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 ...