Group 1: Company Growth Strategy - Western Midstream Partners, LP (WES) plans to invest at least $1.1 billion in capital expenditures for 2026, focusing on significant growth in the Delaware Basin [1] - The company is executing a $2 billion acquisition of Aris Water Solutions, which is expected to enhance its produced water disposal capacity to over 3.8 million barrels per day and diversify its customer base [2] - A new natural gas processing train at the North Loving facility, sanctioned to process 300 million cubic feet per day, will increase total processing capacity to approximately 2.5 billion cubic feet per day by early Q2 2027 [3] Group 2: Operational Expectations - WES anticipates mid-single-digit year-over-year growth in natural gas and produced water throughput for the remainder of 2025, with low single-digit growth in crude oil and NGLs [4] - Continued growth is expected across all product lines in 2026, even before considering the contributions from the Aris acquisition [4] Group 3: Long-Term Value Creation - The company aims to deliver sustained throughput growth and operational scale in the Delaware Basin through infrastructure expansions, customer diversification, and disciplined balance sheet management [5]

Financial Data and Key Metrics Changes - The second quarter generated net income attributable to limited partners of $334 million and adjusted EBITDA of $618 million, with an adjusted gross margin increase of $18 million compared to the first quarter, primarily driven by increased throughput and improved gross margin contribution from the Delaware Basin [19][20] - The company maintained a top-tier net leverage ratio of 2.9 times at quarter end, with free cash flow of $388 million [21][23] Business Line Data and Key Metrics Changes - Natural gas throughput increased by 3% sequentially, crude oil and NGLs throughput increased by 6%, and produced water throughput increased by 4%, primarily due to new wells coming online in the Delaware Basin [13][14] - Adjusted gross margin per Mcf for natural gas decreased by $0.02, while per barrel adjusted gross margin for crude oil and NGLs decreased by $0.15, reflecting changes in contract mix and distribution payments [14][15] Market Data and Key Metrics Changes - The Delaware Basin continued to be the primary growth engine, with expectations of modest year-over-year increases in average throughput across all product lines [16][17] - The company anticipates meaningful natural gas throughput growth from other assets, particularly in the Uinta Basin, driven by pipeline expansions [18] Company Strategy and Development Direction - The company announced an agreement to acquire Arris Water Solutions, which is expected to optimize the value of existing assets and enhance service offerings [6][9] - The sanctioning of a second train at the North Loving natural gas processing plant aims to increase capacity and prepare for anticipated growth in natural gas and produced water volumes [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth outlook despite volatile market conditions, with no substantial changes in customers' expected production [26][27] - The company remains committed to generating strong returns for unitholders while sustaining and growing distributions over time [24][27] Other Important Information - The acquisition of Arris is valued at $2 billion, implying approximately 7.5 times 2026 consensus EBITDA, and is expected to be accretive to free cash flow per unit in 2026 [9][10] - The company has identified permanent annual run rate cost savings of approximately $50 million through operational efficiencies [22] Q&A Session Summary Question: Funding for ARRIS acquisition - Management explained the decision to finance the acquisition in a leverage-neutral way to preserve balance sheet capacity and position for future growth opportunities [31][33] Question: Water business percentage of EBITDA - Management indicated no specific target mix for the water business but expressed satisfaction with a range around 15% to 20% [34] Question: Opportunities for consolidation in New Mexico - Management noted that the ARRIS acquisition completes their system in the Delaware Basin and they are comfortable with the regulatory environment in New Mexico [36][38] Question: FID on North Loving II - Management acknowledged a more aggressive approach to FID, supported by strong underlying contracts and producer confidence [40][42] Question: Synergies from the ARRIS acquisition - Management clarified that the $40 million in synergies are primarily G&A savings and that they expect to realize these quickly post-acquisition [46][48] Question: Capital expenditures outlook - Management expects elevated capital expenditures in 2026 due to major projects, normalizing in 2027 [51][52] Question: Opportunities at McNeil Ranch - Management views McNeil Ranch as a long-term upside opportunity for water disposal and surface use [55][57] Question: Regulatory hurdles for ARRIS acquisition - Management does not foresee significant hurdles in the regulatory process and expects to close the transaction in the fourth quarter [60][62]

Financial Performance - Western Midstream Partners (WES) achieved a record quarterly Adjusted EBITDA of $618 million, a 4% increase quarter-over-quarter[13] - Operating cash flow was $564 million in the second quarter of 2025[20] - Free cash flow for the second quarter of 2025 was $3884 million[20] - Cash distributions paid in the second quarter of 2025 were $35534 million[20] - Net income for the second quarter of 2025 was $334 million[21] Operational Performance - Total natural gas throughput was 54 Bcf/d, a 3% increase quarter-over-quarter[13] - Total crude oil and NGLs throughput was 543 MBbls/d, a 6% increase quarter-over-quarter[13] - Total produced water throughput was 1242 MBbls/d[13] Strategic Growth - WES sanctioned a new 300 MMcf/d cryogenic processing train at the North Loving plant in the Delaware Basin, expected to be in service by the second quarter of 2027[13, 17] - The company is constructing the Pathfinder Pipeline, an ~800 MBbls/d produced-water transportation pipeline, expected to be in service by the first quarter of 2027, with ~85% of the total project capex to be spent in 2026[17] Ownership Structure - Occidental owns 447% of Western Midstream Partners, LP, while public unitholders own 553%[8] - The market capitalization of Western Midstream Partners, LP is approximately $15 billion[8]

Core Financial Performance - Western Midstream Partners, LP reported a net income attributable to limited partners of $333.8 million for Q2 2025, equating to $0.87 per common unit (diluted) [2][7] - The company achieved an Adjusted EBITDA of $617.9 million, marking the highest quarterly Adjusted EBITDA in its history [6][7] - Cash flows from operating activities totaled $564.0 million, with Free Cash Flow amounting to $388.4 million for the second quarter [2][7] Distribution and Cash Flow - A per-unit distribution of $0.910 will be paid on August 14, 2025, consistent with the prior quarter, resulting in an annualized distribution of $3.64 [4][7] - After distributions, the Free Cash Flow for Q2 2025 was $33.1 million [4] Operational Highlights - Natural gas throughput averaged 5.3 Bcf/d, a 3% increase from the previous quarter [5][8] - Crude oil and NGLs throughput averaged 532 MBbls/d, reflecting a 6% sequential increase [5][8] - Produced water throughput averaged 1,217 MBbls/d, representing a 4% increase from the prior quarter [5][8] Strategic Initiatives - The company announced the acquisition of Aris Water Solutions, Inc. for an enterprise value of approximately $2.0 billion, expected to enhance its position in midstream water services [6][9] - A new 300 MMcf/d cryogenic natural-gas processing train, North Loving Train II, has been sanctioned to increase processing capacity in West Texas [6][9] Guidance and Future Outlook - Western Midstream reaffirmed its 2025 financial guidance ranges for Adjusted EBITDA ($2.350 billion to $2.550 billion), capital expenditures ($625 million to $775 million), and Free Cash Flow ($1.275 billion to $1.475 billion) [7][10] - The impact of the Aris acquisition will be incorporated into the 2026 guidance projections, to be announced in February 2026 [10]

Financial Data and Key Metrics Changes - In Q1 2025, the company generated net income attributable to limited partners of $300 million and adjusted EBITDA of $594 million, with a decrease in adjusted gross margin by $8 million compared to Q4 2024 [16][18] - The company maintained a trailing twelve-month net leverage ratio of just below three times at quarter end, with liquidity of approximately $2.4 billion [6][17] Business Line Data and Key Metrics Changes - Natural gas throughput decreased by 2% sequentially, primarily due to lower volumes from the DJ Basin and Powder River Basin, while crude oil and NGL throughput decreased by 6% [9][10] - The adjusted gross margin for natural gas assets increased by $0.05 per 1,000 cubic feet, driven by higher excess natural gas liquids volumes and pricing [10][11] Market Data and Key Metrics Changes - The company expects mid-single-digit percentage growth in year-over-year throughput for natural gas and produced water, and low-single-digit growth for crude oil and NGLs [12][14] - Delaware Basin is anticipated to continue being the main engine of throughput growth in 2025, with modest growth expected across all product lines [12][14] Company Strategy and Development Direction - The company emphasizes prudent capital allocation and maintaining a strong balance sheet, with net leverage at or below 3x, allowing for growth while increasing distributions [19][20] - The company is focused on organic growth projects backed by minimum volume commitments, which provide stability during commodity price fluctuations [19][20] Management's Comments on Operating Environment and Future Outlook - Management noted that recent market volatility has not changed their strategy, and they remain prepared to adjust plans based on customer activity and market conditions [6][19] - The company is closely monitoring customer capital discipline and operational efficiency in light of recent commodity price weakness [12][44] Other Important Information - The company declared a quarterly distribution of $0.91 per unit, representing a 4% increase over the prior quarter [17] - Bob Phillips, former CEO of Crestwood Equity Partners, has joined the board as an independent director, bringing significant midstream expertise [21][22] Q&A Session Summary Question: How will capital allocation change in a slower growth environment? - Management stated that their strategy remains unchanged, and they are prepared to take advantage of potential acquisitions if organic growth opportunities slow [24][25] Question: What is the guidance for the rest of the year? - Management expects volumes to pick up, driven by West Texas and Uinta, with no material changes to the outlook [26][27] Question: Any updates on the PATHFINDER project? - Management reported positive discussions with customers and midstream players, seeking minimum volume commitments for the pipeline [32][33] Question: How recent are conversations with producer customers regarding CapEx cuts? - Management indicated that conversations are ongoing and real-time, with no significant changes in guidance despite some producers announcing CapEx cuts [42][44] Question: How would CapEx look in a flat Permian production environment? - Management suggested that CapEx would likely be at the low end of the current guidance range if flat production occurs [66][68]

Reported first-quarter 2025 Net income attributable to limited partners of $301.8 million, generating first-quarter Adjusted EBITDA(1) of $593.6 million. Reported first-quarter 2025 Cash flows provided by operating activities of $530.8 million, generating first-quarter Free Cash Flow(1) of $399.4 million. Announced a first-quarter distribution of $0.910 per unit, which is 4-percent higher than the prior quarter's distribution, or $3.64 per unit on an annualized basis, and in-line with prior management comm ...