future customers and counterparties or otherwise do not take sufficient mitigating actions, including obtaining sufficient collateral, deterioration in their creditworthiness, and any resulting increase in nonpayment and/or nonperformancebythemcouldcause us to write down or write off accountsreceivable. Such write-downs or write-offs couldnegativelyaffect our operating resultsfor the period in which theyoccur, and, if significant, couldhave amaterial adverse effect on our business, financial condition, resultsofoperations, and cash flows. We face opposition to operation and expansion of our pipelines and facilities from various individuals and groups. We have experienced, and we anticipatethatwewill continue to face, opposition to the operation and expansion of our pipelines and facilitiesfrom governmental officials, environmentalgroups, landowners, tribal groups, local groups and otheradvocates. In some instances, we encounter opposition thatdisfavors hydrocarbon-based energy suppliesregardless of practicalimplementation or financial considerations. Opposition to our operation and expansion cantakemanyforms, including the delay or denial of required governmental permits, organizedprotests, attemptstoblockorsabotage our operations, intervention in regulatory or administrative proceedings involving our assets, or lawsuits or otheractions designedtoprevent, disrupt or delay the operation or expansion of our assets and business. In addition, acts of sabotage or eco-terrorism couldcause significant damage or injury to people, property, or the environment or lead to extendedinterruptions of our operations. Any such event thatdelays or prevents the expansion of our business, thatinterruptsthe revenues generated by our operations, or which causes us to make significant expenditures not covered by insurance, couldadversely affect our financial condition and resultsof operations.

25 We may not be able to grow or effectively manage our growth. As part of our growthstrategy, we consideracquisition opportunities and engage in significant capital projects. We have both aproject lifecycleprocess and an investment evaluation process. These are processesweuse to identify, evaluate,and executeonacquisition opportunities and capital projects. We maynot always have sufficient and accurate information to identify and value potential opportunities and risks or our investment evaluation process maybeincompleteorflawed. Regarding potential acquisitions, suitable acquisition candidatesorassets maynot be availableonterms and conditions we find acceptable or, where multiple parties aretrying to acquire an acquisition candidate or assets, we maynot be chosen as the acquirer. If we are abletoacquire atargeted business, we maynot be able to successfully integratethe acquired businessesand realize anticipatedbenefitsinatimelymanner. Our growth mayalsobedependent upon the construction of new natural gas gathering, transportation, compression, processing or treating pipelines, and facilities, NGL transportation, or fractionation or storage facilities as wellasthe expansion of existing facilities. Additional risks associated with construction mayinclude the inability to obtain rights-of-way, skilled labor, equipment, materials, permits, and otherrequired inputsinatimely manner such thatprojectsare completed, on time or at all, andthe riskthat construction cost overruns could cause total project costs to exceedbudgeted costs.Additional risks associated with growing our businessinclude,among others, that: •Changing circumstances and deviations in variables could negativelyimpactour investment analysis, including our projections of revenues, earnings, and cash flow relatingtopotential investment targets, resulting in outcomesthat are materiallydifferent thananticipated; •Wecould be required to contributeadditional capital to support acquiredbusinesses or assets, and we may assume liabilities that were not disclosed to us, thatexceedour estimatesand for which contractual protections are eitherunavailableorprove inadequate; •Acquisitions could disrupt our ongoing business, distract management, divert financial and operational resourcesfrom existing operations and make it difficulttomaintain our current businessstandards, controls, and procedures; •Acquisitions and capital projectsmay require substantialnew capital,including the issuance of debt or equity, andwemay not be abletoaccesscreditorcapitalmarkets or obtain acceptableterms. If realized, any of these risks could have an adverse impactonour financial condition, resultsofoperations, including the possible impairment of our assets, or cash flows. Our industry is highlycompetitiveand increased competitivepressure could adversely affectour business and operating results. We have numerous competitors in allaspects of our businesses, and additional competitors mayenterour markets. Any current or future competitor thatdelivers natural gas,NGLs,orothercommodities into the areasthat we operate could offer transportation services that are more desirabletoshippers than those we provide because of price, location, facilitiesorotherfactors. In addition, current or potential competitors maymakestrategic acquisitions or have greaterfinancial resourcesthanwedo, which couldaffect our ability to make strategic investments or acquisitions. Our competitors maybeabletorespond more quickly to new laws or regulations or emerging technologiesortodevotegreaterresourcestothe construction, expansion, or refurbishment of their facilitiesthanwecan.Failure to successfully competeagainst current and future competitors could have amaterial adverse effectonour business, results of operations, financialcondition, andcashflows. We do not own 100 percent of the equityinterestsofcertain subsidiaries, including the PartiallyOwnedEntities, whichmay limitour abilitytooperate and control thesesubsidiaries. Certainoperations, including the Partially Owned Entities, are conductedthrough arrangements that may limit our abilitytooperate and control these operations. The operations of our current non-wholly-owned subsidiaries, including the Partially Owned Entities, are conductedinaccordance withtheirorganizational documents. We anticipatethatwewill enter into more such arrangements, including through new joint venture structures or new Partially Owned Entities. We mayhavelimited

26 operational flexibility in such current and future arrangements and we maynot be abletocontrol the timingor amount of cash distributions received. In certain cases: •Wecannot control the amount of cash reservesdeterminedtobenecessary to operate the business, which reduces cash available for distributions; •Wecannot control the amount of capital expendituresthatweare required to fund and we are dependent on third partiestofund their requiredshare of capitalexpenditures; •Wemay be subject to restrictions or limitations on our ability to sell or transfer our interests in the jointly owned assets; •Wemay be forced to offer rightsofparticipation to otherjoint venture participants in the area of mutual interest; •Wehave limitedability to influenceorcontrol certain daytoday activitiesaffecting the operations; •Wemay have additionalobligations, such as required capitalcontributions, that are important to the success of the operations. In addition, conflicts of interest mayarisebetween us, on the one hand, and otherinterest owners, on the other hand. If such conflicts of interest arise, we maynot have the ability to control the outcome withrespect to thematter in question. Disputes between us and otherinterest owners mayalsoresult in delays, litigation or operational impasses. The risks described above or the failure to continue such arrangementscouldadversely affect our ability to conductthe operations thatare the subjectofsuch arrangementswhich could, in turn, negativelyaffect our business, growth strategy, financialcondition andresultsofoperations. We may not be able to replace, extend, or add additional customercontractsorcontracted volumes on favorable terms, or at all,which couldaffectour financial condition, the amount of cash availabletopay dividends, and our ability to grow. We relyonalimited numberofcustomers and producers for asignificant portion of our revenues and supply of natural gas and NGLs. Although many of our customers and suppliers are subject to long-term contracts, if we are unabletoreplaceorextend such contracts, add additional customers, or otherwise increase the contracted volumes of natural gas providedtousbycurrent producers, in each case on favorable terms,ifat all, our financial condition, growth plans, and the amount of cash availabletopay dividends could be adversely affected. Our ability to replace, extend, or add additional customerorsuppliercontracts, or increase contracted volumes of natural gas from current producers, on favorable terms,oratall,issubjecttoanumberoffactors, some of which are beyond our control, including: •The levelofexisting and newcompetition in our businessesorfrom alternative sources,such as electricity, renewable resources, coal,fuel oils, or nuclear energy; •Naturalgas and NGL prices, demand, availability, and margins in our markets. Higher prices for energy commodities related to our businesses couldresult in adecline in the demand for those commodities and, therefore,incustomer contracts or throughput on our pipeline systems. Also, lower energy commodity prices could negativelyimpactour ability to maintainorachieve favorable contractual terms,including pricing, and couldalsoresult in adecline in the production of energy commodities resultinginreduced customer contracts, supply contracts, and throughput on our pipeline systems; •General economic, financialmarkets, and industry conditions; •The effects of regulation on us, our customers, and our contracting practices; •Our ability to understand our customers’ expectations, efficiently and reliably deliverhigh qualityservices and effectively manage customerrelationships.The results of these efforts willimpact our reputation and positioning in the market.

27 Certain of our gas pipeline services are subject to long-term,fixed-pricecontracts that are not subjectto adjustment,evenifour cost to perform suchservicesexceeds the revenuesreceived from suchcontracts. Our gas pipelines provide some services pursuant to long-term,fixed-pricecontracts. It is possible that costs to perform services under such contracts willexceedthe revenues our pipelines collect for their services.Although otherservices are priced at cost-basedrates that are subject to adjustment in ratecases, under FERCpolicy, a regulated serviceproviderand acustomer maymutually agreetosign acontractfor serviceata“negotiatedrate” thatmay be above or below the FERCregulatedcost-based ratefor thatservice. These “negotiatedrate” contracts are not generally subjecttoadjustment for increased costs that could be producedbyinflation or otherfactors relating to the specific facilitiesbeing used to perform the services. Some of our businessesare exposedtosupplierconcentration risks arising from dependenceonasingleora limitednumber of suppliers. Some of our businesses maybedependent on asmallnumberofsuppliers for delivery of criticalgoods or services. If asupplieronwhich one of our businesses depends were to failtotimelysupply required goods and services, such businessmay not be abletoreplacesuch goods and services in atimelymanner or otherwise on favorable terms or at all. If our businessisunabletoadequatelydiversify or otherwise mitigate such supplier concentration risks and such risks were realized, such businesses couldbesubjecttoreduced revenues and increased expenses, which could have amaterialadverse effectonour financialcondition, results of operation, and cash flows. Failure of our serviceproviders or disruptions to our outsourcing relationships might negatively impact our abilitytoconductour business. Certainofour accounting and information technology services are currentlyprovidedbythird-partyvendors, and sometimes from servicecenters outside of the United States. Services providedpursuant to these arrangements couldbedisrupted. Similarly, the expiration of agreementsassociatedwith such arrangementsorthe transition of services between providers couldleadtoloss of institutionalknowledge or servicedisruptions. Our reliance on others as serviceproviders couldhave amaterial adverse effect on our business, financial condition, resultsof operations, and cash flows. An impairment of our assets, including property, plant, and equipment, intangibleassets, and/or equity-method investments, could reduce ourearnings. GAAP requires us to test certain assets for impairment on eitheranannualbasis or when events or circumstances occur whichindicatethatthe carrying value of such assets might be impaired. The outcome of such testing couldresult in impairments of our assets including our property, plant, and equipment, intangible assets, and/ or equity-method investments. Additionally, any assetmonetizations couldresult in impairments if any assets are sold or otherwise exchanged for amounts less than their carrying value. If we determine that an impairmenthas occurred, we would be required to take an immediate noncash charge to earnings. Increasing scrutiny and changing expectations from stakeholders withrespect to our environmental,social and governancepractices may impose additional costs on us or expose us to new or additional risks. Companiesacross allindustries are facing increasing scrutiny from stakeholders related to their environmental, socialand governance (“ESG”) practices. Investor advocacygroups, certain institutionalinvestors, investment funds and otherinfluentialinvestors are also increasinglyfocused on ESG practicesand in recent years have placed increasingimportance on the implications and socialcost of their investments. Regardless of the industry, investors’ increased focus and activism related to ESG and similarmatters mayhinder access to capital,asinvestors may decide to reallocate capital or to not commitcapital as aresult of their assessment of acompany’s ESG practices. Companiesthatdonot adapt to or comply with investor or otherstakeholderexpectations and standards, which are evolving, or thatare perceived to have not responded appropriatelytothe growing concern for ESG issues, regardless of whetherthere is alegal requirementtodoso, maysuffer from reputationaldamage and the business, financial condition, and/or stock price of such acompany couldbematerially andadversely affected. We facepressuresfrom our stockholders, who are increasinglyfocused on climatechange, to prioritize sustainableenergy practices, reduceour carbon footprint and promotesustainability. Our stockholders mayrequire us to implement ESG procedures or standards in order to continue engaging with us, to remaininvested in us or before they maymakefurtherinvestments in us. Additionally, we mayfacereputational challenges in the event our

28 ESGprocedures or standards do not meet the standards setbycertain constituencies. We have adoptedcertain practicesashighlightedinour 2019 Sustainability Report, including with respecttoair emissions, biodiversityand land use,climate change and environmentalstewardship. It is possible,however, thatour stockholders might not be satisfied with our sustainability effortsorthe speedoftheir adoption. If we do not meet our stockholders’ expectations, our business, abilitytoaccess capital, and/or our stockpricecould be harmed. Additionally, adverse effects upon the oil and gas industry related to the worldwide social and political environment, including uncertaintyorinstabilityresulting from climatechange, changes in politicalleadership and environmentalpolicies, changes in geopolitical-socialviews toward fossilfuelsand renewable energy, concern about the environmentalimpactofclimate change, and investors’ expectations regarding ESG matters, mayalso adversely affect demand for our services. Any long-term material adverse effect on the oil and gas industry could have asignificant financial and operationaladverse impact on our business. The occurrence of any of the foregoing couldhave amaterial adverse effect on the priceofour stock and our businessand financial condition. We may be subjecttophysical and financial risks associated with climatechange. The threatofglobalclimate change maycreatephysicaland financial risks to our business. Energy needs vary with weather conditions. To the extent weather conditions maybeaffected by climatechange, energy use could increase or decrease depending on the duration and magnitude of any changes. Increased energy use due to weather changes mayrequire us to invest in more pipelines andotherinfrastructure to serve increased demand. Adecrease in energy use due to weather changes mayaffectour financial condition through decreased revenues. Extremeweather conditions in general require more system backup, adding to costs,and cancontributetoincreased system stresses, including serviceinterruptions. Weather conditions outside of our operating territory couldalsohave an impacton our revenues. To the extent the frequency of extremeweather events increases,thiscouldincrease our cost of providing service. We maynot be abletopass on the higher costs to our customers or recover allcosts related to mitigatingthese physical risks. Additionally, many climatemodels indicatethatglobalwarming is likelytoresult in rising sea levelsand increased frequency and severity of weather events, which mayleadtohigherinsurancecosts,oradecrease in availablecoverage,for our assets in areas subject to severe weather. These climate-related changescoulddamage our physicalassets, especiallyoperations located in low-lying areas nearcoasts and riverbanks, and facilities situatedinhurricane-prone and rain-susceptibleregions. To the extent financial marketsviewclimate change and greenhouse gas (“GHG”) emissions as afinancial risk, this could negativelyimpactour cost of and access to capital.Climate change and GHG regulation couldalsoreduce demand for our services. Our businesscouldalsobeaffected by the potential for lawsuits against GHG emitters, based on links drawnbetween GHGemissions and climatechange. Our operationsare subjecttooperational hazards and unforeseen interruptions. There are operational risks associated with the gathering, transporting, storage,processing, and treating of natural gas,the fractionation, transportation, and storage of NGLs, and crude oil transportation and production handling, including: •Aging infrastructure and mechanicalproblems; •Damages to pipelines andpipeline blockages or otherpipeline interruptions; •Uncontrolled releases of natural gas (including sour gas), NGLs, crude oil, or other products; •Collapse or failure of storage caverns; •Operator error; •Damagecaused by third-partyactivity, such as operation of construction equipment; •Pollution and other environmental risks; •Fires, explosions,craterings, and blowouts;

29 •Security risks, including cybersecurity; •Operating in amarine environment. Any of theserisks could result in loss of human life,personal injuries, significant damage to property, environmental pollution, impairment of our operations, loss of services to our customers,reputationaldamage,and substantial lossestous. The location of certain segments of our facilitiesinornearpopulatedareas, including residential areas, commercial businesscenters, and industrial sites, could increase the level of damagesresulting from these risks.An event such as those describedabove could have amaterial adverse effect on our financial condition and resultsof operations, particularlyifthe event is not fullycovered by insurance. We face risks related to the COVID-19 pandemicand otherhealth epidemics The global outbreak of the coronavirus (COVID-19) is currentlyimpacting countries, communities, supply chains, and markets. We provide acritical servicetoour customers, which means that it is paramount thatwekeep our employees safe. We cannot predict whether, and the extent to which, COVID-19 will have amaterial impact on our business, including our liquidity, financial condition, and resultsofoperations. COVID-19 poses arisk to our employees, our customers, our suppliers, and the communitiesinwhich we operate,which couldnegativelyimpact our business. To the extent thatour access to the capital marketsisadverselyaffected by COVID-19, we mayneed to consider alternative sourcesoffunding for our operations and for working capital,any of which couldincrease our cost of capital.Measures to try to containthe virus, such as travelbans and restrictions, quarantines, shelter in place orders, and shutdowns, maycause us to experience operational delays or to delay plans for growth. The extent to which COVID-19 mayimpactour businesswill depend on future developments, which are highly uncertain and cannot be predicted, including new information concerning the severity of COVID-19 and the actions taken to containitortreat itsimpact, among others. To the extent the COVID-19 pandemicadversely affectsour business and financialresults,itmay also have theeffectofheightening many of the otherfactors described in thisreport. Our assets and operations, as wellasour customers’ assets and operations, can be adversely affectedbyweather and othernatural phenomena. Our assets and operations, especiallythose located offshore, and our customers’ assets and operations canbe adversely affected by hurricanes, floods, earthquakes, landslides, tornadoes, fires, and othernatural phenomena and weather conditions, including extremeorunseasonabletemperatures, making it more difficultfor us to realize the historicrates of return associatedwith our assets and operations. Asignificant disruption in our or our customers’ operations or the occurrence of asignificant liability for which we are not fullyinsured couldhave amaterial adverse effectonour business, financialcondition, results of operations, and cash flows. Our business could be negativelyimpactedbyactsofterrorism and related disruptions. Given the volatile nature of the commoditieswetransport, process, store, and sell,our assets and the assets of our customers and others in our industry maybetargetsofterrorist activities. Aterrorist attack couldcreate significant pricevolatility, disrupt our business, limitour access to capital markets, or cause significant harm to our operations, such as full or partialdisruption to our ability to produce,process, transport, or distribute natural gas, NGLs, or othercommodities. Acts of terrorism, as wellaseventsoccurring in response to or in connection with acts of terrorism, couldcause environmental repercussions thatcouldresult in asignificant decrease in revenues or significant reconstruction or remediation costs,which couldhave amaterial adverse effect on our business, financial condition, resultsofoperations, and cash flows. Abreach of our information technology infrastructure,including abreach causedbyacybersecurity attack on us or third parties with whomweare interconnected, may interfere with the safe operation of our assets, resultinthe disclosure of personal or proprietary information, and harm our reputation. We relyonour information technology infrastructure to process, transmit,and store electronicinformation, including information we use to safelyoperate our assets. Our Board of Directors has oversight responsibilitywith regard to assessment of the majorrisks inherent in our business, including cybersecurity risks, and reviews management’s efforts to address and mitigatesuch risks, including the establishment and implementation of policies to address cybersecurity threats. We have invested, and expect to continue to invest, significant time,manpower and capital in our information technology infrastructure. However, the age, operating systems, or condition of our current information technology infrastructure and software assets and our ability to maintainand upgrade such assets

30 could affect our ability to resist cybersecuritythreats. While we believe thatwemaintain appropriate information security policies,practices, and protocols, we regularly facecybersecurity and othersecurity threatstoour information technology infrastructure, whichcouldinclude threats to our operational industrialcontrol systemsand safetysystemsthatoperate our pipelines, plants, and assets. We faceunlawful attempts to gainaccesstoour information technology infrastructure, including coordinated attacks from hackers,whetherstate-sponsoredgroups, “hacktivists”,orprivate individuals. We facethe threat of theft and misuse of sensitive dataand information, including customer and employeeinformation. We also faceattemptstogainaccesstoinformation related to our assets through attemptstoobtain unauthorized access by targeting acts of deception against individuals with legitimate accesstophysical locations or information. We also are subject to cybersecurity risks arising from the fact that our businessoperations are interconnected with third parties, including third-partypipelines, otherfacilitiesand our contractors and vendors. In addition, the breach of certain business systemscouldaffect our ability to correctly record, process and report financial information. Breachesinour information technology infrastructure or physical facilities, or otherdisruptions including those arising from theft, vandalism, fraud, or unethical conduct,couldresult in damage to or destruction of our assets, unnecessary waste, safetyincidents, damage to the environment, reputationaldamage,potential liability,the loss of contracts, the imposition of significant costs associatedwith remediation and litigation, heightened regulatory scrutiny, increased insurancecosts,and have amaterial adverse effect on our operations, financialcondition, results of operations, and cash flows. If third-party pipelines and other facilities interconnected to our pipelines and facilities become unavailableto transport natural gas and NGLsortotreatnatural gas, our revenuescouldbeadversely affected. We depend upon third-partypipelines and otherfacilitiesthatprovide deliveryoptions to and from our pipelines and facilitiesfor the benefit of our customers. Because we do not own these third-party pipelines or otherfacilities, their continuing operation is not withinour control. If these pipelines or facilitieswere to become temporarily or permanentlyunavailablefor any reason, or if throughput were reduced because of testing, line repair, damage to pipelines or facilities, reduced operating pressures, lack of capacity, increased credit requirements or rates charged by such pipelines or facilitiesorothercauses, we and our customers would have reducedcapacitytotransport, store or delivernatural gas or NGL productstoend use marketsortoreceive deliveriesofmixed NGLs, thereby reducing our revenues. Any temporary or permanent interruption at any key pipeline interconnection or in operations on third- partypipelines or facilitiesthatwould cause amaterial reduction in volumes transportedonour pipelines or our gathering systemsorprocessed, fractionated, treated, or stored at our facilitiescouldhave amaterial adverse effect on our business, financialcondition, results of operations, and cash flows. Our operatingresults for certaincomponents of our business might fluctuate on aseasonalbasis. Revenues from certain componentsofour businesscan have seasonal characteristics. In many partsofthe country, demand for natural gas and otherfuelspeaks during the winter. As aresult, our overall operating resultsin the future might fluctuate substantiallyonaseasonal basis.Demandfor natural gas and otherfuelscouldvary significantlyfrom our expectations depending on the nature and location of our facilitiesand pipeline systemsand the terms of our natural gas transportation arrangements relative to demand created by unusual weather patterns. We do not own all of the land on which our pipelines and facilities are located, which coulddisrupt our operations. We do not own allofthe land on which our pipelines and facilitieshave beenconstructed. As such, we are subjecttothe possibilityofincreased costs to retainnecessary land use. In those instancesinwhich we do not own the land on which our facilitiesare located, we obtain the rights to constructand operate our facilitiesand gathering systemsonlandowned by third partiesand governmental agenciesfor aspecific period of time.Inaddition, some of our facilitiescross Native Americanlands pursuant to rights-of-wayoflimited terms. We maynot have the right of eminent domain over land owned by Native Americantribes. Our loss of any of these rights,through our inabilityto renewright-of-way contracts or otherwise,couldhave amaterial adverse effect on our business, financial condition, resultsofoperations, and cash flows. Our business could be negativelyimpactedasaresult of stockholder activism. In recent years,stockholderactivism, including threatenedoractualproxy contests,has beendirected against numerous publiccompanies, including ours. We were thetarget of aproxy contest from astockholder activist, which resulted in our incurring significant costs.Ifstockholder activists were to againtakeorthreatentotake

31 actions against the Company or seek to involve themselvesinthe governance,strategic directionoroperations of the Company, we could incur significant costs as well as thedistraction of management, which couldhave an adverse effect on our businessorfinancial results. In addition, actions of activist stockholders maycause significant fluctuations in our stock pricebased on temporary or speculative market perceptions or otherfactors that do not necessarilyreflectthe underlying fundamentalsand prospectsofour business. Our costs and funding obligations for our defined benefitpension plans and costs for our otherpostretirement benefitplans are affectedbyfactors beyond our control. We have defined benefit pension plans and otherpostretirement benefit plans.The timing and amount of our funding requirementsunder the defined benefit pension plans depend upon anumberoffactors that we control, including changes to pension planbenefits, as well as factors outside of our control, such as assetreturns, interest rates, and changes in pension laws. Changestothese and otherfactors that cansignificantlyincrease our funding requirementscould have asignificant adverse effectonour financialcondition andresultsofoperations. Risks RelatedtoFinancingOur Business Adowngrade of our creditratings, which are determinedoutside of our control by independent third parties, could impactour liquidity,access to capital,and our costs of doing business. Downgrades of our credit ratings increase our cost of borrowing and couldrequire us to provide collateraltoour counterparties, negativelyimpacting our availableliquidity. In addition, our ability to access capital marketscould be limitedbythe downgrading of our credit ratings. Creditrating agencies perform independent analysis when assigning credit ratings. The analysis includesa numberofcriteria such as, businesscomposition, market and operational risks,aswell as various financial tests. Credit ratingagencies continue to review the criteria for industry sectors and various debt ratings and maymake changes to those criteria from time to time.Creditratings are subjecttorevision or withdrawal at any time by the ratings agencies. As of the dateofthe filingofthisreport,wehave beenassigned an investment-grade credit rating by the credit ratings agencies. Difficult conditions in the global financial markets and the economy in general could negatively affectour business and results of operations. Our businesses maybenegativelyimpactedbyadverse economicconditions or future disruptions in the global financial markets. Included among these potential negativeimpacts areindustrial or economiccontraction (including as aresultofthe COVID-19 pandemic) leading to reduced energy demand and lower prices for our productsand services and increased difficulty in collecting amounts owed to us by our customers. If financing is not available when needed, or is available only on unfavorable terms,wemay be unabletoimplement our businessplans or otherwise take advantage of businessopportunities or respond to competitive pressures. In addition, financial marketshave periodically beenaffected by concerns over U.S. fiscaland monetary policies. These concerns, as well asactions taken by the U.S. federal government in response to these concerns, couldsignificantlyand adversely impactthe global and U.S. economies and financial markets, which couldnegativelyimpactusinthe manner described above. Restrictionsinour debt agreements and the amount of our indebtednessmay affectour future financial and operating flexibility. Our totaloutstanding long-term debt (including current portion) as of December31, 2020, was $22.3 billion. The agreements governing our indebtedness containcovenantsthatrestrict our and our materialsubsidiaries’ ability to incur certain liens to support indebtedness and our ability to merge or consolidateorsell allorsubstantially allofour assets in certain circumstances. In addition, certain of our debt agreements contain various covenantsthat restrict or limit, among otherthings, our ability to make certain distributions during the continuation of an event of default,the abilityofour subsidiariestoincur additional debt,and our, and our materialsubsidiaries’, ability to enter intocertain affiliatetransactions and certain restrictive agreements. Certainofour debt agreements also contain, and those we enterintointhe future maycontain, financial covenants, and otherlimitations with which we willneedto comply.

32 Our debt serviceobligations and the covenants described above could have important consequences. For example, they could: •Makeitmore difficultfor us to satisfy our obligations with respecttoour indebtedness, which could in turn result in an event of defaultonsuchindebtedness; •Impair our abilitytoobtain additionalfinancing in the future for working capital,capital expenditures, acquisitions, generalcorporatepurposes, or otherpurposes; •Diminish our ability to withstand acontinued or future downturn in our business or theeconomygenerally; •Require us to dedicateasubstantialportion of our cash flowfrom operations to debt servicepayments, thereby reducing the availability of cash for working capital,capital expenditures,acquisitions, the paymentsofdividends, generalcorporatepurposes, or otherpurposes; •Limit our flexibility in planning for, or reacting to, changesinour business and the industry in which we operate,including limiting our ability to expand or pursue our business activities and preventing us from engaging in certain transactions thatmight otherwisebeconsideredbeneficialtous. Our ability to comply withour debt covenants, to repay, extend, or refinanceour existing debt obligations and to obtain future creditwilldepend primarily on our operating performance. Our ability to refinanceexisting debt obligations or obtain future creditwillalsodepend upon the current conditions in the creditmarketsand the availability of credit generally.Ifweare unabletocomply withthese covenants, meet our debt serviceobligations, or obtain future creditonfavorable terms, or at all, we could be forcedtorestructure or refinanceour indebtedness, seek additional equitycapital or sell assets. We maybeunabletoobtain financing or sell assets on satisfactory terms, or at all. Our failure to comply with the covenants in the documentsgoverning our indebtedness couldresult in events of default,which couldrendersuch indebtedness due and payable.Wemay not have sufficient liquidity to repayour indebtedness in such circumstances. In addition, cross-defaultorcross-acceleration provisions in our debt agreementscouldcause adefault or acceleration to have awider impact on our liquidity thanmight otherwise arise from adefault or acceleration of asingle debt instrument. For more information regarding our debt agreements, please read Note 14 –Debtand Banking ArrangementsofNotes to ConsolidatedFinancialStatements. Changes to interest ratesorincreases in interest ratescould adversely impact our access to credit, share price, our abilitytoissue securities or incurdebt for acquisitions or other purposes, and our abilitytomake cash dividends at our intended levels. Interest rates mayincrease in the future.Asaresult,interest rates on future creditfacilitiesand debt offerings couldbehigherthancurrent levels, causing our financing costs to increase accordingly. As with otheryield-oriented securities, our share pricewill be impacted by the level of our dividends and implied dividend yield. The dividend yield is oftenused by investors to compare and rank yield-oriented securities for investment decision-making purposes. Therefore,changes in interest rates, either positive or negative, mayaffect the yield requirementsof investors who invest in our shares,and arising interest rateenvironment could have an adverse impactonour share priceand our ability to issue equityorincur debt for acquisitions or otherpurposes and to pay cash dividends at our intendedlevels. Our hedging activitiesmightnot be effectiveand could increase thevolatilityofour results. In an effort to manage our financial exposure related to commodity priceand market fluctuations, we have entered, and mayinthe future enterintocontracts to hedge certain risks associated with our assets and operations. In these hedging activities, we have used, and mayinthe future use, fixed-price, forward, physicalpurchase, and sales contracts, futures, financial swaps, and option contracts tradedinthe over-the-countermarketsoronexchanges. Nevertheless, no single hedging arrangement canadequately address allrisks present in agivencontract. For example, aforward contractthatwould be effective in hedging commodity pricevolatility risks would not hedge the contract’s counterpartycredit or performancerisk. Therefore,unhedgedrisks will always continue to exist. While we attempttomanagecounterpartycredit riskwithin guidelines established by our credit policy, we maynot be able to successfully manage allcreditrisk and as such, future cash flows andresultsofoperations couldbeimpactedby counterparty default.

33 Our and our customers’ accesstocapital could be affectedbyfinancial institutions’policies concerningfossil- fuelrelated businesses.

Publicconcern regarding the potential effects of climatechange have directed increased attention towards the funding sources of fossil-fuelenergy companies. As aresult,certain financial institutions, funds, and othersources of capital have restricted or eliminatedtheir investment in certain market segments of fossil-fuelrelated energy. Ultimately, limiting fossil-fuelrelated companies’ access to capital could make it more difficultfor our customers to secure funding for exploration and production activitiesorfor us to secure funding for growth projects. Such alack of capitalcouldalso both indirectlyaffectdemand for our services and directlyaffectour ability to fund construction or othercapital projects.

Risks RelatedtoRegulations The operation of our businessesmight be adversely affectedbyregulatory proceedings, changesingovernment regulations or in their interpretation or implementation, or the introduction of new laws or regulations applicable to our businessesorour customers. Public and regulatory scrutiny of the energy industry has resulted in the proposal and/or implementation of increased regulations. Such scrutiny has also resulted in various inquiries, investigations, and court proceedings, including litigation of energy industry matters. Both the shippers on our pipelines and regulators have rights to challenge the rates we charge under certain circumstances. Any successful challenge couldmateriallyaffect our resultsofoperations. Certaininquiries, investigations, and court proceedings are ongoing. Adverse effects maycontinue as aresultof the uncertaintyofongoing inquiries, investigations, and court proceedings, or additional inquiries and proceedings by federal or stateregulatory agencies or private plaintiffs. In addition, we cannot predict the outcome of any of these inquiries or whetherthese inquiries willlead to additional legal proceedings against us, civil or criminal fines and/or penalties, or otherregulatory action, including legislation, which might be materiallyadverse to the operation of our businessand our resultsofoperations or increase our operating costs in otherways. Current legal proceedings or othermatters, including environmentalmatters, suits,regulatory appeals, and similarmatters might result in adverse decisions against us which, among otheroutcomes, couldresult in the imposition of substantialpenalties and finesand coulddamage our reputation. The result of such adverse decisions, eitherindividuallyorinthe aggregate, could be materialand maynot be covered fully or at allbyinsurance. In addition, existing regulations, including those pertaining to financial assurancestobe providedbyour businesses in respectofpotential assetdecommissioning and abandonment activities, might be revised, reinterpreted, or otherwise enforcedinamanner thatdiffers from prior regulatory action. New laws and regulations, including those pertaining to oil and gas hedging and cash collateral requirements, might also be adopted or become applicabletous, our customers, or our businessactivities. The change in the U.S. governmental administration and itspolicies mayincrease the likelihood of such legal and regulatory developments. If new laws or regulations are imposed relating to oil and gas extraction, or if additional or revised levelsofreporting, regulation, or permitting moratoriaare requiredorimposed, including those related to hydraulic fracturing, the volumes of natural gas and otherproductsthatwetransport, gather, process, and treat could decline, our compliancecosts could increase, and our resultsofoperations couldbeadverselyaffected. The natural gas sales,transportation, and storage operations of our gas pipelines are subjecttoregulation by the FERC, which could have an adverse impact on theirabilitytoestablish transportation and storage ratesthat would allow themtorecover the full cost of operating theirrespectivepipelines and storage assets, including a reasonablerate of return. In addition to regulation by otherfederal,state, and local regulatory authorities, interstate pipelinetransportation and storage serviceissubject to regulation by the FERC. Federal regulation extends to suchmatters as: •Transportation and sale for resale of naturalgas in interstatecommerce; •Rates,operating terms, typesofservices, andconditions of service; •Certificationand construction of new interstate pipelines andstorage facilities;

34 •Acquisition, extension, disposition, or abandonment of existing interstatepipelinesand storage facilities; •Accounts andrecords; •Depreciationand amortization policies; •Relationships with affiliatedcompanies thatare involvedinmarketing functions of the natural gas business; •Market manipulation in connection withinterstate sales, purchases,ortransportation of naturalgas. Regulatory or administrative actions in these areas, including successful complaints or protests against the rates of the gas pipelines, canaffect our businessinmanyways, including decreasing tariff rates and revenues, decreasing volumes in our pipelines, increasing our costs, andotherwise altering theprofitabilityofour pipeline business. Our operations are subjecttoenvironmental laws and regulations, including lawsand regulations relating to climate change and greenhouse gas emissions, which may expose us to significant costs, liabilities, and expendituresthat could exceed our expectations. Our operations are subject to extensive federal,state, tribal, and local laws and regulations governing environmentalprotection, endangeredand threatenedspecies, the discharge of materials into the environment,and the security of chemicaland industrial facilities. Substantialcosts,liabilities, delays, and othersignificant issues related to environmentallawsand regulations are inherent in the gathering, transportation, storage,processing, and treating of natural gas,fractionation, transportation, and storage of NGLs, and crude oil transportation and production handling as wellaswaste disposalpracticesand construction activities. New or amendedenvironmental laws and regulations canalso result in significantincreases in capital costs we incur to comply with such laws and regulations. Failure to comply with these laws,regulations, and permitsmay result in the assessment of administrative,civil and/or criminal penalties,the imposition of remedial obligations, the imposition of stricter conditions on or revocation of permits, the issuance of injunctions limitingorpreventing some or allofour operations, and delays or denialsingranting permits. Joint and severalstrictliability maybeincurred without regard to faultunder certain environmentallawsand regulations, for the remediationofcontaminatedareas and in connection with spillsorreleases of materials associatedwith natural gas,oil, andwastes on, under or from our propertiesand facilities. Privateparties, including the owners of propertiesthrough which our pipeline and gathering systemspass and facilitieswhere our wastes are taken for reclamation or disposal, mayhave the right to pursue legal actions to enforcecomplianceaswell as to seek damagesfor noncompliancewith environmentallawsand regulations or for personal injury or propertydamage arising from our operations. Some sitesatwhichweoperate are located nearcurrent or formerthird-party hydrocarbon storage and processing or oil and natural gas operations or facilities, and there is ariskthat contamination has migrated from those sitestoours. We are generally responsible for allliabilities associatedwith the environmental condition of our facilitiesand assets, whetheracquiredordeveloped, regardless of when the liabilities arose and whethertheyare known or unknown. In connection with certain acquisitions and divestitures, we could acquire,orberequired to provide indemnification against, environmentalliabilities that could expose us to materiallosses, which maynot be covered by insurance. In addition, the steps we could be required to take to bring certain facilitiesintocompliancecould be prohibitivelyexpensive, and we might be required to shut down, divest or alterthe operation of those facilities, which might cause us to incur losses. In addition, climatechange regulations and the costs thatmay be associatedwith such regulations and with the regulation of emissions of GHGs have the potential to affectour business. Regulatory actions by the Environmental Protection Agency or the passage of new climate change laws or regulations could resultinincreased coststo operateand maintainour facilities, install new emission controls on our facilities, or administerand manage any GHG emissions program. We believe it is possible that future governmentallegislation and/or regulation may requireuseither to limitGHG emissions associatedwith our operations or to purchase allowances forsuch emissions.Wecould also be subjectedtoacarbon taxassessedonthe basis of carbon dioxide emissions or otherwise.However, we cannot predictprecisely what form these future regulations might take, thestringencyof anysuch regulations or when theymight become effective.Several legislative bills havebeen introduced in the UnitedStatesCongress thatwould requirecarbon dioxide emission reductions. Previously consideredproposals have included, among otherthings, limitations on the amount of GHGs thatcan be emitted (socalled“caps”)

35 together withsystemsofpermittedemissions allowances. These proposals couldrequire us to reduceemissions or to purchase allowancesfor suchemissions. In addition to activitiesonthe federallevel, state andregional initiatives could also lead to the regulation of GHG emissions sooner thanand/or independent of federal regulation. These regulations couldbemore stringent thanany federal legislation thatmay be adopted. Future legislationand/or regulation designedtoreduceGHG emissions couldmakesome of our activitiesuneconomictomaintainoroperate.Wecontinue to monitor legislative and regulatory developmentsinthisareaand otherwise take efforts to limit andreduceGHG emissions from our facilities. Although the regulation of GHG emissions mayhave amaterial impact on our operations and rates, we believe it is premature to attempttoquantify thepotentialcosts of theimpacts. If we are unabletorecover or pass through asignificant level of our costs related to complying with climate change regulatory requirementsimposed on us, it could have amaterial adverse effect on our resultsofoperations and financialcondition. General Risk Factors We do not insure againstall potential risks and lossesand could be seriouslyharmed by unexpectedliabilitiesor by theinability of our insurers to satisfy our claims. In accordance withcustomary industry practice,wemaintain insurance against some,but not all, risks and losses, and only at levelswebelieve to be appropriate.The occurrence of any risks not fullycovered by our insurancecouldhave amaterial adverseeffect on our business, financial condition, resultsofoperations, and cash flows andour ability to repayour debt. Failure to attract and retainanappropriately qualifiedworkforcecould negatively impact our results of operations. Events suchasanaging workforcewithout appropriate replacements, mismatch of skill sets to future needs,the challengesofattracting new,qualified workers to the midstreamenergy industry, or unavailability of contractlabor mayleadtooperating challengessuch as lack of resources, loss of knowledge, and alengthy time period associated with skill development, including with the workforce needs associatedwith projectsand ongoing operations. Failure to hire and adequatelyobtain replacement employees, including the abilitytotransfersignificant internalhistorical knowledge and expertise to the new employees, or the future availabilityand cost of contractlabor mayadversely affect our ability to manage and operate the businesses. If we are unabletosuccessfully attract and retainan appropriatelyqualified workforce,resultsofoperations couldbenegatively impacted.

Holders of our common stock maynot receivedividends in the amount expected or any dividends. We maynot have sufficient cash each quarter to pay dividends or maintaincurrent or expected levelsof dividends. The actual amount of cash we dividend mayfluctuate from quarter to quarter and will depend on various factors, someofwhichare beyond our control,including: •The amount of cash that our subsidiariesdistributetous; •The amount of cash we generatefrom our operations, our working capital needs, our levelofcapital expenditures, and our abilitytoborrow; •The restrictions containedinour indentures and creditfacilityand our debt servicerequirements; •The cost of acquisitions, if any. Afailure either to pay dividends or to pay dividends at expectedlevelscouldresult in aloss of investor confidence, reputationaldamage, andadecrease in the value of our stockprice.

Item 1B. UnresolvedStaff Comments

Not applicable.

36 Item2. Properties

Pleaseread“Business” for adescription of the location and general character of our principalphysical properties. We generally ownour facilities, although asubstantialportion of our pipeline and gathering facilitiesis constructed and maintained pursuant to rights-of-way, easements, permits, licenses, or consentsonand across propertiesownedbyothers.

Item3. Legal Proceedings

Environmental

Certain reportablelegal proceedings involving governmental authorities under federal,state,and local laws regulating the discharge of materials intothe environment are described below. While it is not possible for us to predict the finaloutcome of the proceedings thatare still pending, we do not anticipate amaterial effect on our consolidated financial position if we receive an unfavorable outcome in any one or more of such proceedings. Our threshold for disclosing materialenvironmentallegal proceedings involving agovernmental authority where potential monetary sanctions are involved is $1 million.

On January 19, 2016, we received aNotice of Noncompliance withcertain Leak Detectionand Repair (LDAR) regulations under the CleanAir Act at our MoundsvilleFractionator Facility from the EPA, Region 3. Subsequently, the EPA alleged similarviolations of certain LDAR regulations at our Oak Grove Gas Plant. On March 19, 2018, we received aNoticeofViolation of certain LDAR regulations at our formerIgnacio Gas Plant from the EPA, Region 8, following an on-site inspection of the facility.OnMarch 20, 2018, we also received aNoticeofViolation of certain LDAR regulations at our Parachute CreekGas Plant from the EPA, Region 8. All such noticeswere subsequently referred to acommon attorneyatthe Department of Justice(DOJ). We are exploring globalresolution of the claims at these facilities, as well as alleged violations at certain otherfacilities, with theDOJ. Global resolution would include both payment of acivil penalty andaninjunctive relief component. We continue to work with the DOJ and the otheragenciestoresolve these claims, whetherindividuallyorglobally, and negotiations are ongoing.

Other environmentalmatters called forbythisItemare describedunder the caption “Environmental Matters”in Note 19 –Contingent Liabilities andCommitments of Notes to ConsolidatedFinancialStatementsincludedunder Part II, Item 8FinancialStatements of thisreport, whichinformation is incorporatedbyreferenceinto this Item.

Other litigation

The additionalinformation called for by thisItemisprovidedinNote 16 –Stockholders' Equity and Note 19 – Contingent Liabilities andCommitments of Notes to ConsolidatedFinancialStatementsincludedunder Part II, Item8Financial Statementsofthis report,which information is incorporated by reference intothisItem.

Item 4. Mine Safety Disclosures

Not applicable.

37 Information About OurExecutive Officers The name, title, age, period of service, and recent business experience of each of our executive officers as of February 24, 2021, arelisted below.

Name and Position Age Business Experience in Past Five Years

Alan S. Armstrong 58 2011 to present Director, Chief Executive Officer, and President, The Williams Companies, Inc. Director, Chief Executive Officer, and 2015 to 2018 Chairman of the Board, WPZ President 2014 to 2018 Chief Executive Officer, WPZ

2012 to 2018 Director of the general partner, WPZ

Walter J. Bennett 51 2020 to present Senior Vice President Gathering &Processing, The Williams Companies, Inc. Senior Vice President Gathering & 2015 to 2019 Senior Vice President –West, The Williams Processing Companies, Inc. 2013 to 2018 Senior Vice President –West of the general partner, WPZ 2017 Director of the general partner, WPZ

John D. Chandler 51 2017 to present Senior Vice President and Chief Financial Officer, The Williams Companies, Inc. Senior Vice President and ChiefFinancial 2017 to 2018 Director of the general partner, WPZ Officer Debbie Cowan 43 2018 to present Senior Vice President and ChiefHuman Resources Officer, The Williams Companies, Inc. Senior Vice President and ChiefHuman 2013 to 2018 Global Vice President of Human Resources, Koch Resources Officer Chemical Technology Group, LLC Micheal G. Dunn 55 2017 to present Executive Vice President and Chief Operating Officer, The Williams Companies, Inc. Executive Vice President and Chief 2017 to 2018 Director of the general partner, WPZ Operating Officer 2015 to 2016 President /Executive Vice President, Questar Pipeline /Questar Corporation Scott A. Hallam 44 2020 to present Senior Vice President Transmission &Gulf of Mexico, The Williams Companies, Inc. Senior Vice President Transmission & 2019 Senior Vice President –Atlantic-Gulf, The Williams Gulf of Mexico Companies, Inc. 2017 to 2019 Vice President GM Atlantic-Gulf, The Williams Companies, Inc. 2015 to 2017 Vice President Northeast OA, The Williams Companies, Inc. John D. Porter 51 2020 to present Vice President, Chief Accounting Officer, Controller and Financial Planning &Analysis, The Williams Companies, Inc. Vice President, Chief Accounting Officer, 2017 to 2019 Vice President Enterprise Financial Planning & Controller and Financial Planning & Analysis and Investor Relations, The Williams Analysis Companies 2013 to 2017 Director of Investor Relations &Enterprise Planning

38 Name and Position Age Business Experience in Past Five Years Chad A. Teply 49 2020 to present Senior Vice President –Project Execution, The Williams Companies, Inc.

Senior Vice President –Project Execution 2017 to 2020 Senior Vice President –Business Policy and Development, PacifiCorp 2009 to 2017 Vice President –Resource Development and Construction, PacifiCorp T. Lane Wilson 54 2017 to present Senior Vice President and General Counsel, The Williams Companies, Inc. Senior Vice President and General 2009 to 2017 United States MagistrateJudge for the Northern Counsel District of Oklahoma Chad J. Zamarin 44 2017 to present Senior Vice President –Corporate Strategic Development, The Williams Companies, Inc. Senior Vice President –Corporate 2017 to 2018 Director of the general partner, WPZ Strategic Development 2014 to 2017 President –Pipeline andMidstream, Cheniere Energy

39 PARTII

Item 5. Marketfor Registrant’s Common Equity, RelatedStockholderMatters and Issuer Purchases of Equity Securities Our common stock is listed on the NewYorkStock Exchange under the symbol “WMB.”Atthe closeof businessonFebruary 19, 2021, we had6,353 holders of record of our common stock. Performance Graph Set forth below is alinegraph comparing our cumulative total stockholderreturn on our common stock (assuming reinvestment of dividends) with the cumulative totalreturn of the S&P 500 Stock Index, the Bloomberg AmericasPipelinesIndex, and the Arca Natural Gas Index for the period of five fiscal years commencing January 1, 2016. The Bloomberg AmericasPipelinesIndex is composed of Enbridge Inc., TC Energy Corporation, Kinder Morgan, Inc., ONEOK, Inc., Cheniere Energy, Inc., Pembina Pipeline Corporation, New FortressEnergy Inc., Inter Pipeline Ltd., Hess Midstream LP, andWilliams. The Arca NaturalGas Index is comprised of over 20 highly capitalized companies in the natural gas industry involved primarily in natural gas exploration and production and natural gas pipeline transportation and transmission. The graph below assumes an investment of $100 at the beginning of theperiod.

2015 2016 2017 2018 2019 2020 The Williams Companies, Inc...... 100.0 131.4 134.1 102.0 116.6 107.7 S&P 500 Index...... 100.0 112.0 136.4 130.4 171.4 203.0 Bloomberg AmericasPipelinesIndex.... 100.0 146.8 146.4 125.6 169.8 134.4 ArcaNatural GasIndex...... 100.0 146.6 125.1 85.4 84.4 73.0

40 Item7. Management’s Discussion and Analysis of Financial Condition andResults of Operations

General

We are an energy infrastructure company focused on connecting NorthAmerica’s significant hydrocarbon resource plays to growing marketsfor natural gas and NGLsthrough our gas pipelineand midstreambusiness. Our operations are locatedinthe UnitedStates.

Our interstate natural gas pipelinestrategy is to createvalue by maximizing the utilizationofour pipeline capacitybyproviding high quality, low cost transportation of natural gas to large and growing markets. Our gas pipeline businesses’ interstate transmission and storage activities aresubject to regulation by the FERCand as such, our rates and charges for the transportation of natural gas in interstatecommerce,and the extension, expansion or abandonment of jurisdictional facilities andaccounting, among otherthings, are subject to regulation. Rates are established in accordance withthe FERC’s ratemaking process. Changesincommodity prices and volumes transported have limited near-term impact on these revenues because the majority of cost of serviceisrecovered through firm capacity reservation chargesintransportation rates.

The ongoing strategy of our midstreamoperations is to safelyand reliably operate large-scale midstream infrastructure where our assets canbefullyutilized anddrive low per-unitcosts.Wefocus on consistentlyattracting new businessbyproviding highlyreliable servicetoour customers. These services include natural gas gathering, processing, treating, and compression, NGL fractionation and transportation, crude oil production handling and transportation, marketing services for NGL,crude oil and naturalgas,aswellasstorage facilities.

Consistentwith themanner in which our chief operating decision maker evaluatesperformanceand allocates resources, our operations are conducted, managed, and presented withinthe following reportablesegments: Transmission &Gulf of Mexico, Northeast G&P,and West. All remaining businessactivitiesaswell as corporate activitiesare included in Other. Ourreportablesegmentsare comprised of the following businesses: •Transmission &Gulf of Mexicoiscomprised of our interstate natural gas pipelines, Transco and Northwest Pipeline,aswell as natural gas gathering and processing and crude oil production handling and transportation assets in the Gulf Coastregion, including a51percent interest in Gulfstar One (a consolidatedvariableinterest entity), which is aproprietary floating production system,a50percent equity-method investment in Gulfstream, anda60percent equity-method investment in Discovery. •Northeast G&P is comprised of our midstreamgathering, processing, and fractionation businesses in the Marcellus Shale region primarily in Pennsylvaniaand New York, and the Utica Shale region of eastern Ohio, as wellasa65percent interest in our Northeast JV (a consolidated variableinterest entity) which operatesinWestVirginia, Ohio, and Pennsylvania, a66percent interest in Cardinal (a consolidated variableinterest entity) which operatesinOhio, a69percent equity-method investment in Laurel Mountain, a99percent interest in CaimanII(aformerequity-method investment which is aconsolidatedentity following our November2020 acquisition of an additional ownershipinterest) which owns a50percent equity-method investment in Blue Racer, and AppalachiaMidstreamInvestments, awholly owned subsidiary thatowns equity-method investments withanapproximate average 66 percent interest in multiple gas gathering systemsinthe Marcellus Shale region. •West is comprised of our gas gathering, processing, and treating operations in the Rocky Mountainregion of Colorado and Wyoming, the BarnettShale region of north-central Texas,the Eagle Ford Shale region of south Texas, the Haynesville Shaleregion of northwestLouisiana,and the Mid-Continent region which includesthe Anadarko, Arkoma, and Permian basins.Thissegment also includesour NGL and natural gas marketing business, storage facilities, an undivided 50 percent interest in an NGL fractionator near Conway, Kansas, a50percent equity-method investment in OPPL,a50percent equity-method investment in RMM, a20percent equity-method investment in Targa Train 7, and a15percent interest in Brazos Permian II, LLC(Brazos Permian II). •Other includes certain previously owned operations, minor businessactivitiesthatare not reportable segments, as well as corporate operations.

41 Unlessindicatedotherwise,the following discussion and analysisofresultsofoperations and financial condition and liquidity relates to our current continuing operations and should be readinconjunction with the consolidated financialstatementsand notestheretoincludedinPartII, Item 8ofthisreport.

Dividends

In December2020, we paidaregularquarterlydividend of $0.40 per share. On January 26, 2021, our board of directors approved aregular quarterly dividend of $0.41 per share payable on March 29, 2021.

Overview

Netincome (loss) attributabletoThe Williams Companies,Inc.,for the yearended December31, 2020, decreased $639 million compared to the yearendedDecember 31, 2019, reflecting: •An$860 million increase in Impairment of equity-method investments; • A$187 million Impairment of goodwill in 2020; •A$123 million unfavorable change in Netincome(loss) attributabletononcontrolling interests primarily drivenbyareducedshare of certainimpairment chargesattributabletononcontrolling interests; • The absence of a$122 million gainrecognized on the saleofour interest in an equity-method investment in 2019; • A$76 million unfavorable change in Other income (expense) –net.

These unfavorable changes were partially offset by:

• A$282 million decrease in Impairment of certain assets;

•A$234 million favorable change in Operating and maintenance expenses and Selling, general, and administrative expenses,drivenbylower employee-relatedexpenses, including the absence of 2019 severance and related costs and the associatedreduced costs in 2020 as wellasthe benefit of achange in an employeebenefitpolicy;

•A$256 million favorablechange in Provision (benefit)for income taxes.

Acquisition of Caiman II (Blue Racer)

Expansion ProjectUpdates

Significant expansion project updates for the period, including projectsplacedintoserviceare describedbelow. Ongoing major expansion projects are discussed laterinCompany Outlook.

Transmission &Gulf of Mexico

Hillabee

In February 2016, the FERCissued acertificate order for the initialphases of Transco’s Hillabee Expansion Project.The project involvesanexpansion of Transco’s existing natural gas transmission system from Station 85 in west centralAlabamatoaninterconnection withthe Sabal Trail pipeline in east central Alabama. Theproject is being constructed in phases, and allofthe project expansion capacityisdedicatedto SabalTrail pursuant to acapacitylease agreement. PhaseIwas completed in 2017 and it increasedcapacityby

42 818 Mdth/d. We placedPhaseIIintoserviceonMay 1, 2020. Together, the firsttwo phases of the project increasedcapacityby1,025 Mdth/d.

Southeastern Trail

In October2019, we received approval from the FERCtoexpand Transco’s existing natural gas transmissionsystem to provide incrementalfirm transportation capacityfrom the Pleasant Valleyinterconnect with Dominion’s Cove Point Pipeline in Virginiatothe Station 65 pooling point in Louisiana. We placed230 Mdth/dofcapacityunder the project into serviceinthe fourth quarter of 2020, and the project wasfully in serviceonJanuary 1, 2021. In total,the project increased capacityby296 Mdth/d.

West

Project Bluestem

We expandedour presenceinthe Mid-Continent region through building a189-mile NGL pipelinefrom our fractionator and NGL storage facilitiesnearConway, Kansas, to an interconnection withathird-partyNGL pipeline system in Oklahoma,providing us withfirm access to Mt. Belvieu pricing. As part of the project,the third partyconstructeda110-mile pipelineextension of itsexisting NGL pipelinesystemthat willhave an initial capacity of 120 Mbbls/d. The pipelineand extension projectswereplacedintoserviceonDecember 1, 2020. Further, during the firstquarter of 2019, we exercisedanoption to purchase a20percent equityinterest in Targa Train 7, aMt. Belvieu fractionation train developedbythe third party, whichwas placedintoservicein the first quarterof2020.

COVID-19

The outbreak of COVID-19 hasseverely impacted global economicactivity andcaused significant volatilityand negative pressure in financial markets. We are monitoring the COVID-19 pandemicand have taken steps intended to protect the safetyofour customers, employees, and communities, and to support the continueddelivery of safe and reliable servicetoour customers and the communitiesweserve. We are continuing to monitor developmentswith respecttothe outbreak andnote the following:

•Our financial condition, resultsofoperations, and liquidity have not beenmateriallyimpactedbydirect effectsofCOVID-19.

•Webelieve we have the ability to access the debt market,ifnecessary, as evidencedbythe successful completion of debt offerings during second-quarter2020, and continue to have significant levelsofunused capacityonour revolving creditfacility.

•Wecontinue to monitor and adapt our remote working arrangementsand limitbusiness-relatedtravel. Implementation of these measures has not required materialexpenditures or significantlyimpactedour ability to operate our business.

•Our remote working arrangementshave not significantlyimpactedour internalcontrols over financial reporting anddisclosure controls and procedures.

CustomerBankruptcy

In June 2020, our customer, Chesapeake Energy Corporation (Chesapeake), announced thatithad voluntarily filed for reliefunder Chapter 11 of the U.S. Bankruptcy Code. We provide midstreamservices, including wellhead gathering, for the natural gas that Chesapeake and itsjoint interest owners produce,primarily in the Eagle Ford Shale, Haynesville Shale,and Marcellus Shale regions (through AppalachiaMidstream Investments).

43 regions, along-term gas supply commitment for Transco’s RegionalEnergy Access pipeline currentlyunder development,and transferring certain naturalgas properties in Louisiana to us.

Company Outlook

Our strategy is to provide large-scale energy infrastructure designed to maximizethe opportunities createdby the vastsupply of natural gas and natural gas productsthatexists in the United States. We accomplish thisby connecting the growing demand for cleaner fuelsand feedstocks withour major positions in the premiernatural gas and natural gas productssupply basins. We continue to maintainastrong commitment to safety, environmental stewardship, operational excellence, and customer satisfaction. We believethat accomplishingthese goalswill position us to deliversafe and reliable servicetoour customers and an attractive returntoour shareholders. Our businessplanfor 2021 includesacontinuedfocus on earnings and cash flow growth, while continuing to improve leverage metricsand control operating costs.

The creditprofiles of certain of our producercustomers continue to be challenged, including some thathave filed for bankruptcy protection. However, we note that the physical nature of services we provide supports the success of these customers. In many cases, we have long-term acreage dedications with strong historicalcontractual conveyances that create realestate interestsinunproducedgas. Our gathering lines in many cases are physically connected to the customers’ wellheads and pads, and there maynot be alternative gathering lines nearby. The construction of gathering systemsiscapital intensive and it would be costlyfor others to replicate, especially considering the depletiontodateofthe associatedreserves. As aresult,weplayacritical role in getting customers’ production from the wellhead to amarketablecondition and location. Thistends to reducecollectability risk as our services enable producers to generateoperating cash flows.

In 2021, our operating resultsare expectedtobenefit from growth in our Northeast G&P gathering and processing volumes. We also anticipate increasesfrom Transco expansion projectsand higherGulf of Mexico resultsprimarily due to lower anticipatedhurricane impacts. These increases willbepartiallyoffset by adecrease in West results, including areduction in NGL transportation volumes on OPPL and certain fee reductions in the Haynesville area in exchange for upstreamvalue in natural gas properties. We also expectamodest increase in expenses, including higher operating taxes.

Our growth capital and investment expenditures in 2021 are expectedtobeinarange from $1.0 billion to $1.2 billion. Growthcapital spending in 2021 primarily includesTransco expansions, allofwhich are fullycontracted with firm transportation agreements, and projectssupporting the Northeast G&P businessand opportunities in the Haynesville area.Inaddition to growth capital and investment expenditures, we also remain committed to projects thatmaintainour assets for safe and reliable operations, as wellasprojectsthatmeetlegal, regulatory, and/or contractualcommitments.

Potentialrisks and obstaclesthat couldimpactthe execution of our planinclude:

•Continued negative impacts of COVID-19 driving aglobalrecession, which couldresult in further downturns in financial marketsand commodity prices, as wellasimpact demand for natural gas and related products;

•Opposition to, and legal regulations affecting, our infrastructure projects, including the riskofdelay or denial in permits and approvalsneededfor our projects;

•Counterpartycredit and performancerisk, including unexpected developmentsincustomer bankruptcy proceedings; •Unexpected significant increases in capital expenditures or delays in capitalprojectexecution; •Unexpected changes in customer drilling and production activities, which couldnegativelyimpact gathering and processing volumes; •Lower thananticipateddemand for natural gas and natural gas productswhich couldresult in lower than expected volumes, energy commodityprices, and margins;

44 •General economic, financialmarkets, or furtherindustry downturns, including increasedinterest rates; •Physical damagestofacilities, including damage to offshore facilities by weather-relatedevents; •Other risks setforthunder PartI,Item1A. Risk Factors in thisreport.

We seek to maintainastrong financial position and liquidity, as well as manageadiversifiedportfolio of energy infrastructure assets that continue to serve keygrowthmarketsand supply basins in theUnited States.

Expansion Projects

Our ongoing major expansion projects include thefollowing:

Transmission &Gulf of Mexico

Northeast Supply Enhancement

In May2019, we received approval from the FERCtoexpand Transco’sexisting natural gas transmission system to provide incrementalfirm transportation capacityfrom Station 195 in Pennsylvania to the Rockaway Delivery Lateral transfer point in NewYork. However, approvals required for the project from the NewYork State DepartmentofEnvironmentalConservation and the NewJersey Department of EnvironmentalProtection were denied in May 2020. We have not refiledour applications for those approvals. Considering thatthe customer precedent agreementsand FERCcertificatefor the project remainineffect,wehad previously concludedthatthe probability of completing the project was sufficienttonot require impairment. However, recent developments in the politicaland regulatory environments have causedustoslightlylowerthatassessed probability such thatthe capitalized project costs now require impairment. See further discussion in Critical Accounting Estimates. Leidy South

In July 2020, we received approval from the FERCfor theproject to expand Transco’s existing natural gas transmission system and also extend itssystem through acapacitylease with National Fuel GasSupply Corporation thatwill enableustoprovide incrementalfirm transportation from Clermont,Pennsylvaniaand from the Zick interconnection on Transco’s Leidy Line to the River Road regulating station in Lancaster County, Pennsylvania. We placed125 Mdth/d of capacityunder the project into serviceinthe fourth quarter of 2020, and we plantoplace the remainder of the project into serviceasearly as the fourth quarter of 2021, assuming timely receipt of allnecessary regulatory approvals. The project is expected to increase capacity by 582 Mdth/d.

Critical Accounting Estimates The preparation of financial statements in conformity with generally acceptedaccounting principles requires management to make estimatesand assumptions. We believe thatthe nature of these estimates and assumptions is materialdue to the subjectivity and judgment necessary, or the susceptibility of such matters to change, and the impactofthese on our financialcondition or results of operations.

Pension and Postretirement Obligations We have employee benefit plans thatinclude pension and otherpostretirement benefits. Net periodic benefit costand obligations for these plans are impacted by various estimatesand assumptions. These estimates and assumptions include the expected long-term rates of return on planassets, discount rates, cash balanceinterest crediting rate, and employeedemographics, including retirement age and mortality. These assumptions are reviewed annually and adjustments are made as needed. The assumptions utilized to compute cost and the benefit obligations are shown in Note 10 –Employee Benefit Plans of Notes to ConsolidatedFinancialStatements.

45 Thefollowingtable presentsthe estimatedincrease (decrease)innet periodic benefit costand obligations resulting from aone-percentage-point change in the specific assumption.

Benefit Cost Benefit Obligation One- One- One- One- Percentage- Percentage- Percentage- Percentage- Point Point Point Point Increase Decrease Increase Decrease (Millions) Pension benefits: Discount rate...... $2$3$(101) $119 Expected long-term rate of return on plan assets...... (12) 12 —— Cash balance interest crediting rate...... 9(4) 67 (57) Other postretirement benefits: Discount rate...... —1(24) 30 Expected long-term rate of return on plan assets...... (3) 3——

Our expected long-term rates of return on planassets, as determinedatthe beginning of each fiscalyear, are based on the average rateofreturn expected on the funds investedinthe plans.Wedetermine our long-term expected rates of return on planassets using our expectations of capital market results,which include an analysis of historicalresultsaswell as forward-looking projections. These capital market expectations are based on aperiod of at least 10 years and take intoaccount our investment strategy and mixofassets. We develop our expectations using input from our third-partyindependent investment consultant.The forward-looking capital market projections start withcurrent conditions of interest rates, equitypricing, economicgrowth, and inflation and those are overlaidwith forward looking projections of normalinflation, growth, and interest rates to determine expectedreturns. The capital market return projections for specific asset classesinthe investment portfolio are then appliedtothe relative weightings of the asset classesinthe investment portfolio. The resultingrates are an estimate of future results and, thus, likelytobedifferent thanactualresults.

Our expected long-term rateofreturn on planassets used for our pension plans was 4.67 percent in 2020. The 2020 actualreturn on planassets for our pension plans was approximately 17.9 percent.The 10-yearaverage rateof return on pension planassets through December2020 was approximately 8.6 percent.The expectedrates of return on planassets are long-term in nature and are not significantlyimpactedbyshort-term market performance.Changes to our asset allocation also impact the expected ratesofreturn.

The discount rates are used to measure the benefit obligations of our pension and otherpostretirement benefit plans. The objective of the discount rates is to determine the amount, if invested at the December31measurement dateinaportfolio of high-quality debt securities, thatwillprovide the necessary cash flows when benefit payments are due. Increases in the discount rates decrease the obligation and, generally, decrease the related cost. The discount rates for our pension and otherpostretirement benefit plans are determinedseparately based on an approach specific to our plans and their respective expected benefit cash flows as described in Note 1–General, Description of Business, Basis of Presentation, and Summary of Significant Accounting Policiesand Note 10 –EmployeeBenefit Plans of Notes to ConsolidatedFinancialStatements. Our discount rateassumptions are impactedbychanges in general economicand market conditions that affectinterest rates on long-term,high-quality debt securitiesaswell as by the duration of our plans’ liabilities.

The cash balance interest crediting rateassumption represents the average long-term ratebywhich the pension plans’ cash balanceaccountsare expectedtogrow. Interest on the cash balance accounts is based on the 30-year U.S. Treasury securities rateand is creditedtothe accounts quarterly. An increase in thisratecauses the pension obligation andcost to increase.

Equity-Method Investments

We monitor our equity-method investments for any indications thatthe carrying value mayhave experienced an other-than-temporary decline in value.

46 In the firstquarter of 2020, we observed asignificant declineinthe publiclytraded priceofour common stock (NYSE:WMB)aswellasotherindustry peers and increases in equity yields within the midstream andoverall energy industry, whichserved to increase our estimatesofdiscount rates and weighted-average cost of capital.These changes were attributedtothe swift, world-wide economicdeclines associated withactions to address the spreadof COVID-19, coupled withthe energy industry impactofsignificantly reduced energy commodity prices,which were furtherimpactedbycrude oil pricedeclines associatedwithgeopolitical actions during the quarter. These significant macroeconomic changesserved as indications thatthe carrying amount of certain of our equity-method investments mayhave experienced an other-thantemporary decline in fairvalue, determinedinaccordance withAccounting Standards Codification (ASC)Topic323, “Investments-EquityMethod andJoint Ventures.”

As aresult,weestimated the fairvalueofthese equity-method investments in accordance withASC Topic 820, “FairValue Measurement,” as of the March 31, 2020, measurement date. Inassessing the fairvalue, we were requiredtoconsiderrecent publiclyavailableindications of value, which includedlower observed publiclytraded EBITDA market multiples as comparedwith recent history, and significantlyhigherindustry weighted-average discount rates. As aresult, we determinedthatthere were other-than-temporary declines in the fairvalueofcertain of our equity-method investments, resulting in recognized impairments during the firstquarter of 2020 totaling $938 million. (See Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRiskofNotes to ConsolidatedFinancialStatements.) Thisincludedimpairments of certain of our equity-method investments in our Northeast G&P segmenttotaling $405 million, primarily associatedwith operations in wet-gasareas where producer drilling activitiesare influencedbyNGL prices, which historicallytrend with crude oil prices. Thistotal was primarily comprised of impairments of our investment in CaimanIIand predominantlywet-gasgathering systems thatare part of AppalachiaMidstreamInvestments. We also recognized an impairment of $97 million related to Discovery withinthe Transmission &Gulf of Mexicosegment. We estimated the fairvalueofthese investmentsas of the March 31, 2020, measurement dateutilizing income and market approaches, which were impactedby assumptions reflecting the significant recent market declines previously discussed, such as higher discount rates, ranging from 9.7 percent to 13.5 percent,and lower EBITDA multiplesranging from 5.0x to 6.2x. We also consideredany debt heldatthe investeelevel,and itsimpacttofairvalue. At that time we estimated that aone percentage point increase or decrease in the discount rates used would increase theserecognized impairments by approximately $197 million or decrease the level of these recognized impairments by approximately $121 million and a0.5x increase or decrease in the EBITDA multiples assumed would decrease or increase the level of impairments recognized by approximately$48 million.

During the firstquarter of 2020 we also recognized $436 million of impairments within our West segment relatedtoour investments in RMM and Brazos Permian II, measured using an income approach. Both investees operate in primarily crude oil-driven basins where our gathering volumes are drivenbycrude oil drilling. Our expectation of continuedlower crude oil prices and related expectation of significant reductions in current and future produceractivitiesinthese areasled to reduced estimatesofexpected future cash flows.Our fair value estimates also reflectedincreases in the discount rates to approximately 17 percent for these investments. We also considered any debt heldatthe investeelevel,and itsimpacttofairvalue. At that time we estimated that aone percentage point increase in the discount ratewould increase theserecognized impairments by approximately $32 million, while a one percentage point decrease would decrease these impairmentsbyapproximately$43 million.

During the fourth quarter of 2020, RMM renegotiated servicecontracts withasignificant customer in connection with the customer’s Chapter 11 bankruptcy proceedings. The renegotiated contracts resultinlower servicerates, and lower projected future cash flows.Asaresult, we recognized an additional $108 million impairment of our investment in RMM, measuredusing an income approach. Our estimate of fairvalue reflects a discount rate of 18 percent. We estimatethataone percentage point increase in the discount ratewould increase the recognizedimpairment by approximately$24 million, while aone percentage point decrease would decrease these impairments by approximately $26 million. Judgmentsand assumptions are inherent in our estimatesoffuture cash flows,discount rates, and market measuresutilized. The use of alternatejudgmentsand assumptions couldresultinadifferentcalculationoffair value,whichcould ultimately resultinthe recognition of adifferent impairment charge in the consolidated financial statements, potentiallyincluding impairments for investments thatwere evaluatedbut for whichnoimpairments were recognized.

47 Property,Plant, andEquipment and Other IdentifiableIntangibleAssets

As aresult of the previously described significant macroeconomicchanges during the firstquarter of 2020, we also evaluatedcertain of our property, plant, and equipment and otheridentifiable intangibleassetsfor indicators of impairment as of March 31, 2020. In our assessments, we consideredthe impactofthe then current market conditions on certain of our assets and did not identify any indicators that the carrying amounts of those assets may not be recoverable.The use of alternatejudgmentsorchanges in future conditions could result in adifferent conclusion regarding the occurrence and measurement of impairments affecting the consolidatedfinancial statements.

We also evaluated $212 million of capitalized project development costs for the Northeast Supply Enhancement project for impairment as of December31, 2020. As previously discussed, approvals requiredfor the project from the New YorkState DepartmentofEnvironmentalConservation and the New Jersey DepartmentofEnvironmental Protection have beendenied and we have not refiledatthis time. Beginning in May 2020, we discontinued capitalization of costs relatedtothis project.

Considering thatthe customerprecedent agreementsand FERCcertificatefor theproject remainineffect,we had previously concludedthatthe probability of completing the project was sufficienttonot require impairment. However, recent developments in the politicaland regulatory environments have caused us to slightly lower that assessedprobability such thatthe capitalized project costs now require impairment. The estimated fairvalue of the materials within capitalized project costs was determinedtobe $42 million and considered otherinternaluses and estimatedsalvage values. The remaining capitalized costs were determinedtohave no fairvalue. As aresult,we recognized an impairment charge of $170 million withinour Transmission &Gulf of Mexicosegment during the fourth quarter of 2020. Our assumption regarding the probability of completing the project is subjective and required management to exercise significant judgment.The use of an alternatejudgment could have resulted in adifferent conclusion regarding the needtoevaluatethe projectfor impairment.

48 Results of Operations

ConsolidatedOverview

The following table and discussion is asummary of our consolidated resultsofoperations for the three years ended December31, 2020. The results of operations by segment are discussed in furtherdetailfollowing this consolidated overviewdiscussion.

Year Ended December 31,

$Change %Change $Change %Change from from from from 2020 2019* 2019* 2019 2018* 2018* 2018 (Millions) Revenues: Service revenues...... $5,924 -9 —% $5,933 +431 +8% $5,502 Service revenues –commodity consideration...... 129 -74 -36% 203 -197 -49% 400 Product sales...... 1,666 -399 -19% 2,065 -719 -26% 2,784 Total revenues...... 7,719 8,201 8,686 Costs and expenses: Product costs...... 1,545 +416 +21% 1,961 +746 +28% 2,707 Processing commodity expenses...... 68 +37 +35% 105 +32 +23% 137 Operating and maintenance expenses...... 1,326 +142 +10% 1,468 +39 +3% 1,507 Depreciation and amortization expenses..... 1,721 -7 —% 1,714 +11 +1% 1,725 Selling, general, and administrative expenses...... 466 +92 +16% 558 +11 +2% 569 Impairment of certain assets...... 182 +282 +61% 464 +1,451 +76% 1,915 Impairment of goodwill...... 187 -187 NM ———— Gain on sale of certainassetsand businesses...... —+2+100% 2-694 NM (692) Other (income) expense –net...... 22 -14 -175% 8+42 +84% 50 Total costs and expenses...... 5,517 6,280 7,918 Operating income (loss)...... 2,202 1,921 768 Equity earnings (losses)...... 328 -47 -13% 375 -21 -5% 396 Impairment of equity-method investments...... (1,046) -860 NM (186) -154 NM (32) Other investing income(loss) –net...... 8-99 -93% 107 -112 -51% 219 Interest expense...... (1,172) +14 +1% (1,186) -74 -7% (1,112) Other income (expense) –net...... (43) -76 NM 33 -59 -64% 92 Income (loss) from continuing operations before income taxes...... 277 1,064 331 Less: Provision (benefit) for income taxes.. 79 +256 +76% 335 -197 -143% 138 Income (loss) from continuing operations...... 198 729 193 Income (loss) from discontinued operations.... —+15 +100% (15) -15 NM — Net income (loss)...... 198 714 193 Less: Net income (loss) attributable to noncontrolling interests...... (13) -123 -90% (136) +484 NM 348 Net income (loss) attributable to The Williams Companies, Inc...... $211 $850 $(155) ______*+=Favorablechange; -=Unfavorable change;NM=Apercentage calculation is not meaningful due to a change in signs,azero-value denominator, or apercentage change greater than 200.

49 2020 vs.2019

Service revenues decreasedprimarily due to lower volumes in our West segment, lower deferred revenue amortization at GulfstarOne, the expiration of an MVC agreement in the BarnettShaleregion, and temporary shut- ins at certain offshore Gulf of Mexicooperations. Thisdecrease waspartiallyoffsetbyhigherNortheast G&P revenuesdrivenbyhighervolumes and the March 2019 consolidation of UEOM (seeNote 3–Acquisitions and DivestituresofNotes to ConsolidatedFinancial Statements), higher MVC revenue in our West segment, as well as highertransportation fee revenues at Transcoand Northwest Pipeline associatedwith expansion projectsplacedin servicein2019 and 2020, increased volumes in the EasternGulf region, and higherdeficiencyfee revenue associatedwithlowervolumes at OPPL.

Service revenues –commodity consideration decreaseddue to lower commodity prices, as well as lower equity NGL processing volumes due to less producerdrilling activity. These revenues represent consideration we receive in theformofcommodities as full or partialpayment for processing services provided. Most of these NGL volumes are sold within themonth processedand therefore areoffset within Product costs below.

Product sales decreasedprimarily due to lower NGL and natural gas prices associated withour marketing and equity NGLsales activities, as well as lowervolumes associatedwithour equity NGLsales activities, partiallyoffset by highermarketing volumes. Thisdecrease also includeslower system managementgas sales. Marketing salesand system management gassalesare substantially offset within Product costs.

Product costs decreasedprimarily due to lower NGL and natural gas prices associatedwith our marketing and equity NGL production activities. Thisdecrease also includeslower volumes acquiredascommodityconsideration for NGL processing services and lower system managementgas purchases, partiallyoffsetbyhighervolumes for marketing activities.

Processing commodity expenses decreased primarily due to lower natural gas purchases associatedwith equity NGL production primarilydue to lower naturalgas pricesand lower volumes.

Operating and maintenance expenses decreased primarily due to lower employee-relatedexpenses, including the absence of 2019 severance and related costs and the associatedreduced costs in 2020, as well as thefavorable impactofachange in an employeebenefit policy (see Note 6–Other Incomeand Expenses of Notes to ConsolidatedFinancialStatements), and lower maintenance and operating costsprimarilydue to timing and scope of activities. Thesedecreases are partiallyoffset by higher expenses related to the consolidation of UEOM.

Depreciation and amortization expenses increased primarily due to new assets placedinserviceand the March 2019 consolidation of UEOM, partiallyoffset by lower expense related to assets that becamefully depreciated in the fourth quarterof2019.

Selling, general, and administrative expenses decreased primarily due to lower employee-relatedexpenses, including the absence of 2019 severance and related costs and the associatedreduced costs in 2020, as wellasthe favorableimpactofachange in an employeebenefit policy (see Note 6–Other Incomeand Expenses of Notes to ConsolidatedFinancialStatements), and the absence of transaction costs associatedwith our 2019 acquisition of UEOM andthe formation of the Northeast JV.

Impairment of certain assets includes the 2019 impairments of our Constitution development project,certain Eagle Ford Shale gathering assets, and certain idlegathering assets. The assetimpairments in 2020 includedour Northeast Supply Enhancement development project and certain gathering assets in the MarcellusShale region (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRiskofNotes to Consolidated FinancialStatements).

Impairment of goodwill reflectsthe goodwill impairment charge at the Northeast reporting unit in 2020 (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRiskofNotes to Consolidated FinancialStatements).

50 Equityearnings (losses) changedunfavorably primarily due to our share of 2020 impairments at equity-method investments (seeNote 7–Investing ActivitiesofNotes to Consolidated Financial Statements), andlower volumes at OPPLand Discovery. These decreaseswerepartiallyoffsetbyfavorable amortizationofbasis differencesrelated to impairments of severalofour equity-method investments which were recognized in first quarter 2020, as well as highervolumes at Appalachia MidstreamInvestments, increased resultsatBlueRacer/Caiman II drivenbyhigher volumes and ahigherownershipinterest, and theabsence of 2019 lossesatBrazos Permian II.

Impairment of equity-method investments includes impairments of various equity-method investments in 2020 and 2019 (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRiskofNotes to ConsolidatedFinancialStatements).

The unfavorable change in Other investing income (loss) –net is primarily due to the absence of a2019 gainon the saleofour equity-method investment in Jackalope,partiallyoffset by the absence of a2019 loss on the deconsolidation of Constitution (see Note 7–Investing ActivitiesofNotes to ConsolidatedFinancialStatements).

The unfavorable change in Other income (expense) –net below Operatingincome (loss) includes acharge in the fourth quarter 2020 for alegal settlementassociatedwith formerolefins operations, lower equity allowancefor funds used during construction (AFUDC), and 2020 write-offs of certain regulatory assets related to cancelled projects.

Provision (benefit) for incometaxes changedfavorably primarily due to lower pre-tax income.See Note 8– Provision (Benefit)for IncomeTaxes of Notes to ConsolidatedFinancialStatementsfor adiscussion of the effective taxratecompared to the federal statutory rate for both periods.

The unfavorable change in Netincome (loss) attributabletononcontrolling interests is primarily due to the absenceofthe 2019 impairment of our Constitution development project and the impactfrom theformation of the Northeast JV in June 2019, partiallyoffset by the first-quarter 2020 goodwill impairment charge at the Northeast reporting unit, andlower GulfstarOne results.

2019 vs. 2018

Service revenues increased primarily due to highertransportation fee revenues at Transco associatedwith expansion projectsplacedinservicein2018 and 2019, as wellasthe impactofthe consolidation of UEOM, higher Northeast volumes at the Susquehanna Supply Hub and Ohio Valley Midstreamregions, and highergathering rates and volumes at the Utica Shale region. These increases are partiallyoffset by the absence of revenues associated with assetdivestitures and deconsolidations during 2018, including our formerFour Corners area operations (see Note 3–Acquisitions and DivestituresofNotes to ConsolidatedFinancialStatements), as wellaslowerrevenue in the BarnettShale associatedwith the end of acontractualMVC period and lower revenue at GulfstarOne primarily associatedwith producer operationalissues.

Service revenues –commodity consideration decreased due to lower NGL prices and lower volumes primarily due to the absence of our formerFour Corners area operations. These revenues represent consideration we receive in theformofcommodities as full or partialpayment for processing services provided. Most of these NGL volumes are sold withinthe monthprocessedand therefore areoffset in Product costs below.

Product sales decreased primarily due to lower NGL and natural gas prices associatedwith our marketing and equity NGL sales activities,lower volumes from our equity NGL sales primarily reflecting the absence of our formerFour Corners area operations, and lower system managementgas sales, partiallyoffset by highermarketing volumes. Marketing sales and system management gassales are substantiallyoffset in Product costs.

Product costs decreased primarily due to lower NGL and natural gas prices associatedwith our marketing and equity NGL production activities. Thisdecrease also includes lowervolumes acquiredascommodityconsideration for NGL processing services reflectingthe absence of our formerFour Corners area operations and lower system management gaspurchases, partiallyoffset by higher volumesfor marketing activities.

51 Processing commodityexpenses decreasedprimarily due to lowerproduction of equity NGLsprimarily related to ethane rejectionand the absence of our formerFour Corners areaoperations, and lower prices for natural gas purchasesassociatedwith our NGLproduction.

Operating and maintenanceexpenses decreasedprimarily due to the absence of our formerFour Corners area operations and lowercontractedservices at Transcoprimarily due to the timingofrequired engine overhauls and integrity testing. These decreases are partiallyoffsetbythe impactofthe consolidation of UEOMand by a$32 million charge for severance and related costsprimarily associated withavoluntary separation program (VSP) in 2019.

Depreciation and amortization expenses decreasedprimarily due to the 2018 impairment of certain assetsinthe BarnettShaleregion, whichserves to reducedepreciation prospectively, and the absence of assets disposed including our formerFour Corners areaoperations, partiallyoffsetbynew assets placedinserviceand by the impact of the consolidation of UEOM.

Selling, general, and administrative expenses decreased primarily due to the absences of acharitable contribution of preferred stocktothe Williams Foundation, Inc. (see Note 16 –Stockholders' Equity of Notesto Consolidated Financial Statements) andfeesassociated withthe WPZ Merger, partiallyoffsetbya$25 million charge for severance and related costs primarily associated withour 2019 VSP, and transaction expenses associated with theacquisition of UEOM andthe formation of the Northeast JV.

Impairment of certainassets includes 2019 impairments of our Constitution development project,certain Eagle Ford Shale gathering assets, and certain idlegathering assets. Assetimpairments in 2018 includedcertain assets in the BarnettShale region and certain idlepipelines (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRisk of Notes to ConsolidatedFinancialStatements).

Gain on sale of certain assets and businesses includes gains recognized on the sales of our Four Corners area and our Gulf Coastpipeline systemsin2018 (see Note 3–Acquisitions and DivestituresofNotes to Consolidated FinancialStatements).

The favorablechange in Other (income) expense–net within Operating income (loss) includes net favorable changes to charges and creditstoregulatory assets and liabilities, partiallyoffset by the absence of a2018 gainon assetretirement.

The unfavorable change in Equity earnings (losses) is primarily due to 2019 lossesfrom our Brazos Permian II investment acquiredinDecember2018 of $14 million, the impactofthe consolidation of UEOM during the first quarter of 2019 which reduced equity earnings by $9 million, and a$7million unfavorable impactrelatedtothe April 2019 sale of our Jackalope investment. Additionally, equityearnings at Aux Sable decreased $9 million related to lower rates reflectinglower NGL prices. These decreases are partiallyoffset by improved resultsatour AppalachiaMidstream Investmentsof$20 million.

The unfavorable change in Impairment of equity-method investments includes 2019 noncash impairments, partiallyoffset by the absence of a2018 impairment of UEOM (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRisk of Notes to ConsolidatedFinancialStatements).

The unfavorable change in Other investing income (loss) –net includes the absenceof2018 gains on the deconsolidations of our Delaware basin assets and Jackalope, anda2019 loss on thedeconsolidation of Constitution. These were partially offset by a2019 gain on thedisposition of Jackalope (see Note 7–Investing ActivitiesofNotes to ConsolidatedFinancialStatements).

Interest expense increased primarily due to an increase in financing obligations associatedwith Transco’s AtlanticSunrise project and lower Interest capitalized related to construction projectsthathave beenplaced into service.

The unfavorable change in Other income (expense) –net below Operatingincome (loss) is primarily due to a decrease in equity AFUDC associatedwith reduced capital expendituresonprojects(see Note 6–Other Incomeand

52 Expenses of NotestoConsolidated Financial Statements),partially offsetbythe absence of 2018 unfavorable settlement chargesfrom our pension earlypayout program.

Provision (benefit) for incometaxes changedunfavorably primarily due to higherpre-tax income attributable to The Williams Companies, Inc, partiallyoffsetbythe absence of acharge to establish $105 million valuation allowance, recorded in 2018, on certain deferred taxassets that maynot be realizedfollowing the WPZ merger. See Note 8–Provision (Benefit)for IncomeTaxes of Notes to ConsolidatedFinancialStatementsfor adiscussion of the effective taxratecompared to the federal statutory rate for both periods.

The favorablechange in Net income (loss) attributabletononcontrolling interests is primarily due to our third- quarter 2018 acquisition of the publiclyheldinterests in WPZ associatedwith the WPZ Merger, the impairment of Constitution project costs,and lower resultsatGulfstarOne.

Year-Over-Year OperatingResults –Segments

We evaluatesegment operating performancebased upon ModifiedEBITDA.Note 20 –Segment Disclosures of Notes to ConsolidatedFinancialStatementsincludesareconciliation of thisnon-GAAP measure to Net income (loss).Management uses ModifiedEBITDA because it is an accepted financial indicator used by investors to compare company performance. In addition, management believes that this measure providesinvestors an enhanced perspective of the operating performanceofour assets. ModifiedEBITDA should not be considered in isolation or as asubstitute for ameasure of performancepreparedinaccordancewithGAAP.

Transmission &GulfofMexico

Year Ended December 31, 2020 2019 2018 (Millions) Servicerevenues...... $3,257 $3,311 $2,953 Servicerevenues–commodityconsideration...... 21 41 59 Productsales...... 191 288 435 Segment revenues...... 3,469 3,640 3,447

Productcosts...... (193) (288) (438) Processing commodity expenses...... (7) (16) (16) Othersegmentcosts and expenses...... (886) (984) (964) Impairment of certain assets...... (170) (354) — Gain on sale of certain assets andbusinesses ...... ——81 Proportional Modified EBITDA of equity-method investments...... 166 177 183 Transmission &GulfofMexico Modified EBITDA...... $2,379 $2,175 $2,293

Commodity margins...... $12$ 25 $40 2020 vs.2019

Transmission &Gulf of MexicoModifiedEBITDA increasedprimarily due to lower Impairment of certain assets andfavorable changes to Other segment costs and expenses, partiallyoffsetbydecreased Servicerevenues.

Service revenues decreasedprimarily due to: •A$115 million decrease due to lower deferred revenue amortization associatedwiththe end of the exclusive use period at Gulfstar Onefor theTubularBells field; •A$42 million decrease due to temporary shut-ins primarily at Perdido and Gulfstar One related to Gulf of Mexicoweather-related events, pricing, andscheduled maintenance;

53 •A$32 million decrease due to lowervolumes at GulfstarOne in the Gunflint field due to ongoing operational issues;partially offset by •A$65 million increase in Transco’s and Northwest Pipeline’s natural gas transportation revenues associatedwith expansion projects placed in servicein2019 and 2020; •A$44 million increase at GulfstarOne associatedwith highervolumes in the TubularBells field due to a new well and higher production; •A$24 million increase associatedwith volumesfrom Norphlet placedinservice in June 2019.

The net sumofService revenues –commodity consideration, Product sales, Product costs, and Processing commodity expenses compriseour commodity margins. Our commodity margins associatedwith our equity NGLs decreased $11 million drivenbylower commodity prices and volumes. Additionally, the decrease in Product sales includesa$47 million decrease in commodity marketing salesdue to lower NGL prices and volumes and $27 million lower system managementgas sales. Marketing salesand system managementgas sales aresubstantially offset in Product costs and therefore have little impact to Modified EBITDA.

Other segment costs and expenses decreased primarily due to lower employee-relatedexpenses, including the absenceof2019 severance and related costs and the associatedreduced costs in 2020, as wellasthe favorable impactofachange in an employeebenefit policy (see Note 6–Other Incomeand Expenses of Notes to ConsolidatedFinancialStatements), lower maintenance costs primarily due to adecrease in contractedservices related to general maintenance andothertesting at Transco, the absence of a2019 charge for reversal of costs capitalized in previous periods and net favorablechanges to charges and creditsassociatedwith aregulatory asset related to Transco’s asset retirement obligations, partiallyoffset by lower equity AFUDC and higher operating taxes.

Impairment of certain assets includes the absenceofthe impairment of our Constitution development project in 2019, partiallyoffset by the impairment of our Northeast Supply Enhancement development project in 2020 (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRiskofNotes to Consolidated FinancialStatements).

Proportional ModifiedEBITDA of equity-method investments decreased at Discovery drivenbylower volumes due to scheduled maintenanceand temporary shut-ins related to Gulf of Mexicoweather-relatedevents and pricing.

2019 vs. 2018

Transmission &Gulf of MexicoModifiedEBITDA decreased primarily due to the impairment of Constitution, the absence of a2018 Gain on sale of certain assets and businesses,and higher Other segment costs and expenses, partiallyoffset by increased Service revenues related to expansion projectsplacedintoserviceduring 2018 and 2019.

Service revenues increased primarily due to a$403 million increase in Transco’s natural gas transportation revenues primarily drivenbya$358 million increase related to expansion projectsplacedinservicein2018 and 2019, as wellashigherrevenue associatedwith Transco’s general ratecase settlementand increased amounts for reimbursablepower and storage expenses. Partiallyoffsetting these increases were lower fee revenues of $62 million primarily due to produceroperational issuesand lower deferred revenue amortization at GulfstarOne, as wellasthe saleofcertain Gulf Coast pipeline assets in fourth-quarter 2018.

54 andsystem management gas salesare substantiallyoffsetinProduct costs and therefore have little impactto ModifiedEBITDA.

Other segment costs and expenses increased primarily due a$56 million unfavorable change in Transco’s equity AFUDC due to lower construction activity, a$39 million charge in 2019 for severance and related costs primarily associatedwith our 2019 VSP, a$21 million increase in reimbursable powerand storage expenses, $16 million of expense in 2019 related to the reversal of expenditures previously capitalized, and the absence of a$12 million 2018 gainonasset retirements. These unfavorablechanges were partiallyoffset by $77 million of net favorablechanges to charges and creditsassociatedwith regulatory assets and liabilities, which were significantlydrivenbythe previously mentioned settlement in Transco’s general ratecase, a$46 million decrease in Transco’s contracted services compared to 2018 mainlydue to the timing of required engine overhauls and integrity testing, and the absenceofa2018 unfavorable charge of $12 million for aregulatory liability associatedwith adecrease in Northwest Pipeline’s estimated deferredstateincometax rate following the WPZ Merger.

Impairment of certain assets includes the 2019 impairment of our Constitution development project (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRiskofNotes to Consolidated FinancialStatements).

Gain on sale of certain assets and businesses reflects an $81 million gainfrom the saleofour Gulf Coast pipeline system assets in fourth-quarter2018 (see Note 3–Acquisitions and DivestituresofNotes to Consolidated FinancialStatements).

Northeast G&P

Year Ended December 31, 2020 2019 2018 (Millions) Servicerevenues...... $1,465 $1,338 $976 Servicerevenues–commodityconsideration...... 71220 Productsales...... 57 150 287 Segment revenues...... 1,529 1,500 1,283

Productcosts...... (57) (152) (289) Processing commodity expenses...... (3) (8) (9) Othersegmentcosts and expenses...... (441) (470) (392) Impairment of certain assets...... (12) (10) — Proportional Modified EBITDA of equity-method investments...... 473 454 493 Northeast G&P Modified EBITDA...... $1,489 $1,314 $1,086

Commodity margins...... $4$2$9

2020 vs.2019

Northeast G&P ModifiedEBITDA increased primarily due to higher Service revenues, lower Other segment costs and expenses, and increased Proportional ModifiedEBITDA of equity-method investments,inaddition to the favorable impactofacquiring the additionalinterest in UEOM, which is aconsolidatedentityafter the remaining ownershipinterest waspurchased in March 2019.

Service revenues increased primarily due to:

•A$94 million increase at the Northeast JV, including $62 million higherprocessing, fractionation, transportation, and gathering revenues primarily due to highervolumes and a$32 million increase associatedwith theconsolidation of UEOM, as previously discussed;

55 •A$20 million increaseingathering revenues associatedwithhighervolumes in theUticaShale region;

•A$13 million increase in revenues associatedwith reimbursable electricity expenses,which is offsetby similarchanges in electricitycharges,reflectedinOther segment costs and expenses.

Product sales decreasedprimarily due to lower NGL volumes and prices within our marketing activities, and lower system managementgas sales.Marketing salesand system managementgas sales areoffsetbysimilar changes in marketing purchases and system managementgas purchases, reflectedabove as Product costs,and therefore have little impacttoModifiedEBITDA.

Other segment costs and expenses decreaseddue to lower employee-relatedexpenses, including the absence of 2019 severance and related costs and the associatedreduced costs in 2020, as well as thefavorableimpactofa change in an employeebenefit policy (see Note 6–Other Incomeand Expenses of Notes to ConsolidatedFinancial Statements), and lower maintenance and operating expenses primarily due to timing and scope of activities. Additionally, expenses changed favorably due to the absence of transaction costs associatedwith our 2019 acquisition of UEOM and the formation of the Northeast JV. These decreases were partiallyoffset by higher reimbursableelectricity expenses, increased expenses associatedwith the consolidation of UEOM, and the absence of afavorablecustomersettlement in 2019.

Impairment of certain assets includes a$12 million impairment of certain gathering assets in the Marcellus Shale region in 2020 and a$10 million write-down of othercertain assets that were no longerinuse or were surplus in nature in 2019 (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRiskofNotes to ConsolidatedFinancialStatements).

Proportional ModifiedEBITDA of equity-method investments increased at Appalachia MidstreamInvestments drivenbyhighervolumes, partiallyoffset by a$26 million decrease for our share of an impairment of certain assets. Additionally, there was an increase at Blue Racer/Caiman II primarily due to highervolumes and the favorable impactofincreased ownership, partiallyoffset by a$10 million decrease for our share of an impairment of certain assets. These increases were partiallyoffset by a$16 million decrease as aresult of the consolidation of UEOM in 2019, as previously discussed, as wellasadecrease at Laurel Mountain primarily due to $11 million for our share of an impairment of certain assets that were subsequently sold, partiallyoffset by highervolumes, and adecrease at Aux Sable.

2019 vs. 2018

Northeast G&P ModifiedEBITDA increased primarily due to higher Service revenues due to increased gathering volumes, as wellasthe $38 million favorable impactofacquiring the additionalinterest in UEOM, partiallyoffset by 2019 impairments.

Service revenues increased primarily due to: •A$158 million increase associatedwith theconsolidation of UEOM, as previously discussed; •A$102 million increase associatedwith highergathering revenues at Susquehanna Supply Hub reflecting 18 percent highergathering volumes due to increased production from customers and higher rates; •A$49 million increase at Ohio Valley Midstream primarily due to highergathering, processing, and transportation volumes; •A$36 million increase in gathering revenues in the Utica Shale region due to higherrates and volumes from newwells; •A$14 million increase in compression revenues for services chargedtoanaffiliatedrivenbyhigher volumes.

Product sales decreased primarily due to lower non-ethane volumes and prices within our marketing activities. The changesinmarketing revenues are offset by similarchanges in marketing purchases, reflectedabove as Product costs.

56 Other segment costs and expenses increasedprimarily due to: •A$53 million increaseassociatedwiththe consolidation of UEOM; •A$10 million increase related to transaction expensesassociated withthe acquisition of UEOM and the formation of the Northeast JV; •A$7 million charge in 2019 for severanceand related costs primarily associatedwith our VSP.

Impairment of certain assets increased due to a$10 million write-down of othercertain assets that are no longer in use or are surplus in nature in 2019 (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRisk of Notes to ConsolidatedFinancialStatements).

Proportional ModifiedEBITDA of equity-method investments decreased $59 million as aresultofthe consolidation of UEOM and $10 million due to unfavorable rates reflecting lowerNGL prices at Aux Sable.This decrease was partiallyoffsetbya$29 million increase at Appalachia MidstreamInvestments, reflecting higher volumes due to increased customer production.

West

Year Ended December 31, 2020 2019 2018 (Millions) Servicerevenues...... $1,280 $1,364 $1,641 Servicerevenues – commodityconsideration...... 101 150 321 Productsales...... 1,562 1,797 2,448 Segment revenues...... 2,943 3,311 4,410

Productcosts...... (1,520) (1,774) (2,448) Processing commodity expenses...... (58) (79) (116) Othersegmentcosts and expenses...... (477) (519) (644) Impairment of certain assets...... —(100) (1,849) Gain on sale of certain assets andbusinesses...... —(2) 591 Proportional Modified EBITDA of equity-method investments...... 110 115 94 West Modified EBITDA...... $998 $952 $38

Commodity margins...... $85$ 94 $205 2020 vs.2019

WestModifiedEBITDA increased primarily due to the absence of Impairment of certainassets andlower Other segment costs and expenses,partiallyoffsetbylower Service revenues.

Service revenues decreased primarily due to: •An$83 million decrease associatedwithlowervolumes, excluding theEagleFord Shale region; •A$72 million decrease drivenbylower deferred revenue amortization and MVC deficiency fee revenues associatedwiththe second-quarter2019 expiration of theMVC agreement in the BarnettShale region; •A$47 million decrease associatedwith lower rates, excluding the Eagle Ford Shaleregion, drivenbylower commodity pricing in the BarnettShaleregion and the expiration of acost-of-serviceperiod on acontract in theMid-Continent region; •An$11 million decrease associatedwithlowerfractionation fees drivenbylowervolumes;

57 •An$8million decrease drivenbythe absence of afavorable 2019 cost-of-serviceagreement adjustment in the Mid-Continent region; partiallyoffsetby •A$91 million increase in the Eagle Ford Shaleregion due to higherMVC revenue and higherrates, partiallyoffsetbylowervolumes primarily due to decreased produceractivity, including temporary shut- ins on certaingathering systems; •A$29 million increase associatedwithatemporary volumedeficiencyfee associatedwithreduced volumes from ashipperonOPPL; •A$26 million increaseinthe Wamsutterregion associatedwithhigherMVC revenue.

The net sumofService revenues – commodity consideration, Productsales, Product costs, and Processing commodity expenses comprise our commodity margins, which we furthersegregate into product margins associated withour equity NGLsand marketing margins. Product margins from our equity NGLsdecreased $29 million primarily due to: •A$35 million decrease associatedwith lower salesprices primarily due to 25 percent loweraverage net realized per-unit non-ethane salesprices; •A$15 million decrease primarily associatedwith 14 percent lowernon-ethane sales volumes drivenbyless producerdrilling activity; partially offset by •A$21 million increase related to adecline in natural gas purchases associated with equity NGL production due to lower naturalgas pricesand lower equitynon-ethane production volumes.

Additionally, marketing margins increased by $23 million primarily due to favorable changesinnet commodity prices. The decrease in Product sales includes a$168 million decrease in marketing sales, which is due to lower salesprices, partiallyoffsetbyhighermarketing salesvolumes. An $18 million decrease in otherproduct sales also contributed to the overall decrease. These decreases are substantially offset in Product costs.

Other segment costs and expenses decreased primarily due to lower employee-relatedexpenses drivenbythe absenceof2019 severance and related costs and the associatedreduced costs in 2020, and the favorableimpactofa change in an employeebenefit policy (see Note 6–Other Incomeand Expenses of Notes to ConsolidatedFinancial Statements), as wellasloweroperating costs due to fewer leased compressors and lower maintenance costs primarily due to timing and scope of activities. These favorablechanges are partiallyoffset by the absence of $12 million in favorable settlements in 2019.

Impairment of certain assets decreased primarily due to the absence of a$79 million impairment of certain Eagle Ford Shale gathering assets and a$12 million impairment of certain idlegathering assets in 2019 (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRiskofNotes to Consolidated FinancialStatements).

Proportional ModifiedEBITDA of equity-method investments decreased primarily due to lower volumes at OPPLand the absence of the Jackalope equity-method investment sold in April 2019, partiallyoffset by growth at the RMM, Brazos Permian II, andTarga Train7equity-method investments.

2019 vs. 2018

West ModifiedEBITDA increased primarily due to lower Impairment of certain assets and lower Other segment costs and expenses, partially offset by alower gainonsale of certain assets in 2019, lower Service revenues, and lower commoditymargins.

Service revenues decreased primarily due to: •A$218 million decrease associatedwith assetdivestitures and deconsolidations during 2018 and 2019, including our formerFour Corners area assets, certain Delaware basin assets that were contributedtoour

58 BrazosPermian II equity-method investment,and our Jackalope assets whichweredeconsolidated in second-quarter2018 and subsequently soldinsecond-quarter2019; •A$57 million decrease drivenbylowerdeferred revenue amortization and MVC deficiency fee revenues in the BarnettShale region primarily associatedwiththe expiration of acertain MVCagreement; •A$17 million decrease drivenbylowergathering volumes primarily in the Mid-Continent,BarnettShale, and Wamsutterregions, partiallyoffsetbyhighergathering volumes primarily in the Haynesville Shaleand Eagle Ford regions; •A$15 million decrease associatedwithlowerprocessing rates primarily drivenbylower commodity pricing in the Piceance region; •A$15 million decrease associated withlowergathering rates primarily in the Mid-Continent and Haynesville Shaleregions; partiallyoffsetby •A$17 million increaserelated to other MVC deficiencyfee revenues; •A$13 million increase relatedtohigher fractionation and storage fees; •An$8million increase associatedwith theresolution of aprior period performance obligation.

The net sumofService revenues – commodity consideration, Product sales, Product costs, and Processing commodity expenses comprise our commodity margins. Our commodity margins associatedwith our equity NGLs decreased by $127 million primarilydue to: •A$98 million decrease associatedwith lower salesvolumes, consisting of $54 million related to the absenceofour formerFour Corners area assets and $44 million due to 12 percent lower non-ethane volumes and 33 percent lower ethane sales volumes primarily due to higherethane rejectionin2019, natural declines, less producer drilling activity, andmore severe weather conditions in first-quarter 2019; •A$66 million decrease associatedwith lower salesprices primarily due to 29 percent and 48 percent lower average net realizedper-unitnon-ethane andethane salesprices, respectively; partiallyoffset by •A$37 million increase related to lower natural gas purchases associatedwith lower equity NGL production volumes and lower natural gas prices, including $9 million related to the absence of our formerFour Corners areaassets.

Additionally, the decrease in Product sales includesa$447 million decrease in marketing sales, which is due to lower salesprices, partiallyoffset by highersalesvolumes, and a$36 million decrease related to the saleofother products. These decreases are substantiallyoffset in Product costs. Marketing margins increased by $27 million primarily due to favorablechangesinprices.

Other segment costs and expenses decreased primarily due to a$127 million reduction associatedwith the absenceofour formerFour Corners area assets and from the Jackalope deconsolidation in second-quarter2018, $12 million favorable settlements in 2019, as wellas$7million lower ad valorem taxes.These decreases were partially offset by an unfavorable charge in 2019 for severance and related costs primarily associatedwith our VSP of $10 million.

Impairment of certain assets decreased primarily due to the absence of the $1.849 billion Barnett impairment in in 2018, partiallyoffset by smallimpairment charges in 2019 (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRisk of Notes to ConsolidatedFinancialStatements).

The decrease in Gain on sale of certain assets and businesses reflects theabsenceofthe gainfrom thesaleof our Four Corners area assets recorded in the fourth quarter of 2018 (see Note 3–Acquisitions and Divestituresof Notes to theConsolidatedFinancialStatements).

59 Proportional ModifiedEBITDA of equity-method investments increasedprimarily due to the additions of the RMMand Brazos Permian II equity-method investmentsinthe second halfof2018, partiallyoffsetbythe sale of our Jackalope investment in second-quarter2019. Other

Year Ended December 31, 2020 2019 2018 (Millions) Other Modified EBITDA...... $(15) $6$(29) 2020 vs.2019

Other ModifiedEBITDA decreasedprimarily due to:

•A$24 million charge in fourth quarter of 2020 related to alegal settlement associatedwithformerolefins operations;

•Acharge of $15 million related to the write-offs of certain regulatory assets associatedwith cancelled projectsin2020; partiallyoffsetby

•The absenceofa$12 million unfavorable adjustment to aregulatory assetassociated with an increase in Transco’s estimateddeferred state incometax ratefollowing the WPZ Merger.

2019 vs. 2018

Other ModifiedEBITDA increased primarily due to: •The absenceofthe $66 million impairment of certain idlepipelines in the second quarter of 2018 (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRiskofNotes to Consolidated Financial Statements); •The absenceofa$35 million charge in 2018 associatedwithacharitablecontribution of preferred stock to The Williams CompaniesFoundation, Inc. (a not-for-profitcorporation) (see Note 16 –Stockholders' Equity of NotestoConsolidated FinancialStatements); •The absenceof$20 million in costs in 2018 associatedwiththe WPZ Merger (see Note 1–General, Description of Business, Basis of Presentation, and Summary of Significant Accounting PoliciesofNotes to Consolidated Financial Statements); •An$8million increase related to theabsence of 2018 unfavorable Modified EBITDA associated with the resultsofcertainofour formerGulf Coast area operations sold in 2018; •The absence of a$7million loss on earlyretirement of debt in 2018.

These increases were partially offset by: •The absenceofa$37 million benefit of establishing aregulatory assetassociatedwith an increase in Transco’s estimateddeferred stateincome taxrate followingthe WPZ Merger in 2018 and asubsequent unfavorable $12 million adjustment in thefirst quarter of 2019; •A$26 million decrease in income associatedwith aregulatory assetrelated to deferred taxes on equity funds used during construction; •The absenceofa$20 million gainonthe saleofcertain assets and operations located in the Gulf Coastarea in 2018 (see Note 3–Acquisitions and DivestituresofNotes to ConsolidatedFinancialStatements).

60 Management’s Discussion and Analysis of Financial Condition andLiquidity

Overview

As previously discussed, we have continued to focus on earnings and cash flow growth, whilecontinuing to improve leverage metrics and control operating costs. During 2020, we retired approximately$2.1 billion of long- term debt and issued approximately $2.2 billion of new long-term debt.InJuly 2020, we paid$284 million for rate refunds related toTransco’s increasedrates collectedsincethe new rates becameeffective in March 2019. In 2020, we acquiredsubstantiallyall of the remaining outstanding ownership interests in CaimanIIfor approximately $157 million, netofcash acquired. See also the section titled Sources (Uses) of Cash.

Outlook

As previously discussed in Company Outlook, our growth capital and investment expenditures in 2021 are currentlyexpected to be in arange from $1.0 billion to $1.2 billion. Growthcapital spending in 2021 primarily includesTransco expansions, allofwhich are fullycontractedwith firm transportation agreements, and projects supporting the Northeast G&P businessand opportunities in the Haynesville area.Inaddition to growth capital and investment expenditures, we also remain committed to projectsthatmaintainour assets for safe and reliable operations, as wellasprojectsthatmeetlegal, regulatory, and/or contractualcommitments. We intend to fund substantiallyall of our planned 2021 capital spending with cash availableafter paying dividends. We retainthe flexibility to adjust plannedlevels of growth capitaland investment expenditures in response to changesineconomic conditions or business opportunities.

As of December31, 2020, we have $893 million of long-term debt due withinone year. Our potential sources of liquidity availabletoaddress these maturities include proceeds from refinancing at attractivelong-term rates or from our creditfacility, as well as proceeds from asset monetizations.

Liquidity

Based on our forecastedlevelsofcashflow from operations and othersources of liquidity, we expecttohave sufficient liquidity to manage our businesses in 2021. Our potential material internal and externalsources and uses of liquidity areasfollows:

Sources: Cash and cash equivalents on hand Cash generatedfrom operations Distributions from our equity-method investees Utilization of our credit facilityand/or commercial paperprogram Cash proceeds from issuanceofdebtand/or equitysecurities Proceeds from assetmonetizations

Uses: Working capital requirements Capital and investment expenditures Product costs Otheroperating costsincluding humancapital expenses Quarterly dividends to our shareholders Debt servicepayments, including payments of long-term debt Distributions to noncontrolling interests As of December31, 2020, we have approximately$21.5 billion of long-term debt due after one year. See Note 14 –Debtand Banking ArrangementsofNotestoConsolidated Financial Statements forthe aggregate maturities over the next five years. Our potential sourcesofliquidity availabletoaddress these maturities include cash generated from operations, proceeds from refinancing at attractivelong-term rates or from our credit facility,as wellasproceeds from asset monetizations.

61 Potential risks associatedwith our planned levelsofliquidity discussedabove include those previously discussedinCompany Outlook.

As of December31, 2020, we had aworking capital deficitof$890 million, including cash and cash equivalents and long-term debt due withinone year. Ouravailableliquidityisasfollows:

Available Liquidity December 31, 2020 (Millions) Cash and cash equivalents...... $142 Capacityavailableunderour $4.5 billion credit facility, less amountsoutstanding underour $4 billion commercial paperprogram (1)...... 4,500 $4,642 ______(1) In managing our availableliquidity, we do not expect amaximumoutstanding amount in excessofthe capacity of our credit facilityinclusive of any outstanding amounts under our commercial paperprogram.Wehad no commercial paperoutstanding as of December31, 2020. The highest amount outstanding under our commercial paperprogram and credit facilityduring 2020 was$1.7 billion. At December31, 2020, we were in compliance withthe financial covenants associatedwithour credit facility. See Note 14 –Debtand Banking Arrangements of Notes to Consolidated Financial Statementsfor additional information on our credit facilityand commercial paperprogram.

Dividends

We increased our regular quarterlycashdividend to common stockholders by approximately 5percent from the $0.38 per share paidineachquarter of 2019, to $0.40 per share paidineachquarter of 2020.

Registrations

To replaceour recently expired shelf registration statement,weanticipatefiling anew shelfregistration statement as awell-known seasoned issuer.

Distributions from Equity-Method Investees

The organizational documentsofentitiesinwhich we have an equity-method investment generally require periodic distributions of their availablecashtotheir members. In each case, availablecashisreduced, in part,by reservesappropriatefor operating their respective businesses. See Note 7–Investing ActivitiesofNotes to ConsolidatedFinancialStatements for our more significant equity-method investees.

Credit Ratings

The interest rates at whichweare able to borrow moneyare impactedbyour credit ratings. The current ratings are as follows: Senior Unsecured Rating Agency Outlook Debt Rating S&P Global Ratings Stable BBB Moody’s Investors ServicePositive Baa3 Fitch Ratings Stable BBB

In November2020, Fitch Ratings upgradedour credit rating from BBB- to BBB. In January 2021, Moody’s changed our OutlookfromStable to Positive.

These creditratings are included for informationalpurposesand are not recommendations to buy, sell,orhold our securities, and each rating should be evaluatedindependentlyofany otherrating. No assurance canbegiventhat the creditrating agencies will continue to assign us investment-grade ratings even if we meet or exceedtheir current

62 criteria forinvestment-grade ratios.Adowngrade of our credit ratings might increase our future costofborrowing and would require us to provide additionalcollateraltothird parties, negatively impacting our available liquidity.

Sources (Uses) of Cash

The following table summarizesthe sources(uses) of cash and cash equivalentsfor each of the periods presented (see Notes to ConsolidatedFinancial Statements for the Notes referenced in the table): Cash Flow Year EndedDecember31, Category 2020 2019 2018 (Millions) Sources of cash and cash equivalents: Operating activities –net...... Operating $3,496 $3,693 $3,293 Proceeds from long-term debt (seeNote 14)...... Financing 2,199 67 2,086 Proceeds from credit-facility borrowings...... Financing 1,700 700 1,840 Contributions in aidofconstruction...... Investing 37 52 411 Proceeds from sale of partialinterestinconsolidated subsidiary (see Note3)...... Financing —1,334 — Proceeds from dispositions of equity-method investments (see Note 7)...... Investing —485 — Proceeds from sale of businesses, net of cash divested(see Note 3)...... Investing —(2) 1,296

Usesofcash andcashequivalents: Paymentsoflong-term debt (see Note 14)...... Financing (2,141) (49) (1,254) Common dividends paid...... Financing (1,941) (1,842) (1,386) Paymentsoncredit-facilityborrowings...... Financing (1,700) (860) (1,950) Capital expenditures...... Investing (1,239) (2,109) (3,256) Purchases of and contributions to equity-method investments (see Note 7)...... Investing (325) (453) (1,132) Dividends anddistributions paid to noncontrolling interests... Financing (185) (124) (591) Purchases of businesses, net of cash acquired(see Note 3)...... Investing —(728) —

Financing Othersources /(uses)–net...... and Investing (48) (43) (88) Increase (decrease) in cash andcashequivalents...... $(147) $121 $(731) Operating activities

The factorsthat determine operating activitiesare largelythe same as those that affect Netincome (loss),with theexception of noncash itemssuch as Depreciation and amortization, Provision (benefit) for deferred income taxes, Equity (earnings) losses, Gain on disposition of equity-method investments,(Gain) on sale of certain assets and businesses,(Gain) loss on deconsolidation of businesses, Impairment of goodwill, Impairment of equity-method investments,and Impairment of certain assets.

Our Netcashprovided(used) by operating activities in 2020 decreased from 2019 primarily due to the net unfavorable changesinnet operating working capital in 2020, including the payment of Transco’s raterefunds in 2020 and the decrease in the income taxrefund thatwas received in 2020 comparedtothatreceived in 2019, partiallyoffset by higher operating income(excluding noncash itemsaspreviously discussed) in 2020.

Our Net cash provided(used) by operating activities in 2019 increased from 2018 primarily due to the net favorablechanges in operating working capital in 2019, including the collection of Transco’s filed rates subject to refund and the receipt of an income taxrefund, as wellashigheroperating income (excluding noncash itemsas previously discussed) in 2019, partiallyoffset by the impactofdecreased distributions from unconsolidated affiliates in 2019.

63 Environmental

We are aparticipant in certain environmentalactivitiesinvarious stages including assessment studies, cleanup operations, and/or remedial processesatcertain sites,some of which we currently do not own (seeNote 19 – Contingent Liabilities and CommitmentsofNotes to Consolidated Financial Statements). We aremonitoring these sitesinacoordinated effort withother potentially responsible parties,the EPA, or othergovernmental authorities. We are jointlyand severallyliablealong with unrelated third partiesinsome of these activities andsolely responsible in others. Current estimates of the most likelycostsofsuch activitiesare approximately$33 million, all of which are included in Accrued liabilities and Regulatory liabilities, deferredincome, and other in the ConsolidatedBalanceSheet at December 31, 2020. We willseekrecovery of the accrued costs related to remediation activitiesbyour interstate gas pipelines totaling approximately $4 million through future natural gas transmission rates. The remainder of these costswill be fundedfrom operations. During 2020, we paid approximately$3million for cleanup and/or remediation and monitoring activities. We expecttopay approximately $11 million in 2021 for these activities.Estimates of the most likelycostsofcleanup are generally based on completedassessment studies, preliminary resultsofstudies, or our experience withothersimilar cleanup operations. At December 31, 2020, certain assessment studieswere stillinprocess for which the ultimate outcome mayyield different estimates of most likelycosts.Therefore,the actual costs incurredwill depend on the final amount, type,and extent of contamination discovered at these sites, the final cleanup standards mandated by the EPA or other governmentalauthorities, and other factors.

The EPA and various stateregulatory agencies routinelypromulgateand propose new rules and issue updated guidance to existing rules. These rulemakings include, but are not limitedto, rulesfor reciprocating internal combustion engine and combustion turbine maximum achievablecontrol technology, airqualitystandards for one- hour nitrogen dioxide emissions, and volatile organiccompound and methane new source performance standards impacting design and operation of storage vessels, pressure valves,and compressors. The EPA previously issuedits rule regarding National Ambient AirQualityStandards for ground-level ozone. We are monitoring the rule's implementation as it willtrigger additional federal and stateregulatory actions thatmay impactour operations. Implementation of the regulations is expectedtoresult in impacts to our operations and increase the cost of additions to Property,plant,and equipment –net in the ConsolidatedBalanceSheet for both new and existing facilitiesin affected areas. We are unabletoreasonably estimate the cost of additions thatmay be required to meet the regulations at this time due to uncertaintycreated by various legal challenges to these regulations and the needfor furtherspecific regulatory guidance.

Our interstate natural gas pipelines consider prudently incurred environmentalassessment and remediation costs and thecosts associatedwith compliance with environmental standards to be recoverablethrough rates.

64 Item7A. Quantitative and Qualitative DisclosuresAbout Market Risk

InterestRate Risk

Our current interest raterisk exposureisrelated primarily to our debt portfolio. Our debt portfolio is primarily comprised of fixedratedebt,which mitigates the impactoffluctuations in interest rates. Any borrowings under our credit facilityand any issuances under our commercial paperprogram could be at avariable interest rate andcould expose us to the riskofincreasing interest rates. The maturity of our long-term debt portfolio is partiallyinfluenced by the expectedlives of our operating assets. (See Note 14 –Debtand Banking ArrangementsofNotes to ConsolidatedFinancial Statements.)

The tablesbelowprovide information by maturity dateabout our interest raterisk-sensitive instruments as of December31, 2020 and 2019. See Note 18 –Fair Value Measurements, Guarantees, and Concentration of Credit Risk of Notes to Consolidated Financial Statementsfor the methods usedindetermining the fairvalueofour long- term debt.

Fair Value December 31, 2021 2022 2023 2024 2025 Thereafter (1) Total 2020 (Millions) Long-term debt, including current portion: Fixed rate...... $894 $2,025 $1,477 $2,280 $1,617 $14,051 $22,344 $27,043 Weighted-average interest rate...... 5.0 %5.1 %5.2 %5.3 %5.4 %5.4 %

Fair Value December 31, 2020 2021 2022 2023 2024 Thereafter (1) Total 2019 (Millions) Long-term debt, including current portion: Fixed rate...... $2,141 $893 $2,025 $1,477 $2,279 $13,473 $22,288 $25,319 Weighted-average interest rate...... 5.2 %5.2 %5.3 %5.4 %5.6 %5.6 %

______(1) Includes unamortizeddiscount /premium and debt issuance costs.

Commodity PriceRisk

We are exposed to the impactoffluctuations in the market priceofNGLsand natural gas,aswellasother market factors, such as market volatility and energy commodity pricecorrelations. We are exposed to these risks in connection withour ownedenergy-related assets, our long-term energy-relatedcontracts, and limitedproprietary trading activities. Our management of the risks associatedwiththese market fluctuations includesmaintaining sufficient liquidity, as well as using various derivativesand nonderivative energy-relatedcontracts. The fairvalueof derivative contractsissubject to many factors, including changes in energy commodity market prices, the liquidity and volatility of the marketsinwhich the contractsare transacted, and changes in interest rates. AtDecember 31, 2020 and 2019, our derivative activity was not material.

65 Item8. FinancialStatementsand Supplementary Data

Report of Independent RegisteredPublicAccounting Firm

The Stockholders and the Board of Directors of The Williams Companies, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidatedbalancesheetofThe Williams Companies,Inc. (the Company) as of December31, 2020 and 2019, the related consolidated statements of operations, comprehensive income(loss), changes in equity and cash flowsfor each of the three years in theperiod endedDecember 31, 2020, and the related notesand the financial statementschedule listedinthe index at Item15(a) (collectively referred to as the “consolidatedfinancial statements”). In our opinion, based on our audits and the report of otherauditors, the consolidated financial statements present fairly, in all material respects,the consolidatedfinancial position of the Company at December 31, 2020 and 2019, and the consolidatedresultsofits operations and itscashflows for each of the three years in theperiod endedDecember31, 2020, in conformitywith U.S. generally acceptedaccounting principles.

We did not auditthe financial statements of GulfstreamNaturalGas System,L.L.C. (Gulfstream), alimited liability corporation in which the Company has a50percent interest. In the consolidatedfinancial statements,the Company’s investment in Gulfstreamwas $204 million and $217 million as of December31, 2020 and 2019, respectively, and the Company’s equity earnings in the net income of Gulfstreamwere $77 million in 2020, $74 million in 2019 and $75 million in 2018. Gulfstream’s financial statements were audited by otherauditors whose report has been furnished to us, and our opinion, insofar as it relatestothe amounts included for Gulfstream, is based solelyonthe report of otherauditors.

We also have audited, in accordance withthe standards of the PublicCompany Accounting Oversight Board (United States) (PCAOB), the Company's internalcontrol over financial reporting as of December31, 2020, based on criteria established in Internal Control-Integrated Framework issuedbythe CommitteeofSponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February24, 2021 expressedanunqualified opinion thereon.

Basis for Opinion

These consolidatedfinancial statements are theresponsibilityofthe Company's management. Our responsibilityis to express an opinion on the Company’s consolidated financial statements based on our audits. We are apublic accounting firm registered with thePCAOBand are requiredtobeindependent with respecttothe Company in accordance withthe U.S. federal securities laws and the applicable rulesand regulations of the Securities and Exchange Commission and thePCAOB.

We conducted our audits in accordance withthe standards of the PCAOB. Those standards require that we planand perform the audittoobtain reasonable assurance about whetherthe consolidatedfinancial statements are free of materialmisstatement,whetherdue to error or fraud. Our audits included performing procedures to assess the risks of materialmisstatement of the consolidatedfinancial statements,whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on atestbasis, evidence regarding the amounts and disclosures in the consolidatedfinancial statements.Our audits also included evaluating the accounting principles used and significant estimatesmadebymanagement, as wellasevaluating the overall presentation of the consolidated financial statements.Webelieve thatour audits and the report of otherauditors provide areasonable basis for our opinion.

66 Critical AuditMatters

The critical audit matterscommunicated below are mattersarising from the current period auditofthe financial statements that were communicated or required to be communicatedtothe audit committeeand that(1) relateto accountsordisclosures that are materialtothe financial statementsand (2) involved our especiallychallenging, subjective or complexjudgments. The communication of criticalauditmatters does not alterinany way our opinion on the consolidated financial statements, taken as awhole,and we are not, by communicating the critical audit matters below,providing separate opinions on the critical audit mattersoronthe accounts or disclosures to which theyrelate. Pension and Other Postretirement BenefitObligations

Description of At December 31, 2020, the Company’s aggregatepension and otherpostretirement benefit the Matter obligations were $1,403 million and were exceeded by the fairvalueofpension and other postretirement planassets of $1,635 million, resulting in overfundedpension and other postretirement benefit obligations of $232 million. As explained in Note 10 to the consolidated financial statements,the Company utilizedkey assumptions to determine the pension and other postretirement benefitobligations.

Auditing the pension and otherpostretirement benefit obligations is complexand required the involvement of specialists due to the judgmentalnature of the actuarial assumptions (e.g., discount rates and cash balanceinterest crediting rate) used in the measurement process. These assumptions have asignificant effect on the projected benefitobligations. How We We obtainedanunderstanding, evaluatedthe design, and tested the operating effectiveness of Addressed the controls relatingtothe measurement and valuation of the pension and otherpostretirement benefit Matter in Our obligations, including controls over management’s review of the pension and otherpostretirement Audit obligations, the significant actuarial assumptions, and the datainputs.

To test the pension and otherpostretirement benefit obligations, our auditprocedures included, among others, evaluating the methodologies used, the significant actuarialassumptions discussed above,and the underlying dataused by the Company. We compared the actuarial assumptions used by management to historicaltrends and evaluatedthe changesinthe funded status from prior year. In addition, we involvedour actuarialspecialists to assist withour procedures. For example, we evaluated management’s methodology for determining the discount rates that reflectthe maturity andduration of the benefit paymentsand are used to measure the pension and other postretirement benefit obligations. As part of thisassessment,weindependently developedarange of yield curves, we compared the projected cash flows to prior year, and comparedthe current yearbenefitspaidtothe prior yearprojected cash flows. To test the cash balanceinterest crediting rate, we independently calculatedarange of rates and comparedthemtothe rateused by management. We also tested thecompleteness and accuracy of the underlying data, including the participant data.

67 Impairment Review of Equity-Method Investments

Description of As discussedinNote 7tothe consolidated financial statements,the Company has investmentsin the Matter nonconsolidated entitiesaccounted for using the equity-method, totaling $5,159 million as of December31, 2020, and recorded impairments of equity-method investmentsof$1,046 million during 2020. The carrying value of each equity-method investment is evaluatedfor impairment when events or changes in circumstances indicatethatthe carrying value of the investment may have experienced an other-than-temporary decline in value. Whenthere are indicators of impairment, the fairvalueofthe equity-method investment is estimated. Fair value is estimated using various methods, including income and market approaches. Whenthe estimated fairvalue is lower thanthe carrying value, the Company determineswhetherthe impairment is other-thantemporary.

Auditing the Company’s impairment assessmentswas complexand judgmental due to the estimation required in the determination of fairvalue of the investmentsfor which evidenceof loss in value hasoccurred. How We We obtainedanunderstanding, evaluatedthe design, and tested the operating effectiveness of Addressed the controls over the Company’s equity-method impairment review process, including controls over Matter in Our the determination of fairvalue. Audit For the equity-method investments withevidence of loss in value, we performed audit procedures thatincluded, among others, assessing the methodologies used by management to determine fair value, evaluating the significant assumptions, and testing the underlying dataused by the Company in its analyses.For example, we compared the estimated cash flows used withinthe assessmentstocurrent operating resultsand future expectedeconomictrends, and obtainedthird- partysupport, where available, to evaluate significant assumptions. We also recalculated management’sestimate. We involvedour valuation specialists to assist withour evaluation of the methodologiesused by the Company and significant assumptions includedinthe fairvalue estimates.

/s/ Ernst &YoungLLP

We have served as the Company’s auditor since 1962. Tulsa, Oklahoma February 24, 2021

68 Report of Independent RegisteredPublicAccounting Firm

To theManagementCommittee and Members of GulfstreamNaturalGas System,L.L.C.:

Opinion on the Financial Statements

We have audited the statements of financial position of Gulfstream NaturalGas System, L.L.C. (the “Company”)as of December31, 2020 and 2019, and the related statements of earnings, comprehensive income, changes in members’ equity and cash flowsfor each of the three years in theperiod endedDecember 31, 2020, including the related notes(collectively referred to as the “financialstatements”)(not presented herein). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December31, 2020 and 2019, and the results of itsoperations and itscashflows for each of the three years in theperiod ended December31, 2020 in conformity with accounting principles generallyacceptedinthe United States of America.

Basis forOpinion

These financial statements arethe responsibility of the Company’s management. Our responsibilityistoexpress an opinion on the Company’s financial statements based on our audits. We are apublicaccounting firm registered with thePublic Company Accounting Oversight Board (UnitedStates) (PCAOB)and are requiredtobeindependent with respecttothe Company in accordance withthe U.S. federal securities laws andthe applicable rulesand regulations of the Securities and Exchange Commission and thePCAOB.

We conducted our audits of these financial statements in accordance withthe standards of the PCAOB and in accordance withauditing standards generally acceptedinthe United StatesofAmerica.Those standards require that we planand perform the audittoobtain reasonable assurance about whetherthe financial statements arefreeof materialmisstatement,whetherdue to error or fraud.

Our audits included performing procedures to assess the risks of material misstatementofthe financial statements, whether due to error or fraud, and performing procedures that respondtothose risks. Such procedures included examining, on atestbasis, evidence regarding the amounts and disclosures in the financial statements. Ouraudits also includedevaluating the accounting principles used and significant estimatesmadebymanagement, as wellas evaluatingthe overall presentation of the financial statements. We believe thatour audits provide areasonablebasis for our opinion.

CriticalAudit Matters

Critical audit mattersare mattersarising from the current period auditofthe financial statements that were communicated or required to be communicatedtothose charged with governance and that(i) relatetoaccountsor disclosures thatare material to thefinancial statements and(ii)involved our especiallychallenging, subjective, or complexjudgments. We determined there are no criticalaudit matters.

/s/ PricewaterhouseCoopers LLP

Houston, Texas February 24, 2021

We have served as the Company’s auditor since 2018.

69 The Williams Companies,Inc. ConsolidatedStatementofOperations

Year Ended December 31, 2020 2019 2018 (Millions, except per-share amounts) Revenues: Service revenues...... $5,924 $5,933 $5,502 Service revenues –commodityconsideration...... 129 203 400 Product sales...... 1,666 2,065 2,784 Total revenues...... 7,719 8,201 8,686 Costs and expenses: Product costs...... 1,545 1,961 2,707 Processing commodity expenses...... 68 105 137 Operating and maintenance expenses...... 1,326 1,468 1,507 Depreciation and amortization expenses...... 1,721 1,714 1,725 Selling, general, and administrative expenses...... 466 558 569 Impairment of certain assets (Note 18)...... 182 464 1,915 Impairment of goodwill(Note 18)...... 187 —— Gain on saleofcertain assetsand businesses (Note 3)...... —2(692) Other (income) expense –net...... 22 850 Total costsand expenses...... 5,517 6,280 7,918 Operating income (loss)...... 2,202 1,921 768 Equity earnings (losses) (Note 7)...... 328 375 396 Impairment of equity-method investments (Note 18)...... (1,046) (186) (32) Other investing income (loss) –net (Note 7)...... 8107 219 Interestincurred...... (1,192) (1,218) (1,160) Interest capitalized...... 20 32 48 Other income (expense) –net...... (43) 33 92 Income (loss) from continuing operations before income taxes...... 277 1,064 331 Less: Provision (benefit) for income taxes...... 79 335 138 Income (loss) from continuing operations...... 198 729 193 Income (loss) from discontinued operations...... —(15) — Net income(loss)...... 198 714 193 Less: Net income(loss) attributabletononcontrolling interests...... (13) (136) 348 Netincome(loss) attributabletoThe WilliamsCompanies, Inc...... 211 850 (155) Less: Preferred stock dividends (Note 16)...... 331 Net income(loss) availabletocommon stockholders...... $208 $847 $(156) Amountsattributable to TheWilliamsCompanies, Inc. available to common stockholders: Income (loss) from continuing operations...... $208 $862 $(156) Income (loss) from discontinued operations...... —(15) — Net income(loss)...... $208 $847 $(156) Basic earnings (loss) per common share: Income (loss) from continuing operations...... $.17 $.71 $(.16) Income (loss) from discontinued operations...... —(.01) — Net income(loss)...... $.17 $.70 $(.16) Weighted-average shares (thousands)...... 1,213,631 1,212,037 973,626 Diluted earnings (loss) per common share: Income (loss) from continuing operations...... $.17 $.71 $(.16) Income (loss) from discontinued operations...... —(.01) — Net income(loss)...... $.17 $.70 $(.16) Weighted-average shares (thousands)...... 1,215,165 1,214,011 973,626 Seeaccompanying notes.

70 The Williams Companies,Inc. ConsolidatedStatementofComprehensive Income (Loss)

Year Ended December 31, 2020 2019 2018 (Millions) Net income (loss)...... $198 $714 $193 Other comprehensive income (loss): Cash flow hedging activities: Net unrealized gain (loss) from derivative instruments, net of taxes of $—, $—, and $1 in 2020, 2019, and 2018, respectively...... (2) —(7) Reclassifications into earnings of net derivative instruments (gain) loss, net of taxes of $—, $—, and ($1) in 2020, 2019, and 2018, respectively...... 1— 8 Pension and other postretirement benefits: Net actuarial gain (loss) arising during the year, net of taxes of ($27), ($20), and $3 in 2020, 2019, and 2018, respectively...... 81 59 (6) Amortization of actuarial (gain) loss and net actuarial loss from settlements included in net periodic benefit cost (credit),net of taxes of ($7), ($4), and ($11) in 2020, 2019, and 2018, respectively...... 23 12 35 Other comprehensive income (loss)...... 103 71 30 Comprehensive income (loss)...... 301 785 223 Less: Comprehensive income (loss) attributabletononcontrolling interests...... (13) (136) 346 Comprehensive income (loss) attributabletoThe Williams Companies, Inc...... $314 $921 $(123) Seeaccompanying notes.

71 The Williams Companies,Inc. ConsolidatedBalanceSheet

December 31, 2020 2019 (Millions, except per-share amounts) ASSETS Current assets: Cash and cash equivalents...... $142 $289 Trade accounts andotherreceivables...... 1,000 1,002 Allowance for doubtful accounts...... (1) (6) Trade accounts andotherreceivables -net...... 999 996 Inventories...... 136 125 Othercurrent assets anddeferred charges...... 152 170 Total current assets...... 1,429 1,580

Investments...... 5,159 6,235 Property, plant,and equipment –net...... 28,929 29,200 Intangibleassets –net of accumulated amortization...... 7,444 7,959 Regulatory assets, deferredcharges,and other...... 1,204 1,066 Total assets...... $44,165 $46,040,

LIABILITIESAND EQUITY Current liabilities: Accounts payable...... $482 $552 Accrued liabilities...... 944 1,276 Long-term debt due withinone year...... 893 2,140 Total current liabilities...... 2,319 3,968

Long-term debt...... 21,451 20,148 Deferred incometax liabilities...... 1,923 1,782 Regulatory liabilities, deferred income, andother...... 3,889 3,778 Contingent liabilitiesand commitments (Note 19)

Equity: Stockholders’ equity: Preferred stock...... 35 35 Common stock ($1 parvalue; 1,470 million shares authorizedatDecember 31, 2020 and December31, 2019; 1,248 millionsharesissued at December31, 2020 and 1,247 millionsharesissued at December31, 2019)...... 1,248 1,247 Capital in excess of par value...... 24,371 24,323 Retaineddeficit...... (12,748) (11,002) Accumulated other comprehensive income(loss)...... (96) (199) Treasury stock, at cost (35 million shares of common stock)...... (1,041) (1,041) Total stockholders’ equity...... 11,769 13,363 Noncontrolling interestsinconsolidated subsidiaries...... 2,814 3,001 Total equity...... 14,583 16,364 Total liabilities andequity...... $44,165 $46,040 Seeaccompanying notes.

72 The Williams Companies, Inc. Consolidated Statement of Changes in Equity

The Williams Companies, Inc. Stockholders Capital in Total Preferred Common Excess of Retained Treasury Stockholders’ Noncontrolling Total Stock Stock Par Value Deficit AOCI* Stock Equity Interests Equity (Millions) BalanceatDecember 31, 2017...... $—$861 $18,508 $(8,434) $(238) $(1,041) $9,656 $6,519 $16,175 Adoption of new accounting standards...... —— —(23) (61) —(84) (37) (121) Net income (loss)...... —— —(155) —— (155) 348 193 Other comprehensive income (loss)...... —— ——32 —32(2) 30 WPZ Merger (Note 1)...... —382 6,112 —(3) —6,491 (4,629) 1,862 Issuanceofpreferred stock (Note 16)...... 35 ———— —35—35 Cash dividends –common stock ($1.36 per share)...... —— —(1,386) —— (1,386) —(1,386) Dividends anddistributions to noncontrolling interests...... —— ———— —(637) (637) Stock-based compensation and related common stock issuances, netoftax...... —1 60 —— —61—61 Salesoflimited partnerunits of Williams Partners L.P...... —— ———— —4646 Changes in ownership of consolidated subsidiaries, net...... —— 14 —— —14(18) (4) Contributions from noncontrolling interests...... —— ———— —1515 Deconsolidation of subsidiary (Note 7)...... —— ———— —(267) (267) Other...... —1 (1)(4) —— (4) (1) (5) Net increase (decrease) in equity...... 35 384 6,185 (1,568) (32) —5,004 (5,182) (178) BalanceatDecember31, 2018...... 35 1,245 24,693 (10,002) (270) (1,041) 14,660 1,33715,997 Netincome (loss)...... —— —850 —— 850 (136) 714 Other comprehensive income (loss)...... —— ——71 —71—71 Cash dividends –common stock ($1.52 per share)...... —— —(1,842) —— (1,842) —(1,842) Dividends anddistributions to noncontrolling interests...... —— ———— —(124) (124) Stock-based compensation and related common stock issuances, netoftax...... —2 56 —— —58—58 Sale of partial interest in consolidated subsidiary (Note 3)...... —— ———— —1,334 1,334 Change in ownership of consolidated subsidiaries, net (Note 3)...... ——(426)——— (426) 567141 Contributions from noncontrolling interests...... —— ———— —3636 Deconsolidation of subsidiary (Note 7)...... —— ———— —(13) (13) Other...... —— —(8) —— (8) —(8) Net increase (decrease) in equity...... —2(370)(1,000) 71 —(1,297) 1,664 367 BalanceatDecember31, 2019...... 35 1,247 24,323 (11,002) (199) (1,041) 13,363 3,001 16,364 Net income (loss)...... —— —211 —— 211 (13) 198 Other comprehensive income (loss)...... —— ——103 —103 —103 Cash dividends –common stock ($1.60 per share)...... —— —(1,941) —— (1,941) —(1,941) Dividends anddistributions to noncontrolling interests...... —— ———— —(185) (185) Stock-based compensation and related common stock issuances, netoftax...... —1 50 —— —51—51 Contributions from noncontrolling interests...... —— ———— —77 Other...... —— (2)(16) —— (18) 4(14) Net increase (decrease) in equity...... —1 48 (1,746) 103 —(1,594) (187) (1,781) BalanceatDecember31, 2020...... $35$1,248 $24,371 $(12,748) $(96) $(1,041) $11,769 $2,814 $14,583

*AccumulatedOther Comprehensive Income(Loss)

Seeaccompanying notes.

73 The Williams Companies,Inc. ConsolidatedStatementofCash Flows

Year Ended December 31, 2020 2019 2018 (Millions) OPERATING ACTIVITIES: Net income (loss)...... $198 $714 $193 Adjustments to reconcile to net cash provided (used) by operating activities: Depreciation and amortization...... 1,721 1,714 1,725 Provision (benefit) for deferred incometaxes...... 108 376 220 Equity (earnings) losses...... (328) (375) (396) Distributions from unconsolidated affiliates...... 653 657 693 Gain on disposition of equity-method investments (Note 7)...... —(122) — (Gain) on sale of certain assets and businesses (Note 3)...... —2(692) (Gain) loss on deconsolidation of businesses (Note 7)...... —29(203) Impairment of goodwill (Note 18)...... 187 —— Impairment of equity-method investments (Note 18)...... 1,046 186 32 Impairment of certain assets (Note 18)...... 182 464 1,915 Amortization of stock-based awards...... 52 57 55 Cash provided (used) by changes in current assets and liabilities: Accounts receivable...... (2) 34 (36) Inventories...... (11) 5(16) Other current assets and deferred charges...... 11 21 17 Accounts payable...... (7) (46) (93) Accrued liabilities...... (309) 153 23 Other, including changes in noncurrent assets and liabilities...... (5) (176) (144) Net cash provided (used) by operating activities...... 3,496 3,693 3,293 FINANCING ACTIVITIES: Proceeds from long-term debt...... 3,899 767 3,926 Payments of long-term debt...... (3,841) (909) (3,204) Proceeds from issuance of common stock...... 91015 Proceeds from sale of partialinterest in consolidated subsidiary (Note 3)...... —1,334 — Common dividends paid...... (1,941) (1,842) (1,386) Dividends and distributions paid to noncontrolling interests...... (185) (124) (591) Contributions from noncontrolling interests...... 73615 Payments for debt issuance costs...... (20) —(26) Other –net...... (13) (17) (48) Net cash provided (used) by financing activities...... (2,085) (745) (1,299) INVESTING ACTIVITIES: Property, plant, and equipment: Capital expenditures (1)...... (1,239) (2,109) (3,256) Dispositions –net...... (36) (40) (7) Contributions in aid of construction...... 37 52 411 Proceeds from sale of businesses, net of cash divested (Note 3)...... —(2) 1,296 Purchases of businesses, net of cash acquired (Note 3)...... —(728) — Proceeds from dispositions of equity-method investments (Note 7)...... —485 — Purchases of and contributions to equity-method investments (Note 7)...... (325) (453) (1,132) Other –net...... 5(32) (37) Net cash provided (used) by investing activities...... (1,558) (2,827) (2,725) Increase (decrease) in cash and cash equivalents...... (147) 121 (731) Cash and cash equivalents at beginning of year...... 289 168 899 Cash and cash equivalents at end of year...... $142 $289 $168 ______(1) Increases to property, plant,and equipment...... $(1,160) $(2,023) $(3,021) Changes in related accounts payableand accrued liabilities...... (79) (86) (235) Capital expenditures...... $(1,239) $(2,109) $(3,256)

Seeaccompanying notes.

74 The Williams Companies, Inc. Notes to Consolidated Financial Statements

Note 1–General, Description of Business, Basis of Presentation, and SummaryofSignificantAccounting Policies

General

Unless the context clearly indicatesotherwise, references in thisreport to “Williams,” “we,” “our,” “us,” or like terms refertoThe Williams Companies, Inc. and itssubsidiaries. Unless the context clearly indicatesotherwise, references to “Williams,” “we,” “our,” and “us”include the operations in whichweown interests accountedfor as equity-method investmentsthatare not consolidated in our financial statements. When we refertoour equity investees by name, weare referring exclusivelytotheirbusinesses and operations.

WPZ Merger

On August 10, 2018, we completed our merger with Williams Partners L.P. (WPZ), our previously consolidated master limitedpartnership, pursuant to which we acquiredall of the approximately256 million publiclyheld outstanding common unitsofWPZ in exchange for 382 million shares of our common stock (WPZ Merger). Williams continued as the surviving entity. The WPZ Merger wasaccounted for as anoncash equity transaction resulting in increases to Common stock of $382 million, Capitalinexcessofpar value of $6.112 billion, and Regulatory assets, deferredcharges,and other of $33 million and decreases to Accumulated othercomprehensive income (loss) (AOCI) of $3 million, Noncontrolling interests in consolidatedsubsidiaries of $4.629 billion, and Deferredincome tax liabilities of $1.829 billion in the ConsolidatedBalanceSheet.Prior to the completion of the WPZ Merger and pursuant to itsdistribution reinvestment program,WPZ had issuedcommon unitstothe publicin 2018 associatedwith reinvested distributions of $46 million.

Description of Business

We are aDelaware corporation whose common stock is listed andtraded on the New YorkStock Exchange. Our operations are locatedinthe United States. Our operations are presented withinthe following reportable segments: Transmission &Gulf of Mexico, Northeast G&P,and West, consistent with the manner in which our chief operating decision maker evaluatesperformanceand allocates resources. All remaining businessactivitiesas well as corporate activitiesare included in Other.

Transmission &Gulf of Mexicoiscomprised of our interstate natural gas pipelines, TranscontinentalGas Pipe Line Company, LLC(Transco) and Northwest Pipeline LLC(NorthwestPipeline), as wellasnatural gas gathering and processing and crude oil production handling and transportation assets in the Gulf Coastregion, including a51 percent interest in Gulfstar One LLC(GulfstarOne) (a consolidated variableinterest entity, or VIE), which is a proprietary floating production system,a50percent equity-method investment in GulfstreamNaturalGas System, L.L.C. (Gulfstream), anda60percent equity-method investment in Discovery Producer ServicesLLC (Discovery).

Northeast G&P is comprisedofour midstreamgathering, processing, and fractionation businesses in the Marcellus Shale region primarilyinPennsylvaniaand New York, and the Utica Shale region of eastern Ohio, as well as a65percent interest in Ohio Valley MidstreamLLC (Northeast JV) (a consolidated VIE) which operatesinWest Virginia, Ohio, and Pennsylvania, a66percent interest in Cardinal Gas Services, L.L.C. (Cardinal)(aconsolidated VIE) which operatesinOhio, a69percent equity-method investment in Laurel Mountain Midstream, LLC(Laurel Mountain), a99percent interest in CaimanEnergy II, LLC(Caiman II)(aformerequity-method investment which is aconsolidatedentityfollowing our November2020 acquisition of an additional ownershipinterest and was subsequently renamedBlue Racer MidstreamHoldings, LLC) which owns a50percent equity-method investment in Blue Racer MidstreamLLC (Blue Racer) (see Note 7–Investing Activities), and AppalachiaMidstreamServices, LLC, awholly owned subsidiary thatowns equity-method investments withanapproximate average 66 percent interest in multiplegas gathering systemsinthe Marcellus Shale region (AppalachiaMidstream Investments).

75 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Westiscomprisedofour gas gathering, processing, and treating operations in the Rocky Mountain region of Colorado and Wyoming, the BarnettShale region of north-central Texas,the Eagle Ford Shale region of south Texas, the Haynesville Shaleregion of northwestLouisiana, and the Mid-Continent region which includesthe Anadarko, Arkoma, and Permian basins.Thissegment also includesour natural gas liquid (NGL)and natural gas marketing business, storage facilities, an undivided 50 percent interest in an NGL fractionator nearConway, Kansas, a50percent equity-method investment in Overland Pass Pipeline Company LLC(OPPL), a50percent equity- method investment in Rocky MountainMidstreamHoldings LLC(RMM),a20percent equity-method investment in Targa Train 7LLC (Targa Train 7) (a nonconsolidated VIE), and a15percent interest in Brazos Permian II, LLC (Brazos Permian II) (a nonconsolidated VIE).

Basis of Presentation

Discontinued operations

Unlessindicatedotherwise,the information in the NotestoConsolidatedFinancialStatementsrelates to our continuing operations.

Significant risksand uncertainties

We believethat the carrying value of certain of our property, plant, and equipment and otheridentifiable intangible assets, notably certain acquiredassets accountedfor as businesscombinations between 2012 and 2014, maybeinexcess of current fairvalue. However, the carrying value of these assets, in our judgment,continuestobe recoverable.Itisreasonablypossible that future strategic decisions,including transactions such as monetizing non- core assets or contributing assets to new ventures withthird parties, as wellasunfavorable changesinexpected produceractivities, including effectsoffinancial distresscaused by financial and commodity market declines, could impactour assumptions and ultimatelyresult in impairments of these assets. Such transactions or developmentsmay also indicate that certain of our equity-method investments have experienced other-than-temporary declines in value, which could result in impairment.

Customer bankruptcy

In November2020, we reached aglobal resolutionwith Chesapeake as part of Chesapeake’s restructuring process. The resolution was approvedbythe bankruptcycourt in December2020 and per the terms,Chesapeake paidall outstanding pre-petition amounts due to us. Additional terms include reduced gathering feesinthe Haynesville Shaleregion, continuation of the gathering agreementsinthe Eagle Ford Shaleand Marcellus Shale regions, along-term gas supply commitment for Transco’s Regional Energy Access pipeline currentlyunder development,and transferring certain natural gas propertiesinLouisiana to us. As aresult of thisresolution, we recorded increases to our othernonregulated property, plant, and equipment of $98 million, contractliabilities of $67 million (see Note 5–Revenue Recognition), and assetretirement obligations (AROs) of $31 million (see Note 11 –Property, Plant,and Equipment).

Summary of Significant Accounting Policies

Principles of consolidation

The consolidatedfinancial statements include the accounts of allentitiesthatwecontrol and our proportionate interest in the accounts of certain ventures in which we own an undivided interest. Our judgment is required to evaluate whetherwecontrol an entity. Key areas of thatevaluation include:

76 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

•Determiningwhetheranentity is aVIE;

•Determiningwhetherweare the primary beneficiary of aVIE, including evaluating which activitiesofthe VIE most significantly impactits economicperformanceand the degree of powerthatweand our related partieshave overthose activitiesthrough our variableinterests;

•Identifying events thatrequire reconsideration of whetheranentityisaVIE and continuouslyevaluating whetherweare aVIE’s primary beneficiary;

•Evaluating whetherotherowners in entitiesthatare not VIEsare able to effectively participate in significant decisions that would be expected to be made in the ordinary course of business such thatwedo not have thepower to control such entities.

We apply the equitymethod of accounting to investments over which we exercise significant influencebut do not control. Distributions received from equity-method investeesare presented in the ConsolidatedStatement of Cash Flows according to the nature of the distributionsapproach, which classifiesdistributions received from equity-method investeesaseither returnsoninvestment (cash inflows from operating activities) or returns of investment (cash inflows from investing activities) based on the nature of the activities of the equity-method investee thatgeneratedthe distribution.

Equity-method investment basis differences

Differencesbetween the cost of our equity-method investments and our underlying equity in the net assets of investeesare accountedfor as if the investees were consolidatedsubsidiaries. Equity earnings (losses) in the ConsolidatedStatement of Operations includes our allocableshare of net income(loss) of investeesadjusted for any depreciation andamortization, as applicable, associatedwith basis differences.

Use of estimates

The preparation of financial statements in conformity with accounting principles generally acceptedinthe UnitedStates requiresmanagement to make estimatesand assumptions thataffect the amounts reportedinthe consolidated financialstatements and accompanying notes. Actualresults coulddifferfrom those estimates.

Significant estimates and assumptions include:

•Impairmentassessments of investments, property, plant, and equipment, goodwill,and otheridentifiable intangible assets;

•Litigation-related contingencies;

•Environmental remediation obligations;

•Depreciationand/or amortization of long-livedassets;

•Depreciationand/or amortization of equity-method investment basis differences;

•AROs;

•Pensionand postretirement valuation variables;

•Measurement of regulatory liabilities;

•Measurement of deferred income taxassets and liabilities, including assumptions related to the realization of deferred incometax assets;

77 TheWilliams Companies, Inc. Notes to ConsolidatedFinancial Statements –(Continued)

•Revenue recognition, including estimatesutilizedinrecognition of deferred revenue;

•Purchase priceaccounting.

These estimatesare discussedfurtherthroughout these notes.

Regulatory accounting

Transcoand Northwest Pipeline are regulatedbythe Federal Energy Regulatory Commission (FERC), and their rates are established by the FERC. Therefore, we have determinedthatitisappropriateunder Accounting Standards Codification (ASC)Topic980, “Regulated Operations,” (ASC 980) thatcertain costs thatwould otherwise be charged to expense should be deferred as regulatory assets, based on the expectedrecovery from customers in future rates. Likewise, certain actualoranticipatedcreditsthatwould otherwise reduce expense should be deferred as regulatory liabilities, based on the expectedreturn to customers in future rates.Management’sexpectedrecovery of deferred costs and return of deferred creditsgenerally resultsfrom specific decisions by regulators granting such ratemaking treatment. We record certain incurredcosts and obligations as regulatory assets or liabilities if, based on regulatory orders or otheravailableevidence, it is probablethatthe costs or obligations willbeincludedinamounts allowablefor recovery or refundedinfuture rates.Accounting for these operations thatare regulatedcan differfrom the accounting requirementsfor nonregulated operations. For example, for regulated operations, allowancefor funds used during construction (AFUDC)represents the estimatedcost of debt and equity funds applicabletoutility plant in the process of construction and is capitalized as acost of property, plant, and equipment because it constitutesan actualcost of construction under established regulatory practices; nonregulated operations are only allowed to capitalizethe cost of debt funds related to construction activities, while acomponent for equity is prohibited. The componentsofour regulatory assets and liabilities relatetothe effectsofdeferred taxes on equity funds used during construction, AROs, shipper imbalanceactivity, fuel and power cost differentials, levelized incremental depreciation, negative salvage, pension and otherpostretirement benefits, customer taxrefunds, and rateallowances for deferred incometaxesatahistoricallyhigherfederal income taxrate.

Our current and noncurrent regulatory assetand liability balances for the years ended December31, 2020 and 2019 are as follows:

December 31, 2020 2019 (Millions) Current assets reported within Other currentassets and deferredcharges...... $64$ 72 Noncurrent assets reported within Regulatory assets, deferredcharges,and other...... 442 466 Total regulated assets...... $506 $538

Current liabilities reported within Accrued liabilities...... $59$ 60 Noncurrent liabilities reported within Regulatory liabilities, deferredincome,and other.... 1,314 1,277 Total regulated liabilities...... $1,373 $1,337

Cashand cashequivalents

Cashand cashequivalents in the Consolidated Balance Sheetconsist of highlyliquid investmentswithoriginal maturities of threemonths or less whenacquired.

Accountsreceivable

Accountsreceivableare carried on agross basis, with no discounting, less an allowancefor doubtful accounts. We estimate the allowance for doubtful accounts, considering current expected credit losses (as discussed below in Accounting standards issued and adopted), the financial condition of our customers, and age of past due accounts. We do not offer extendedpayment terms and typicallyreceive payment within one month. We considerreceivables

78 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued) pastdue if full payment is not received by the contractual due date. Interestincome related to past due accounts receivableisgenerally recognized at the time full payment is received or collectability is assured. Past due accounts are generally written off against the allowancefor doubtful accounts only after allcollection attemptshave been exhausted.

Inventories

Inventories in the ConsolidatedBalanceSheet primarily consistofNGLs, natural gas in underground storage, and materials and suppliesand are statedatthe lower of cost or net realizable value. The cost of inventories is primarily determined using theaverage-cost method.

Property,plant,and equipment

Property, plant, and equipment is initiallyrecorded at cost. We basethe carrying value of these assets on estimates, assumptions, and judgmentsrelative to capitalized costs, useful lives, and salvage values.

As regulated entities, Northwest Pipeline and Transco provide for depreciation using the straight-line method at FERC-prescribed rates. Depreciation for nonregulated entitiesisprovidedprimarily on the straight-line method over estimateduseful lives, except for certainoffshore facilitiesthat applyanaccelerateddepreciation method.

Gains or lossesfrom the ordinary sale or retirement of property, plant, and equipment for regulated pipelines are credited or charged to accumulateddepreciation. Other gains or lossesare recorded in Other (income) expense –net includedinOperating income (loss) in theConsolidatedStatement of Operations.

Ordinary maintenance and repair costs are generally expensed as incurred. Costsofmajor renewals and replacementsare capitalizedasproperty, plant, andequipment.

We record aliability andincrease the basis in the underlying assetfor the present value of each expected future AROatthe time the liability is initiallyincurred, typicallywhen the assetisacquiredorconstructed. As regulated entities, Northwest Pipeline and Transco offset the depreciationofthe underlying assetthatisattributable to capitalized AROcost to aregulatory assetasweexpecttorecover these amounts in future rates. We measure changes in the liability due to passage of time by applying an interest ratetothe liability balance. Thisamount is recognized as an increase in the carrying amount of the liability andasacorresponding accretion expense included in Operating and maintenance expenses in the ConsolidatedStatement of Operations, except for regulated entities, for which the liability is offset by aregulatory asset. The regulatory assetisamortizedcommensuratewith our collection of those costs in rates.

MeasurementsofAROs include,asacomponent of future expectedcosts,anestimate of the pricethatathird partywould demand, and couldexpect to receive, for bearing the uncertaintiesinherent in the obligations, sometimes referred to as amarket-risk premium.

Goodwill Goodwill included within Intangible assets –net of accumulatedamortization in the ConsolidatedBalance Sheet,asofDecember31, 2019, represents the excess of the consideration, plus the fairvalue of any noncontrolling interest or any previously heldequity interest, over the fairvalueofthe net assets acquired. It is not subjectto amortization but is evaluated annuallyasofOctober1for impairment or more frequentlyifimpairment indicators are present that would indicate it is more likely than not thatthe fairvalueofthe reporting unit is less thanits carrying amount. As part of the evaluation, we compare our estimate of the fairvalueofthe reporting unit withits carryingvalue, including goodwill.Ifthe carrying value of the reporting unit exceeds itsfair value, an impairment charge is recorded for the difference (not to exceedthe carrying value of goodwill). Judgmentsand assumptions are inherent in our management’s estimates of fairvalue.

79 The Williams Companies, Inc. Notes to ConsolidatedFinancial Statements –(Continued)

Other identifiable intangibleassets

Our otheridentifiable intangibleassetsincludedwithin Intangible assets –net of accumulated amortization in the Consolidated Balance Sheetare primarily related to gas gathering, processing, and fractionation contractual customer relationships. Our otheridentifiable intangibleassetsare amortized on astraight-line basis over the period in which these assets contributetoour cash flows. We evaluatethese assets for changes in the expectedremaining useful livesand wouldreflectany changes prospectively through amortization over therevised remaining useful life.

Impairment of property, plant, and equipment,otheridentifiableintangible assets, and investments

We evaluateour property, plant, and equipment and otheridentifiable intangibleassets for impairment when, in our judgment,events or circumstances, including probableabandonment, indicate that the carrying value of such assets maynot be recoverable.Whenanindicator of impairment has occurred, wecompare our estimate of undiscounted future cash flows attributable to the assets to the carrying value of the assets to determine whether an impairment has occurred and we mayapply aprobability-weightedapproach to considerthe likelihood of different cash flow assumptions and possible outcomesincluding selling in the neartermorholding for the remaining estimateduseful life. If an impairment of the carrying value has occurred, wedetermine the amount of the impairment recognized in the financial statements by estimating the fairvalueofthe assets and recording aloss for the amount thatthe carrying value exceeds the estimated fairvalue. Thisevaluation is performed at the lowestlevel forwhich separately identifiablecash flowsexist.

For assets identified to be disposedofinthe future and considered heldfor sale,wecompare the carrying value to the estimated fairvalue less the cost to sell to determine if recognition of an impairment is required. Until the assets are disposedof, the estimated fairvalue, which includesestimatedcashflows from operations untilthe assumed date of sale,isrecalculated when relatedevents or circumstances change.

We evaluateour investments for impairment when, in our judgment,events or circumstances indicatethatthe carrying value of such investments mayhave experienced an other-than-temporary decline in value. Whenevidence of loss in value has occurred, wecompare our estimate of fairvalue of the investment to the carrying value of the investment to determine whether an impairment has occurred. Ifthe estimatedfairvalue is less than the carrying value and we consider the declineinvaluetobeother-than-temporary, the excess of the carrying value over the fair value is recognizedinthe consolidatedfinancial statementsasanimpairment charge.

Judgmentsand assumptions are inherent in our estimate of undiscounted future cash flows andanasset’s or investment’s fairvalue. Additionally, judgment is used to determine the probability of sale withrespect to assets considered for disposal.

Contingent liabilities

We record liabilities forestimatedloss contingencies, including environmentalmatters, when we assess thata loss is probable, and the amount of the loss canbereasonably estimated. These liabilities arecalculatedbasedupon our assumptions and estimateswith respecttothe likelihood or amount of loss and upon advice of legal counsel, engineers, or otherthird partiesregarding the probableoutcomesofthe matters. These calculations are made without consideration of any potential recovery from third parties. We recognizeinsurance recoveriesorreimbursements from others when realizable. Revisions to these liabilities aregenerally reflected in incomewhen new or different facts or information become known or circumstanceschange thataffectthe previous assumptions or estimates.

Cash flowsfrom revolving credit facilitiesand commercial paper program

Proceeds and paymentsrelatedtoborrowings under our credit facilities are reflected in thefinancing activities in the ConsolidatedStatement of Cash Flows on agross basis. Proceeds and payments related to borrowings under our commercialpaperprogram are reflected in thefinancingactivitiesinthe ConsolidatedStatement of Cash Flows on anet basis, as the outstandingnotesgenerallyhave maturity dates less than threemonths from the dateof issuance.(See Note 14 –Debt andBanking Arrangements.)

80 TheWilliams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Treasury stock

Treasury stockpurchasesare accountedfor under the costmethod whereby the entire costofthe acquiredstock is recorded as Treasury stock, at cost in the ConsolidatedBalanceSheet.Gains and lossesonthe subsequent reissuance of shares are credited or charged to Capital in excess of par value in the ConsolidatedBalanceSheet using the average-cost method.

Derivativeinstruments and hedging activities

We mayutilize derivativestomanage aportion of our commodity pricerisk. These instruments consist primarily of swaps, futures, and forward contracts involving short- and long-term purchases and salesofenergy commodities. We report the fairvalueofderivatives, except those for which the normalpurchases and normalsales exception has beenelected,inOther currentassets and deferredcharges;Regulatory assets, deferredcharges,and other; Accrued liabilities;orRegulatory liabilities, deferredincome, and other in the ConsolidatedBalanceSheet. We determine the current and noncurrent classification based on the timing of expected future cash flows of individualtrades. We report these amounts on agross basis.Additionally, we report cash collateral receivablesand payableswithour counterpartiesonagross basis.

The accounting for thechangesinfairvalue of acommodity derivative canbesummarized as follows:

Derivative Treatment Accounting Method Normal purchases andnormalsales exception Accrual accounting Designated in aqualifying hedging relationship Hedge accounting All other derivatives Mark-to-marketaccounting

We mayelect thenormalpurchasesand normalsales exception for certain short- and long-term purchasesand salesofphysical energy commodities. Underaccrualaccounting, any change in the fairvalueofthese derivativesis not reflected on thebalance sheet after theinitialelection of theexception.

We mayalso designate ahedging relationshipfor certain commodity derivatives. For aderivative to qualify for designation in ahedging relationship, it must meet specificcriteria and we must maintainappropriate documentation. We establish hedging relationships pursuant to our risk management policies. We evaluatethe hedging relationships at the inception of the hedge and on an ongoing basis to determine whether the hedging relationship is, and is expectedtoremain, highlyeffective in achieving offsetting changes in fairvalue or cash flows attributable to the underlying risk being hedged. We also regularlyassess whetherthe hedged forecastedtransaction is probableofoccurring. If aderivative ceasestobeorisnolongerexpected to be highlyeffective,orifwebelieve thelikelihood of occurrenceofthe hedged forecastedtransaction is no longerprobable, hedge accounting is discontinuedprospectively, and future changesinthe fairvalueofthe derivativeare recognized currentlyinProduct sales or Product costs in theConsolidatedStatement of Operations.

For commodity derivativesdesignatedasacash flow hedge,the change in fairvalue of the derivativeis reportedinAOCIinthe ConsolidatedBalanceSheet and reclassifiedintoearnings in the period in which the hedged item affects earnings. Gains or lossesdeferred in AOCIassociatedwith terminated derivatives, derivativesthatcease to be highlyeffective hedges, derivativesfor which the forecastedtransaction is reasonablypossible but no longer probableofoccurring, and cash flow hedges that have beenotherwise discontinued remaininAOCIuntilthe hedged item affects earnings. If it becomesprobablethatthe forecastedtransaction designatedasthe hedgediteminacash flow hedge will not occur, any gainorloss deferred in AOCIisrecognized in Product sales or Product costs in the ConsolidatedStatement of Operations at that time.The change in likelihood of aforecastedtransaction is a judgmentaldecision thatincludes qualitative assessmentsmade by us.

For commodity derivativesthatare not designatedinahedging relationship, and for which we have not elected the normalpurchases and normalsalesexception, we report changes in fairvalue currentlyinProduct sales or Product costs in theConsolidatedStatement of Operations.

81 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Certain gains and losses on derivative instrumentsincludedinthe Consolidated Statement of Operations are nettedtogethertoasingle net gainorloss,while othergainsand losses are reported on agross basis. Gains and lossesrecorded on anet basis include unrealizedgains and losses on allderivativesthatare not designatedashedges and for which we have not electedthe normal purchases andnormalsales exception.

Realized gains and lossesonderivativesthat(1) require physicaldelivery, (2) are used for managing commodity risk on NGL processing or natural gas production activities, and (3) are not heldfor trading purposes nor were entered into as apre-contemplated buy/sell arrangement,are recorded on agross basis.

Revenue recognition

Customersinour gas pipelinebusinesses are comprised of publicutilities, municipalities, gas marketers and producers, intrastate pipelines, direct industrialusers, and electricalpower generators. Customers in our midstream businesses are comprised of oil and natural gas producercounterparties. Customers for our product sales are comprised of public utilities, gas marketers, and directindustrialusers.

Servicerevenue contracts from our gas pipelineand midstreambusinesses containaseriesofdistinct services, with the majority of our contracts having asingle performanceobligation thatissatisfied over time as the customer simultaneously receives and consumesthe benefitsprovidedbyour performance. Most of our product sales contractshave asingle performanceobligation with revenue recognized at apoint in time when the productshave beensold and deliveredtothe customer.

Certaincustomers reimburse us for costs we incurassociated with construction of property, plant, and equipment utilizedinour operations. For our rate-regulatedgas pipelinebusinesses thatapplyASC 980, we follow FERCguidelines withrespect to reimbursement of construction costs.FERCtariffsonly allow for cost reimbursement and are non-negotiable in nature; thus, in our judgment,the construction activitiesdonot represent an ongoing major and centraloperation of our gas pipelinebusinesses and are not withinthe scope of ASC Topic 606, “Revenue from Contractswith Customers” (ASC 606). Accordingly, cost reimbursementsare treatedasa reduction to the cost of the constructed asset. For our midstreambusinesses, reimbursement and servicecontracts with customers are viewed togetherasproviding the samecommercial objective,aswehave the ability to negotiate the mixofconsideration between reimbursementsand amounts billed over time.Accordingly, we generally recognizereimbursementsofconstruction costs from customers on agross basis as acontractliability separate from the associatedcosts included withinproperty, plant, and equipment. The contract liability is recognized intoservice revenues as the underlying performance obligations are satisfied.

ServiceRevenues

Gas pipeline businesses: Revenues from our regulated interstate natural gas pipelinebusinesses, whichare subject to regulation by certain state and federal authorities, including the FERC, include both firm and interruptibletransportation and storage contracts. Firm transportation and storage agreementsprovide for a fixedreservation charge based on the pipelineorstorage capacityreserved, and acommodity charge based on the volumeofnatural gas delivered/stored, each at rates specified in our FERCtariffs or basedonnegotiated contractualrates,withcontractterms thatare generally long-term in nature. Most of our long-term contracts containanevergreenprovision, whichallows the contracts to be extendedfor periods primarily up to one year in length an indefinite numberoftimes following the specified contracttermand untilterminated generally by eitherusorthe customer. Interruptible transportation and storage agreementsprovide for avolumetric charge based on actualcommodity transportation or storage utilized in theperiodinwhichthose services are provided, and the contractsare generally limited to one-month periods or less. Our performanceobligations related to our interstate natural gas pipeline businessesinclude the following:

• Firm transportation or storage under firm transportation and storage contracts—anintegratedpackage of services typically constituting asingleperformanceobligation, whichincludesstanding ready to provide such services and receiving, transporting or storing (as applicable), andredelivering commodities;

82 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

• Interruptible transportation or storage under interruptibletransportation and storage contracts—an integratedpackage of services typically constituting asingleperformanceobligation once scheduled, which includesreceiving, transporting or storing (as applicable), andredelivering commodities.

In situations where, in our judgment,weconsider the integrated package of services as asingle performanceobligation, which represents amajorityofour interstate natural gas pipelinecontractswith customers, we do not considerthere to be multiple performanceobligations because the nature of the overall promise in the contract is to stand ready (with regard to firm transportation and storage contracts), receive, transport or store, and redeliver natural gas to thecustomer; therefore, revenue is recognized over time upon satisfaction of our dailystand ready performance obligation.

We recognizerevenues for reservation charges over the performanceobligation period, which is the contractterm, regardless of the volumeofnatural gas that is transportedorstored. Revenues for commodity charges from both firm and interruptibletransportation services and storage services are recognized when natural gas is delivered at the agreed upon delivery point or when natural gas is injected or withdrawn from the storage facility becausethey specificallyrelatetoour effortstoprovide these distinct services. Generally, reservation charges and commodity charges in our interstate natural gas pipelinebusinesses are recognized as revenue in the sameperiod theyare invoiced to our customers. As aresult of the ratemaking process, certain amounts collectedbyusmay be subjecttorefund upon the issuance of finalorders by the FERCinpending rate proceedings. We use judgment to record estimatesofraterefund liabilities considering our and otherthird-party regulatory proceedings, adviceofcounsel, andotherrisks.

Midstream businesses: Revenues from our non-regulated gathering, processing, transportation, and storage midstream businessesinclude contractsfor natural gas gathering, processing, treating, compression, transportation, and otherrelated services withcontract terms that are generally long-term in nature and may extend up to the production life of the associatedreservoir. Additionally, our midstreambusinesses generate revenues from feescharged for storing customers’ natural gas and NGLs, generally under prepaid contracted storage capacity contracts. In situations where, in our judgment,weprovide an integratedpackage of services combinedintoasingle performanceobligation, which represents amajority of thisclass of contracts with customers,wedonot considerthere to be multiple performanceobligations because the nature of the overall promise in the contract is to provide gathering, processing, transportation, storage,and related services resulting in thedelivery, or redelivery in the context of storage services, of pipeline-quality natural gas and NGLstothe customer. As such, revenue is recognized at the daily completion of the integrated package of services as the integratedpackage represents asingle performanceobligation. Additionally, certain contracts in our midstream businesses containfixedorupfront payment terms that result in thedeferral of revenues untilsuch services have beenperformed or such capacity hasbeen made available.

We also earnrevenues from offshore crude oil and natural gas gathering and transportation and offshore production handling. These services represent an integrated package of services and are consideredasingle distinct performanceobligation for which we recognize revenues as the services are providedtothe customer.

We generally earnacontractuallystated fee per unit for the volumeofproduct transported, gathered, processed, or stored. The rateisgenerally fixed; however, certain contracts contain variablerates that are subjecttochange based on commodity prices, levelsofthroughput,oranannualadjustment based on a formulaiccost of servicecalculation. In addition, we have contractswith contractuallystated feesthatdecline over the contract term, such as declines based on the passage of time periods or achievement of cumulative throughput amounts. For allofour contracts, we allocate thetransactionpricetoeachperformanceobligation based on the judgmentallydeterminedrelative standalone selling price. The excess of consideration received over revenue recognized resultsinthe deferral of those amounts untilfuture periods based on aunitsof production or straight-line methodology as thesemethods appropriately matchthe consumption of services providedtothe customer. The unitsofproduction methodology requires the use of production estimatesthatare uncertain and the use of judgment when developing estimatesoffuture production volumes, thus impactingthe rateofrevenue recognition. Production estimatesare monitored as circumstances andevents warrant. Certain

83 The Williams Companies, Inc. NotestoConsolidated Financial Statements –(Continued) of our gas gathering and processing agreementshave minimum volumecommitments(MVC). If acustomer under such an agreement fails to meetits MVCfor aspecifiedperiod (thus not exercising allthe contractual rightstogathering and processing services within thespecifiedperiod, herein referred to as “breakage”), it is obligated to pay acontractuallydeterminedfee based upon the shortfall between the actualgatheredor processedvolumes and the MVC for the period contained in the contract.Whenweconclude, based on management’s judgment, it is probablethatthe customerwill not exercise alloraportion of itsremaining rights, we recognizerevenue associatedwith such breakage amount in proportion to the pattern of exercised rightswithinthe respective MVC period.

Under keep-whole and percent-of-liquids processing contracts, we receive commodityconsideration in the form of NGLsand take titletothe NGLs at the tailgateofthe plant. We recognizesuch commodity consideration as servicerevenue based on the market value of the NGLs retained at the time the processing is provided. The current market value, as opposed to the market value at thecontract inception date, is used due to acombination of factors, including the factthat the volume, mix, and market priceofNGL consideration to be received is unknown at the time of contractexecution and is not specifiedinour contracts withcustomers. Additionally, product sales revenue (discussed below) is recognized upon the saleofthe NGLs to athird party based on the sales priceatthe time of sale.Asaresult,revenue is recognized in the ConsolidatedStatement of Operations both at the time the processing serviceisprovidedinService revenues –commodity consideration and at the time the NGLsretained as part of the processing serviceare sold in Product sales.The recognition of revenue related to commodity consideration has the impactofincreasing the book value of NGL inventory, resulting in highercost of goods sold at the time of sale.Given thatmost inventory is sold in the sameperiod thatitisgenerated, the impactofthese transactions is expectedtohavelittleimpact to operating income.

Product Sales

In the course of providing transportation services to customers of our gas pipelinebusinessesand gathering and processing services to customers of our midstreambusinesses, we mayreceivedifferent quantitiesof natural gas from customers than the quantitiesdelivered on behalf of those customers.The resultingimbalances are primarily settledthrough the purchase or sale of natural gas with each customer under terms providedfor in our FERCtariffs or gathering and processing agreements, respectively. Revenue is recognized from the saleof natural gas upon settlement of imbalances.

In certain instances, we purchase NGLs, crude oil,and natural gas from our oil and natural gas producer customers whichweremarket.Inaddition, we retainNGLs as consideration in certain processing arrangements, as discussed above in the ServiceRevenues -Midstream businesses section. We recognizerevenue from the sale of these commoditieswhen the productshave beensold and delivered. Our product sales contractsare primarily short-term contracts based on prevailing market rates at the time of the transaction.

Contract Assets

Our contractassetsprimarily consist of revenue recognized under contracts containing MVC features wherebymanagement has concluded it is probablethere will be ashort-fallpayment at the end of the current MVC period, which typicallyfollows the calendar year, and thatasignificant reversal of revenue recognized currentlyfor the future MVC payment will not occur. As aresult,our contractassets related to our future MVC paymentsare generally expectedtobecollected withinthe next 12 months and are included within Other current assets and deferredcharges in the ConsolidatedBalanceSheet untilsuch time as the MVC short-fall paymentsare invoiced to the customer.

Contract Liabilities

Our contractliabilities consistofadvance payments primarily from midstream business customers which include construction reimbursements, prepayments, and otherbillings and transactions for which future services are to be providedunder the contract.These amounts are deferred untilrecognized in revenue whenthe

84 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

associated performanceobligation has beensatisfied,whichisprimarily based on aunitsofproduction methodology over the remaining contractualserviceperiods, and are classifiedascurrent or noncurrent according to whensuch amounts are expectedtoberecognized. Current and noncurrent contractliabilities are includedwithin Accrued liabilities and Regulatory liabilities, deferredincome,and other,respectively, in the ConsolidatedBalanceSheet.

Contracts requiring advance paymentsand the recognition of contractliabilities are evaluatedtodetermine whetherthe advancepaymentsprovide us with asignificant financing benefit.Thisdetermination is based on the combined effect of the expectedlength of time between when we transfer the promised good or serviceto the customer, when the customerpays for those goods or services, and the prevailing interest rates. We have assessedour contracts for significant financing componentsand determined, in our judgment,thatone group of contracts entered intoincontemplation of one another for certain capital reimbursements contains asignificant financing component.Asaresult,werecognizenoncash interest expensebased on the effective interest method and revenue (noncash) is recognized when the underlying assetisplacedinto serviceutilizing aunitsof production or straight-line methodology overthe life of thecorresponding customercontract.

Leases

We recognizealease liability with an offsetting right-of-use assetinthe ConsolidatedBalanceSheet for operating leases based on the present value of the future lease payments. We have elected to combine lease and nonlease componentsfor allclassesofleased assets in our calculation of the lease liability andthe offsetting right- of-use asset.

Our lease agreementsrequire both fixedand variableperiodic payments, with initial terms typically ranging from one yearto20years, but acertain land lease has atermof108 years. Payment provisions in certain of our lease agreementscontain escalation factors which maybebased on stated rates or achange in apublished index at afuture time.The amount by which alease escalatesbased on the change in apublished index, which is not known at lease commencement, is considered avariablepayment and is not includedinthe present value of the future lease payments, which only includesthose thatare statedorcan be calculatedbased on the lease agreementatlease commencement. In addition to the noncancellableperiods, many of our lease agreementsprovide for one or more extensions of the lease agreementfor periods ranging from one yearinlength to an indefinite numberoftimes following the specified contractterm. Other lease agreementsprovide for extension terms that allowustoutilize the identifiedleased assetfor an indefinite period of time so long as the assetcontinuestobeutilizedinour operations. In consideration of these renewalfeatures, we assess thetermofthe lease agreements, whichincludesusing judgment in the determination of which renewal periods and termination provisions,when at our sole election, will be reasonably certain of being exercised. Periods afterthe initialtermorextension terms thatallow for eitherparty to the lease to cancel theleaseare not considered in the assessment of the lease term. Additionally, we have elected to exclude leases withanoriginal term of one yearorless, including renewal periods,from the calculationofthe lease liabilityand theoffsetting right-of-use asset.

We use judgment in determining the discount rateupon which the present value of the future leasepayments is determined. Thisrate is based on acollateralized interest ratecorresponding to the term of the leaseagreement using company, industry, and marketinformation available.

Whenpermittedunder our lease agreements, we maysublease certain unused officespace for fixedperiods that couldextend up to the length of theoriginallease agreement.

Interest capitalized

We capitalize interest during construction on major projectswith construction periods of at least 3months and a total project cost in excess of $1 million. Interest is capitalized on borrowed funds and, where regulation by the FERCexists, on internallygenerated funds (equity AFUDC). The latter is includedinOther income (expense) –net below Operating income (loss) in the ConsolidatedStatement of Operations. The rates used by regulated companies

85 The Williams Companies, Inc. Notes to ConsolidatedFinancial Statements –(Continued) arecalculated in accordance withFERC rules.Rates used by nonregulated companies are based on our average interest rate on debt.

Employee stock-based awards

We recognizecompensation expense on employeestock-based awards on astraight-line basis; forfeituresare recognized when they occur.

Pension and otherpostretirement benefits

The funded status of each of the pension and otherpostretirement benefit plans is recognized separately in the ConsolidatedBalanceSheet as eitheranassetorliability. The funded status is the differencebetween the fairvalue of planassets and the plan’s benefit obligation. The plans’benefit obligations and net periodic benefit costs (credits) areactuarially determined and impactedbyvarious assumptions and estimates.

The discount rates are determinedseparately for each of our pension and otherpostretirement benefit plans based on an approach specific to our plans. The year-end discount rates are determinedconsidering ayield curve comprised of high-qualitycorporate bonds and the timing of the expected benefitcash flowsofeachplan.

The expectedlong-term rates of return on planassets are determinedbycombining areview of the historical returns withinthe portfolio, the investment strategyincludedinthe plans’investment policy statement,and capital market projections for the assetclassesinwhich the portfolio is invested, as wellasthe weighting of each asset class.

Unrecognizedactuarialgains and lossesand unrecognized prior servicecosts and creditsare deferred and recorded in AOCIor, for Transco and Northwest Pipeline, as aregulatory assetorliability, untilamortizedasa component of net periodic benefit cost(credit). Unrecognizedactuarialgains and lossesinexcess of 10 percent of the greaterofthe benefit obligation or the market-related value of planassets are amortizedover the participants’ averageremainingfuture years of service, which is approximately10years for our pension plans and approximately 6years for our other postretirement benefit plan.

The expectedreturn on planassets component of net periodic benefit cost(credit)iscalculated using the market-related value of planassets. For our pension plans, the market-related value of planassets is equaltothe fair value of planassets adjustedtoreflectthe amortizationofgains or lossesassociatedwith the difference between the expected and actualreturn on planassets over a5-yearperiod. Additionally, the market-relatedvalue of assets may be no more than 110 percent or less than90percent of the fairvalueofplanassets at the beginning of the year. The market-relatedvalue of planassets for our otherpostretirement benefit planisequaltothe unadjustedfair value of planassets at thebeginning of the year.

Income taxes

We include the operations of our domestic corporate subsidiariesand income from our subsidiary partnerships in our consolidated federal income taxreturn and alsofile taxreturns in various foreign and state jurisdictions as required. Deferred income taxes are computed using the liability method and are provided on all temporary differences betweenthe financial basisand the taxbasis of our assets and liabilities. Our judgment and income tax assumptions are used to determine the levels, if any, of valuation allowances associatedwith deferredtax assets.

Earnings (loss) percommon share

Basic earnings (loss) per common share in the ConsolidatedStatement of Operations is based on the sum of the weighted-average numberofcommon sharesoutstanding and vested restrictedstockunits. Diluted earnings (loss) per common share in the ConsolidatedStatement of Operations includesany dilutive effectofnonvested restricted stockunits, stockoptions, and convertible instruments, unless otherwise noted. Diluted earnings (loss) per common share is calculatedusing the treasury-stock method.

86 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Accounting standards issuedand adopted

In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update(ASU) 2016-13 “Financial Instruments -CreditLosses(Topic326): Measurement of CreditLossesonFinancial Instruments” (ASU 2016-13). ASU 2016-13 changed the impairment model for most financial assets and certain otherinstruments. For trade and otherreceivables, held-to-maturitydebt securities, loans, andotherinstruments, entitiesare requiredtouse aforward-looking “expectedloss”modelthatgenerally will result in theearlier recognition of allowances for losses. We adoptedASU 2016-13 effective January 1, 2020, which primarily applied to our short-term trade receivables. There was no cumulative effect adjustment to retained earnings upon adoption.

The majority of our trade receivablebalances are due within30days. We monitor the creditqualityofour counterparties through review of collection trends, credit ratings, and otheranalyses,such as bankruptcymonitoring. Financialassets from our natural gas transmissionbusinessand gathering and transportation businessare segregated intoseparate pools for evaluation due to different counterpartyrisks inherent in each business. Changesin counterparty risk factors could lead to reassessment of the composition of our financial assets as separate pools or the needfor additional pools. We calculate our allowancefor credit lossesincorporating an aging method. In estimating our expected credit losses, we utilized historical loss rates over many years, which includedperiods of both high and low commodityprices. Commodityprices could have asignificant impactonaportion of our gathering and processing counterparties’ financial health andability to satisfy current liabilities. Our expected credit loss estimate consideredboth internaland externalforward-looking commodity priceexpectations, as wellas counterpartycredit ratings, and factors impactingtheir near-term liquidity. In addition, our expected credit loss estimate consideredpotential contractual,physical, and commercial protections and outcomesinthe case of a counterparty bankruptcy. The physicallocation and nature of our services helptomitigatecollectability concerns of our gathering and processing producercustomers. Our gathering lines in many cases are physicallyconnected to the customers’ wellheads and pads, and there maynot be alternative gathering lines nearby. The construction of gathering systemsiscapital intensive anditwould be costlyfor others to replicate, especiallyconsidering the depletion to dateofthe associatedreserves. As aresult,weplayacritical role in getting customers’ production from the wellhead to amarketablecondition and location. Thistends to reducecollectability risk as our services enable producers to generateoperating cash flows. Commoditypricemovements generally do not impactthe majority of our natural gas transmission businessescustomers’ financialcondition.

Past due accountsare generally written off against the allowance fordoubtful accounts only after allcollection attemptshave beenexhausted. We do not have amaterial amount of significantlyagedreceivables at December 31, 2020.

Note 2–Variable Interest Entities

Consolidated VIEs

As of December31, 2020, we consolidatethe following VIEs:

Northeast JV

We own a65percent interest in the Northeast JV, asubsidiary thatisaVIE due to certain of our voting rights being disproportionatetoour obligation to absorb lossesand substantiallyall of the Northeast JV’s activitiesbeing performed on our behalf. We are the primary beneficiary because we have the power to direct the activitiesthatmost significantlyimpactthe Northeast JV’s economicperformance. The Northeast JV providesmidstreamservices for producers in the MarcellusShale andUticaShale regions. Future expansion activityisexpectedtobefunded with capital contributions from us and theother equitypartner on aproportional basis.

Gulfstar One

We own a51percent interest in Gulfstar One, asubsidiary that, due to certain risk-sharing provisions in its customer contracts, is aVIE. Gulfstar One includes aproprietary floating-production system,Gulfstar FPS, and

87 TheWilliams Companies, Inc. NotestoConsolidated Financial Statements –(Continued) associated pipelines that provide production handling and gathering services in the easterndeepwaterGulf of Mexico. We are the primary beneficiary becausewehavethe powertodirect the activitiesthatmost significantly impactGulfstarOne’s economic performance.

Cardinal

We own a66percent interestinCardinal, asubsidiary thatprovidesgathering services for the Utica Shale region and is aVIE due to certain risks sharedwithcustomers. We are the primary beneficiary becausewehavethe powertodirect the activitiesthatmost significantlyimpactCardinal’s economicperformance. Future expansion activityisexpected to be funded withcapital contributions from us and the otherequitypartner on aproportional basis.

The following table presentsamounts includedinthe Consolidated Balance Sheetthatare only for the use or obligation of our consolidated VIEs:

December 31, 2020 2019 (Millions) Assets (liabilities): Cash and cash equivalents...... $107 $102 Trade accounts and other receivables–net ...... 148 167 Other current assets and deferred charges...... 75 Property, plant, and equipment –net...... 5,514 5,745 Intangible assets –net of accumulated amortization...... 2,376 2,669 Regulatory assets, deferred charges, and other...... 15 13 Accounts payable...... (42) (58) Accrued liabilities...... (34) (66) Regulatory liabilities, deferred income, and other...... (289) (283)

Nonconsolidated VIEs

TargaTrain 7

We own a20percent interestinTarga Train 7, which providesfractionation services at Mt.Belvieu andisa VIE due primarily to our limitedparticipating rightsasthe minorityequity holder. At December31, 2020, the carrying value of our investment in Targa Train 7was $51 million. Our maximum exposure to loss is limitedtothe carrying value of our investment.

Brazos Permian II

We own a15percent interestinBrazos Permian II (seeNote 7–Investing Activities), which providesgathering and processing services in the Delaware basin and is aVIE due primarily to our limitedparticipating rightsasthe minorityequity holder. During the firstquarter of 2020 we recorded an impairment of our equity-method investment in Brazos Permian II (seeNote 18 –FairValue Measurements, Guarantees, and Concentration of CreditRisk).Our maximum exposure to loss is limitedtothe carrying value of our investment.

Note 3–Acquisitions andDivestitures

UEOM

As of December31, 2018, we owneda62percent interestinUtica East Ohio Midstream LLC(UEOM)which weaccountedfor as an equity-method investment.OnMarch 18, 2019, we signed and closed the acquisition of the

88 TheWilliams Companies, Inc. Notes to Consolidated Financial Statements –(Continued) remaining 38 percent interestinUEOM.Total consideration paid, including post-closing adjustments, was$741 million in cash funded through credit facilityborrowings and cash on hand, net of $13 million cash acquired. As a result of acquiring thisadditionalinterest, we obtainedcontrol of andconsolidated UEOM.

UEOMisinvolvedprimarily in the processing and fractionation of natural gas and natural gas liquids in the UticaShale playineastern Ohio. The purpose of the acquisition wastoenhance our position in the region. We expect synergies through common ownership of UEOMand our Ohio Valley midstreamsystemstocreateamore efficient platform for capital spending in the region, resulting in reduced operating and maintenance expenses and creating enhanced capabilitiesand benefitsfor producers in thearea.

The acquisition of UEOMwas accounted for as abusiness combination, which requires, among otherthings, thatidentifiable assets acquiredand liabilities assumed be recognized at theiracquisition datefairvalues. In March 2019, based on the transaction pricefor our purchase of the remaining interest in UEOM as finalizedjust prior to the acquisition, we recognized a$74 million noncash impairment loss related to our existing 62 percent interest (see Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRisk). Thus, there was no gainorloss on remeasuring our existing equity-method investment to fairvalue due to the impairment recognized just prior to closing the acquisition of theadditionalinterest.

The valuationtechniques used to measure the acquisition datefairvalue of the UEOMacquisition consistedof the market approachfor our previous equity-method investment in UEOM and the incomeapproach (excess earnings method) for valuation of intangible assets and depreciated replacement costs for property, plant, and equipment.

The following table presentsthe allocation of the acquisition datefairvalue of the major classesofthe assets acquired, which are presented in the Northeast G&P segment, and liabilities assumed, including post closing purchase priceadjustments. The net assets acquiredreflectthe sum of the consideration transferred and the noncash elimination of the fairvalueofour existing equity-method investment upon our acquisition of the additionalinterest. The fairvalueofaccountsreceivableacquired, presented in current assets in the table,equalscontractualamounts receivable.

(Millions) Current assets, including $13 millioncashacquired...... $56 Property, plant,and equipment...... 1,387 Otherintangible assets...... 328 Total identifiable assets acquired...... 1,771

Current liabilities...... 7 Total liabilities assumed...... 7

Netidentifiableassets acquired...... 1,764

Goodwill...... 187 Netassets acquired...... $1,951

The goodwillrecognized in the acquisition related primarily to enhancing and diversifying our basin positions and is reported withinthe Northeast G&P segment. Substantially allofthe goodwill is expected to be deductible for taxpurposes. As of December31, 2019, goodwill wasincluded within Intangible assets –net of accumulated amortization in the ConsolidatedBalanceSheet and representedthe excess of the consideration, plus the fairvalue of any previously held equityinterest, over thefairvalue of the net assets acquired.

The goodwill recognized in the UEOMacquisition of $187 million, which includesa$1million adjustment recorded in the firstquarter of 2020, was impaired during first quarter of 2020. Our partner’s $65 million share of

89 TheWilliams Companies, Inc. Notes to Consolidated Financial Statements –(Continued) this impairmentisreflected within Netincome(loss) attributable to noncontrolling interests in the Consolidated Statement of Operations(see Note 18 –Fair ValueMeasurements, Guarantees, and Concentration of CreditRisk).

Other intangible assets recognized in the acquisition are related to contractualcustomer relationships from gas gathering, processing, and fractionation agreementswith our customers. The basis for determining the value of these intangible assets is estimatedfuture net cash flows to be derived from acquiredcontractualcustomer relationships discounted using arisk-adjusted discount rate. These intangible assets are being amortizedonastraight-line basis over aperiod of 20 years which represents the term over which the contractual customerrelationships are expected to contributetoour cash flows. Approximately 49 percent of the expectedfuture revenues from these contractual customer relationships are impactedbyour ability and intent to reneworrenegotiateexisting customer contracts. We expense costs incurredtoreneworextend the terms of our gas gathering, processing, and fractionation contracts with customers. Based on the estimated future revenues during the current contract periods (as estimated at the time of the acquisition), the weighted-average period prior to the next renewal or extension of the existing contractual customer relationships wasapproximately10years.

The following unauditedpro forma Revenues and Net income (loss) attributabletoThe WilliamsCompanies, Inc. for the years ended December31, 2019 and 2018, respectively, are presented as if the UEOMacquisition had beencompletedonJanuary 1, 2018. These pro forma amounts are not necessarilyindicative of what the actual results would have beenifthe acquisition had in factoccurred on the dateorfor the periods indicated, nor do they purport to project Revenues or Net income (loss) attributabletoThe WilliamsCompanies,Inc. for any future periods or as of any date. These amounts do not give effecttoany potential cost savings, operating synergies, or revenue enhancements to result from the transaction or the potential costs to achieve these cost savings, operating synergies, and revenue enhancements.

Year Ended December 31, 2019 2018 (Millions) Revenues...... $8,233 $8,836 Netincome(loss) attributabletoThe Williams Companies, Inc...... 928 (128) Adjustmentstopro forma Netincome (loss) attributabletoThe Williams Companies, Inc. include the removal of the previously described$74 million impairment loss recognized in March 2019 just prior to theacquisition.

During the period from the acquisition dateofMarch 18, 2019 to December31, 2019, UEOMcontributed Revenues of $179 million and Netincome (loss) attributabletoThe Williams Companies, Inc. of $53 million.

Costs related to thisacquisition are $4 million and are reportedwithin our Northeast G&P segment and included in Selling, general, and administrative expenses in the Consolidated Statement of Operations for the yearended December31, 2019.

Northeast JV

Concurrent withthe UEOMacquisition, we executedanagreement whereby we contributedour consolidated interests in UEOMand our Ohio Valley midstream business to anewly formedpartnership. In June 2019, our partner invested approximately $1.33 billion for a35percent ownership interest, and we retained65percent ownership of, as wellasoperate and consolidate, the Northeast JV business. The change in ownership due to this transaction increased Noncontrolling interests in consolidatedsubsidiaries by $567 million, and decreased Capital in excess of par value by $426 million and Deferredincome tax liabilities by $141 million in the Consolidated BalanceSheet as of December31, 2019. Costs related to thistransaction are $6 million and are reportedwithinour Northeast G&P segment and includedinSelling, general, and administrative expenses in the ConsolidatedStatement of Operations for the yearendedDecember 31, 2019.

90 TheWilliams Companies, Inc. Notes to ConsolidatedFinancial Statements –(Continued)

Sale of GulfCoastPipeline Systems

In November2018, we completed the sale of certain assetsand operations located in the Gulf Coast areafor $177 million in cash. As aresult of thissale, we recorded againofapproximately $101 million in the fourth quarter of 2018, consisting of $81 millioninour Transmission &Gulf of Mexico segmentand $20 millioninOther.

Previous impairments made to aportion of these assets and operations include $66 million related to certain idle pipelines in the second quarter of 2018. The impairment is reflected in Impairment of certain assets in the ConsolidatedStatement of Operations. (See Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRisk.) The results of operations for thisdisposalgroup, excluding the impairments and gains noted, were not significant for thereporting period.

Sale of Four CornersAssets

In October2018, we completed the saleofour natural gas gathering and processing assets in the Four Corners areaofNew Mexicoand Colorado for total consideration of $1.125 billion. As aresult of thissale,werecorded a gainofapproximately $591 millionwithinthe West segment in the fourth quarterof2018.

The following table presentsthe results of operations for the Four Corners area, excluding thegainnoted above:

Year Ended December 31, 2018 (Millions) Income(loss) before incometaxesofFour Corners area...... $52 Income(loss) before incometaxesofFour Corners areaattributabletoThe Williams Companies, Inc.. 43 Note 4–RelatedParty Transactions

Transactions withEquity-Method Investees

We have purchasesfrom our equity-method investees included in Productcosts in the Consolidated Statement of Operations of $348 million, $304 million, and $236 million for the years ended 2020, 2019, and 2018, respectively. We have $50 million and $36 million includedinAccountspayable in the Consolidated Balance Sheet with our equity-method investees at December31, 2020 and 2019, respectively.

We have operating agreementswith certain equity-method investees. These operating agreementstypically provide for reimbursement or payment to us for certain direct operational payrolland employeebenefit costs, materials, supplies, and othercharges and also for management services. The totalcharges to equity-method investees for these feesare $79 million, $103 million, and $75 million for the years ended 2020, 2019, and 2018, respectively.

91 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Note 5–RevenueRecognition Revenue by Category

The following tablepresents our revenue disaggregatedbymajor serviceline:

Gulf of Northwest Mexico Northeast West Transco Pipeline Midstream Midstream Midstream OtherEliminations Total (Millions) 2020 Revenues from contracts with customers: Service revenues: Regulated interstate natural gas transportation andstorage...... $2,404 $449 $—$—$—$—$(7) $2,846 Gathering, processing, transportation, fractionation, and storage: Monetaryconsideration...... ——348 1,2791,204 —(75)2,756 Commodity consideration...... —— 21 7101 ——129 Other...... 10 —27164 651 (14)253 Total service revenues...... 2,414 449396 1,4501,370 1(96)5,984 Productsales: NGL and naturalgas...... 80 —114 57 1,565 —(147) 1,669 Totalrevenues from contracts with customers...... 2,494 449510 1,5072,935 1(243) 7,653 Other revenues(1)...... 10 —922 833(16) 66 Totalrevenues...... $2,504 $449 $519 $1,529 $2,943 $34$ (259) $7,719

2019 Revenues from contracts with customers: Service revenues: Regulated interstate natural gas transportation andstorage...... $2,336 $450 $—$—$—$—$(6) $2,780 Gathering, processing, transportation, fractionation, and storage: Monetary consideration...... ——479 1,1711,309 —(75)2,884 Commodity consideration...... —— 41 12 150 ——203 Other...... 11 —26147 42— (16)210 Total service revenues...... 2,347 450546 1,3301,501 —(97)6,077 Productsales: NGL and naturalgas...... 106 —185 1501,795 —(173) 2,063 Totalrevenues from contracts with customers...... 2,453 450731 1,4803,296 —(270) 8,140 Other revenues(1)...... 1— 8201430(12) 61 Totalrevenues...... $2,454 $450 $739 $1,500 $3,310 $30$ (282) $8,201

92 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Gulf of Northwest Mexico Northeast West Transco Pipeline Midstream Midstream Midstream OtherEliminations Total (Millions) 2018 Revenues from contracts with customers: Service revenues: Regulated interstate natural gas transportation andstorage...... $1,921 $443 $—$—$—$—$(2) $2,362 Gathering, processing, transportation, fractionation, and storage: Monetaryconsideration...... ——541 861 1,5902 (73)2,921 Commodity consideration...... —— 59 20 321 ——400 Other...... 2— 17 94 46 —(15)144 Total service revenues...... 1,923 443617 975 1,9572 (90)5,827 Productsales: NGL and naturalgas...... 127 —307 2872,421 —(382) 2,760 Other...... —— ——21 —(4) 17 Totalproduct sales...... 127 —307 287 2,442 —(386) 2,777 Totalrevenues from contracts with customers...... 2,050 443 924 1,262 4,3992 (476) 8,604 Other revenues(1)...... 11 —18211232(12) 82 Totalrevenues...... $2,061 $443 $942 $1,283 $4,411 $34$ (488) $8,686

______(1) Revenuesnot within the scope of ASC 606, “Revenue from Contracts withCustomers,” consist of leasing revenues associatedwithour headquarters building and management feesthatwereceivefor certain services we provide to operatedequity-method investments, which are reportedinService revenues in the Consolidated Statement of Operations, and amounts associatedwith our derivative contracts, which are reportedinProduct sales in theConsolidatedStatement of Operations.

ContractAssets

The following table presentsareconciliation of our contract assets:

Year Ended December 31, 2020 2019 (Millions) Balance at beginning of year...... $8$4 Revenue recognized in excessofamountsinvoiced...... 145 62 Minimum volumecommitments invoiced...... (141) (58) Balance at end of year...... $12$ 8

93 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Contract Liabilities

The following tablepresents areconciliation of our contract liabilities:

Year Ended December 31, 2020 2019 (Millions) Balance at beginning of year...... $1,215 $1,397 Paymentsreceived and deferred...... 140 157 Significant financing component...... 11 13 Chesapeake globalresolution (Note1)...... 67 — Recognized in revenue...... (224) (352) Balance at end of year...... $1,209 $1,215

RemainingPerformance Obligations

Remaining performanceobligations primarily include reservation charges on contractedcapacityfor our gas pipeline firm transportation contracts withcustomers,storage capacitycontracts, long-term contractscontaining minimum volumecommitmentsassociated with our midstream businesses, and fixedpaymentsassociated with offshore production handling. For our interstate natural gas pipeline businesses, remaining performanceobligations reflectthe rates for such services in our current FERCtariffs for the life of the related contracts; however, these rates maychange based on future tariffsapproved by the FERCand the amount and timing of these changesare not currentlyknown.

Our remaining performanceobligations exclude variableconsideration, including contracts withvariable consideration for which we have electedthe practicalexpedient for consideration recognized in revenue as billed. Certain of our contracts contain evergreenand otherrenewal provisions for periods beyond the initialtermofthe contract. The remaining performanceobligation amounts as of December31, 2020, do not considerpotential future performanceobligations for which the renewal has not beenexercised and exclude contractswith customers for which the underlying facilitieshave not received FERCauthorization to be placedintoservice. Consideration received prior to December31, 2020, thatwill be recognized in future periods is also excluded from our remaining performanceobligations and is instead reflected in contractliabilities.

The following table presentsthe amount of the contract liabilities balance expectedtobe recognized as revenue when performanceobligations are satisfied and the transaction priceallocated to the remaining performance obligations under certaincontracts as of December31, 2020.

Remaining Contract Performance Liabilities Obligations (Millions) 2021...... $129 $3,537 2022...... 113 3,329 2023...... 118 3,076 2024...... 98 2,443 2025...... 92 2,310 Thereafter...... 659 17,760 Total...... $1,209 $32,455

94 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Note 6–OtherIncomeand Expenses

The following table presents by segment,certain items within Operating and maintenance expenses and Selling, general, and administrative expenses in the Consolidated Statement of Operations:

Transmission &Gulf of Northeast Mexico G&P West Other (Millions) 2020 Income related to benefit policy change...... $(22) $(9) $(9) $— 2019 Severance and related costs...... 39 7101 2018 Expense from charitable contribution of preferred stock to the Williams Companies Foundation, Inc. (Note 16).... ———35

WPZ Merger related costs...... ———20

Additional Items

Other income (expense) –net below Operating income (loss) includes $15 million, $32 million, and $89 million of income for equity AFUDC within the Transmission &Gulf of Mexico segment for the years ended December 31, 2020, 2019, and 2018, respectively. Other income (expense) –net below Operating income (loss) also includes $(13) million of loss and $9 million and $35 million of income, forthe years ended December 31, 2020, 2019, and 2018, respectively, associated with regulatory assets related to the effects of deferred taxes on equity funds used during construction primarily within the Other segment.

Note 7–Investing Activities

Acquisition of Additional Interests in Caiman II

As of December31, 2019, we effectivelyowned a29percent indirect interest in Blue Racerthrough our 58 percent interest in Caiman II, whose primary asset is a50percent interest in Blue Racer. On November 18, 2020, we paid$157 million, net of cash acquired, to acquire an additional 41 percent ownership interest in Caiman II. We now control and consolidate Caiman II, reporting the 50 percent interest in Blue Racerasanequity-method investment. Sincesubstantiallyall of the fairvalueofthe Caiman II assetsacquiredisconcentrated in asingleasset,the investment in Blue Racer, and we previously heldanoncontrolling interest in Caiman II, we recorded the November 18, 2020, additional purchase of interests as an asset acquisition.

EquityEarnings (Losses)

Equity earnings (losses) in 2020 includesa$78 million loss associatedwiththe first-quarter full impairment of goodwillrecognized by our investeeRMM, which was allocated entirely to our memberinterest per the terms of the membership agreement.Also includedin2020 are lossesof$11 million, $26 million, and $10 million for our share of asset impairmentsatLaurelMountain, Appalachia Midstream Investments, and Blue Racer, respectively.

Impairments of Equity-Method Investments

See Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRiskfor information regarding impairments of our equity-method investments of $1,046 million, $186 million, and $32 million for 2020, 2019, and 2018, respectively.

95 TheWilliams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

OtherInvesting Income (Loss) –Net

The following table presentscertain itemsreflectedinOtherinvesting income (loss) –net in theConsolidated Statement of Operations:

Year Ended December 31, 2020 2019 2018 (Millions) Gain (loss) on deconsolidation of businesses...... $—$(29) $203 Gain on disposition of Jackalope...... —122 — Other...... 81416 Otherinvesting income (loss) – net...... $8$107 $219

Constitution deconsolidation

Upon determination thatwewerenolongerthe primary beneficiary, we deconsolidated our interest in Constitution Pipeline Company, LLC(Constitution) as of December31, 2019, recognizing aloss on deconsolidation of $27 million.

Delaware basin asset deconsolidation and Brazos Permian II equity-method investment

During the fourth quarter of 2018, we contributedthe majority of our existing Delaware basin assets and $27 million in cash in exchange for a15percent interest in the Brazos Permian II, which consistsofgas and crude oil gathering pipelines, natural gas processing, and oil storage facilities. We recorded adeconsolidation gainof$141 million reflecting the excess of the fairvalueofour acquiredinterest over the carrying value of the assets contributed. We estimatedthe fairvalueofour interest to be $192 million primarily using amarket approach(a Level 3measurement within the fairvalue hierarchy). Thisapproach involved the observation of recent transaction multiplesinthe Permianbasin, including recent acquisitions consummated during 2018. Our interest in Brazos Permian II is considered an equity-method investment due to the factthat weare able to exert significant influence over itsoperating andfinancial policies.

Jackalope deconsolidation

During the second quarter of 2018, we deconsolidated our 50 percent interest in Jackalope Gas Gathering Services, L.L.C. (Jackalope). We recorded our interest in Jackalope as an equity-method investment at itsestimated fairvalue, resulting in adeconsolidation gainof$62 million. We estimated the fairvalueofour interest to be $310 million using an income approachbased on expected future cash flows andanappropriatediscount rate(aLevel 3 measurement within the fairvalue hierarchy). The determinationofexpected future cash flows involvedsignificant assumptions regarding gathering and processing volumes and related capital spending. A10.9 percent discount rate was utilizedand reflectedour estimate of the cost of capital as impactedbymarket conditions and risks associated with the underlying business. The deconsolidatedcarrying value of the net assets of Jackalope included $47 million of goodwill.

Gain on disposition of Jackalope

In April 2019, we sold our 50 percent equity-method interest in Jackalope for $485 million in cash, resulting in againonthe disposition of $122 million.

96 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Equity-MethodInvestments

Ownership Interest at December 31, December 31, 2020 2020 2019 (Millions) Appalachia Midstream Investments...... (1) $3,087 $3,236 RMM...... 50% 421 881 OPPL...... 50% 395 403 Blue Racer/Caiman II (2)...... 50% 357 428 Discovery...... 60% 352 472 Laurel Mountain...... 69% 219 249 Gulfstream...... 50% 204 217 Brazos Permian II...... 15% —194 Other...... Various 124 155 $5,159 $6,235

______(1) Includes equity-method investmentsinmultiplegathering systems in the Marcellus Shale with an approximate average 66 percent interest. (2) See previous discussion in thesection Acquisition of Additional Interests in Caiman II above.

The carrying value of our AppalachiaMidstreamInvestmentsexceeds our portion of the underlying net assets by approximately $1.2 billion and $1.4 billion at December 31, 2020 and 2019, respectively. These differenceswere assigned at the acquisition datetoproperty, plant, and equipment and customer relationship intangible assets. Certainofour otherequity-method investments have acarryingvalue less thanour portion of the underlying net assets primarily due to otherthantemporary impairments that we have recognized but thatwere not required to be recognized in the investees’ financial statements. These differences totalapproximately $1.3 billion and $360 million at December31, 2020 and 2019, respectively, and were assigned to property, plant, and equipment and customer relationship intangible assets. Differencesinthe carrying value of our equity-method investments and our portion of the underlying net assets are generally amortizedover the remaining useful lives of the associated underlying assets and included in Equity earnings (losses) withinthe ConsolidatedStatement of Operations.

Purchases of and contributions to equity-method investments

We generally fund our portion of significant expansion or development projectsofthese investees through additional capital contributions. These transactions increased the carrying value of our investments and included:

Year Ended December 31, 2020 2019 2018 (Millions) Blue Racer/Caiman II (1)...... $157 $28$ — AppalachiaMidstreamInvestments...... 116 140 246 Targa Train7...... 643— Laurel Mountain...... 53616 RMM...... —145 795 Jackalope...... —2442 Brazos Permian II...... —1827 Discovery...... —— 5 Other...... 41 19 1 $325 $453 $1,132 ______(1) Seeprevious discussion in thesection Acquisition of Additional Interests in Caiman II above.

97 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Dividends and distributions

The organizational documentsofentitiesinwhichwehaveanequity-method investment generally require distribution of availablecashtomembers on at leastaquarterlybasis. These transactions reduced the carrying value of our investments and included:

Year Ended December 31, 2020 2019 2018 (Millions) AppalachiaMidstreamInvestments...... $357 $293 $297 Gulfstream...... 93 86 93 OPPL...... 50 77 73 Blue Racer/Caiman II (1)...... 47 42 46 RMM...... 39 38 — Laurel Mountain...... 31 30 23 Discovery...... 21 41 45 UEOM...... —1370 Other...... 15 37 46 $653 $657 $693 ______(1) Seeprevious discussion in thesection Acquisition of Additional Interests in Caiman II above.

Summarized Financial Position and ResultsofOperations of AllEquity-Method Investments

December 31, 2020 2019 (Millions) Assets (liabilities): Current assets...... $630 $581 Noncurrent assets...... 13,424 11,966 Current liabilities...... (312) (341) Noncurrent liabilities...... (3,884) (2,532)

Year Ended December 31, 2020 2019 2018 (Millions) Gross revenue...... $2,625 $2,490 $2,411 Operating income...... 508 685 804 Netincome...... 459 598 795

98 TheWilliams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Note 8–Provision (Benefit) for IncomeTaxes

The Provision (benefit) for income taxes includes:

Year Ended December 31, 2020 2019 2018 (Millions) Current: Federal...... $(29) $(41) $(83) State...... —(5) 1 Foreign...... —2— (29) (44) (82) Deferred: Federal...... 98 280 183 State...... 10 99 37 108 379 220 Provision (benefit) for income taxes...... $79$ 335 $138

Reconciliations from the Provision (benefit) at statutory rate to recorded Provision (benefit)for income taxes are as follows:

Year Ended December 31, 2020 2019 2018 (Millions) Provision (benefit) at statutory rate...... $58$ 224 $69 Increases (decreases) in taxesresulting from: Impact of nontaxablenoncontrolling interests...... 329(73) State income taxes (net of federal benefit)...... 674(10) State deferred incometax rate change...... ——38 Federal valuation allowance...... 13105 Other–net...... 11 59 Provision (benefit) for incometaxes...... $79$ 335 $138

Income (loss) from continuing operations before income taxes includes $1 million, $6 million, and $3 million of foreign loss in 2020, 2019, and2018, respectively.

During the courseofaudits of our businessbydomestic and foreign taxauthorities, we frequentlyface challengesregarding the amount of taxes due. These challenges include questions regarding the timing andamount of deductions and the allocation of income among various taxjurisdictions. In evaluating the liability associated with our various filing positions, we apply the two-step process of recognition and measurement.Inassociation with thisliability, we record an estimate of related interest and taxexposure as acomponent of our taxprovision. The impactofthisaccrualisincluded within Other –net in our reconciliation of the Provision (benefit) at statutory rate to recorded Provision (benefit) forincome taxes.

99 TheWilliams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Significant componentsofDeferredincome tax liabilities and Deferredincome tax assets areasfollows:

December 31, 2020 2019 (Millions) Deferredincome taxliabilities: Property, plant and equipment...... $2,320 $1,921 Investments...... 1,515 1,411 Other...... 140 82 Total deferred incometax liabilities...... 3,975 3,414 Deferred incometax assets: Accrued liabilities...... 747 729 Minimum taxcredit...... —29 Foreign taxcredit...... 140 140 Federal loss carryovers...... 905 544 State losses andcredits...... 445 362 Other...... 140 147 Total deferred incometax assets...... 2,377 1,951 Less valuation allowance...... 325 319 Net deferred incometax assets...... 2,052 1,632 Overall net deferred incometax liabilities...... $1,923 $1,782 The valuation allowanceatDecember 31, 2020 and 2019 serves to reducethe available deferred income tax assets to an amount thatwill,more likelythan not, be realized. We considered allavailablepositive and negative evidence, which incorporates available taxplanning strategies, and management’s estimateoffuture reversals of existing taxabletemporary differences, and have determinedthat aportion of our deferred income taxassets related to the Foreign tax credit and Statelossesand credits maynot be realized. The amounts presented in the table above are,with respecttostateitems,before any federal benefit.The change from prior yearfor the Statelossesand credits reflects increases in lossesand creditsgenerated in the current and prior years less lossesand/or credits utilizedinthe current year. We have loss and credit carryoversinmultiple state taxing jurisdictions. These attributes generally expire between 2021 and2039 with some carryovers having indefinite carryforward periods.

Federal loss carryovers include deferred taxassets on loss carryovers of $905 million which have no expiration date.

Cashrefunds for income taxes (net of payments) were $40 million and $86 million in 2020 and 2019, respectively. Cashpaymentsfor incometaxes(net of refunds) were $11 millionin2018.

As of December31, 2020, we had approximately$51 million of unrecognized taxbenefits. No change occurred to the amount of unrecognized taxbenefitsineachofthe years 2020 and 2019. If recognized, income taxexpense would be reduced by $51 million for each of the years 2020 and 2019, including the effectofthese changesonother taxattributes, with state income taxamounts includednet of federal taxeffect.

We recognizerelated interest and penaltiesasacomponent of Provision (benefit) for income taxes.Total interest and penaltiesrecognized as part of income taxprovision were abenefit of $900 thousand in 2020 and expenses of $500 thousand and $800 thousand for 2019 and 2018, respectively. Approximately $4 million and $3 million of interest and penaltiesprimarily relating to uncertain taxpositions have beenaccrued as of December31, 2020 and 2019, respectively.

During the next 12 months, we do not expect ultimate resolutionofany unrecognized taxbenefit associated with domesticorinternationalmatters to have amaterial impactonour unrecognizedtax benefit position.

100 TheWilliams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Consolidated U.S. Federalincome taxreturnsare open to Internal Revenue Service(IRS) examination for years after 2010, excluding 2015 and 2016, for which the statutes have expired. As of December31, 2020, examinations of taxreturns for 2011 through 2014 are currently in appeals. We do not expect materialchanges in our financial position resulting from these examinations. The statute of limitations for most statesexpiresone yearafter expiration of the IRS statute. Generally, taxreturnsfor our previously owned Canadian entitiesare open to auditfor taxyears after 2012. Taxyears 2013 and 2014 are currently under income taxexamination. In September2016, we sold the majority of our Canadianoperations and, as part of the sale, indemnified the purchaser for any increases in Canadiantax due to an audit of any taxperiods prior to the sale.

Note 9–Earnings (Loss) Per Common SharefromContinuingOperations

Year Ended December 31, 2020 2019 2018 (Dollars in millions, exceptper-share amounts; shares in thousands) Income (loss) from continuing operations available to common stockholders...... $208 $862 $(156) Basic weighted-average shares...... 1,213,631 1,212,037 973,626 Effect of dilutive securities: Nonvestedrestricted stockunits...... 1,531 1,811 — Stockoptions...... 3163 — Dilutedweighted-average shares (1)...... 1,215,165 1,214,011 973,626 Earnings (loss) per common share from continuing operations: Basic...... $.17 $.71 $(.16) Diluted...... $.17 $.71 $(.16) ______(1) For the yearended December31, 2018, 2.0 million weighted-average nonvestedrestricted stockunitsand 0.5 million weighted-average stockoptions have beenexcluded from the computation of dilutedearnings (loss) per common share as theirinclusion would be antidilutive due to our loss from continuing operations attributable to The Williams Companies, Inc.

Note 10 –Employee BenefitPlans

Pension Plans

We have noncontributory defined benefit pension plans for eligible employeeshiredprior to January 1, 2019. Eligible employeesearncompensation creditsbased on acashbalanceformula. As of January 1, 2020, certain active employees are no longereligible to receive compensation credits. At the time of retirement, participants mayelect, to theextent they are eligible for the various options, to receive annuity payments, alump-sum payment, or a combination of annuity andlump-sum payments.

We recognized apre-tax, noncash settlement charge of $23 million in 2018, which is substantiallyreported in Other income (expense) –net below Operating income (loss) in the ConsolidatedStatement of Operations. This amount is included withinthe subsequent tablesofnet periodic benefit cost(credit)and otherchanges in planassets and benefitobligations recognizedinother comprehensive income (loss) before taxes.

OtherPostretirement Benefits

We currently provide subsidized retireemedical and life insurancebenefitstocertain eligible participants. Generally,employeeshiredafter December31, 1991, are not eligible for the subsidized retireemedical benefits, except for participants that were employeesorretirees of Transco Energy Company on December31, 1995. Subsidized retireemedical benefitsfor eligible participantsage 65 and olderare paidthrough contributions to health reimbursement accounts. Subsidized retireemedical benefitsfor eligible participantsunder age 65 are provided through aself-insured medical plansponsored by us. The self-insured retireemedical planprovidesfor retiree

101 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued) contributions and contains othercost-sharing featuressuch as deductibles, co-payments, and co-insurance.The accounting for thisplananticipatesestimated future increases to our contribution levelstothe healthreimbursement accountsfor participants age 65 and older, as well as future cost-sharing thatisconsistent with our expressedintent to increase the retireecontribution level generally in line withhealthcarecostincreasesfor participants under age 65.

Defined Contribution Plan

We have adefined contribution planfor the benefit of substantiallyall employees. Plan participants may contribute aportion of their compensation on apre-tax or after-tax basis.Generally, we matchemployee contributions up to 6percent of eligible compensation. Additionally, eligible active employeesthatare not eligible to receive compensation creditsunder the defined benefit pension planare eligible for afixed annualcontribution made by us to the defined contribution plan. Our contributions chargedtoexpense were $42 million in 2020, $36 million in 2019, and $35 millionin2018.

Funded Status

The following table presentsthe changesinbenefit obligations and planassets for pension benefitsand other postretirement benefits for the years indicated:

Other Postretirement Pension Benefits Benefits 2020 2019 2020 2019 (Millions) Change in benefit obligation: Benefitobligation at beginning of year...... $1,237 $1,187 $215 $186 Servicecost...... 31 45 11 Interestcost...... 36 50 78 Planparticipants’ contributions...... —— 22 Benefits paid...... (41) (111) (14) (12) Netactuarial loss (gain)...... 47 69 930 Settlements...... (127) (3) —— Netincrease (decrease) in benefitobligation...... (54) 50 529 Benefitobligation at end of year...... 1,183 1,237 220 215 Change in planassets: Fairvalue of plan assets at beginning of year...... 1,299 1,132 247 214 Actualreturn on plan assets...... 212 218 37 38 Employercontributions...... 14 63 65 Planparticipants’ contributions...... —— 22 Benefits paid...... (41) (111) (14) (12) Settlements...... (127) (3) —— Net increase (decrease)infairvalue of planassets...... 58 167 31 33 Fairvalue of plan assets at endofyear...... 1,357 1,299 278 247 Funded status—overfunded (underfunded)...... $174 $62$ 58 $32 Accumulated benefitobligation...... $1,167 $1,221

102 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Theoverfunded(underfunded) status of our pension plans and otherpostretirement benefit planpresented in the previous table are recognized in the Consolidated BalanceSheetwithin thefollowing accounts:

December 31, 2020 2019 (Millions) Overfunded (underfunded) pension plans: Noncurrent assets...... $203 $92 Current liabilities...... (3) (3) Noncurrent liabilities...... (26) (27)

Overfunded (underfunded) other postretirement benefit plan: Noncurrent assets...... 64 38 Current liabilities...... (6) (6)

The planassets within our otherpostretirement benefit planare intendedtobeusedfor the payment of benefits for certain groups of participants. The Current liabilities for the otherpostretirement benefit planrepresentthe current portion of benefitsexpected to be payable in the subsequent yearfor the groups of participants whose benefitsare not expected to be paid from planassets.

The pension plans’ benefit obligation Net actuarial loss (gain) of $47 million in 2020 and $69 million in 2019 are primarily due to the impactofdecreases in the discount rates utilizedtocalculate the benefit obligation, partially offset by theimpact of decreases in the cash balance interest crediting rate assumption.

The 2020 benefit obligation Net actuarial loss (gain) of $9 million for our otherpostretirement benefit planis primarily due to adecrease in the discount rateused to calculate the benefit obligation, partiallyoffset by the net impactofexperience related items.The 2019 benefit obligation Net actuarial loss (gain) of $30 million for our other postretirement benefit planisprimarily due to adecrease in the discount rateused to calculate the benefit obligation and other assumption changes, partiallyoffset by theimpact of benefit payment experience and taxlaw changes.

The following table summarizes information for pension plans with obligations in excess of plan assets.

December 31, 2020 2019 (Millions) Plans with aprojected benefitobligation in excess of plan assets: Projected benefitobligation...... $29$ 29 Fairvalue of plan assets...... ——

Plans with an accumulatedbenefit obligation in excess of planassets: Accumulatedbenefit obligation...... 25 26 Fairvalue of plan assets...... ——

103 TheWilliams Companies, Inc. NotestoConsolidated Financial Statements –(Continued)

Pre-taxamounts not yet recognized in Netperiodicbenefit cost(credit) at December31are as follows:

Other Postretirement Pension Benefits Benefits 2020 2019 2020 2019 (Millions) Amounts included in Accumulated other comprehensive income (loss): Netactuarial loss...... $(101) $(243) $(25) $(21) Amounts included in regulatory liabilities associatedwith Transcoand NorthwestPipeline: Netactuarial gain...... N/A N/A $32$ 11 In addition to the regulatory liabilities included in the previous table,differences in the amount of actuarially determined Netperiodicbenefitcost(credit) for our otherpostretirement benefit planand the otherpostretirement benefit costs recoveredinrates for Transco and Northwest Pipeline are deferred as aregulatory assetorliability. We have regulatory liabilities of $100 million at December 31, 2020 and $106 million at December 31, 2019, related to these deferrals. Additionally, Transco recognizes aregulatory liability for ratecollections in excess of itsamount funded to the tax-qualified pension plans. At December 31, 2020 and 2019, these regulatory liabilities were $39 million and $43 million, respectively. These pension and otherpostretirement plans amounts willbereflectedin rates based on theratestructures of these gas pipelines.

Net PeriodicBenefitCost (Credit) Net periodicbenefit cost (credit) for the years ended December 31 consist of the following:

Other Pension Benefits Postretirement Benefits 2020 2019 2018 2020 2019 2018 (Millions) Componentsofnet periodicbenefitcost (credit): Servicecost...... $31$ 45 $50$ 1$ 1$ 1 Interestcost...... 36 50 46 787 Expectedreturn on planassets...... (53) (61) (63) (11) (10) (11) Amortization of prior service credit...... ————— (2) Amortization of net actuarialloss...... 21 15 23 ——— Netactuarial loss from settlements...... 9123 ——— Reclassificationtoregulatory liability...... ——— 212 Netperiodicbenefitcost (credit)...... $44$ 50 $79$ (1) $—$(3) The components of Netperiodicbenefitcost(credit) otherthanthe servicecost component are included in Other income (expense) –net below Operating income (loss) in theConsolidatedStatement of Operations.

104 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Items Recognized in Other ComprehensiveIncome(Loss) and Regulatory Assets andLiabilities

Other changes in planassetsand benefit obligations recognized in Other comprehensive income (loss) before taxes for the years ended December31consistofthe following:

Other Pension Benefits Postretirement Benefits 2020 2019 2018 2020 2019 2018 (Millions) Other changesinplanassets and benefitobligations recognized in Other comprehensiveincome(loss): Netactuarial gain(loss)...... $112 $88$(18) $(4) $(9) $9 Amortization of net actuarialloss...... 21 15 23 ——— Netactuarial loss from settlements...... 9123 ——— Otherchanges in planassetsand benefitobligations recognized in Othercomprehensiveincome(loss)...... $142 $104 $28$ (4) $(9) $9

Other changes in planassetsand benefit obligations for our otherpostretirement benefit planassociated with Transco and Northwest Pipeline are recognized in regulatory assetsand liabilities.Amounts recognized in regulatory assets andliabilities for the years ended December31consistofthe following:

2020 2019 2018 (Millions) Other changesinplanassets andbenefit obligations recognizedin regulatory (assets) and liabilities: Netactuarial gain(loss)...... $21$ 7$ (10) Amortization of prior service credit...... —— (2)

KeyAssumptions

The weighted-average assumptions utilizedtodetermine benefitobligations as of December31are as follows:

Other Postretirement Pension Benefits Benefits 2020 2019 2020 2019 Discount rate...... 2.45 %3.19 %2.59 %3.27 % Rate of compensation increase...... 3.76 3.68 N/A N/A Cash balance interest crediting rate...... 3.00 3.50 N/A N/A The weighted-average assumptions utilizedtodetermine Netperiodicbenefitcost(credit) forthe yearsended December31are as follows:

Other Pension Benefits Postretirement Benefits 2020 2019 2018 2020 2019 2018 Discount rate...... 3.08 %4.33 %3.67 %3.27 %4.39 %3.71 % Expected long-term rate of return on planassets...... 4.67 5.26 5.34 4.39 5.01 4.95 Rate of compensation increase...... 3.68 4.83 4.93 N/A N/A N/A Cash balance interest crediting rate..... 3.50 4.25 4.25 N/A N/A N/A

105 The Williams Companies, Inc. Notes to ConsolidatedFinancial Statements –(Continued)

Themortalityassumptions usedtodetermine the benefit obligations for our pension and otherpostretirement benefit plans reflect generationalprojection mortalitytables.

The assumed health care cost trend rate for 2021 is 7.0 percent.Thisrate decreases to 4.5 percent by 2027.

Plan Assets

Plan assets for our pension and otherpostretirement benefit plans consist primarily of equity and fixedincome securities including mutual funds and commingledinvestment funds invested in equity and fixedincome securities. Theplans’ investment policy providesfor astrategy in accordance withthe EmployeeRetirement IncomeSecurity Act (ERISA), which governs the investment of the assets in adiversifiedportfolio. The plans followapolicy of diversifying theinvestmentsacrossvarious assetclassesand investment managers.

The investment policy for the pension plans includesageneral target assetallocation at December 31, 2020, of 25 percent equitysecurities and 75 percent fixedincomesecurities. The target allocationincludesthe investmentsin equity andfixedincome mutual and commingled investment funds.

Equity securities mayinclude U.S. equities and non-U.S. equities. Investment in Williams’ securities or an entityinwhich Williams has amajority ownershipisprohibitedexcept where these securities maybeowned in a commingledinvestment fund in which the plans’trusts invest. No more than 5percent of the totalstock portfolio valued at marketmay be invested in the common stockofany one corporation.

Fixed income securities mayconsist of U.S. as wellasinternationalinstruments, including emerging markets. The fixedincomestrategies mayinvestinU.S. and sovereign government,corporate,asset-backedsecurities, and mortgage-backed obligations. The weighted-average creditrating of the fixedincomestrategies must be at least “investment grade”including ratings by Moody’s and/or Standard &Poor’s. No more than 5percent of the total fixedincome portfolio maybeinvested in the fixedincomesecurities of any one issuerwith the exception of bond indexfunds and U.S. government guaranteedand agencysecurities.

The following securities and transactions are not authorized: unregisteredsecurities, commodities or commodity contracts, short sales or margin transactions, or otherleveraging strategies. Additionally, realestate equity, natural resource property, venture capital,leveraged buyouts, and otherhigh-return, high-risk investments are generally restricted. Use of derivative securities in mutual funds and commingledinvestment funds heldbythe plans’trusts is allowed. However, direct investment in derivative securities requiresapproval. Currently, investment managers are approvedtoenter intoU.S. Treasury futurescontracts on behalf of the plans to implementand manage duration and yield curve strategy in thefixed incomeportfolio.

There are no significant concentrations of risk withinthe plans’investment securities because of the diversity of the types of investments, diversity of the various industries, and the diversity of the fund managers and investment strategies. Generally, the investmentsheldinthe plans are publiclytraded, therefore,minimizing liquidity risk in the portfolio.

106 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Thefair valuesofour pension plan assets at December 31, 2020 and2019 by assetclass are as follows:

2020 Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Assets Inputs Inputs (Level 1) (Level 2) (Level 3) Total (Millions) Pension assets: Cash management fund ...... $21$ —$ —$ 21 Equity securities...... 39 22 —61 Fixedincome securities (1): U.S. Treasury securities...... 110 ——110 Government andmunicipal bonds...... —32—32 Mortgage andasset-backed securities...... —19—19 Corporate bonds...... —342 —342 Other...... —4—4 $170 $419 $— 589 Commingledinvestment funds measured at netasset value practical expedient (2): Equities —U.S. large cap...... 137 Equities —Globallarge and midcap...... 121 Equities —Internationalemerging markets...... 30 Fixedincome —U.S. long and intermediate duration 346 Fixedincome —Corporate bonds...... 134 Total assetsatfairvalue at December31, 2020...... $1,357

107 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

2019 Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Assets Inputs Inputs (Level 1) (Level 2) (Level 3) Total (Millions) Pension assets: Cash management fund ...... $11$ —$ —$ 11 Equity securities...... 41 22 —63 Fixedincome securities (1): U.S. Treasury securities...... 62 ——62 Government andmunicipal bonds...... —35—35 Mortgage andasset-backed securities...... —11—11 Corporate bonds...... —360 —360 Other...... 54—9 $119 $432 $— 551 Commingledinvestment funds measured at netasset value practical expedient (2): Equities —U.S. large cap...... 133 Equities —Globallarge and midcap...... 100 Equities —Internationalemerging markets...... 26 Fixedincome —U.S. long and intermediate duration 380 Fixedincome —Corporate bonds...... 109 Total assetsatfairvalue at December31, 2019...... $1,299

108 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Thefair values of our otherpostretirement benefitsplan assetsatDecember 31, 2020 and 2019 by assetclass are as follows:

2020 Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Assets Inputs Inputs (Level 1) (Level 2) (Level 3) Total (Millions) Other postretirement benefit assets: Cash management funds ...... $12$ —$ —$ 12 Equity securities...... 38 10 —48 Fixedincome securities (1): U.S. Treasury securities...... 14 ——14 Government andmunicipal bonds...... —4—4 Mortgage andasset-backed securities...... —3—3 Corporate bonds...... —45—45 Mutualfund —Municipal bonds...... 52 ——52 $116 $62$ —178 Commingledinvestment funds measuredatnet asset value practical expedient (2): Equities —U.S. large cap...... 18 Equities —Globallarge and midcap...... 16 Equities —International emerging markets...... 4 Fixedincome —U.S. long and intermediate duration 45 Fixedincome —Corporate bonds...... 17 Total assetsatfairvalue at December31, 2020...... $278

109 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

2019 Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Assets Inputs Inputs (Level 1) (Level 2) (Level 3) Total (Millions) Other postretirement benefit assets: Cash management funds ...... $11$ —$ —$ 11 Equity securities...... 35 9—44 Fixedincome securities (1): U.S. Treasury securities...... 8—— 8 Government andmunicipal bonds...... —4—4 Mortgage andasset-backed securities...... —1—1 Corporate bonds...... —43—43 Mutualfund —Municipal bonds ...... 46 ——46 $100 $57$ —157 Commingledinvestment funds measuredatnet asset value practical expedient (2): Equities —U.S. large cap...... 16 Equities —Globallarge and midcap...... 12 Equities —International emerging markets...... 3 Fixedincome —U.S. long and intermediate duration 46 Fixedincome —Corporate bonds...... 13 Total assetsatfairvalue at December31, 2019...... $247 ______(1) The weighted-average creditqualityrating of the fixedincomesecurityportfolio is investment grade with a weighted-average duration of approximately 16 years for 2020 and 14 years for 2019.

(2) The statedintents of the funds vary based on each commingledfund’s investment objective.These objectives generally include strategies to replicateoroutperform various market indices. Certainstandard withdrawal restrictions generally apply, which mayinclude redemption notification period restrictions ranging from 1day to 30 days. Additionally, the fund managers retainthe right to restrict withdrawalsfrom and/or purchases into the funds so as not to disadvantage otherinvestors in the funds. Generally, the funds also reserve the right to make alloraportion of theredemption in-kind rather than in cash or acombination of cash and in-kind.

The fairvaluemeasurement level within the fairvaluehierarchy is based on the lowest level of any input that is significant to the fairvalue measurement of an asset.

Shares of the cash managementand mutual funds are valued at fair value based on published market prices as of the close of business on thelast business day of the year, which representsthe netassetvaluesofthe sharesheld.

The fairvalues of equity securities tradedonU.S. exchangesare derived from quotedmarket prices as of the close of businessonthe last businessday of the year. The fair values of equity securities tradedonforeign exchangesare also derived from quotedmarket prices as of the closeofbusinessonanactiveforeign exchange on the last businessday of the year. However, the valuation requires translation of the foreign currency to U.S. dollars and this translation is consideredanobservable input to thevaluation.

The fairvalues of allcommingledinvestment funds are determinedbasedonthe net asset values per unit of each of the funds. The net asset values per unit represent the aggregate values of the funds’ assets at fair value less liabilities,divided by thenumber of units outstanding.

110 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Thefair values of fixedincomesecurities,except U.S. Treasury securities, are determinedusing pricing models. These pricing models incorporateobservableinputssuch as benchmark yields, reported trades, broker/dealerquotes, and issuer spreads for similar securities to determine fairvalue. TheU.S. Treasury securities are valued at fairvalue based on closing prices on the last businessday of the yearreportedinthe active market in which the security is traded.

Plan BenefitPayments andEmployer Contributions

Following are the expected benefitstobepaidbythe plans.These estimates are based on the same assumptions previously discussed and reflectfuture serviceasappropriate.The actuarialassumptions are based on long-term expectations and include,but are not limitedto, assumptions as to average expectedretirement age and form of benefit payment.Actual benefit paymentscould differsignificantlyfrom expected benefit paymentsifnear-term participant behaviors differ significantly from the actuarialassumptions.

Other Pension Postretirement Benefits Benefits (Millions) 2021...... $96$ 14 2022...... 91 14 2023...... 86 14 2024...... 82 13 2025...... 82 13 2026-2030...... 378 57 In 2021, we do not expect to contributetoour tax-qualified pension plans. We expecttocontribute approximately $2 million to our nonqualified pension plans and approximately $6 million to our other postretirement benefitplan.

Note 11 –Property, Plant, and Equipment

The following table presentsnonregulated and regulated Property,plant,and equipment –net as presented on the ConsolidatedBalanceSheetfor theyears ended:

Estimated Depreciation December 31, UsefulLife (1) Rates (1) (Years) (%) 2020 2019 (Millions) Nonregulated: Naturalgas gathering andprocessing facilities...... 5-40$17,813 $17,593 Construction in progress...... Not applicable289 354 Other...... 2-452,658 2,519 Regulated: Naturalgas transmission facilities...... 1.25 -7.13 18,688 18,076 Construction in progress...... Not applicable Not applicable 382 586 Other...... 5-450.00 -33.33 2,659 2,382 Total property, plant, andequipment, at cost...... 42,489 41,510 Accumulated depreciation and amortization...... (13,560) (12,310) Property, plant, andequipment —net...... $28,929 $29,200 ______(1) Estimated useful life and depreciation rates are presented as of December31, 2020. Depreciation rates and estimateduseful livesfor regulatedassetsare prescribedbythe FERC.

111 TheWilliams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Depreciation and amortization expense for Property,plant,and equipment –net was$1.393 billion, $1.390 billion, and $1.392 billion in 2020, 2019, and 2018, respectively.

Regulated Property,plant,and equipment –net includes approximately$507 million and $547 million at December31, 2020 and 2019, respectively, related to amounts in excess of the original cost of the regulated facilitieswithin our gas pipeline businessesasaresult of our prior acquisitions. Thisamount is being amortizedover 40 years using the straight-line amortization method. Current FERCpolicy does not permit recovery through rates for amounts in excess of originalcost of construction.

Asset Retirement Obligations

Our accruedobligations primarily relatetooffshore platforms and pipelines,gas transmission pipelines and facilities, gas processing, fractionation, and compression facilities, gas gathering well connections and pipelines, underground storage caverns,and producing wells. At the end of the useful life of each respective asset, we are legally obligated to dismantleoffshore platforms and appropriatelyabandon offshore pipelines,toremove certain componentsofgas transmission facilitiesfrom the ground, to restore land and remove surface equipment at gas processing, fractionation, and compression facilities, to capcertain gathering pipelines at the wellhead connection and remove any related surface equipment,toplug storage caverns and remove any related surface equipment,and to plug producing wellsand remove anyrelated surfaceequipment.

The following table presentsthe significant changes to our ARO, of which$1.159 billion and $1.117 billion are includedinRegulatory liabilities, deferred income,and other withthe remaining current portion in Accrued liabilities at December31, 2020 and 2019, respectively.

December 31, 2020 2019 (Millions) Balance at beginning of year...... $1,165 $1,032 Liabilities incurred (1)...... 37 15 Liabilities settled...... (19) (8) Accretion expense ...... 65 59 Revisions (2)...... (26) 67 Balance at end of year...... $1,222 $1,165 ______(1) As aresult of the global resolution with Chesapeake in 2020, we recorded$31 million of AROrelated to natural gas propertiestransferred to us. (See Note 1–General, Description of Business, Basis of Presentation, and Summary of Significant Accounting Policies.)

(2) Several factorsare considered in the annual review process, including inflation rates, current estimatesfor removal cost, market risk premiums, discount rates, and the estimatedremaining useful life of the assets. The 2020 revisions reflectchanges in removal cost estimates, increases in the estimated remaining useful life of certain assets, decreases in inflation rates, and decreases in the discount rates used in the annual review process. The 2019 revisions reflectchanges in removal cost estimates, decreases in the estimated remaining useful life of certain assets, increases in inflation rates, and decreases in the discount rates usedinthe annual review process.

The funds Transco collectsthrough aportion of itsrates to fund itsARO are depositedintoanexternaltrust account dedicatedtofunding itsARO (ARO Trust). (See Note 18 –Fair Value Measurements, Guarantees, and Concentration of CreditRisk.) Under itscurrent ratesettlement, Transco’s annualfunding obligation is approximately $16 million, with installmentstobedepositedmonthly.

112 TheWilliams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Note 12 –Goodwilland OtherIntangible Assets

Goodwill

Changes in the carrying amount of goodwill, includedinIntangible assets –net of accumulatedamortization in the Consolidated BalanceSheet,byreportablesegment for the periods indicatedare as follows:

Northeast G&P (Millions) December 31, 2018...... $— UEOM Acquisition (Note 3)...... 188 December 31, 2019...... 188 Impairment of goodwill (Note 18)...... (187) Other (Note 3)...... (1) December 31, 2020...... $— Goodwill is not subject to amortization, but is evaluatedatleastannually for impairment or more frequentlyif impairment indicators are present.Wedid not identify or recognizeany impairments to goodwill in connection with our evaluation of goodwill for impairment during the years ended December 31, 2019, and2018, respectively.

OtherIntangibleAssets

The gross carrying amount and accumulatedamortization of otherintangible assets, includedinIntangible assets –net of accumulated amortization in theConsolidatedBalanceSheet, at December 31 areasfollows:

2020 2019 Gross Gross Carrying Accumulated Carrying Accumulated Amount Amortization Amount Amortization (Millions) Other intangibleassets...... $9,561 $(2,117) $9,560 $(1,789)

Other intangible assets primarily relatetogas gathering, processing, and fractionation contractualcustomer relationships recognized in acquisitions. Contractualcustomer relationships are being amortizedonastraight-line basis over aperiod of 20 years for the acquisition of UEOMand 30 years for otheracquisitions, which represents a portion of the term overwhich thecontractual customer relationships are expected to contributetoour cash flows.

We expensecosts incurred to reneworextend the terms of our gas gathering, processing, and fractionation contracts withcustomers. Based on the estimated future revenues during the contract periods (as estimated at the time of the acquisition), the weighted-average period prior to the next renewal or extension of the contractual customer relationships associatedwith the UEOMacquisition was approximately 10 years. Although asignificant portion of the expectedfuture cash flows associated with these contractual customerrelationships are dependent on our ability to reneworextend the arrangements beyond the initialcontractperiods, these expectedfuture cash flows aresignificantlyinfluenced by the scope and paceofour producercustomers’ drilling programs. Once producer customers’ wellsare connectedtoour gathering infrastructure, their likelihood of switching to another provider before the wellsare abandonedisreduced due to thesignificant capital investment required.

The amortization expense related to otherintangible assets was $328 million, $324 million, and $333 million in 2020, 2019, and 2018, respectively. The estimated amortization expense for each of the next five succeeding fiscal years is approximately$328 million.

113 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Note 13 –AccruedLiabilities

December 31, 2020 2019 (Millions) Interestondebt...... $271 $288 Employeecosts...... 149 226 Estimated rate refund liabilities...... —189 Contractliabilities(Note 5)...... 129 158 Assetretirement obligation (Note11)...... 63 48 Operating leaseliabilities(Note 15)...... 28 21 Other, including accruedloss contingencies...... 304 346 $944 $1,276

114 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Note 14 –Debt and BankingArrangements

Long-TermDebt

December 31, 2020 2019 ...... (Millions) Transco: 7.08% Debentures due 2026...... $8$8 7.25% Debentures due 2026...... 200 200 7.85% Notesdue 2026...... 1,000 1,000 4% Notes due 2028...... 400 400 3.25% Notesdue 2030...... 700 — 5.4% Notes due 2041...... 375 375 4.45% Notes due 2042...... 400 400 4.6% Notes due 2048...... 600 600 3.95% Notes due 2050...... 500 — Other financing obligation -Atlantic Sunrise...... 847 857 Other financing obligation -Dalton...... 257 259 Northwest Pipeline: 7.125% Debentures due 2025...... 85 85 4% Notes due 2027...... 500 500 Williams: 4.125% Notes due 2020...... —600 5.25% Notes due 2020...... —1,500 4% Notes due 2021...... 500 500 7.875% Notes due 2021...... 371 371 3.35% Notes due 2022...... 750 750 3.6% Notes due 2022...... 1,250 1,250 3.7% Notes due 2023...... 850 850 4.5% Notes due 2023...... 600 600 4.3% Notes due 2024...... 1,000 1,000 4.55% Notes due 2024...... 1,250 1,250 3.9% Notes due 2025...... 750 750 4% Notes due 2025...... 750 750 3.75% Notes due 2027...... 1,450 1,450 3.5% Notes due 2030...... 1,000 — 7.5% Debentures due 2031...... 339 339 7.75% Notes due 2031...... 252 252 8.75% Notes due 2032...... 445 445 6.3% Notes due 2040...... 1,250 1,250 5.8% Notes due 2043...... 400 400 5.4% Notes due 2044...... 500 500 5.75% Notes due 2044...... 650 650 4.9% Notes due 2045...... 500 500 5.1% Notes due 2045...... 1,000 1,000 4.85% Notes due 2048...... 800 800 Various —7.7%to10.25% Notes and Debentures due 2020 to 2027...... 324 Credit facilityloans...... —— Unamortized debt issuance costs...... (125) (119) Net unamortized debt premium (discount)...... (63) (58) Total long-term debt, including current portion...... 22,344 22,288 Long-term debt due within one year...... (893) (2,140) Long-term debt...... $21,451 $20,148

115 TheWilliams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Certain of our debt agreements containcovenantsthatrestrict or limit, among otherthings, our ability to create liens supporting indebtedness, sell assets, and incur additional debt.Default of these agreements could also restrict our ability to make certaindistributions or repurchase equity.

The following table presentsaggregateminimum maturities of long-term debt and otherfinancing obligations, excluding net unamortizeddebt premium (discount)and debt issuance costs,for each of thenextfiveyears:

December 31, 2020 (Millions) 2021...... $894 2022...... 2,025 2023...... 1,477 2024...... 2,280 2025...... 1,617 Issuances and retirements

On August 17, 2020, we retired$600 million of 4.125 percent senior unsecurednotesthatweredue November15, 2020.

On May14, 2020, we completedapublic offering of $1 billion of 3.5 percent senior unsecured notes due 2030.

On May8,2020, Transcoissued $700 million of 3.25 percent senior unsecurednotesdue 2030 and $500 million of 3.95 percent senior unsecured notesdue 2050 to investors in aprivate debt placement. As part of the issuance, Transcoenteredintoaregistration rightsagreement withthe initial purchasers of the unsecurednotes. Underthe terms of the agreement, Transcowas obligated to fileand consummatearegistration statement for an offer to exchange the notesfor anew issue of substantiallyidenticalnotesregisteredunder the SecuritiesAct of 1933, as amended, within365 days from closing and to use commerciallyreasonable efforts to complete the exchange offer. In the fourth quarter of 2020, Transco filed the registrationstatement and completedthe exchange offer.

We retired$1.5 billion of 5.25 percent senior unsecured notes thatmatured on March15, 2020.

We retired$14 million of 8.75 percent senior unsecurednotesthat maturedonJanuary 15, 2020.

We retired$32 million of 7.625 percent senior unsecurednotesthat maturedonJuly 15, 2019.

Other financing obligations

During the construction of the AtlanticSunrise and Dalton projects, Transco received funding from itspartners for their proportionateshare of construction costs.Amounts receivedwererecordedwithin noncurrent liabilities and the costs associatedwith construction were capitalized in the ConsolidatedBalanceSheet.Upon placing these projectsintoserviceTransco beganutilizing the partners’undivided interest in the assets, including the associated pipeline capacity, and reclassifiedthe funding previously received from itspartners from noncurrent liabilities to debt.The obligations, which mature in 2038 and 2052, respectively, require monthly interest and principalpayments and bothbearaninterest rate of approximately 9percent.

116 TheWilliams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Credit Facilities

December 31, 2020 Stated Capacity Outstanding (Millions) Long-term credit facility (1)...... $4,500 $— Letters of credit under certainbilateral bank agreements...... 15 ______(1) In managing our availableliquidity, we do not expect amaximumoutstanding amount in excessofthe capacity of our credit facilityinclusive of anyoutstanding amounts underour commercial paperprogram.

Revolving creditfacility

In 2018, we along withTranscoand Northwest Pipeline, the lenders named therein, and an administrative agent enteredintoacredit agreement (CreditAgreement)withaggregatecommitmentsavailableof$4.5 billion, with up to an additional $500 million increase in aggregatecommitmentsavailableunder certain circumstances. The maturity dateofthe creditfacilityisAugust 10, 2023. However, the co-borrowers mayrequest up to two extensions of the maturity dateeachfor an additional one-year period to allow amaturitydate as late as August 10, 2025, under certain circumstances. The CreditAgreement allowsfor swing line loans up to an aggregateof$200 million, subject to availablecapacityunder the creditfacility, and letters of credit commitments of $1 billion. Transco and Northwest Pipeline are each abletoborrow up to $500 million under thiscredit facilitytothe extent not otherwise utilized by the otherco-borrowers.

The CreditAgreement contains the following terms and conditions:

•Various covenantsmay limit, among otherthings, aborrower’s and itsmaterialsubsidiaries’ ability to grant certain liens supporting indebtedness, merge or consolidate, sell allorsubstantiallyall of itsassets, make certain distributions during an event of default, andenter into certainrestrictive agreements.

•Ifanevent of default withrespect to aborrower occurs under the creditfacility, the lenders willbeableto terminatethe commitments and accelerate the maturity of theloans and exercise other rights and remedies.

•Other than swing line loans, each time funds are borrowed, the applicable borrower maychoose from two methods of calculating interest: afluctuating base rateequaltoCitibank N.A.'s alternatebase rateplus an applicablemargin or aperiodic fixedrate equal to the London Interbank Offered Rateplus an applicable margin. We are required to pay acommitment fee based on the unused portion of the creditfacility. The applicablemargin and the commitment fee are determinedbyreferencetoapricing schedulebased on the applicableborrower’s senior unsecured long-term debt ratings.

Significant financial covenants under the CreditAgreement require the ratio of debt to EBITDA (earnings before interest, taxes, depreciation, and amortization), each as defined in the creditfacility, to be no greaterthan5.0 to 1, except for the fiscal quarter and the two following fiscalquarters in which one or more acquisitions withatotal aggregatepurchase priceof$25 million or more has beenexecuted, in which case the ratio of debt to EBITDA is to be no greater than 5.5 to 1.

The ratio of debt to capitalization (defined as net worthplus debt)must be no greaterthan65percent for each of Transco and NorthwestPipeline.

At December31, 2020, we are in compliance with these covenants.

Commercial Paper Program

In 2018, we entered intoa$4billion commercial paperprogram.The maturities of the commercialpapernotes vary but maynot exceed397 days from the dateofissuance.The commercialpapernotesare sold under customary

117 The Williams Companies, Inc. NotestoConsolidated Financial Statements –(Continued) terms in the commercialpapermarket and are issued at adiscount from par, or, alternatively, are sold at par and bear varying interest rates on afixedorfloating basis. The net proceeds of issuances of the commercialpapernotesare expected to be usedtofund planned capital expendituresand for othergeneral corporatepurposes. At December31, 2020 and 2019, no commercialpaper wasoutstanding.

CashPayments for Interest (Net of AmountsCapitalized)

Cash paymentsfor interest (net of amounts capitalized) were $1.149 billion in 2020, $1.153 billion in 2019, and $1.064 billion in 2018.

Note 15 –Leases

We are alessee through noncancellablelease agreements for propertyand equipment consisting primarily of buildings, land, vehicles, and equipment usedinbothour operations and administrative functions.

Year Ended December 31, 2020 2019 (Millions) Lease Cost: Operating leasecost...... $37$ 40 Variable leasecost...... 19 27 Sublease income...... (1) (2) Total lease cost...... $55$ 65 Cash paidfor amounts included in the measurement of operating lease liabilities...... $30$ 39

December 31, 2020 2019 (Millions) OtherInformation: Right-of-useasset(included in Regulatory assets, deferredcharges, and other in the Consolidated BalanceSheet)...... $182 $207 Operating leaseliabilities: Current (includedinAccrued liabilities in theConsolidated BalanceSheet)...... $28$ 21 Noncurrent (includedinRegulatory liabilities, deferredincome,and other in the Consolidated BalanceSheet)...... $161 $188 Weighted-average remaining lease term – operating leases (years)...... 13 13 Weighted-average discount rate – operating leases...... 4.60% 4.61% Prior to adopting ASU 2016-02 “Leases(Topic842)”, which waseffective January 1, 2019, total rent expense was$73 million in 2018 and primarily includedinOperating and maintenance expenses and Selling, general, and administrative expenses in theConsolidated Statement of Operations.

118 TheWilliams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

As of December31, 2020, the following table represents our operating leasematurities,including renewal provisions thatwehaveassessedasbeing reasonably certainofexercise, for each of theyears endedDecember 31:

(Millions) 2021...... $34 2022...... 28 2023...... 23 2024...... 19 2025...... 17 Thereafter...... 140 Total future leasepayments...... 261 Less amount representing interest...... 72 Total obligations underoperating leases...... $189 We are the lessor to certain leaseagreementsfor officespace in our headquarters building, which are insignificant to our financial statements.

Note 16 –Stockholders'Equity

On January 26, 2021, our board of directors approvedaregular quarterlydividend to common stockholders of $0.41 per share payable on March 29, 2021.

StockholderRightsAgreement

On March 19, 2020, our board of directors approvedthe adoption of alimited duration stockholder rights agreements(RightsAgreement)and declared adistribution of one preferred stock purchase rightfor each outstanding share of common stock. The Rights Agreement is intendedtoprotect the interests of us and our stockholders by reducing the likelihood of another partygaining control of or significant influenceover us without paying an appropriatepremium considering recent volatile markets. Each preferred stock purchase right represents the righttopurchase, upon certain terms and conditions, one one-thousandths (.001) of ashare of SeriesC Participating Cumulative Preferred Stock, $1.00 par value per share. Each one-thousandth (.001) of ashare of SeriesCParticipatingCumulative Preferred Stock, if issued, would have rights similar to one share of our common stock. The distribution of preferred stock purchase rights occurred on March 30, 2020, to holders of record as of the close of businessonthatdate. The Rights Agreement expires on March 20, 2021. Please see our Current Report on Form 8-K datedMarch 20, 2020, for additionaldetails of the RightsAgreement.

On August 27, 2020, apurportedshareholder filed aputative class action lawsuitinthe DelawareCourt of Chancery challenging the Rights Agreement. The plaintiff alleges that theindividual members of our board of directors breachedtheir fiduciary duties by adopting the Rights Agreement. On September3,2020, apurported shareholder filed aseparate putative class action lawsuitinthe DelawareCourt of Chancery, asserting identical claims to the August 27, 2020, lawsuit. Both complaintsseek declaratory relief, an injunction against the agreement, and an award of attorneys’ feesand costs,which are not expected to be material. The court consolidated the lawsuits. The trial occurred January 12 through January 14, 2021, and we areawaiting thecourt’s decision.

IssuanceofPreferred Stock

In July 2018, through awholly owned subsidiary, we contributed35,000 shares of newly issuedSeriesBNon- Voting Perpetual Preferred Stock (PreferredStock) to The Williams CompaniesFoundation, Inc. (a not-for-profit corporation) for use in future charitable and nonprofit causes. The charitable contribution of PreferredStock was recorded as an expense in the third quarter of 2018. The Preferred Stock was issuedfor an aggregatevalue of $35 million and pays non-cumulative quarterlycashdividends when, as and if declared, at arate of 7.25 percent per year. Our certificate of incorporation authorizes30million shares of PreferredStock, $1 parvalue pershare.

119 TheWilliams Companies, Inc. Notes to ConsolidatedFinancial Statements –(Continued)

AOCI

Thefollowingtable presentsthe changes in AOCI by component,net of income taxes:

Pension and Cash Foreign Other Post Flow Currency Retirement Hedges Translation Benefits Total (Millions) Balance at December31, 2019...... $(2) $(1) $(196) $(199) Other comprehensiveincome(loss) before reclassifications...... (2) —8179 Amounts reclassifiedfrom accumulated other comprehensiveincome(loss)...... 1—2324 Other comprehensiveincome(loss)...... (1) —104 103 Balance at December31, 2020...... $(3) $(1) $(92) $(96)

Reclassifications out of AOCIare presented in the following table by component for the yearended December31, 2020:

ComponentReclassifications Classification (Millions) Cash flow hedges: Energy commodity contracts...... $1Productsales Pension andotherpostretirement benefits: Amortization of actuarial (gain) loss and net actuarial loss from settlements included in net Other income (expense) –net below periodicbenefit cost(credit)...... 30 Operating income (loss) Incometax benefit...... (7) Provision (benefit) forincome taxes Reclassifications during theperiod...... $24

Note 17 –Equity-Based Compensation

Williams’ Plan Information

The Williams Companies, Inc. 2007 Incentive Plan(the Plan) providescommon-stock-basedawards to both employees and nonmanagement directors. To date, 50 million new shareshave beenauthorizedfor making awards under the Plan, including 10 million shares added on April 28, 2020. The Planpermits thegranting of various types of awards including, but not limitedto, restricted stockunitsand stockoptions. At December31, 2020, 31 million shares of our common stockwerereservedfor issuancepursuant to existing and future stockawards, of which19 million shares were available for future grants.

Additionally, up to 5.2 million new shares of our common stockhave beenauthorizedtodatetobeavailablefor saleunder our EmployeeStockPurchase Plan(ESPP), including 1.6 million sharesaddedonApril 28, 2020. Employees purchased 347 thousand sharesataweighted-average priceof$16.07 per share during 2020. Approximately1.7 million shares were availablefor purchase under theESPP at December31, 2020.

Operating and maintenanceexpenses and Selling, general, and administrative expenses in the Consolidated Statement of Operations include equity-basedcompensation expense for the years ended December 31, 2020, 2019, and 2018 of $52 million, $57 million, and $54 million, respectively. Incometax benefit recognized related to the stock-basedcompensation expense for the years ended December 31, 2020, 2019, and 2018 was $13 million, $14 million, and $14 million, respectively. Measured but unrecognized stock-basedcompensation expense at December 31, 2020, was $57 million, substantiallyall of whichrelated to restrictedstockunits. These amounts are expected to be recognizedover aweighted-average period of 1.7 years.

120 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

NonvestedRestrictedStockUnits

The following summary reflects nonvestedrestricted stockunit activityand related information for the year ended December 31, 2020:

Weighted- Average Restricted Stock Units Outstanding Shares Fair Value (1) (Millions) NonvestedatDecember 31, 2019...... 5.4 $28.11 Granted...... 2.8 $18.32 Forfeited...... (0.5) $27.90 Vested...... (1.5) $29.04 NonvestedatDecember 31, 2020...... 6.2 $23.53 ______(1) Performance-based restricted stockunitsare valued considering measures of total shareholderreturn utilizing a Monte Carlo valuation method, as well as returnoncapital employed and aratio of debt to EBITDA. All other restricted stockunitsare valued at the grant-datemarket price. Restricted stockunitsgenerally vest after three years.

Value of Restricted Stock Units 2020 2019 2018 Weighted-average grant date fairvalue of restricted stockunitsgranted during theyear, pershare...... $18.32 $25.87 $30.48 Total fairvalue of restrictedstockunitsvested during theyear(in millions)... $43$ 29 $35 Performance-based restricted stockunitsgranted under the Planrepresent41percent of nonvestedrestricted stockunitsoutstanding at December 31, 2020. These grantsmay be earned at the end of the vesting period based on actualperformanceagainst aperformance target.Based on the extent to which certain financial targetsare achieved, vestedshares mayrange from zero percent to 200 percent of the original grant amount.

StockOptions

The following summary reflects stock option activityand related information for the yearended December31, 2020:

Weighted- Average Aggregate Exercise Intrinsic Stock Options Options Price Value (Millions) (Millions) Outstanding at December31, 2019...... 6.8 $32.64 Granted...... —$ — Exercised...... (0.3)$ 17.28 Cancelled...... (0.5) $34.04 Outstanding at December31, 2020...... 6.0 $33.18 $— ExercisableatDecember31, 2020...... 5.7 $33.41 $— The following table summarizesadditional information related to stockoption activityduring each of the last threeyears:

Year Ended December 31, 2020 2019 2018 (Millions) Total intrinsic value of options exercised...... $1$6$3 Taxbenefitsrealized on options exercised...... $—$ $1$ $—$ Cash receivedfrom theexercise of options...... $3$4$9$ $ $

121 TheWilliams Companies, Inc. Notes to ConsolidatedFinancial Statements –(Continued)

Theweighted-average remaining contractuallives for stockoptions outstanding and exercisable at December 31, 2020, were 3.5 years and 3.3 years,respectively.

The estimatedfairvalue at dateofgrant of options for our common stockgranted in each respective year, using the Black-Scholesoption pricing model,isasfollows:

2018 Weighted-average grant date fairvalue of options for our common stock grantedduring theyear, per share...... $5.49 Weighted-average assumptions: Dividend yield...... 4.7 % Volatility...... 30.1 % Risk-freeinterestrate...... 2.7 % Expected life (years)...... 6.0 There were no stockoptions granted in 2020 or 2019. The expecteddividend yield for each respective yearis basedonthe dividend forecast for thatyearand the grant-datemarket priceofour stock. Our expected future volatility is determinedusing the historicalvolatility of our stockand implied volatility on our traded options. Historicalvolatility is based on the blended 10-yearhistorical volatility of our stockand certain peercompanies. The risk-free interest rateisbased on the U.S. Treasury Constant Maturityrates as of the grant date. Theexpected life of the option is based on historicalexercise behavior andexpected future experience.

Note 18 –FairValue Measurements, Guarantees, and Concentration of Credit Risk

The following table presents, by level within the fairvalue hierarchy, certain of our significant financial assets andliabilities. The carrying values of cash and cash equivalents, accountsreceivable, margin deposits, and accounts payable approximatefairvalue because of the short-term nature of these instruments. Therefore,these assets and liabilities are not presentedinthe following table.

Fair Value Measurements Using Quoted Prices In Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Fair Assets Inputs Inputs Amount Value (Level 1) (Level 2) (Level 3) (Millions) Assets(liabilities) at December 31, 2020: Measured on arecurring basis: ARO Trust investments...... $235 $235 $235 $—$— Additional disclosures: Long-term debt, including current portion...... (22,344) (27,043) —(27,043) — Guarantees...... (40) (27) —(11) (16)

Assets(liabilities) at December 31, 2019: Measured on arecurring basis: ARO Trust investments...... $201 $201 $201 $—$— Additional disclosures: Long-term debt, including current portion...... (22,288) (25,319) —(25,319) — Guarantees...... (41) (27) —(11) (16)

122 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Fair Value Methods

We use the following methods andassumptions in estimating the fairvalue of our financialinstruments:

Assets measuredatfair value on arecurring basis

AROTrust investments: Transco depositsaportion of itscollected rates,pursuant to itsratecasesettlement, into an externaltrust thatisspecifically designatedtofund future ARO’s. The AROTrustinvests in aportfolio of activelytraded mutual funds thatare measured at fairvalueonarecurring basis based on quotedprices in an active market and is reported in Regulatory assets, deferredcharges,and other in the ConsolidatedBalanceSheet.Both realizedand unrealized gains and lossesare ultimately recordedasregulatory assets or liabilities.

Additional fair value disclosures

Long-termdebt,including current portion: The disclosedfairvalue of our long-term debt is determined primarily by amarket approachusing broker quotedindicative period-end bond prices.The quotedprices are based on observabletransactions in less active marketsfor our debt or similar instruments. The fairvalues of the financing obligations associatedwith our Dalton lateral and AtlanticSunriseprojects, which are included withinlong-term debt,weredetermined using an income approach (see Note 14 –Debt and Banking Arrangements).

Guarantees: Guarantees primarily consist of aguaranteewehaveprovidedinthe event of nonpayment by our previously ownedcommunications subsidiary, Williams Communications Group (WilTel), on alease performance obligation that extends through 2042. Guarantees also include an indemnification related to adisposedoperation.

To estimate the fairvalue of the WilTel guarantee, an estimateddefault rateisapplied to the sum of the future contractuallease paymentsusing an income approach. The estimated default rateisdeterminedbyobtaining the average cumulative issuer-weighted corporate default ratebased on the creditrating of WilTel’s current owner and the term of the underlying obligation. The default rateispublished by Moody’s Investors Service. The carrying value of the WilTel guaranteeisreportedinAccrued liabilities in the ConsolidatedBalanceSheet.The maximum potential undiscounted exposure is approximately$27 million at December 31, 2020. Our exposure declines systematically through the remaining term of WilTel’s obligation.

The fairvalueofthe guaranteeassociatedwith the indemnification related to adisposedoperation was estimatedusing an income approachthatconsidered probability-weightedscenarios of potential levelsoffuture performance. The terms of the indemnification do not limitthe maximum potential future paymentsassociated with the guarantee. The carrying value of thisguaranteeisreportedinRegulatory liabilities, deferredincome, and other in theConsolidatedBalanceSheet.

We are required by our revolving credit agreement to indemnify lenders for certain taxes requiredtobe withheld from paymentsdue to the lenders and for certain taxpaymentsmadebythe lenders. The maximum potential amount of future paymentsunder these indemnifications is based on the related borrowings and such future paymentscannot currentlybedetermined. These indemnifications generally continue indefinitelyunless limitedby the underlying taxregulations and have no carrying value. We have neverbeencalledupon to perform under these indemnifications and have no current expectation of afuture claim.

Nonrecurring fairvalue measurements

During the firstquarter of 2020, we observed asignificant decline in the publiclytraded priceofour common stock (NYSE:WMB), which declined 40 percent during the quarter, including a26percent declineinthe monthof March. These changeswere generally attributedtomacroeconomic and geopolitical conditions, including significant declines in crude oil prices drivenbyboth surplus supply and adecrease in demand caused by the coronavirus (COVID-19) pandemic. As aresult of these conditions, we performed an interimassessment of the goodwill

123 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued) associated with our Northeast G&P reporting unit as of March 31, 2020. Thisgoodwill resulted from the March 2019 acquisition of UEOM (seeNote3–Acquisitions and Divestitures).

The assessment considered the totalfairvalue of the businesseswithin the NortheastG&P reporting unit,which was determinedusing income and market approaches. We utilized internally developedindustry weighted-average discount rates andestimatesofvaluation multiplesofcomparable publiclytraded gathering and processing companies. In assessing the fairvalueasofthe March31, 2020, measurement date, we were requiredtoconsider recent publiclyavailableindications of value, which includedlower observed publiclytraded EBITDA market multiplesascompared with recent history and significantlyhigherindustry weighted-average discount rates.The fairvalue of the reporting unit was furtherreconciledtoour estimatedtotal enterprise value as of March 31, 2020, which considered observablevaluation multiplesofcomparable publiclytraded companies applied to each distinct businessincluding the Northeast G&P reporting unit.Thisassessment indicated thatthe estimated fairvalue of the Northeast G&P reporting unit was below itscarrying value, including goodwill.Asaresult of thisLevel 3 measurement,werecognized afull impairment charge of $187 million as of March 31, 2020, in Impairment of goodwill in the ConsolidatedStatement of Operations. Our partner’s $65 million share of thisimpairment is reflectedwithin Net income (loss) attributabletononcontrolling interests in the ConsolidatedStatement of Operations (seeNote 3–Acquisitions and Divestitures).

The following table presentsimpairments of assets and equity-method investments associatedwith certain nonrecurring fair value measurementswithinLevel 3ofthe fairvalue hierarchy, except as specifically noted.

Impairments Year Ended December 31, Date of Fair Segment Measurement Value 2020 2019 2018 (Millions) Impairment of certain assets: Transmission & December 31, Certain capitalized project costs (1)...... Gulf of Mexico 2020 $42$170 December 31, Certain gathering assets (2)...... Northeast G&P 2020 512 Transmission & December 31, Certain pipeline project (3)...... Gulf of Mexico 2019 22 $354 December 31, Certain gathering assets (4)...... West 2019 25 20

Certain gathering assets (4)...... West June 30, 2019 40 59

Certain idle gathering assets (5) ...... West March 31, 2019 —12 December 31, Certain gathering assets (6)...... West 2018 470 $1,849

Certain idle pipeline assets (7)...... Other June 30, 2018 25 66

Other impairments and write-downs (8)...... 19 Impairment of certain assets...... $182 $464 $1,915

124 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Impairments Year Ended December 31, Date of Fair Segment Measurement Value 2020 2019 2018 (Millions) Impairment of equity-method investments: December 31, RMM (9)...... West 2020 $421 $108

RMM (10)...... West March 31, 2020 557 243

Brazos Permian II (10)...... West March 31, 2020 —193

Caiman II (11)...... Northeast G&P March 31, 2020 191 229

Appalachia Midstream Investments (11)...... Northeast G&P March 31, 2020 2,700 127

Aux Sable (11)...... Northeast G&P March 31, 2020 739

Laurel Mountain (11)...... Northeast G&P March 31, 2020 236 10 Transmission & Discovery (11)...... Gulf of Mexico March 31, 2020 367 97 September 30, Laurel Mountain (12)...... Northeast G&P 2019 242 $79 September 30, Appalachia Midstream Investments (13)...... Northeast G&P 2019 102 17 August 31, Pennant (14)...... Northeast G&P 2019 11 17

UEOM (15)...... Northeast G&P March 17, 2019 1,210 74 December 31, UEOM (15)...... Northeast G&P 2018 1,293 $32

Other...... (1) Impairment of equity-method investments...... $1,046 $186 $32 ______(1) Relatestocapitalized project development costs for the Northeast Supply Enhancement project.Aspreviously disclosed, approvals required for the project from the NewYorkState Department of Environmental Conservation and the NewJersey DepartmentofEnvironmentalProtection have beendenied andwehavenot refiledatthis time.Beginning in May2020, we discontinued capitalization of costs related to thisproject. Considering thatthe customer precedent agreementsand FERCcertificatefor the project remainineffect,we had previously concludedthatthe probability of completing the project wassufficienttonot require impairment. However, recent developments in the politicaland regulatory environments have caused us to slightly lower thatassessedprobability such thatthe capitalized project costs now required impairment. The estimatedfairvalue of the materials withinthe capitalized project costs considered otherinternaluses and salvage values for the Property,plant,and equipment –net.The remaining capitalized costs were determined to have no fair value.

(2) Relates to agathering system in the Marcellus Shale region, thatismore likelythannot to be sold in the short term. The estimated fairvalue of the Property,plant,and equipment –net and Intangible assets –net of accumulatedamortization was determinedusing amarket approach, which incorporated an indication of interest by athird party. These inputs resulted in afairvalue measurement withinLevel 2ofthe fairvalue hierarchy.

125 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

(3) Relatestothe Constitution proposedpipeline project extending from Susquehanna County, Pennsylvania,to the Iroquois GasTransmission and the TennesseeGas Pipeline systemsinNew York. Although Constitution received acertificateofpublicconvenience and necessityfrom the FERCtoconstructand operate the proposedpipeline and obtained, among otherapprovals, awaiverofthe water qualitycertification under Section 401 of the CleanWater Act forthe New Yorkportion of the project,the membersofConstitution, following extensive evaluation and discussion, determinedthatthe underlying risk-adjusted return for this greenfield pipeline project had diminished in such away thatfurtherdevelopment wasnolongersupported. The estimatedfairvalue of the Property,plant,and equipment –net was based on probability-weighted third- partyquotes. Our partners’ $209 million share of thisimpairment is reflectedwithin Netincome (loss) attributable to noncontrolling interests in theConsolidated Statement of Operations.

(4) Relatestoagas gathering system in the Eagle Ford Shaleregion withexpected declines in asset utilizationand possible idling of the gathering system.Wedesignated these operations as heldfor sale,includedinOther current assets and deferredcharges,asofDecember31, 2019. As aresult,wemeasured the fairvalue of the disposal group using the expectedsalespriceunder acontractwith athird party. These inputs resulted in afair value measurement within Level 2ofthe fairvalue hierarchy. The estimated fairvalue of the Property,plant, and equipment –net at June 30, 2019, was determinedusing amarket approach, which incorporated indications of interest from third parties.

(5) Reflects impairment of Property,plant,and equipment –net that is no longerinuse for which the fairvalue wasdetermined to be lower thanthe carrying value.

(6) Relates to our gathering operations in the BarnettShale region. Certainofour contractualgathering rates, primarily those in the BarnettShale region, are based on apercentage of the New YorkMercantile Exchange (NYMEX) natural gas prices. During the fourth quarter of 2018, we determined there was asustained decline in theforward pricecurvesfor natural gas.During thissame period, alarge producercustomer in the Barnett Shale region removed their remaining drilling rig. These factors gave rise to an impairment evaluation of these assets, which incorporated management’s projections of future drilling activityand gathering rates, taking into consideration the information previously notedaswell as recently available information regarding producer drilling cost assumptions in the basin. The resulting estimate of future undiscounted cash flows was less than our carrying value, necessitating the estimation of the fairvalueofthe Property,plant,and equipment –net and Intangible assets –net of accumulatedamortization.Toarrive at the fairvalue, we utilized an income approach with adiscount rateof8.5 percent,reflecting an estimatedcost of capital and risks associatedwith the underlying assets.

(7) Relates to certain idlepipelines. The estimated fairvalue of the Property,plant,and equipment –net was determinedbyamarket approachincorporating information derived from bids received for these assets, which we marketed for sale together with certain otherassets. These inputs resultedinafairvalue measurement withinLevel 2ofthe fairvaluehierarchy. We sold these assets in the fourth quarter of 2018. (See Note 3– Acquisitions and Divestitures.)

(8) Reflects multipleindividuallyinsignificant impairments and write-downs of othercertain assets that mayno longerbeinuse or are surplus in nature for which the fairvaluewas determinedtobelower thanthe carrying value.

(9) During the fourth quarter of 2020, RMM renegotiated servicecontracts withasignificant customer in connection with the customer’s Chapter 11 bankruptcy proceedings. The renegotiated contracts resultinlower servicerates and lower projected future cash flows.Asaresult, we evaluated this investment for other-thantemporary impairment. The fairvalue was measured using an income approach. We utilizedadiscount rateof 18 percent in our analysis.

126 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

(10) Following the previously described declining market conditions during the firstquarter of 2020, we evaluated these investmentsfor other-than-temporary impairment. The fairvaluewas measured using an income approach. Both investeesoperate in primarily oil-drivenbasins where significant expected reductions in produceractivitiesled to reduced estimatesofexpected future cash flows. Our fairvalue estimates also reflected discount rates of approximately 17 percent for these investments. We also consideredany debt heldat theinvesteelevel,and itsimpacttofairvalue. The industry weighted-average discount rates utilized were significantlyinfluenced by therecentmarketdeclinespreviously discussed.

(11) Following the previously described declining market conditions during the firstquarter of 2020, we evaluated these investmentsfor other-than-temporary impairment. The impairments withinour Northeast G&P segment areprimarily associatedwith operations in wet-gasareas where producerdrilling activitiesare influencedby NGL prices whichhistoricallytrend with crude oil prices. The fairvalues of our investments in CaimanIIand Aux Sable Liquid Products LP (Aux Sable)were estimatedusing amarket approach, reflecting valuation multiplesranging from 5.0x to 6.2x EBITDA (weighted-average 6.0x). The fairvalues of the other investments, including gathering systemsthatare part of AppalachiaMidstreamInvestments, were estimated using an income approach, with discount rates ranging from 9.7 percent to 13.5 percent (weighted-average 12.6 percent). We also consideredany debt heldatthe investeelevel,and itsimpacttofairvalue. The assumed valuation multiplesand industry weighted-average discount rates utilized wereboth significantlyinfluenced by the recent market declines previously discussed.

(12) Relates to agas gathering system in the Marcellus Shale region thatwas adversely impactedbylower sustained forward natural gas priceexpectations and changes in expected produceractivity. The estimated fair value was determinedusing an incomeapproach. We utilizedadiscount rate of 10.2 percent in our analysis.

(13) Relates to acertain gathering system heldinAppalachiaMidstreamInvestmentsthatwas adversely impacted by changes in the timing of expected produceractivity. The estimated fairvalue was determinedusing an income approach. We utilized adiscount rateof9percent in our analysis.

(14) The estimated fairvalue of Pennant Midstream, LLC(Pennant)was determined by amarket approachbased on recent observablethird-partytransactions. These inputs resulted in afairvalue measurement within Level 2of the fairvalue hierarchy.

(15) The estimated fairvalue at March17, 2019, was determinedbyamarket approachbased on the transaction pricefor the purchase of the remaining interest in UEOM as finalizedjust prior to the signing and closing of the acquisition in March 2019 (see Note 3–Acquisitions and Divestitures). These inputs resulted in afair value measurement within Level 2ofthe fairvaluehierarchy. The estimated fairvalue at December31, 2018, was determined by amarket approach based on our analysis of inputsinthe principalmarket.

Concentration of Credit Risk

The following table summarizes concentration of receivables, net of allowances:

December 31, 2020 2019 (Millions) NGLs, naturalgas,and related products andservices...... $638 $613 Transportation of natural gas and relatedproducts...... 254 277 AccountsReceivablerelated to revenuesfrom contractswithcustomers...... 892 890 Other...... 107 106 Trade accounts and other receivables -net...... $999 $996

127 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Customers include producers, distribution companies,industrialusers, gas marketers,and pipelines primarily located in the continental United States. As ageneral policy, collateral is not required for receivables, but customers’ financial condition and credit worthiness are evaluated regularly. Based upon thisevaluation, we mayobtain collateral to support receivables.

Note 19 –Contingent Liabilities and Commitments

Reporting of Natural Gas-RelatedInformation to Trade Publications

Directand indirectpurchasers of natural gas in various statesfiled individualand class actions against us, our formeraffiliateWPX Energy, Inc. (WPX) and itssubsidiaries, and others alleging the manipulation of published gas priceindicesand seeking unspecifiedamounts of damages. Such actions were transferred to the Nevada federal district court for consolidation of discovery and pre-trialissues. We have agreed to indemnify WPX and its subsidiariesrelatedtothis matter.

In the individual action, filed by Farmland IndustriesInc. (Farmland), the court issuedanorder on May 24, 2016, granting one of our co-defendant’s motion for summary judgment as to Farmland’s claims.OnJanuary 5, 2017, the court extendedsuch ruling to us, entering finaljudgment in our favor. Farmland appealed. On March 27, 2018, the appellate court reversed the districtcourt’s grant of summary judgment,and on April 10, 2018, the defendantsfiled apetition for rehearing with the appellate court, which was denied on May 9, 2018. The case was remanded to the Nevada federaldistrict court and subsequently remandedtoits originally filed court,the Kansas federaldistrict court where we re-urged our motion for summary judgment.The district court denied the motion but granted our request to seek permission for an immediate appealtothe appellate court. Oralargument occurred before the appellatecourt on January 19, 2021.

In the putative class actions, on March 30, 2017, the court issuedanorder denying the plaintiffs’ motions for class certification. On June 13, 2017, the United StatesCourt of Appealsfor the NinthCircuit granted the plaintiffs’ petition for permission to appeal the order. On August 6, 2018, the Ninth Circuitreversed the order denying class certification andremandedthe case to theNevada federaldistrictcourt.

We reachedanagreement to settle two of the actions, and on April 22, 2019, the Nevada federaldistrict court preliminarilyapprovedthe settlements,which are on behalf of Kansasand Missouri class members. Thefinal fairness hearing on the settlementoccurred August 5, 2019, and afinaljudgment of dismissalwith prejudicewas enteredthe same day.

Two putative class actions remainunresolved, and theyhave beenremanded to their originally filed court,the Wisconsinfederal district court.Trial is scheduled to beginJune 14, 2021.

Because of the uncertaintyaround the remaining unresolvedissues, we cannot reasonably estimate arange of potential exposure at this time. However, it is reasonably possible that the ultimateresolution of these actions and our related indemnification obligation couldresult in apotential loss thatmay be materialtoour resultsof operations. In connection with thisindemnification, we have an accrued liability balanceassociatedwith thismatter and, as aresult,have exposure to future developments.

Alaska Refinery Contamination Litigation

We are involved in litigation arising from our ownershipand operation of the North Pole Refinery in North Pole, Alaska, from 1980 until2004, through our wholly owned subsidiariesWilliamsAlaskaPetroleum Inc. (WAPI) and MAPCOInc. We sold the refinery to Flint Hills Resources Alaska, LLC(FHRA), asubsidiary of Koch Industries, Inc., in 2004. Thelitigation involves threecases,with filing dates ranging from 2010 to 2014. The actions primarily arise from sulfolane contamination allegedlyemanating from the refinery. Aputative class action lawsuit was filed by JamesWestin2010 naming us, WAPI, and FHRAasdefendants. We and FHRAfiled claims against each otherseeking, among otherthings, contractualindemnification alleging thatthe otherparty caused the sulfolane contamination. In 2011, we and FHRAsettledthe claimwithJamesWest. CertainclaimsbyFHRA

128 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued) against us were resolvedbythe Alaska Supreme Court in our favor. FHRA’s claims against us for contractual indemnification and statutory claims for damagesrelated to off-site sulfolane were remanded to the Alaska Superior Court.The State of Alaska filed itsactioninMarch 2014, seeking damages. The City of North Pole (NorthPole) filed itslawsuit in November2014, seeking past and future damages,aswellaspunitive damages.Both we and WAPI assertedcounterclaimsagainst the State of Alaska and North Pole,and cross-claimsagainst FHRA. FHRA has also filed cross-claimsagainst us.

The underlying factualbasis and claims in the cases aresimilar and mayduplicate exposure.Assuch, in February 2017, the three cases wereconsolidated intoone action in state court containing the remaining claims from the James West case andthose of the StateofAlaska and North Pole.The StateofAlaska laterannounced the discovery of additional contaminantsper- and polyfluoralkyl (PFOS and PFOA) offsite of the refinery, and the court permittedthe State of Alaska to amend itscomplaint to add aclaim for offsite PFOS/PFOA contamination. The court subsequently remandedthe offsite PFOS/PFOA claims to the Alaska Department of Environmental Conservation for investigation and stayedthe claims pending their potential resolution at the administrative agency. Severaltrial dates encompassing allthreecases have beenscheduledand stricken. In the summer of 2019, the court deconsolidatedthe cases forpurposes of trial.Abenchtrial on allclaimsexcept North Pole’s claims beganin October2019.

In January 2020, the Alaska Superior Court issuedits Memorandum of Decision finding in favor of the State of Alaska and FHRA, with the totalincurred and potential future damages estimated to be $86 million. The court found thatFHRAisnot entitledtocontractualindemnification from us because FHRAcontributed to the sulfolane contamination. On March 23, 2020, the court enteredfinaljudgment in the case. Filingdeadlines were stayed until May 1, 2020. However, on April 21, 2020, we filed aNotice of Appeal.Wealso filedpost-judgment motions including aMotion for New Trial and aMotion to AlterorAmend the Judgment. These post-trial motions were resolvedwith the court’s denial of the last motiononJune 11, 2020. Our Statement of Points on Appeal was filedon July 13, 2020. On June 22, 2020, the court stayedthe North Pole’s case pending resolution of the appealinthe State of Alaska and FHRAcase. On December23, 2020, we filed our opening briefonappeal.Wehaverecorded an accruedliability in the amount of our estimate of the probableloss. It is reasonablypossible that we may not be successful on appeal and could ultimately payuptothe amount of judgment.

Royalty Matters

Certainofour customers, including Chesapeake,have beennamed in various lawsuits allegingunderpayment of royalties and claiming, among otherthings, violations of anti-trust laws and the RacketeerInfluencedand Corrupt Organizations Act.Wehave also beennamed as adefendant in certain of these cases filed in Pennsylvaniabased on allegations that we improperlyparticipatedwith Chesapeake in causing the alleged royalty underpayments. We believe thatthe claims asserted are subject to indemnity obligations owed to us by Chesapeake.Chesapeake has reached atentativesettlementtoresolvesubstantiallyall Pennsylvaniaroyalty cases pending, which settlement would applytobothChesapeake and us. The settlement as reportedwould not require any contribution from us.

Litigation Against Energy Transferand Related Parties

On April 6, 2016, we filed suit in Delaware Chancery Court against Energy Transfer Equity, L.P. (Energy Transfer) and LE GP, LLC(the general partner for Energy Transfer) alleging willful and materialbreachesofthe Agreement and Plan of Merger (ETEMerger Agreement)with Energy Transfer resulting from the private offering by Energy Transfer on March 8, 2016, of SeriesAConvertiblePreferredUnits (Special Offering) to certain Energy Transfer insiders and otheraccredited investors. The suit seeks,among otherthings, an injunction ordering the defendantstounwind the SpecialOffering and to specifically perform theirobligations under the ETEMerger Agreement.OnApril 19, 2016, we filed an amendedcomplaint seeking the samerelief. OnMay 3, 2016, Energy Transfer and LE GP, LLCfiled an answerand counterclaims.

On May 13, 2016, we filed aseparate complaintinDelawareChancery Court against Energy Transfer, LE GP, LLCand the otherEnergy Transfer affiliates that are partiestothe ETEMerger Agreement,alleging material

129 The Williams Companies, Inc. Notes to ConsolidatedFinancial Statements –(Continued) breachesofthe ETEMerger Agreement for failing to cooperateand use necessary effortstoobtain atax opinion required under the ETEMerger Agreement (TaxOpinion) and for otherwise failing to use necessary effortsto consummatethe merger under the ETEMerger Agreement wherein we would be merged with and intothe newly formedEnergy TransferCorp LP (ETC) (ETCMerger). The suit sought, among otherthings, adeclaratory judgment and injunction preventing Energy Transferfrom terminating or otherwise avoiding itsobligations under the ETE Merger Agreement due to anyfailure to obtainthe TaxOpinion.

The Court of Chancery coordinated the SpecialOffering and TaxOpinion suits. On May20, 2016, the Energy Transferdefendantsfiled amendedaffirmative defenses and verifiedcounterclaimsinthe SpecialOffering and Tax Opinion suits,alleging certain breachesofthe ETEMerger Agreement by us and seeking, among otherthings, a declaration thatwewerenot entitledtospecific performance, that Energy Transfer couldterminatethe ETCMerger, and thatEnergy Transfer is entitled to a$1.48 billion termination fee.OnJune 24, 2016, following atwo-day trial, the court issuedaMemorandum Opinion and Orderdenying our requested reliefinthe TaxOpinion suit. The court did not rule on the substanceofour claims related to the SpecialOffering or on the substanceofEnergy Transfer’s counterclaims. On June 27, 2016, we filed an appeal of the court’s decisionwith the SupremeCourt of Delaware, seeking reversal and remand to pursue damages.OnMarch 23, 2017, the SupremeCourt of Delaware affirmedthe Court of Chancery’s ruling. On March 30, 2017, we filed amotion for reargument with the SupremeCourt of Delaware, whichwas deniedonApril 5, 2017.

On September16, 2016, we filed an amendedcomplaint withthe Court of Chancery seeking damagesfor breachesofthe ETEMerger Agreement by defendants. On September23, 2016, Energy Transfer filed asecond amendedand supplemental affirmative defenses and verifiedcounterclaim withthe Court of Chancery seeking, among otherthings, payment of the $1.48 billion termination fee due to our alleged breachesofthe ETEMerger Agreement.OnDecember1,2017, the court granted our motion to dismiss certain of Energy Transfer’s counterclaims, including itsclaim seeking payment of the $1.48 billion termination fee.OnDecember8,2017, Energy Transfer filed amotion for reargument, which the Court of Chancery denied on April 16, 2018. The Court of Chancery had scheduled trial for May 20 through May 24, 2019; the court struck thissetting and reset the trial for June 8through June 11, and June 15, 2020. Due to COVID-19, the court struck the June 2020 setting and re- scheduled the trialfor August 31 through September4,2020; thissetting was also struck as aresultofCOVID-19. The court reset trialfor December14through December18, 2020, but also struck thissetting as aresultof COVID-19. Trial hasbeen reset for May10through May 17, 2021.

FormerOlefins Business

SABIC Petrochemicals, the otherinterest owner in our formerGeismar, Louisiana,olefins facility we sold in July 2017, sought recovery from us for lossesitallegedly suffered, including itsshare of personal injury settlements in which it was aco-defendant,aswell as amounts related to lost income,defense costs, and propertydamage associatedwith an explosion and fire at theplant in June 2013. We settled this claimwithSABIC Petrochemicalsin the fourth quarter 2020. Part of the settlementiscoveredbyour general liability policy and any uninsuredlossesare immaterial.

EnvironmentalMatters

We are aparticipant in certain environmentalactivitiesinvarious stagesincluding assessment studies, cleanup operations, and/or remedial processesatcertain sites,someofwhich we currently do not own. We are monitoring these sites in acoordinated effort with otherpotentially responsible parties,the U.S. Environmental Protection Agency (EPA), or othergovernmental authorities. We are jointlyand severallyliablealong with unrelated third partiesinsome of these activities andsolelyresponsible in others. Certainofour subsidiarieshave beenidentifiedas potentially responsible parties at various Superfund and statewastedisposalsites. In addition, these subsidiaries have incurred, or are alleged to have incurred, various otherhazardous materials removal or remediation obligations under environmentallaws. As of December31, 2020, we have accrued liabilities totaling $33 million for these matters, as discussed below. Estimatesofthe most likelycostsofcleanup are generally based on completed assessment studies,preliminary results of studies, or our experience withothersimilar cleanup operations. At

130 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

December31, 2020, certain assessment studieswerestill in process for whichthe ultimate outcome mayyield different estimatesofmost likelycosts.Therefore,the actual costsincurred will depend on the finalamount, type, and extent of contamination discoveredatthese sites, thefinalcleanup standards mandated by the EPA or other governmental authorities, and otherfactors.

The EPA and various state regulatoryagenciesroutinelypromulgateand propose new rules and issue updated guidance to existing rules. These rulemakings include,but are not limitedto, rulesfor reciprocating internal combustion engine and combustion turbine maximum achievablecontrol technology, airqualitystandards for one- hour nitrogen dioxide emissions, and volatile organiccompound and methane new source performancestandards impacting design and operation of storage vessels, pressure valves,and compressors. The EPA previously issuedits rule regarding National Ambient AirQuality Standards for ground-level ozone. We are monitoring the rule’s implementation as it will trigger additional federal and state regulatory actions thatmay impactour operations. Implementation of the regulations is expected to result in impacts to our operations and increase the cost of additions to Property,plant,and equipment –net in the Consolidated Balance Sheetfor both new and existing facilitiesin affected areas.Weare unabletoreasonably estimate the cost of additions thatmay be required to meet the regulations at this time due to uncertaintycreated by various legal challenges to these regulations and the needfor furtherspecific regulatory guidance.

Continuing operations

Our interstate gas pipelines are involved in remediation activitiesrelated to certain facilitiesand locations for polychlorinated biphenyls, mercury, and otherhazardous substances. These activities have involvedthe EPA and various state environmental authorities, resulting in our identification as apotentially responsible partyatvarious Superfund waste sites. At December 31, 2020, we have accrued liabilities of $4 million for these costs. We expect thatthese costs will be recoverablethrough rates.

We also accrue environmentalremediation costs for natural gas underground storage facilities, primarily related to soil and groundwatercontamination. At December 31, 2020, we have accrued liabilities totaling $8 million for these costs.

Formeroperations

We have potential obligations in connection with assets and businesses we no longeroperate.These potential obligations include remediation activitiesatthe direction of federal and stateenvironmentalauthoritiesand the indemnification of the purchasers of certain of these assets and businesses for environmentaland otherliabilities existing at the time the sale was consummated. Our responsibilitiesrelatetothe operations of the assets and businesses describedbelow.

•Formeragriculturalfertilizerand chemical operations and formerretailpetroleum and refining operations;

•Formerpetroleum products and naturalgas pipelines;

•Formerpetroleum refining facilities;

•Formerexploration andproduction andmining operations;

•Formerelectricity andnatural gas marketing andtrading operations.

At December31, 2020, we have accruedenvironmentalliabilitiesof$21 million related to these matters.

OtherDivestiture Indemnifications

Pursuant to various purchase and sale agreements relatingtodivested businesses and assets, we have indemnified certain purchasers against liabilities that they mayincur with respecttothe businesses and assets acquiredfrom us. The indemnitiesprovidedtothe purchasers are customary in sale transactions and are contingent

131 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued) upon the purchasers incurring liabilities that are not otherwiserecoverable from third parties. The indemnities generally relatetobreach of warranties, tax, historic litigation, personal injury, propertydamage,environmental matters,right of way, and other representations that we have provided.

At December 31, 2020, otherthanaspreviously disclosed, we are not aware of any materialclaimsagainst us involving the above-describedindemnities; thus, we do not expect any of the indemnitiesprovidedpursuant to the salesagreementstohave amaterial impact on our future financial position. Any claimfor indemnity brought against us in the future mayhaveamaterial adverseeffect on our resultsofoperations in the period in which the claimis made.

In addition to the foregoing, various otherproceedings are pending against us thatare incidental to our operations, none of which are expectedtobematerialtoour expected future annual results of operations, liquidity, and financialposition.

Summary

We have disclosed our estimatedrange of reasonably possible lossesfor certain matters above, as wellasall significant matters for which we are unabletoreasonably estimate arange of possible loss. We estimatethatfor all othermatters for which we are abletoreasonably estimate arange of loss, our aggregatereasonably possible losses beyond amounts accrued are immaterial to our expected future annual results of operations, liquidity, and financial position. These calculations have been made without consideration of anypotential recovery from third parties.

Commitments

Commitmentsfor construction and acquisition of property, plant, and equipment are approximately$262 million at December 31, 2020.

Note 20 –Segment Disclosures

Our reportablesegments are Transmission &Gulf of Mexico, Northeast G&P,and West. All remaining businessactivitiesare included in Other. (See Note 1–General, Description of Business, Basis of Presentation, and Summary of Significant Accounting Policies.)

Performance Measurement

We evaluatesegment operating performancebased upon ModifiedEBITDA.Thismeasure represents the basis of our internalfinancial reporting and is the primary performancemeasure used by our chief operating decision maker in measuring performanceand allocating resourcesamong our reportablesegments. Intersegment revenues primarily represent the saleofNGLsfrom our natural gas processing plants and transportation services providedto our marketing business.

We define Modified EBITDA as follows: •Net income (loss) before: ◦ Income(loss) from discontinuedoperations; ◦ Provision (benefit)for income taxes; ◦ Interest incurred, net of interest capitalized; ◦ Equity earnings (losses); ◦ Impairment of equity-method investments;

◦ Other investing income (loss) – net;

132 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

◦ Impairment of goodwill; ◦ Depreciation and amortization expenses; ◦ Accretion expense associatedwithasset retirement obligations for nonregulatedoperations. •This measure is furtheradjustedtoinclude our proportionateshare (based on ownership interest) of ModifiedEBITDA from our equity-method investmentscalculatedconsistently withthe definition described above.

133 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Thefollowingtable reflects the reconciliation of Segment revenues to Total revenues as reported in the Consolidated Statement of Operations and Other financial information:

Transmission & Northeast Gulf of Mexico G&P West Other Eliminations Total (Millions) 2020 Segment revenues: Service revenues External...... $3,207 $1,416 $1,280 $21$ —$5,924 Internal...... 50 49 —13(112) — Total service revenues...... 3,257 1,465 1,280 34 (112) 5,924 Total service revenues–commodity consideration..... 21 7101 ——129 Product sales External...... 144 16 1,506 ——1,666 Internal...... 47 41 56 —(144) — Total product sales...... 191 57 1,562 —(144) 1,666 Total revenues...... $3,469 $1,529 $2,943 $34$ (256) $7,719

Other financial information: Additions to long-lived assets...... $706 $137 $318 $122 $—$1,283 Proportional Modified EBITDA of equity-method investments...... 166 473 110 ——749

2019 Segment revenues: Service revenues External...... $3,261 $1,291 $1,364 $17$ —$5,933 Internal...... 50 47 —13(110) — Total service revenues...... 3,311 1,338 1,364 30 (110) 5,933 Total service revenues–commodity consideration 41 12 150 ——203 Product sales External...... 217 115 1,733 ——2,065 Internal...... 71 35 64 —(170) — Total product sales...... 288 150 1,797 —(170) 2,065 Total revenues...... $3,640 $1,500 $3,311 $30$ (280) $8,201

Other financial information: Additions to long-lived assets...... $1,341 $1,245 $304 $21$ —$2,911 Proportional Modified EBITDA of equity-method investments...... 177 454 115 ——746

134 TheWilliams Companies,Inc. NotestoConsolidatedFinancial Statements –(Continued)

Transmission& Northeast Gulf of Mexico G&P West Other Eliminations Total (Millions) 2018 Segment revenues: Service revenues External...... $2,904 $935 $1,641 $22$ —$5,502 Internal...... 49 41 —12(102) — Total service revenues...... 2,953 976 1,641 34 (102) 5,502 Total service revenues–commodity consideration 59 20 321 ——400 Product sales External...... 174 245 2,365 ——2,784 Internal...... 261 42 83 —(386) — Total product sales...... 435 287 2,448 —(386) 2,784 Total revenues...... $3,447 $1,283 $4,410 $34$ (488) $8,686

Other financial information: Additions to long-lived assets...... $2,379 $477 $279 $36$ —$3,171 Proportional Modified EBITDA of equity-method investments...... 183 493 94 ——770

Thefollowing table reflects the reconciliation of ModifiedEBITDA to Net income (loss) as reported in the Consolidated Statement of Operations:

Year Ended December 31, 2020 2019 2018 (Millions) ModifiedEBITDAbysegment: Transmission &GulfofMexico...... $2,379 $2,175 $2,293 Northeast G&P...... 1,489 1,314 1,086 West...... 998 952 38 Other...... (15) 6(29) 4,851 4,447 3,388 Accretion expense associatedwithasset retirementobligations for nonregulated operations...... (35) (33) (33) Depreciation and amortization expenses...... (1,721) (1,714) (1,725) Impairment of goodwill...... (187) —— Equity earnings (losses)...... 328 375 396 Impairment of equity-method investments...... (1,046) (186) (32) Otherinvesting income (loss)–net...... 8107 219 Proportional Modified EBITDA of equity-method investments...... (749) (746) (770) Interestexpense...... (1,172) (1,186) (1,112) (Provision) benefitfor incometaxes...... (79) (335) (138) Income(loss) from discontinued operations...... —(15) — Netincome(loss)...... $198 $714 $193

135 The Williams Companies, Inc. Notes to Consolidated Financial Statements –(Continued)

Thefollowingtable reflects Total assets and Equity-method investments by reportable segments:

Total Assets Equity-Method Investments December 31, December 31, December 31, December 31, 2020 2019 2020 2019 (Millions) Transmission &Gulf of Mexico...... $19,110 $18,796 $610 $741 Northeast G&P...... 14,569 15,399 3,682 3,973 West...... 10,558 11,265 867 1,521 Other...... 927 1,151 —— Eliminations (1)...... (999) (571) —— Total...... $44,165 $46,040 $5,159 $6,235 ______(1) Eliminations primarily relatetothe intercompany notesand accountsreceivablegenerated by our cash management program.

Note 21 –Subsequent Event

In February 2021, we acquiredcertain oil and gas properties, primarily approximately 2,000 operatedwells, in theWamsutter basin in Wyoming from asupermajor oil and gas company for atotal of $79 million paidfrom cash on hand. We are working to identify an operating partner to optimize development of the propertiesand enhance the value of our connectedmidstreaminfrastructure.Weexpect to report these operations withinour Other segment.

136 The Williams Companies,Inc.

ScheduleII—Valuation and Qualifying Accounts

Additions Charged (Credited) Beginning To Costs and Ending Balance Expenses Other Deductions Balance (Millions) 2020 Deferredtax asset valuation allowance (1)...... $319 $6$—$—$325 2019 Deferredtax asset valuation allowance(1)...... 320 (1) ——319 2018 Deferredtax asset valuation allowance(1)...... 224 96 ——320 ______(1) Deducted from related assets.

137 Item9. Changes in and Disagreements withAccountants on Accounting andFinancial Disclosure

None.

Item9A. Controlsand Procedures

Disclosure Controls andProcedures

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controlsand procedures (as defined in Rules 13a -15(e) and 15d -15(e) of the Securities Exchange Act) (Disclosure Controls) will prevent allerrors and allfraud. Acontrol system,nomatterhow well conceivedand operated, canprovide only reasonable,not absolute, assurance that the objectivesofthe control system are met. Further, the design of acontrol system must reflectthe fact that thereare resource constraints, and the benefitsof controls must be consideredrelative to their costs.Because of the inherent limitations in allcontrol systems, no evaluation of controls canprovide absolute assurance that allcontrol issuesand instancesoffraud, if any, withinthe company have beendetected.Theseinherent limitations include the realities that judgments in decision-making can be faulty, and thatbreakdowns canoccur because of simpleerror or mistake.Additionally, controls canbe circumvented by the individual acts of some persons, by collusion of two or more people,orbymanagement override of the control.The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there canbenoassurance that any design will succeedinachieving itsstated goals under allpotential future conditions. Because of the inherent limitations in acost-effective control system, misstatementsdue to error or fraud mayoccur and not be detected. We monitor our Disclosure Controlsand make modifications as necessary; our intent in thisregard is that the Disclosure Controlswill be modified as systems change andconditions warrant.

Evaluation of DisclosureControls and Procedures

An evaluation of the effectiveness of the design and operation of our Disclosure Controlswas performed as of the end of the period covered by thisreport.Thisevaluation was performed under the supervision and with the participation of our management, including our ChiefExecutive Officer and ChiefFinancialOfficer. Based upon thatevaluation, our ChiefExecutive Officer and ChiefFinancialOfficerconcludedthatthese DisclosureControls are effective at areasonableassurance level.

ChangesinInternal Control Over Financial Reporting

There have beennochanges during the fourth quarter of 2020 thathave materially affected, or are reasonably likelytomaterially affect, our InternalControl over Financial Reporting.

Management’s Annual Report on Internal Control overFinancial Reporting

Management is responsible for establishing and maintaining adequateinternalcontrol over financial reporting (as defined in Rules13a -15(f) and 15d -15(f) under the Securities Exchange Act of 1934). Our internalcontrol over financial reporting is designed to provide reasonableassurance to our management and board of directors regarding the preparation and fairpresentation of financial statements in accordance withaccounting principles generally acceptedinthe United States. Our internalcontrol over financial reporting includesthose policies and procedures that (i) pertaintothe maintenance of records that, in reasonable detail, accurately andfairly reflectthe transactions and dispositions of our assets; (ii)provide reasonableassurance that transactions are recorded as to permit preparation of financial statements in accordance withgenerally acceptedaccounting principles, and thatour receipts and expenditures are being made only in accordance withauthorization of our management and board of directors; and (iii) provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets thatcould have amaterialeffectonour financialstatements.

All internalcontrol systems, no matter how well designed, have inherent limitations including the possibilityof humanerror and the circumventionoroverriding of controls. Therefore,eventhose systemsdeterminedtobe effective canprovide only reasonableassurance with respect to financialstatement preparation and presentation.

138 Underthe supervision and with the participationofour management, including our ChiefExecutive Officer and Chief Financial Officer, we assessedthe effectiveness of our internalcontrol over financial reporting as of December31, 2020, based on the criteriaset forth by the CommitteeofSponsoring Organizations of the Treadway Commission (COSO) in Internal Control —Integrated Framework (2013). Based on our assessment,weconcluded that, as of December31, 2020, our internalcontrol over financialreporting was effective.

Ernst &Young LLP, our independent registeredpublicaccounting firm,has audited our internalcontrol over financial reporting, as stated in their report whichisincludedinthis AnnualReport on Form 10-K.

139 Report of Independent RegisteredPublicAccounting Firm

The Stockholders and the Board of Directors of The Williams Companies, Inc.

Opinion on Internal Control Over Financial Reporting We have audited The WilliamsCompanies, Inc.’s internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, The Williams Companies, Inc. (the Company) maintained, in allmaterial respects, effective internal control over financial reporting as of December 31, 2020, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of December 31, 2020 and 2019, the related consolidated statementsofoperations, comprehensive income(loss),changes in equityand cash flows for each of the three years in the period ended December 31, 2020, and the related notes and the financial statement schedule listed in the index at Item 15(a) and our report dated February 24, 2021, expressed an unqualified opinion thereon.

Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are apublic accounting firm registered withthe PCAOB and are required to be independent withrespect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of theSecurities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with thestandards of the PCAOB. Those standards require that we plan and perform the audit to obtainreasonable assurance about whether effective internal control over financial reporting was maintained in allmaterial respects.

Our auditincluded obtaining an understanding of internal control over financial reporting, assessing the risk that amaterial weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides areasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting Acompany’s internal control over financial reporting is aprocess designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statementsfor external purposes in accordancewith generallyaccepted accounting principles. Acompany’s internal control over financial reporting includes those policies and procedures that (1) pertaintothe maintenance of records that, in reasonable detail, accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statementsinaccordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timelydetection of unauthorized acquisition, use, or disposition of thecompany’s assetsthat couldhave amaterial effect on thefinancial statements.

Because of itsinherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controlsmay become inadequate because of changes in conditions, or that thedegree of compliance with thepolicies or procedures may deteriorate.

/s/ Ernst &Young LLP

Tulsa, Oklahoma February 24, 2021

140 Item9B. Other Information

None.

PART III

Item10. Directors, Executive Officers and Corporate Governance

The information regarding our directors and nomineesfor director required by Item401 of Regulation S-K will be presented under the heading “Election of Directors” in our definitive proxy statement prepared for the solicitation of proxiesinconnection with our Annual Meeting of Stockholders to be heldApril 27, 2021, which shall be filed no laterthanMarch 18, 2021 (Proxy Statement), which information is incorporated by reference herein.

Information regarding our executive officers requiredbyItem401 of Regulation S-K is presented at the end of Part Iherein and captioned “Information About Our Executive Officers,” as permitted by GeneralInstruction G(3) and theInstruction to Item 401 of Regulation S-K.

Information required by paragraphs (c)(3), (d)(4) and (d)(5) of Item407 of Regulation S-K will be included under the heading “Questions and Answers About the Annual Meeting and Voting” and “CorporateGovernanceand Board Matters” in our Proxy Statement,which information is incorporatedbyreferenceherein.

Our Code of Business Conduct,togetherwith our CorporateGovernanceGuidelines, the charters for each of our board committees, and our Code of Business Conductapplicabletoall employees, including our Chief Executive Officer, ChiefFinancial Officer, and Chief Accounting Officer, or persons performing similarfunctions, are available on our Internet website at www.williams.com. We willprovide,free of charge, acopy of our Code of Business Conductorany of our othercorporate documentslistedabove upon written request to our Corporate Secretary at Williams,One WilliamsCenter,Suite 4700, Tulsa, Oklahoma 74172. We intend to disclose any amendmentstoor waivers, in each case, of the Code of Business Conductonbehalf of our Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer, and persons performing similar functions on the corporate governance sectionofour Internet website at www.williams.com,promptly following the dateofany such amendment or waiver.

Item11. ExecutiveCompensation

The information required by Item402 and paragraphs (e)(4) and (e)(5) of Item407 of Regulation S-K regarding executive compensation willbepresented under the headings “Compensation Discussion and Analysis,” “Executive Compensation and OtherInformation,” “Compensation of Directors,”“Compensationand Management Development Committee Report on Executive Compensation,” and “Compensation and Management Development Committee Interlocks and InsiderParticipation” in our Proxy Statement, whichinformation is incorporated by referenceherein. Notwithstanding the foregoing, the information providedunder the heading “Compensation and Management Development Committee Report on Executive Compensation” in our Proxy Statement is furnished and shall not be deemedtobefiled for purposes of Section 18 of the Securities Exchange Actof1934, as amended, is not subject to the liabilities of thatsectionand is not deemedincorporated by referenceinany filing under the Securities Actof1933, as amended.

Item12. SecurityOwnership of CertainBeneficial Ownersand Management andRelated Stockholder Matters

The information regarding securities authorizedfor issuanceunder equity compensation plans required by Item201(d) of Regulation S-K and the security ownership of certain beneficialowners and management required by Item403 of Regulation S-K will be presented under the headings “EquityCompensation StockPlans” and “Security Ownership of Certain Beneficial Owners and Management”inour Proxy Statement, whichinformation is incorporated by reference herein.

141 Item13. Certain Relationshipsand Related Transactions, and Director Independence

The information regarding certain relationships and related transactions requiredbyItem404 and Item407(a) of Regulation S-K will be presented under the heading “CorporateGovernanceand Board Matters”inour Proxy Statement, whichinformation is incorporated by reference herein.

Item14. Principal Accountant Fees and Services

The information regarding our principalaccounting feesand services requiredbyItem9(e) of Schedule14A will be presented under the heading “PrincipalAccountant Fees and Services”inour Proxy Statement,which information is incorporatedbyreferenceherein.

142 PARTIV

Item 15. Exhibits andFinancial Statement Schedules

(a) 1and 2.

Page Covered by report of independent auditors: Consolidated statement of operations for each year in the three-year period ended December 31, 2020... 70 Consolidated statement of comprehensive income (loss)for each year in the three-year period ended December31, 2020...... 71 Consolidated balance sheet at December31, 2020 and 2019...... 72 Consolidated statement of changesinequityfor each year in the three-year period ended December 31, 2020...... 73 Consolidated statement of cash flowsfor eachyearinthe three-yearperiod endedDecember 31, 2020.. 74 Notes to consolidated financialstatements...... 75 Schedulefor each yearinthe three-yearperiod endedDecember 31, 2020: II —Valuation and qualifying accounts...... 137

Allotherschedules have beenomitted sincethe requiredinformation is not present or is not present in amounts sufficient to require submission of the schedule,orbecausethe information required is included in the financial statements andnotesthereto.

(a) 3and (b). The exhibitslisted below are filed as part of this annual report.

INDEXTOEXHIBITS

Exhibit No. Description 2.1 — Agreement and PlanofMerger dated as of May12, 2015, by and among The Williams Companies,Inc., SCMSLLC, Williams Partners, L.P.,and WPZGPLLC (filed on May13, 2015, as Exhibit2.1 to The Williams Companies, Inc.’s current report on Form 8-K (File No. 001-04174) and incorporatedherein by reference).

2.2 — Agreement and PlanofMerger dated as of May16, 2018, by and among The Williams Companies,Inc., SCMSLLC, Williams Partners L.P.,and WPZ GP LLC(filed on May17, 2018 as Exhibit2.1 to The Williams Companies, Inc.’s current report on Form 8-K (File No. 001-04174) and incorporatedherein by reference).

2.3 — Amendment No 1. to Agreement and PlanofMerger dated as of May1,2016, by and among The Williams Companies,Inc., Energy TransferCorp LP, Energy TransferCorpGP, LLC, Energy TransferEquity, L.P., LE GP, LLCand Energy TransferEquity GP, LLC(filed on May3,2016, as Exhibit2.1 to The Williams Companies, Inc.’s current report on Form 8-K (File No. 001-04174) and incorporatedherein by reference).

2.4 — Agreement and PlanofMerger dated as of September28, 2015, by and among The Williams Companies, Inc., Energy TransferCorp LP, Energy TransferCorp GP, LLC, Energy Transfer Equity, L.P., LE GP, LLCand Energy TransferEquity GP, LLC(filed on October1,2015, as Exhibit 2.1 to The Williams Companies, Inc.’s current report on Form 8-K (FileNo. 001-04174) and incorporatedherein by reference).

143 Exhibit No. Description 2.5 — InterestSwapand PurchaseAgreement by and among Western GasPartners, LP, WGR Operating, LP, Delaware Basin JV Gathering LLC, Williams Partners L.P., Williams Midstream GasServices LLC, and AppalachiaMidstream Services,L.L.C., dated February 9, 2017 (filed on February 10, 2017, as Exhibit2.1 to The Williams CompaniesInc.’s current report on Form 8-K (FileNo. 001-04174) and incorporatedherein by reference).

2.6 — Membership InterestPurchaseAgreement,dated as of April13, 2017, among Williams Field Services Group, LLC, Williams Partners L.P., Williams Olefins, L.L.C., NOVA Chemicals Inc., and NOVA Chemicals Corporation (filed on August 3, 2017, as Exhibit2.2 to Williams Partners L.P.’s quarterlyreport on Form 10-Q (File No. 001-34831) and incorporated hereinbyreference).

3.1 — Amended and RestatedCertificateofIncorporation, (filed on May26, 2010, as Exhibit3.(i)1 to The Williams CompaniesInc.’s current report on Form 8-K (FileNo. 001-04174) and incorporated hereinbyreference).

3.2 — CertificateofDesignations of SeriesBPreferredStockofthe Williams Companies,Inc. (filed on July17, 2018, as Exhibit3.1 to The Williams Companies, Inc. current report on Form 8-K (File No. 001-04174) and Incorporatedherein by reference).

3.3 — CertificateofDesignations of SeriesCParticipating PreferredStockofThe Williams Companies, Inc. (filed on March 20, 2020, as Exhibit3.1 to The Williams Companies, Inc. current report on Form 8-K (FileNo. 001-04174) and incorporatedherein by reference).

3.4 — CertificateofAmendment dated August 10, 2018 (filed on August 10, 2018, as Exhibit3.1 to The Williams Companies,Inc.’s current report on Form 8-K (FileNo. 001-04174) and incorporated herein by reference).

3.5 — By-laws(filed on January 20, 2017, as Exhibit3.1 to The Williams CompaniesInc.’s current report on Form 8-K (FileNo. 001-04174) and incorporatedherein by reference).

4.1 — Senior Indenture, dated February 25, 1997, between MAPCOInc. and Bank One TrustCompany, N.A. (formerly The FirstNationalBankofChicago), as Trustee(filed on February 25, 1997, as Exhibit 4.5.1 to MAPCOInc.’s Amendment No. ltoregistration statement on Form S-3 (File No. 333-20837) and incorporatedherein by reference).

4.2 — SupplementalIndenture No. 2, dated March 5, 1997, between MAPCOInc. and Bank One Trust Company, N.A. (formerly The FirstNational Bank of Chicago), as Trustee (filed on March 4, 1998, as Exhibit4(p) to MAPCOInc.’s annual report on Form 10-K for the fiscal yearended December31, 1997 (FileNo. 001-05254) and incorporatedherein by reference).

4.3 — SupplementalIndenture No. 3, dated March31, 1998, among MAPCOInc., WilliamsHoldings of Delaware, Inc. and Bank One TrustCompany, N.A. (formerly The FirstNational Bank of Chicago), as Trustee(filed on March 30, 1999, as Exhibit4(J) to Williams Holdings of Delaware, Inc.’s annual report on Form 10-K for the fiscalyearendedDecember 31, 1998 (FileNo. 000-20555) and incorporatedherein by reference).

4.4 — Fourth SupplementalIndenture, dated as of July 31, 1999, among Williams Holdings of Delaware, Inc., The Williams Companies, Inc. and Bank One TrustCompany, N.A. (formerly The FirstNational Bank of Chicago), as Trustee(filed on March 28, 2000, as Exhibit4(q) to The Williams Companies,Inc.’s annual report on Form 10-K (FileNo. 001-04174) and incorporated herein by reference).

4.5 — FifthSupplementalIndenture, dated as of February 1, 2010, between The Williams Companies, Inc. and The Bank of NewYork Mellon TrustCompany, N.A. (filed on February 2, 2010, as Exhibit 4.3 to The Williams Companies, Inc.’s current report on Form 8-K (FileNo. 001-04174) and incorporatedherein by reference).

144 Exhibit No. Description 4.6 — FifthSupplementalIndenture between The Williams Companies, Inc. and Bank One Trust Company, N.A., as Trustee,dated as of January 17, 2001 (filed on March 12, 2001, as Exhibit 4(k) to The Williams Companies, Inc.’s annual report on Form 10-K (FileNo. 001-04174) and incorporated hereinbyreference).

4.7 — Seventh SupplementalIndenture, dated March 19, 2002, between The Williams Companies, Inc. as Issuerand Bank One TrustCompany, National Association, as Trustee (filed on May9,2002, as Exhibit4.1 to The Williams Companies, Inc.’s quarterlyreport on Form 10-Q (File No. 001-04174) and incorporatedherein by reference).

4.8 — Eleventh SupplementalIndenture, dated as of February 1, 2010, between The Williams Companies,Inc.and The Bank of NewYork Mellon TrustCompany, N.A. (filed on February 2, 2010, as Exhibit4.1 to The Williams Companies, Inc.’s current report on Form 8-K (File No. 001-04174) and incorporatedherein by reference).

4.9 — Indenture, dated December18, 2012, between The Williams Companies,Inc. and The Bank of NewYork Mellon TrustCompany, N.A. as trustee(filed on December20, 2012, as Exhibit4.1 to The Williams Companies, Inc.’s current report on Form 8-K (FileNo. 001-04174) and incorporated hereinbyreference).

4.10 — FirstSupplementalIndenture, dated December18, 2012, between The Williams Companies, Inc. and The Bank of NewYork Mellon TrustCompany, N.A. as trustee (filed on December20, 2012, as Exhibit4.2 to The Williams Companies, Inc.’s current report on Form 8-K (File No. 001-04174) and incorporatedherein by reference).

4.11 — Second SupplementalIndenture, dated as of June 24, 2014, between The Williams Companies, Inc. and The Bank of NewYork Mellon TrustCompany, N.A., as trustee (filed on June 24, 2014, as Exhibit4.1 to The Williams Companies, Inc.’s current report on Form 8-K (File No. 001-04174) and incorporatedherein by reference).

4.12 — Third SupplementalIndenture, dated as of May14, 2020, between The Williams Companies, Inc. and The Bank of NewYork Mellon TrustCompany, N.A., as trustee (filed on May14, 2020, as Exhibit 4.1 to The Williams Companies, Inc.’s current report on Form 8-K (FileNo. 001-04174) and incorporatedherein by reference).

4.13 — Indenture, dated as of February 9, 2010, between Williams Partners L.P. and The Bank of New York Mellon TrustCompany, N.A. (filed on February 10, 2010, as Exhibit4.1 to The Williams Companies,Inc.’scurrent report on Form 8-K (FileNo. 001-04174) and incorporated herein by reference).

4.14 — FirstSupplementalIndenture, dated as of February 2, 2015, between Williams Partners L.P. and The Bank of NewYork Mellon TrustCompany, N.A. (filed on February 3, 2015, as Exhibit4.5 to Williams Partners L.P.’scurrent report on Form 8-K (FileNo. 001-34831) and incorporated herein by reference).

4.15 — Second SupplementalIndenture, dated as of August 10, 2018, between The Williams Companies, Inc. and The Bank of NewYork Mellon TrustCompany, N.A. (filed on August 10, 2018, as Exhibit 4.2 to The Williams Companies, Inc.’s current report on Form 8-K (FileNo. 001-04174) and incorporatedherein by reference).

4.16 — Indenture, dated as of November9,2010, between Williams Partners L.P. and The Bank of New York Mellon TrustCompany, N.A., as trustee(filed on November12, 2010, as Exhibit4.1 to Williams Partners L.P.’s current report on Form 8-K (FileNo. 001-32599) and incorporated herein by reference).

145 Exhibit No. Description 4.17 — Second SupplementalIndenture, dated as of November17, 2011, between Williams Partners L.P. and The Bank of NewYork Mellon TrustCompany, N.A., as trustee (filed November18, 2011, as Exhibit4.1 to Williams Partners L.P.’s current report on Form 8-K (FileNo. 001-32599) and incorporated hereinbyreference).

4.18 — Third SupplementalIndenture (including Form of 3.35% Senior Notesdue 2022), dated as of August 14, 2012, between Williams Partners L.P. and The Bank of NewYork Mellon Trust Company, N.A., as trustee (filed on August 14, 2012 as Exhibit4.1 to Williams Partners L.P.’s current report on Form 8-K (File No. 001-32599) and incorporated hereinbyreference).

4.19 — Fourth SupplementalIndenture, dated as of November15, 2013, between Williams Partners L.P. and The Bank of NewYork Mellon Trust Company, N.A., as trustee (filed on November18, 2013, as Exhibit4.1 to Williams Partners L.P.’s current report on Form 8-K (FileNo. 001-32599) and incorporatedherein by reference).

4.20 — FifthSupplementalIndenture, dated as of March 4, 2014, between Williams Partners L.P. and The Bank of NewYork Mellon TrustCompany, N.A., as trustee(filed on March 4, 2014, as Exhibit 4.1 to Williams Partners L.P.’s current report on Form 8-K (FileNo. 001-32599) and incorporated hereinbyreference).

4.21 — SixthSupplementalIndenture, dated as of June 27, 2014, between Williams Partners L.P. and The Bank of NewYork Mellon TrustCompany, N.A., as trustee(filed on June 27, 2014, as Exhibit 4.1 to Williams Partners L.P.’s current report on Form 8-K (FileNo. 001-32599) and incorporated hereinbyreference).

4.22 — Seventh SupplementalIndenture, dated as of February 2, 2015, between Williams Partners L.P. and The Bank of NewYork Mellon TrustCompany, N.A. (filed on February 3, 2015, as Exhibit 4.4 to Williams Partners L.P.’s current report on Form 8-K (FileNo. 001-34831) and incorporated hereinbyreference).

4.23 — Eighth SupplementalIndenture, dated as of March 3, 2015, between Williams Partners L.P. and The Bank of NewYork Mellon TrustCompany, N.A., as trustee(filed on March 3, 2015, as Exhibit 4.1 to Williams Partners L.P.’s current report on Form 8-K (FileNo. 001-34831) and incorporated hereinbyreference).

4.24 — NinthSupplementalIndenture, dated as of June 5, 2017, between Williams Partners L.P.and The Bank of NewYork Mellon TrustCompany, N.A., as trustee(filed on June 5, 2017, as Exhibit4.1 to Williams Partners L.P.’scurrent report on Form 8-K (FileNo. 001-34831) and incorporated herein by reference).

4.25 — Tenth SupplementalIndenture, dated as of March 5, 2018, between Williams Partners L.P. and The Bank of NewYork Mellon TrustCompany, N.A., as trustee(filed on March 5, 2018, as Exhibit 4.1 to Williams Partners L.P.’s current report on Form 8-K (FileNo. 001-34831) and incorporated hereinbyreference).

4.26 — Eleventh SupplementalIndenture, dated as of August 10, 2018, between The Williams Companies Inc. and The Bank of NewYork Mellon TrustCompany, N.A. (filed on August 10, 2018, as Exhibit4.1 to The Williams Companies, Inc.’s current report on Form 8-K (File No. 001-04174) and incorporatedherein by reference).

4.27 — Senior Indenture, dated as of November30, 1995, between Northwest Pipeline Corporation and ChemicalBank, Trustee(filed September 14, 1995, as Exhibit4.1 to Northwest Pipeline’s registration statement on Form S-3 (File No. 033-62639) and incorporatedherein by reference).

4.28 — Indenture, dated as of April3,2017, between Northwest Pipeline LLCand The Bank of New York Mellon TrustCompany, N.A., as trustee (filed on April3,2017, as Exhibit4.1 to Northwest Pipeline’s current report on Form 8-K (FileNo. 001-07414) and incorporated herein by reference).

146 Exhibit No. Description 4.29 — Senior Indenture, dated as of July 15, 1996, between Transcontinental GasPipe Line Corporation and Citibank, N.A., as Trustee (filed on April2,1996, as Exhibit 4.1 to Transcontinental GasPipe Line Corporation’s registration statement on Form S-3 (FileNo. 333-02155) and incorporated herein by reference).

4.30 — Indenture, dated as of August 12, 2011, between TranscontinentalGas Pipe Line Company, LLC and The Bank of NewYork Mellon TrustCompany, N.A., as trustee(filed on August 12, 2011, as Exhibit4.1 to Transcontinental GasPipe Line Company, LLC’s current report on Form 8-K (FileNo. 001-07584) and incorporatedherein by reference).

4.31 — Indenture, dated as of July 13, 2012, between Transcontinental GasPipe Line Company, LLCand The Bank of NewYork Mellon TrustCompany, N.A., as trustee (filed on July 16, 2012 as Exhibit 4.1 to Transcontinental GasPipe Line Company, LLC’s current report on Form 8-K (File No. 001-07584) and incorporated hereinbyreference).

4.32 — Indenture, dated as of January 22, 2016, between TranscontinentalGas Pipe Line Company, LLC and The Bank of NewYork Mellon TrustCompany, N.A., as trustee (filed on January 22, 2016, as Exhibit4.1 to The Williams Companies, Inc.’s current report on Form 8-K (File No. 001-04174) and incorporatedherein by reference).

4.33 — Indenture, dated as of March 15, 2018, between TranscontinentalGas Pipe Line Company, LLC and The Bank of NewYork Mellon TrustCompany, N.A., as trustee(filed on March 15, 2018, as Exhibit 4.1 to The Williams Companies, Inc.’s current report on Form 8-K (FileNo. 001-04174) and incorporatedherein by reference).

4.34 — Indenture, dated as of May8,2020, between Transcontinental GasPipeLineCompany, LLCand The Bank of NewYork Mellon TrustCompany, N.A., as trustee (filed on May8,2020, as Exhibit 4.1 to The Williams Companies, Inc.’s current report on Form 8-K (File No. 001-04174) and incorporatedherein by reference).

4.35 — Rights Agreement,dated as of March 20, 2020, between The Williams Companies, Inc. and Computershare TrustCompany, N.A., as Rights Agent, which includesthe Form of Certificate of Designation of SeriesCParticipating Cumulative PreferredStockofThe Williams Companies, Inc. as ExhibitA,the Summary of Terms of the Rights Agreement as Exhibit Band the Form of Right CertificateasExhibitC(filed on March 20, 2020, as Exhibit4.1 to The Williams Companies,Inc.’scurrent report on Form 8-K (FileNo. 001-04174) and incorporated herein by reference).

4.36* — Description of Securities.

10.1§ — Form of Director and OfficerIndemnification Agreement (filed on September 24, 2008, as Exhibit 10.1 to The Williams Companies, Inc.’s current report on Form 8-K (FileNo. 001-04174) and incorporatedherein by reference).

10.2§ — Form of 2013 NonqualifiedStockOption Agreement among Williams and certain employees and officers (filed on February 27, 2013, as Exhibit10.6 to The Williams Companies, Inc.’s annual report on Form 10-K (FileNo. 001-04174) and incorporatedherein by reference).

10.3§ — Form of 2013 Restricted StockUnit Agreement among Williams and certain nonmanagement directors (filed on February 26, 2014, as Exhibit10.11 to The Williams Companies, Inc. annual report on Form 10-K (FileNo. 001-04174) and incorporatedherein by reference).

10.4§ — Form of 2014 NonqualifiedStockOption Agreement among Williams and certain employees and officers (filed on February 26, 2014, as Exhibit10.8 to The Williams Companies, Inc. annual report on Form 10-K (FileNo. 001-04174) and incorporatedherein by reference).

147 Exhibit No. Description 10.5§ — Form of 2014 Restricted StockUnit Agreement among Williams and certain nonmanagement directors (filed on February 25, 2015, as Exhibit10.12 to The Williams Companies, Inc. annual report on Form 10-K (FileNo. 001-04174) and incorporatedherein by reference).

10.6§ — Form of 2015 Time-BasedRestricted StockUnit Agreement among Williams and certain employees and officers (filedonFebruary 25, 2015, as Exhibit 10.16 to TheWilliamsCompanies, Inc. annual report on Form 10-K(File No. 001-04174) and incorporated hereinbyreference).

10.7§ — Form of 2015 NonqualifiedStockOption Agreement among Williams and certain employees and officers (filed on February 25, 2015, as Exhibit10.17 to The Williams Companies, Inc. annual report on Form 10-K (FileNo. 001-04174) and incorporatedherein by reference).

10.8§ — Form of 2016 Performance-BasedRestrictedStockUnit Agreement among Williams and certain employees and officers (filedonFebruary 22, 2017, as Exhibit 10.18 to TheWilliamsCompanies, Inc.’s annualreport on Form10-K (FileNo. 001-04174) and incorporatedherein by reference).

10.9§ — Form of 2016 Time-BasedRestricted StockUnit Agreement among Williams and certain employees and officers (filedonFebruary 22, 2017, as Exhibit 10.19 to TheWilliamsCompanies, Inc.’s annualreport on Form10-K (FileNo. 001-04174) and incorporatedherein by reference).

10.10§ — Form of 2016 Time-BasedRestricted StockUnit Agreement among Williams and certain employees and officers vesting February 22, 2019 (filed on February 22, 2017, as Exhibit10.20 to The Williams Companies, Inc.’s annual report on Form 10-K (File No. 001-04174) and incorporated hereinbyreference).

10.11§ — Form of 2016 Time-BasedRestricted StockUnit Agreement among Williams and certain nonmanagement directors (filed on February 22, 2017, as Exhibit10.21 to The Williams Companies, Inc.’s annualreport on Form10-K (FileNo. 001-04174) and incorporatedherein by reference).

10.12§ — Form of 2016 NonqualifiedStockOption Agreement among Williams and certain employees and officers (filed on February 22, 2017, as Exhibit10.22 to The Williams Companies, Inc.’s annual report on Form 10-K (FileNo. 001-04174) and incorporatedherein by reference).

10.13§ — Form of 2017 Time-BasedRestricted StockUnit Agreement among Williams and certain employees and officers (filedonFebruary 22, 2017, as Exhibit 10.23 to TheWilliamsCompanies, Inc.’s annualreport on Form10-K (FileNo. 001-04174) and incorporatedherein by reference).

10.14§ — Form of 2017 Time-BasedRestricted StockUnit Agreement among Williams and certain nonmanagement directors (filed on February 22, 2017, as Exhibit10.24 to The Williams Companies, Inc.’s annualreport on Form10-K (FileNo. 001-04174) and incorporatedherein by reference).

10.15§ — Form of 2017 NonqualifiedStockOption Agreement among Williams and certain employees and officers (filed on February 22, 2017, as Exhibit10.25 to The Williams Companies, Inc.’s annual report on Form 10-K (FileNo. 001-04174) and incorporatedherein by reference).

10.16§ — Form of 2017 Performance-BasedRestrictedStockUnit Agreement among Williams and certain employees and officers (filed on May4,2017, as Exhibit10.10 to The Williams Companies, Inc.’s quarterlyreport on Form 10-Q (FileNo. 001-04174) and incorporatedherein by reference).

10.17§ — Form of 2018 Time-BasedRestricted StockUnit Agreement among Williams and certain employees and officers (filed on May3,2018, as Exhibit10.3 to The Williams Companies, Inc.’s quarterlyreport on Form 10-Q (File No. 001-04174) and incorporated hereinbyreference).

10.18§ — Form of 2018 Performance-BasedRestrictedStockUnit Agreement among Williams and certain employees and officers (filed on May3,2018, as Exhibit10.4 to The Williams Companies, Inc.’s quarterlyreport on Form 10-Q (File No. 001-04174) and incorporated hereinbyreference).

148 Exhibit No. Description 10.19§ — Form of 2018 NonqualifiedStockOption Agreement among Williams and certain employees and officers (filed on May 3, 2018, as Exhibit10.5 to The Williams Companies, Inc.’s quarterly report on Form 10-Q (FileNo. 001-04174) and incorporatedherein by reference).

10.20§ — Form of 2018 Time-BasedRestricted StockUnit Agreement among Williams and certain nonmanagement directors (filed on August 2, 2018, as Exhibit10.2 to The Williams Companies, Inc.’s quarterlyreport on Form 10-Q (FileNo. 001-04174) and incorporatedherein by reference).

10.21§ — Form of 2019 Executive Performance-BasedRestricted Stock Unit Agreement among Williams and certain employees and officers (filed on May2,2019, as Exhibit10.1 to The Williams Companies,Inc.’squarterlyreport on Form 10-Q (FileNo. 001-04174) and incorporated herein by reference).

10.22§ — Amended Form of 2019 Performance-Base Restricted Stock Unit Agreement among Williams and certain employees and officers (filed on May4,2020, as Exhibit10.1 to The Williams Companies,Inc.’squarterlyreport on Form 10-Q (FileNo. 001-04174) and incorporated herein by reference).

10.23§ — Form of 2019 Time-BasedRestricted StockUnit Agreement among Williams and certain employees and officers (filed on May2,2019, as Exhibit10.3 to The Williams Companies, Inc.’s quarterlyreport on Form 10-Q (File No. 001-04174) and incorporated hereinbyreference).

10.24§ — Form of 2019 Time-BasedRestricted StockUnit Agreement among Williams and certain nonmanagement directors (filed on May2,2019, as Exhibit10.4 to The Williams Companies, Inc.’s quarterlyreport on Form 10-Q (File No. 001-04174) and incorporated hereinbyreference).

10.25§ — Form of 2020 Performance-BasedRestricted StockUnit Agreement among The Williams Companies,Inc.and certain employees and officers (filed on May4,2020, as Exhibit10.2 to The Williams Companies,Inc.’s quarterlyreport on Form 10-Q (FileNo. 001-04174) and incorporated hereinbyreference).

10.26§ — Form of 2020 Time-BasedRestrictedStockUnit Agreement among The Williams Companies, Inc. and certain employees and officers (filed on May4,2020, as Exhibit 10.3 to The Williams Companies, Inc.’squarterlyreport on Form 10-Q (FileNo. 001-04174) and incorporated herein by reference).

10.27§ — Form of 2020 Time-BasedRestrictedStockUnit Agreement among The Williams Companies, Inc. and certain non-management directors (filed on May4,2020, as Exhibit10.4 to The Williams Companies,Inc.’s quarterlyreport on Form 10-Q (FileNo. 001-04174) and incorporated hereinbyreference).

10.28§* — Form of Time-BasedRestricted StockUnit Agreement among The Williams Companies, Inc. and certain employeesand officers.

10.29§* — Form of Time-Based Restricted StockUnit Agreement among The Williams Companies, Inc. and certain non-management directors.

10.30§ — The Williams Companies, Inc. 1996 StockPlanfor Nonemployee Directors(filed on March 27, 1996, as ExhibitBtoThe Williams Companies, Inc.’s Definitive Proxy Statement (File No. 002-27038) and incorporatedherein by reference).

10.31 — The Williams Companies, Inc. 2002 Incentive Planasamended and restatedeffective as of January 23, 2004 (filed on August 5, 2004, as Exhibit 10.1 to The Williams Companies, Inc.’s quarterlyreport on Form 10-Q (File No. 001-04174) and incorporated hereinbyreference).

149 Exhibit No. Description 10.32§ — Amendment No. 1toThe Williams Companies, Inc. 2002 Incentive Plan(filed on February 25, 2009, as Exhibit10.11 to The Williams Companies, Inc.’s annual report on Form 10-K (File No. 001-04174) and incorporated hereinbyreference).

10.33§ — Amendment No. 2toThe Williams Companies, Inc. 2002 Incentive Plan(filed on February 25, 2009, as Exhibit10.12 to The Williams Companies, Inc.’s annual report on Form 10-K (File No. 001-04174) and incorporated hereinbyreference).

10.34§ — Change in Control and Restrictive Covenant Agreement between certain executive officers (Tier OneExecutives)and The Williams Companies, Inc. (filed on February 24, 2020, as Exhibit10.29 to The Williams Companies, Inc.’s annual report on Form 10-K (File No. 001-04174) and incorporated hereinbyreference).

10.35§ — Change in Control and Restrictive Covenant Agreement between certain executive officers (Tier Two Executives)and The Williams Companies, Inc. (filed on February 24, 2020, as Exhibit10.30 to The Williams Companies, Inc.’s annual report on Form 10-K (File No. 001-04174) and incorporated hereinbyreference).

10.36§ — The Williams Companies, Inc. Executive Severance Pay Plan, dated November14, 2012 (filed July 20, 2016, as Exhibit10.2 to The Williams Companies, Inc.’s current report on Form 8-K (FileNo. 001-04174) and incorporatedherein by reference).

10.37§ — FirstAmendment to The Williams Companies, Inc. Executive Severance Pay Plan (filed July20, 2016, as Exhibit10.1 to The Williams Companies, Inc.’s current report on Form 8-K (File No. 001-04174) and incorporatedherein by reference).

10.38§ — The Williams Companies, Inc. 2007 Incentive Planasamended and restatedeffective July 14, 2016 (filed on February 22, 2017, as Exhibit10.38 to The Williams Companies, Inc.’s annual report on Form 10-K (FileNo. 001-04174) and incorporatedherein by reference).

10.39 — Credit Agreement dated as of July 13, 2018, between The Williams Companies,Inc.,Northwest Pipeline LLC, and Transcontinental GasPipeLineCompany, LLCasco-borrowers, the lenders named therein, and Citibank, N.A. as Administrative Agent (filed on July 17, 2018, as Exhibit 10.1 to The Williams Companies, Inc.’s current report on Form 8-K (FileNo. 001-04174) and incorporated hereinbyreference).

10.40 — Form of Commercial Paper Dealer Agreement, dated as of August 10, 2018, between The Williams Companies,Inc., as Issuer, and the Dealer partythereto (filed on August 10, 2018, as Exhibit 10.1 to The Williams Companies, Inc.’s current report on Form 8-K (FileNo. 001-04174) and incorporatedherein by reference).

21* — Subsidiariesofthe registrant.

23.1* — Consent of Independent RegisteredPublicAccounting Firm,Ernst &Young LLP.

23.2* — Consent of Independent RegisteredPublicAccounting Firm,PricewaterhouseCoopers LLP.

31.1* — Certification of the ChiefExecutive Officer pursuant to Rules 13a-l4(a) and 15d-14(a) promulgated under the SecuritiesExchange Actof1934, as amended, and Item601(b)(3l) of Regulation S-K, as adoptedpursuant to Section 302 of theSarbanes-Oxley Act of 2002.

31.2* — Certification of the Chief Financial Officer pursuant to Rules 13a-14(a)and l5d-l4(a) promulgated under the Securities Exchange Actof1934, as amended, and Item601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of theSarbanes-Oxley Act of 2002.

32** — Certification of the ChiefExecutive Officer and the ChiefFinancial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of theSarbanes-Oxley Act of 2002.

150 Exhibit No. Description 101.INS* —XBRL Instance Document. Theinstancedocument does not appear in the Interactive Data File becauseits XBRL tagsare embeddedwithinthe inline XBRL document.

101.SCH* —XBRL Taxonomy Extension Schema.

101.CAL*—XBRL TaxonomyExtension Calculation Linkbase.

101.DEF* —XBRL Taxonomy Extension Definition Linkbase.

101.LAB*—XBRL TaxonomyExtension LabelLinkbase.

101.PRE* —XBRL Taxonomy Extension Presentation Linkbase.

104* —Cover Page Interactive Data File. Thecoverpage interactive datafiledoes not appear in the interactive datafile because itsXBRL tags are embedded withinthe inline XBRL document (contained in Exhibit 101).

______* Filedherewith ** Furnishedherewith § Management contract or compensatory planorarrangement

151 Item16. Form 10-KSummary

Not applicable.

152 SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Actof1934, the registrant has duly caused this report to be signedonits behalfbythe undersigned, thereuntoduly authorized.

THE WILLIAMS COMPANIES,INC. (Registrant)

By: /s/ JOHN D. PORTER John D. Porter Vice President, Controllerand Chief Accounting Officer Date: February 24, 2021

Pursuant to the requirements of the SecuritiesExchange Actof1934, thisreport has beensignedbelow by the following persons on behalfofthe registrant andinthe capacities andonthe dates indicated. Signature Title Date

/s/ALAN S. ARMSTRONG President, ChiefExecutive Officerand Director February 24, 2021 Alan S. Armstrong (Principal Executive Officer)

/s/ JOHN D. CHANDLER Senior Vice President andChiefFinancialOfficer February 24, 2021 John D. Chandler (Principal Financial Officer)

Vice President,Controllerand ChiefAccounting /s/ JOHN D. PORTER OfficerFebruary24, 2021 John D. Porter (Principal Accounting Officer)

/s/ STEPHEN W. BERGSTROM Chairmanofthe Board February 24, 2021 Stephen W. Bergstrom

/s/ NANCYK.BUESE Director February 24, 2021 Nancy K. Buese

/s/ STEPHENI.CHAZEN Director February 24, 2021 Stephen I. Chazen

/s/ CHARLESI.COGUT Director February 24, 2021 Charles I. Cogut

/s/ STACEY H. DORÉDirector February 24, 2021 Stacey H. Doré

/s/ MICHAELA.CREELDirector February 24, 2021 Michael A. Creel

/s/ VICKI L. FULLERDirector February 24, 2021 Vicki L. Fuller

/s/ PETERA.RAGAUSS Director February 24, 2021 PeterA.Ragauss

153 SignatureTitle Date

/s/ROSEM.ROBESONDirectorFebruary24, 2021 RoseM.Robeson

/s/ SCOTTD.SHEFFIELD Director February 24, 2021 ScottD.Sheffield

/s/ MURRAYD.SMITH Director February 24, 2021 MurrayD.Smith

/s/WILLIAMH.SPENCEDirector February 24, 2021 WilliamH.Spence

154 Corporate Data Stockholder Information

WILLIAMS SECURITIES

Williams common stock (WMB) is listed ANNUAL MEETING AUDITORS on the New York Stock Exchange.

Stockholders are invited to our annual Ernst & Young LLP The market value on March 1, 2021 meeting, which will be webcast on 1700 One Williams Center was approximately $28.7 billion. Tuesday, April 27, 2021 at 2 p.m. CDT. Tulsa, OK 74172-0117 On that date, 6,345 stockholders of record Due to public health concerns arising held 1,214,757,033 shares of Williams from the coronavirus pandemic, the CERTIFICATIONS common stock. The company’s common annual meeting will be conducted in a We submitted the certification stock traded at an average daily volume virtual-only format; information regarding of Alan S. Armstrong, President of 11.6 million shares in 2020. attending the virtual annual meeting and Chief Executive Officer, to the can be found in the proxy statement at New York Stock Exchange pursuant www.edocumentview.com/wmb. WMB COMMON STOCK ACTIVITY to NYSE Section 303A.12(a) on (dividend/share) May 8, 2020. INTERNET 2020 2019 We also filed with the Securities and 1st Quarter 0.40 0.38 Company information is available Exchange Commission on February 24, 2nd Quarter 0.40 0.38 at www.williams.com. 2021, as Exhibits 31.1 and 31.2 to our 3rd Quarter 0.40 0.38 Annual Report on Form 10-K for the 4th Quarter 0.40 0.38 INQUIRIES year ended December 31, 2020, the To request additional materials, call certificates of our Chief Executive Officer 800-600-3782 or access our website. and Chief Financial Officer as required by WMB AVERAGE DAILY VOLUMES TRADED thousands of shares To contact our investor relations group, Section 302 of the Sarbanes-Oxley Act call 800-600-3782. Please send written of 2002. 20000 inquiries to investor relations to the EQUAL OPPORTUNITY 16000 headquarters address below.

The company is an Equal Employment 12000 CORPORATE HEADQUARTERS Opportunity (EEO) employer and does not One Williams Center discriminate in any employer/employee 8000 Tulsa, OK 74172 relations based on race, color, religion, sex, sexual orientation, national origin, 4000 Phone: 918-573-2000 or 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 201 201 201 2019 2020 toll-free, 800-WILLIAMS age, disability or veterans status.

CORPORATE RESPONSIBILITY TRANSFER AGENT AND REGISTRAR WMB CLOSING PRICE RANGES share igh ow Routine stockholder correspondence: To learn about Williams corporate Computershare Trust Company, N.A. responsibility, go to www.williams.com. 70 P.O. Box 505000 60 Louisville, KY 40233-5000 50 Phone: 800-884-4225 40 Hearing impaired: 800-952-9245 30 Internet: www.computershare.com 20 10

Overnight correspondence: 0 Computershare Trust Company, N.A. 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 201 201 201 2019 2020 462 South 4th Street, Suite 1600 Louisville, KY 40202

Contact our transfer agent for information WMB DAILY PRICES on registered share accounts, dividend ($/share) payments or to receive information about 2020 2019 our Direct Stock Purchase Plan. High Low High Low 1st Quarter 24.04 9.25 28.93 22.42 2nd Quarter 21.58 13.33 29.35 26.30 3rd Quarter 22.34 18.27 28.85 22.88 4th Quarter 22.49 18.26 23.94 21.95 (800) WILLIAMS l www.williams.com