Western Midstream Partners, LP

What they do

WES owns and operates gathering systems, treating facilities, processing plants, produced-water systems and pipelines, with assets concentrated in the Delaware and DJ Basins and the Powder River Basin. It also buys and sells residue, NGLs and condensate as a natural-gas processor under certain contracts. The general partner is owned by Occidental, and WES holds a 98.2% partnership interest in WES Operating as of June 30, 2026.

Revenue drivers

• Natural-gas gathering, processing and treating — Total natural-gas throughput averaged 5,404 MMcf/d in 2025, up 3% from 5,226 MMcf/d in 2024, with the Delaware Basin at 2,042 MMcf/d and the DJ Basin at 1,470 MMcf/d. Fees are earned under gathering, processing and treating agreements, including fixed-recovery processing contracts that benefit from higher commodity prices.
• Crude-oil and NGLs gathering and transportation — Crude-oil and NGLs throughput in the Delaware Basin averaged 258 MBbls/d in 2025, up 6% from 243 MBbls/d in 2024. The partnership gathers, stabilizes and transports condensate, NGLs and crude oil through pipelines and related assets.
• Produced-water gathering, treating, recycling and disposal — WES operates eight wholly owned produced-water systems. Second-quarter 2026 produced-water throughput averaged 2,939 MBbls/d, up 5% sequentially, with record Delaware Basin produced-water throughput of 2,993 MBbls/d.

Recent performance

Second-quarter 2026 net income attributable to limited partners was $394.9 million, or $0.99 per diluted common unit, with record quarterly Adjusted EBITDA of $736.5 million, up 19% from the prior-year period. Distributable Cash Flow was $537.2 million and operating cash flow was $534.7 million, producing Free Cash Flow of $263.6 million. Adjusted EBITDA rose approximately 8% sequentially on record produced-water throughput, a partial-month contribution from the Brazos Delaware acquisition, and benefits from fixed-recovery processing contracts at higher commodity prices. The second-quarter distribution was $0.930 per unit, or $3.72 annualized.

Strategy

WES is growing through acquisitions and organic projects, including the October 2025 Aris merger and the mid-June 2026 Brazos Delaware acquisition, which added roughly 460 MMcf/d of natural-gas processing capacity. It executed two new Powder River Basin gathering and processing agreements adding about 270,000 dedicated acres, with development beginning in the second half of 2026. The partnership retired its 3.100% and 3.950% Senior Notes due 2025 at par and issued $700 million of senior notes due 2036 to refinance commercial paper and revolver borrowings tied to Brazos Delaware. It is also expanding processing capacity, including the North Loving plant start-up in late February 2025 that added 250 MMcf/d at the West Texas complex.

Risks

• Commodity-price exposure — WES has commodity-price risk under percent-of-proceeds, percent-of-product, keep-whole and fixed-recovery processing contracts, so lower oil, natural gas or NGL prices can reduce revenue and cash flow.
• Occidental relationship — WES depends on Occidental production and faces conflicts of interest with its general partner and Occidental over capital allocation, costs and business opportunities, and Occidental's capital program or strategy changes could reduce throughput.
• Capital and financing needs — WES relies on its revolver, commercial paper program and debt markets to fund acquisitions, capital expenditures and distributions, and second-quarter 2026 Free Cash Flow after distributions was negative $111.0 million due to organic growth capital spending.
• Regulatory and environmental constraints — Federal, state and local laws, including ballot initiatives limiting hydraulic fracturing or other oil and natural-gas development, could reduce customer activity and demand for WES midstream services.

Outlook

Management raised the midpoints of its full-year 2026 guidance ranges by 10% for Adjusted EBITDA, 10% for Distributable Cash Flow and 20% for Free Cash Flow, citing first-half results, the Brazos Delaware acquisition and elevated commodity prices. Revised 2026 guidance is $2.750 billion to $2.950 billion of Adjusted EBITDA, $2.050 billion to $2.250 billion of Distributable Cash Flow and $1.100 billion to $1.300 billion of Free Cash Flow. The 2026 total capital expenditures range of $850.0 million to $1.0 billion was reaffirmed. The Powder River Basin agreements are expected to support 2027 natural-gas throughput growth.