UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2023March 31, 2024

Or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from             to      
WESTERN MIDSTREAM PARTNERS, LP
WESTERN MIDSTREAM OPERATING, LP
(Exact name of registrant as specified in its charter)
Commission file number:State or other jurisdiction of incorporation or organization:I.R.S. Employer Identification No.:
Western Midstream Partners, LP001-35753Delaware46-0967367
Western Midstream Operating, LP001-34046Delaware26-1075808
Address of principal executive offices:Zip Code:Registrant’s telephone number, including area code:
Western Midstream Partners, LP9950 Woodloch Forest Drive, Suite 2800The Woodlands,Texas77380(346)786-5000
Western Midstream Operating, LP9950 Woodloch Forest Drive, Suite 2800The Woodlands,Texas77380(346)786-5000
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbolName of exchange
on which registered
Common units outstanding as of AugustMay 3, 2023:2024:
Western Midstream Partners, LPCommon unitsWESNew York Stock Exchange384,614,611380,490,963
Western Midstream Operating, LPNoneNoneNoneNone
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.
Western Midstream Partners, LPYesþNo¨
Western Midstream Operating, LPYesþNo¨
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).
Western Midstream Partners, LPYesþNo¨
Western Midstream Operating, LPYesþNo¨




Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller 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.
Western Midstream Partners, LPLarge Accelerated FilerAccelerated FilerNon-accelerated FilerSmaller Reporting CompanyEmerging Growth Company
þ
Western Midstream Operating, LPLarge Accelerated FilerAccelerated FilerNon-accelerated FilerSmaller Reporting CompanyEmerging Growth Company
þ
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Western Midstream Partners, LP¨
Western Midstream Operating, LP¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Western Midstream Partners, LPYesNoþ
Western Midstream Operating, LPYesNoþ

FILING FORMAT

This quarterly report on Form 10-Q is a combined report being filed by two separate registrants: Western Midstream Partners, LP and Western Midstream Operating, LP. Western Midstream Operating, LP is a consolidated subsidiary of Western Midstream Partners, LP that has publicly traded debt, but does not have any publicly traded equity securities. Information contained herein related to any individual registrant is filed by such registrant solely on its own behalf. Each registrant makes no representation as to information relating exclusively to the other registrant.

Part I, Item 1 of this quarterly report includes separate financial statements (i.e., consolidated statements of operations, consolidated balance sheets, consolidated statements of equity and partners’ capital, and consolidated statements of cash flows) for Western Midstream Partners, LP and Western Midstream Operating, LP. The accompanying Notes to Consolidated Financial Statements, which are included under Part I, Item 1 of this quarterly report, and Management’s Discussion and Analysis of Financial Condition and Results of Operations, which is included under Part I, Item 2 of this quarterly report, are presented on a combined basis for each registrant, with any material differences between the registrants disclosed separately.




TABLE OF CONTENTS
PAGE
PART I
Item 1.
Item 2.
Item 3.
Item 4.
Item 5.
PART II
Item 1.
Item 1A.
Item 2.
Item 5.
Item 6.
3


COMMONLY USED ABBREVIATIONS AND TERMS

References to “we,” “us,” “our,” “WES,” “the Partnership,” or “Western Midstream Partners, LP” refer to Western Midstream Partners, LP (formerly Western Gas Equity Partners, LP) and its subsidiaries. The following list of abbreviations and terms are used in this document:

Defined TermDefinition
AnadarkoAnadarko Petroleum Corporation and its subsidiaries, excluding our general partner, which became a wholly owned subsidiary of Occidental upon closing of the Occidental Merger on August 8, 2019.
Barrel, Bbl, Bbls/d, MBbls/d42 U.S. gallons measured at 60 degrees Fahrenheit, barrels per day, thousand barrels per day.
BoardThe board of directors of WES’s general partner.
Cactus IIChipetaCactus II PipelineChipeta Processing, LLC, in which we heldare the managing member of and own a 15% interest that we sold in November 2022.75% interest.
ChipetaChipeta Processing, LLC.
CondensateA natural-gas liquid with a low vapor pressure compared to drip condensate, mainly composed of propane, butane, pentane, and heavier hydrocarbon fractions.
DBMDelaware Basin Midstream, LLC.
DBM water systemsDBM’s produced-waterProduced-water gathering and disposal systems in West Texas.
DJ Basin complexThe Platte Valley, system,Fort Lupton, Wattenberg, system, Lancaster, plant,and Latham plant,processing plants, and the Wattenberg processing plant.gathering system.
EBITDA
Earnings before interest, taxes, depreciation, and amortization. For a definition of “Adjusted EBITDA,” see Reconciliation of Non-GAAP Financial Measures under Part I, Item 2 of this Form 10-Q.
Exchange ActThe Securities Exchange Act of 1934, as amended.
FRPFront Range Pipeline LLC, in which we own a 33.33% interest.
GAAPGenerally accepted accounting principles in the United States.
General partnerWestern Midstream Holdings, LLC, the general partner of the Partnership.
ImbalanceImbalances result from (i) differences between gas and NGLs volumes nominated by customers and gas and NGLs volumes received from those customers and (ii) differences between gas and NGLs volumes received from customers and gas and NGLs volumes delivered to those customers.
Marcellus Interest
The 33.75% interest in the Larry’s Creek, Seely, and Warrensville gas-gathering systems and related facilities located in northern Pennsylvania.Pennsylvania that we sold in April 2024 (see Note 3—Acquisitions and Divestitures in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q).
MGRMcf, MMcf, MMcf/dMountain Gas Resources, LLC, includes the Red Desert complex and the Granger straddle plant.Thousand cubic feet, million cubic feet, million cubic feet per day.
MeritageMeritage Midstream Services II, LLC, which was acquired by the Partnership on October 13, 2023.
Mi VidaMi Vida JV LLC, in which we own a 50% interest.
MLPMaster limited partnership.
Mcf, MMcf, MMcf/dThousand cubic feet, million cubic feet, million cubic feet per day.
Mont Belvieu JV
Enterprise EF78 LLC, in which we ownowned a 25% interest.interest that we sold in February 2024 (see Note 3—Acquisitions and Divestitures in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q).
Natural-gas liquid(s) or NGL(s)The combination of ethane, propane, normal butane, isobutane, and natural gasolines that, when removed from natural gas, become liquid under various levels of pressure and temperature.
OccidentalOccidental Petroleum Corporation and, as the context requires, its subsidiaries, excluding our general partner.
Panola
Panola Pipeline Company, LLC, in which we ownowned a 15% interest.interest that we sold in March 2024 (see Note 3—Acquisitions and Divestitures in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q).
Powder River Basin complex
The Hilight system and assets acquired from Meritage, which includes a gathering system, processing plants, and the Thunder Creek NGL pipeline (see Note 3—Acquisitions and Divestitures in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q).
Produced waterByproduct associated with the production of crude oil and natural gas that often contains a number of dissolved solids and other materials found in oil and gas reservoirs.
Ranch WestexRanch Westex JV LLC, in which we owned a 50% interest through August 2022, and a 100% interest thereafter.
RCFWES Operating’s $2.0 billion senior unsecured revolving credit facility.
Red Bluff ExpressRed Bluff Express Pipeline, LLC, in which we own a 30% interest.
Related parties
Occidental, the Partnership’s equity interests (see Note 6—7—Equity Investments in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q), and the Partnership and WES Operating for transactions that eliminate upon consolidation.
RendezvousRendezvous Gas Services, LLC, in which we own a 22% interest.
4


Defined TermDefinition
Residue
The natural gas remaining after the unprocessed natural-gas stream has been processed or treated.
Saddlehorn
Saddlehorn Pipeline Company, LLC, in which we ownowned a 20% interest.
4


interest that we sold in March 2024 (see
Note 3—Acquisitions and Divestitures in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q).
Defined TermDefinition
SECU.S. Securities and Exchange Commission.
Services AgreementThat certain amended and restated Services, Secondment, and Employee Transfer Agreement, dated as of December 31, 2019, by and among Occidental, Anadarko, and WES Operating GP.
Skim oilA crude-oil byproduct that is recovered during the produced-water gathering and disposal process.
Springfield system
The Springfield gas-gathering system and Springfield oil-gathering system.
TEFR InterestsThe interests in TEP, TEG, and FRP.
TEGTexas Express Gathering LLC, in which we own a 20% interest.
TEPTexas Express Pipeline LLC, in which we own a 20% interest.
WES OperatingWestern Midstream Operating, LP, formerly known as Western Gas Partners, LP, and its subsidiaries.
WES Operating GPWestern Midstream Operating GP, LLC, the general partner of WES Operating.
West Texas complexThe DBMDelaware Basin Midstream complex and DBJV and Haley systems.
WGRAHWGR Asset Holding Company LLC.LLC, a subsidiary of Occidental.
White CliffsWhite Cliffs Pipeline, LLC, in which we own a 10% interest.
Whitethorn LLC
Whitethorn Pipeline Company LLC, in which we ownowned a 20% interest.interest that we sold in February 2024 (see Note 3—Acquisitions and Divestitures in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q).
Whitethorn
A crude-oil and condensate pipeline, and related storage facilities, owned by Whitethorn LLC.
$1.25 billion Purchase ProgramThe $1.25 billion buyback program ending December 31, 2024. The common units may be purchased from time to time in the open market at prevailing market prices or in privately negotiated transactions.

5

Table of Contents
PART I. FINANCIAL INFORMATION (UNAUDITED)

Item 1.  Financial Statements

WESTERN MIDSTREAM PARTNERS, LP
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended
March 31,
Three Months Ended 
June 30,
Six Months Ended 
June 30,
Three Months Ended
March 31,
Three Months Ended
March 31,
thousands except per-unit amounts
thousands except per-unit amounts
thousands except per-unit amountsthousands except per-unit amounts2023202220232022
Revenues and otherRevenues and other
Revenues and other
Revenues and other
Service revenues – fee based
Service revenues – fee based
Service revenues – fee basedService revenues – fee based$661,506 $655,952 $1,309,373 $1,287,550 
Service revenues – product basedService revenues – product based46,956 70,498 93,766 111,365 
Service revenues – product based
Service revenues – product based
Product sales
Product sales
Product salesProduct sales29,659 149,736 68,684 235,325 
OtherOther152 233 432 476 
Other
Other
Total revenues and other (1)
Total revenues and other (1)
Total revenues and other (1)
Total revenues and other (1)
738,273 876,419 1,472,255 1,634,716 
Equity income, net – related partiesEquity income, net – related parties42,324 48,464 81,345 98,071 
Equity income, net – related parties
Equity income, net – related parties
Operating expenses
Operating expenses
Operating expensesOperating expenses
Cost of productCost of product44,746 148,556 96,205 221,404 
Cost of product
Cost of product
Operation and maintenance
Operation and maintenance
Operation and maintenanceOperation and maintenance183,431 168,153 357,670 297,129 
General and administrativeGeneral and administrative53,405 47,848 104,522 96,450 
General and administrative
General and administrative
Property and other taxes
Property and other taxes
Property and other taxesProperty and other taxes18,547 22,662 25,378 41,104 
Depreciation and amortizationDepreciation and amortization143,492 139,036 288,118 273,618 
Depreciation and amortization
Depreciation and amortization
Long-lived asset and other impairments (2)
Long-lived asset and other impairments (2)
Long-lived asset and other impairments (2)
Long-lived asset and other impairments (2)
234 90 52,635 90 
Total operating expenses (3)
Total operating expenses (3)
443,855 526,345 924,528 929,795 
Total operating expenses (3)
Total operating expenses (3)
Gain (loss) on divestiture and other, netGain (loss) on divestiture and other, net(70)(1,150)(2,188)(780)
Gain (loss) on divestiture and other, net
Gain (loss) on divestiture and other, net
Operating income (loss)
Operating income (loss)
Operating income (loss)Operating income (loss)336,672 397,388 626,884 802,212 
Interest expenseInterest expense(86,182)(80,772)(167,852)(166,227)
Interest expense
Interest expense
Gain (loss) on early extinguishment of debt
Gain (loss) on early extinguishment of debt
Gain (loss) on early extinguishment of debtGain (loss) on early extinguishment of debt6,813 91 6,813 91 
Other income (expense), netOther income (expense), net2,872 (45)4,087 61 
Other income (expense), net
Other income (expense), net
Income (loss) before income taxes
Income (loss) before income taxes
Income (loss) before income taxesIncome (loss) before income taxes260,175 316,662 469,932 636,137 
Income tax expense (benefit)Income tax expense (benefit)659 1,491 2,075 3,296 
Income tax expense (benefit)
Income tax expense (benefit)
Net income (loss)
Net income (loss)
Net income (loss)Net income (loss)259,516 315,171 467,857 632,841 
Net income (loss) attributable to noncontrolling interestsNet income (loss) attributable to noncontrolling interests6,595 8,854 11,291 17,807 
Net income (loss) attributable to noncontrolling interests
Net income (loss) attributable to noncontrolling interests
Net income (loss) attributable to Western Midstream Partners, LP
Net income (loss) attributable to Western Midstream Partners, LP
Net income (loss) attributable to Western Midstream Partners, LPNet income (loss) attributable to Western Midstream Partners, LP$252,921 $306,317 $456,566 $615,034 
Limited partners’ interest in net income (loss):Limited partners’ interest in net income (loss):
Limited partners’ interest in net income (loss):
Limited partners’ interest in net income (loss):
Net income (loss) attributable to Western Midstream Partners, LP
Net income (loss) attributable to Western Midstream Partners, LP
Net income (loss) attributable to Western Midstream Partners, LPNet income (loss) attributable to Western Midstream Partners, LP$252,921 $306,317 $456,566 $615,034 
General partner interest in net (income) lossGeneral partner interest in net (income) loss(5,821)(6,767)(10,507)(13,550)
General partner interest in net (income) loss
General partner interest in net (income) loss
Limited partners’ interest in net income (loss) (4)
Limited partners’ interest in net income (loss) (4)
Limited partners’ interest in net income (loss) (4)
Limited partners’ interest in net income (loss) (4)
247,100 299,550 446,059 601,484 
Net income (loss) per common unit – basic (4)
Net income (loss) per common unit – basic (4)
$0.64 $0.74 $1.16 $1.49 
Net income (loss) per common unit – basic (4)
Net income (loss) per common unit – basic (4)
Net income (loss) per common unit – diluted (4)
Net income (loss) per common unit – diluted (4)
Net income (loss) per common unit – diluted (4)
Net income (loss) per common unit – diluted (4)
$0.64 $0.74 $1.16 $1.49 
Weighted-average common units outstanding – basic (4)
Weighted-average common units outstanding – basic (4)
384,614 403,027 384,542 403,140 
Weighted-average common units outstanding – basic (4)
Weighted-average common units outstanding – basic (4)
Weighted-average common units outstanding – diluted (4)
Weighted-average common units outstanding – diluted (4)
385,510 404,162 385,665 404,280 
Weighted-average common units outstanding – diluted (4)
Weighted-average common units outstanding – diluted (4)

(1)Total revenues and other includes related-party amounts of $441.6$499.8 million and $890.4$448.8 million for the three and six months ended June 30,March 31, 2024 and 2023, respectively, and $456.8 million and $885.5 million for the three and six months ended June 30, 2022, respectively. See Note 56.
(2)See Note 78.
(3)Total operating expenses includes related-party amounts of $(14.1)$(26.0) million and $(17.2)$(3.1) million for the three and six months ended June 30,March 31, 2024 and 2023, respectively, and $(11.2) million and $(28.8) million for the three and six months ended June 30, 2022, respectively, all primarily related to changes in imbalance positions. See Note 56.
(4)See Note 4.5.
See accompanying Notes to Consolidated Financial Statements.
6

Table of Contents
WESTERN MIDSTREAM PARTNERS, LP
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
thousands except number of unitsthousands except number of unitsJune 30,
2023
December 31,
2022
thousands except number of units
thousands except number of unitsMarch 31,
2024
December 31,
2023
ASSETSASSETS
Current assetsCurrent assets
Current assets
Current assets
Cash and cash equivalents
Cash and cash equivalents
Cash and cash equivalentsCash and cash equivalents$213,953 $286,656 
Accounts receivable, netAccounts receivable, net554,222 554,263 
Other current assetsOther current assets29,028 59,506 
Total current assetsTotal current assets797,203 900,425 
Property, plant, and equipmentProperty, plant, and equipment
Cost
Cost
CostCost13,740,911 13,365,593 
Less accumulated depreciationLess accumulated depreciation5,139,941 4,823,993 
Net property, plant, and equipmentNet property, plant, and equipment8,600,970 8,541,600 
GoodwillGoodwill4,783 4,783 
Other intangible assetsOther intangible assets697,241 713,075 
Equity investmentsEquity investments920,123 944,696 
Other assets (1)
Other assets (1)
198,630 167,049 
Total assets (2)
Total assets (2)
$11,218,950 $11,271,628 
LIABILITIES, EQUITY, AND PARTNERS’ CAPITALLIABILITIES, EQUITY, AND PARTNERS’ CAPITAL
Current liabilitiesCurrent liabilities
Current liabilities
Current liabilities
Accounts and imbalance payables
Accounts and imbalance payables
Accounts and imbalance payablesAccounts and imbalance payables$359,298 $360,562 
Short-term debt
Short-term debt
2,532 215,780 
Accrued ad valorem taxesAccrued ad valorem taxes35,827 72,875 
Accrued liabilitiesAccrued liabilities223,887 254,640 
Total current liabilitiesTotal current liabilities621,544 903,857 
Long-term liabilitiesLong-term liabilities
Long-term debt
Long-term debt
6,824,214 6,569,582 
Long-term debt
Long-term debt
Deferred income taxesDeferred income taxes15,279 14,424 
Asset retirement obligationsAsset retirement obligations301,975 290,021 
Other liabilitiesOther liabilities433,775 385,629 
Total long-term liabilities
Total long-term liabilities
7,575,243 7,259,656 
Total liabilities (3)
Total liabilities (3)
8,196,787 8,163,513 
Equity and partners’ capitalEquity and partners’ capital
Common units (384,613,934 and 384,070,984 units issued and outstanding at June 30, 2023, and December 31, 2022, respectively)2,888,745 2,969,604 
General partner units (9,060,641 units issued and outstanding at June 30, 2023, and December 31, 2022)322 2,105 
Common units (380,490,138 and 379,519,983 units issued and outstanding at March 31, 2024, and December 31, 2023, respectively)
Common units (380,490,138 and 379,519,983 units issued and outstanding at March 31, 2024, and December 31, 2023, respectively)
Common units (380,490,138 and 379,519,983 units issued and outstanding at March 31, 2024, and December 31, 2023, respectively)
General partner units (9,060,641 units issued and outstanding at March 31, 2024, and December 31, 2023)
Total partners’ capitalTotal partners’ capital2,889,067 2,971,709 
Noncontrolling interestsNoncontrolling interests133,096 136,406 
Total equity and partners’ capitalTotal equity and partners’ capital3,022,163 3,108,115 
Total liabilities, equity, and partners’ capitalTotal liabilities, equity, and partners’ capital$11,218,950 $11,271,628 

(1)Other assets includes $3.7$5.5 million and $6.5$5.7 million of NGLs line-fill inventory as of June 30, 2023,March 31, 2024, and December 31, 2022,2023, respectively. Other assets also includes $78.4$107.1 million and $60.4$96.3 million of materials and supplies inventory as of June 30, 2023,March 31, 2024, and December 31, 2022,2023, respectively.
(2)Total assets includes related-party amounts of $982.6 million and $1.3 billion as of June 30, 2023,March 31, 2024, and December 31, 2022,2023, respectively, which includes related-party Accounts receivable, net of $346.7$389.7 million and $313.9$358.1 million as of June 30, 2023,March 31, 2024, and December 31, 2022,2023, respectively. See Note 56.
(3)Total liabilities includes related-party amounts of $346.1$406.4 million and $312.3$378.8 million as of June 30, 2023,March 31, 2024, and December 31, 2022,2023, respectively. See Note 56.

See accompanying Notes to Consolidated Financial Statements.
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Table of Contents
WESTERN MIDSTREAM PARTNERS, LP
CONSOLIDATED STATEMENTS OF EQUITY AND PARTNERS’ CAPITAL
(UNAUDITED)
Partners’ Capital
Partners’ Capital
thousands
thousands
thousandsthousandsCommon
Units
General Partner
Units
Noncontrolling
Interests
TotalCommon
Units
General Partner
Units
Noncontrolling
Interests
Total
Balance at December 31, 2022$2,969,604 $2,105 $136,406 $3,108,115 
Net income (loss)198,959 4,686 4,696 208,341 
Distributions to Chipeta noncontrolling interest owner— — (2,240)(2,240)
Distributions to noncontrolling interest owner of WES Operating— — (4,271)(4,271)
Distributions to Partnership unitholders(192,039)(4,530)— (196,569)
Unit repurchases (1)
(7,061)— — (7,061)
Equity-based compensation expense
7,199 — — 7,199 
Other(11,950)— — (11,950)
Balance at March 31, 2023$2,964,712 $2,261 $134,591 $3,101,564 
Net income (loss)247,100 5,821 6,595 259,516 
Distributions to Chipeta noncontrolling interest owner  (1,230)(1,230)
Distributions to noncontrolling interest owner of WES Operating  (6,860)(6,860)
Distributions to Partnership unitholders(329,227)(7,760) (336,987)
Unit repurchases (1)
(41)  (41)
Equity-based compensation expense
7,665   7,665 
Other(1,464)  (1,464)
Balance at June 30, 2023$2,888,745 $322 $133,096 $3,022,163 
Balance at December 31, 2023
Balance at December 31, 2023
Balance at December 31, 2023
Net income (loss)
Distributions to Chipeta noncontrolling interest owner
Distributions to noncontrolling interest owner of WES Operating
Distributions to Partnership unitholders
Equity-based compensation expense
Equity-based compensation expense
Equity-based compensation expense
Other
Other
Other
Balance at March 31, 2024

Partners’ Capital
thousandsCommon
Units
General Partner
Units
Noncontrolling
Interests
Total
Balance at December 31, 2022$2,969,604 $2,105 $136,406 $3,108,115 
Net income (loss)198,959 4,686 4,696 208,341 
Distributions to Chipeta noncontrolling interest owner— — (2,240)(2,240)
Distributions to noncontrolling interest owner of WES Operating— — (4,271)(4,271)
Distributions to Partnership unitholders(192,039)(4,530)— (196,569)
Unit repurchases (1)
(7,061)— — (7,061)
Equity-based compensation expense
7,199 — — 7,199 
Other(11,950)— — (11,950)
Balance at March 31, 2023$2,964,712 $2,261 $134,591 $3,101,564 

(1)See Note 45.

Partners’ Capital
thousandsCommon
Units
General Partner
Units
Noncontrolling
Interests
Total
Balance at December 31, 2021$2,966,955 $(8,882)$137,687 $3,095,760 
Net income (loss)301,934 6,783 8,953 317,670 
Distributions to Chipeta noncontrolling interest owner— — (1,984)(1,984)
Distributions to noncontrolling interest owner of WES Operating— — (2,805)(2,805)
Distributions to Partnership unitholders(131,786)(2,963)— (134,749)
Unit repurchases (1)
(5,149)— — (5,149)
Contributions of equity-based compensation from Occidental
1,949 — — 1,949 
Equity-based compensation expense
5,794 — — 5,794 
Net contributions from (distributions to) related parties409 — — 409 
Other(6,088)— — (6,088)
Balance at March 31, 2022$3,134,018 $(5,062)$141,851 $3,270,807 
Net income (loss)299,550 6,767 8,854 315,171 
Distributions to Chipeta noncontrolling interest owner— — (1,198)(1,198)
Distributions to noncontrolling interest owner of WES Operating— — (6,007)(6,007)
Distributions to Partnership unitholders(201,667)(4,530)— (206,197)
Unit repurchases (1)
(74,068)— — (74,068)
Contributions of equity-based compensation from Occidental
241 — — 241 
Equity-based compensation expense
6,797 — — 6,797 
Net contributions from (distributions to) related parties375 — — 375 
Other(918)— — (918)
Balance at June 30, 2022$3,164,328 $(2,825)$143,500 $3,305,003 

(1)See Note 4.

See accompanying Notes to Consolidated Financial Statements.
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Table of Contents
WESTERN MIDSTREAM PARTNERS, LP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Six Months Ended 
June 30,
thousandsthousands20232022
thousands
thousands
Cash flows from operating activities
Cash flows from operating activities
Cash flows from operating activitiesCash flows from operating activities
Net income (loss)Net income (loss)$467,857 $632,841 
Net income (loss)
Net income (loss)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Adjustments to reconcile net income (loss) to net cash provided by operating activities:Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortizationDepreciation and amortization288,118 273,618 
Depreciation and amortization
Depreciation and amortization
Long-lived asset and other impairments
Long-lived asset and other impairments
Long-lived asset and other impairments
Long-lived asset and other impairments
52,635 90 
Non-cash equity-based compensation expense
Non-cash equity-based compensation expense
14,864 14,781 
Non-cash equity-based compensation expense
Non-cash equity-based compensation expense
Deferred income taxes
Deferred income taxes
Deferred income taxesDeferred income taxes855 1,920 
Accretion and amortization of long-term obligations, net
Accretion and amortization of long-term obligations, net
4,095 3,586 
Accretion and amortization of long-term obligations, net
Accretion and amortization of long-term obligations, net
Equity income, net – related parties
Equity income, net – related parties
Equity income, net – related partiesEquity income, net – related parties(81,345)(98,071)
Distributions from equity-investment earnings – related parties
Distributions from equity-investment earnings – related parties
82,871 96,404 
Distributions from equity-investment earnings – related parties
Distributions from equity-investment earnings – related parties
(Gain) loss on divestiture and other, net(Gain) loss on divestiture and other, net2,188 780 
(Gain) loss on divestiture and other, net
(Gain) loss on divestiture and other, net
(Gain) loss on early extinguishment of debt
(Gain) loss on early extinguishment of debt
(Gain) loss on early extinguishment of debt(Gain) loss on early extinguishment of debt(6,813)(91)
OtherOther399 136 
Other
Other
Changes in assets and liabilities:
Changes in assets and liabilities:
Changes in assets and liabilities:Changes in assets and liabilities:
(Increase) decrease in accounts receivable, net(Increase) decrease in accounts receivable, net41 (279,830)
(Increase) decrease in accounts receivable, net
(Increase) decrease in accounts receivable, net
Increase (decrease) in accounts and imbalance payables and accrued liabilities, net
Increase (decrease) in accounts and imbalance payables and accrued liabilities, net
Increase (decrease) in accounts and imbalance payables and accrued liabilities, netIncrease (decrease) in accounts and imbalance payables and accrued liabilities, net(99,575)82,909 
Change in other items, netChange in other items, net67,057 14,366 
Change in other items, net
Change in other items, net
Net cash provided by operating activities
Net cash provided by operating activities
Net cash provided by operating activitiesNet cash provided by operating activities793,247 743,439 
Cash flows from investing activitiesCash flows from investing activities
Cash flows from investing activities
Cash flows from investing activities
Capital expenditures
Capital expenditures
Capital expendituresCapital expenditures(334,570)(191,357)
Acquisitions from third parties
Acquisitions from third parties
Acquisitions from third parties
Contributions to equity investments – related partiesContributions to equity investments – related parties(132)(5,040)
Contributions to equity investments – related parties
Contributions to equity investments – related parties
Distributions from equity investments in excess of cumulative earnings – related parties
Distributions from equity investments in excess of cumulative earnings – related parties
Distributions from equity investments in excess of cumulative earnings – related partiesDistributions from equity investments in excess of cumulative earnings – related parties23,179 25,407 
Proceeds from the sale of assets to third partiesProceeds from the sale of assets to third parties 1,096 
Proceeds from the sale of assets to third parties
Proceeds from the sale of assets to third parties
(Increase) decrease in materials and supplies inventory and other(Increase) decrease in materials and supplies inventory and other(19,145)(1,053)
Net cash used in investing activities(330,668)(170,947)
(Increase) decrease in materials and supplies inventory and other
(Increase) decrease in materials and supplies inventory and other
Net cash provided by (used in) investing activities
Net cash provided by (used in) investing activities
Net cash provided by (used in) investing activities
Cash flows from financing activities
Cash flows from financing activities
Cash flows from financing activitiesCash flows from financing activities
Borrowings, net of debt issuance costsBorrowings, net of debt issuance costs956,225 634,010 
Borrowings, net of debt issuance costs
Borrowings, net of debt issuance costs
Repayments of debtRepayments of debt(918,332)(883,548)
Repayments of debt
Repayments of debt
Commercial paper borrowings (repayments), net
Commercial paper borrowings (repayments), net
Commercial paper borrowings (repayments), net
Increase (decrease) in outstanding checks
Increase (decrease) in outstanding checks
Increase (decrease) in outstanding checksIncrease (decrease) in outstanding checks(2,951)13,038 
Distributions to Partnership unitholders (1)
Distributions to Partnership unitholders (1)
(533,556)(340,946)
Distributions to Partnership unitholders (1)
Distributions to Partnership unitholders (1)
Distributions to Chipeta noncontrolling interest owner
Distributions to Chipeta noncontrolling interest owner
Distributions to Chipeta noncontrolling interest ownerDistributions to Chipeta noncontrolling interest owner(3,470)(3,182)
Distributions to noncontrolling interest owner of WES OperatingDistributions to noncontrolling interest owner of WES Operating(11,131)(8,812)
Net contributions from (distributions to) related parties 784 
Distributions to noncontrolling interest owner of WES Operating
Distributions to noncontrolling interest owner of WES Operating
Unit repurchases
Unit repurchases
Unit repurchasesUnit repurchases(7,102)(79,217)
OtherOther(14,965)(9,184)
Other
Other
Net cash provided by (used in) financing activities
Net cash provided by (used in) financing activities
Net cash provided by (used in) financing activitiesNet cash provided by (used in) financing activities(535,282)(677,057)
Net increase (decrease) in cash and cash equivalentsNet increase (decrease) in cash and cash equivalents(72,703)(104,565)
Net increase (decrease) in cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at beginning of period
Cash and cash equivalents at beginning of periodCash and cash equivalents at beginning of period286,656 201,999 
Cash and cash equivalents at end of periodCash and cash equivalents at end of period$213,953 $97,434 
Cash and cash equivalents at end of period
Cash and cash equivalents at end of period
Supplemental disclosures
Supplemental disclosures
Supplemental disclosuresSupplemental disclosures
Interest paid, net of capitalized interestInterest paid, net of capitalized interest$158,376 $181,790 
Interest paid, net of capitalized interest
Interest paid, net of capitalized interest
Income taxes paid (reimbursements received)
Income taxes paid (reimbursements received)
Income taxes paid (reimbursements received)Income taxes paid (reimbursements received)1,271 905 
Accrued capital expendituresAccrued capital expenditures116,466 51,878 
Accrued capital expenditures
Accrued capital expenditures

(1)Includes related-party amounts. See Note 56.

See accompanying Notes to Consolidated Financial Statements.
9

Table of Contents
WESTERN MIDSTREAM OPERATING, LP
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended 
June 30,
Six Months Ended 
June 30,
thousandsthousands2023202220232022
thousands
thousands
Revenues and other
Revenues and other
Revenues and otherRevenues and other
Service revenues – fee basedService revenues – fee based$661,506 $655,952 $1,309,373 $1,287,550 
Service revenues – fee based
Service revenues – fee based
Service revenues – product based
Service revenues – product based
Service revenues – product basedService revenues – product based46,956 70,498 93,766 111,365 
Product salesProduct sales29,659 149,736 68,684 235,325 
Product sales
Product sales
Other
Other
OtherOther152 233 432 476 
Total revenues and other (1)
Total revenues and other (1)
738,273 876,419 1,472,255 1,634,716 
Total revenues and other (1)
Total revenues and other (1)
Equity income, net – related parties
Equity income, net – related parties
Equity income, net – related partiesEquity income, net – related parties42,324 48,464 81,345 98,071 
Operating expensesOperating expenses
Operating expenses
Operating expenses
Cost of product
Cost of product
Cost of productCost of product44,746 148,556 96,205 221,404 
Operation and maintenanceOperation and maintenance183,431 168,153 357,670 297,129 
Operation and maintenance
Operation and maintenance
General and administrative
General and administrative
General and administrativeGeneral and administrative52,219 47,227 103,104 95,088 
Property and other taxesProperty and other taxes18,547 22,662 25,378 41,104 
Property and other taxes
Property and other taxes
Depreciation and amortizationDepreciation and amortization143,492 139,036 288,118 273,618 
Depreciation and amortization
Depreciation and amortization
Long-lived asset and other impairments (2)
Long-lived asset and other impairments (2)
Long-lived asset and other impairments (2)
Long-lived asset and other impairments (2)
234 90 52,635 90 
Total operating expenses (3)
Total operating expenses (3)
442,669 525,724 923,110 928,433 
Total operating expenses (3)
Total operating expenses (3)
Gain (loss) on divestiture and other, netGain (loss) on divestiture and other, net(70)(1,150)(2,188)(780)
Gain (loss) on divestiture and other, net
Gain (loss) on divestiture and other, net
Operating income (loss)
Operating income (loss)
Operating income (loss)Operating income (loss)337,858 398,009 628,302 803,574 
Interest expenseInterest expense(86,182)(80,772)(167,852)(166,227)
Interest expense
Interest expense
Gain (loss) on early extinguishment of debt
Gain (loss) on early extinguishment of debt
Gain (loss) on early extinguishment of debtGain (loss) on early extinguishment of debt6,813 91 6,813 91 
Other income (expense), netOther income (expense), net2,743 (49)3,933 54 
Other income (expense), net
Other income (expense), net
Income (loss) before income taxes
Income (loss) before income taxes
Income (loss) before income taxesIncome (loss) before income taxes261,232 317,279 471,196 637,492 
Income tax expense (benefit)Income tax expense (benefit)659 1,491 2,075 3,296 
Income tax expense (benefit)
Income tax expense (benefit)
Net income (loss)
Net income (loss)
Net income (loss)Net income (loss)260,573 315,788 469,121 634,196 
Net income (loss) attributable to noncontrolling interestNet income (loss) attributable to noncontrolling interest1,410 2,587 1,945 5,223 
Net income (loss) attributable to noncontrolling interest
Net income (loss) attributable to noncontrolling interest
Net income (loss) attributable to Western Midstream Operating, LPNet income (loss) attributable to Western Midstream Operating, LP$259,163 $313,201 $467,176 $628,973 
Net income (loss) attributable to Western Midstream Operating, LP
Net income (loss) attributable to Western Midstream Operating, LP

(1)Total revenues and other includes related-party amounts of $441.6$499.8 million and $890.4$448.8 million for the three and six months ended June 30,March 31, 2024 and 2023, respectively, and $456.8 million and $885.5 million for the three and six months ended June 30, 2022, respectively. See Note 56.
(2)See Note 78.
(3)Total operating expenses includes related-party amounts of $(13.4)$(24.7) million and $(15.3)$(1.9) million for the three and six months ended June 30,March 31, 2024 and 2023, respectively, and $(10.5) million and $(27.2) million for the three and six months ended June 30, 2022, respectively, all primarily related to changes in imbalance positions. See Note 56.

See accompanying Notes to Consolidated Financial Statements.
10

Table of Contents
WESTERN MIDSTREAM OPERATING, LP
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
thousands except number of unitsthousands except number of unitsJune 30,
2023
December 31,
2022
thousands except number of units
thousands except number of unitsMarch 31,
2024
December 31,
2023
ASSETSASSETS
Current assetsCurrent assets
Current assets
Current assets
Cash and cash equivalents
Cash and cash equivalents
Cash and cash equivalentsCash and cash equivalents$208,844 $286,101 
Accounts receivable, netAccounts receivable, net554,202 554,263 
Other current assetsOther current assets27,696 57,291 
Total current assetsTotal current assets790,742 897,655 
Property, plant, and equipmentProperty, plant, and equipment
Cost
Cost
CostCost13,740,911 13,365,593 
Less accumulated depreciationLess accumulated depreciation5,139,941 4,823,993 
Net property, plant, and equipmentNet property, plant, and equipment8,600,970 8,541,600 
GoodwillGoodwill4,783 4,783 
Other intangible assetsOther intangible assets697,241 713,075 
Equity investmentsEquity investments920,123 944,696 
Other assets (1)
Other assets (1)
196,875 166,450 
Total assets (2)
Total assets (2)
$11,210,734 $11,268,259 
LIABILITIES, EQUITY, AND PARTNERS’ CAPITALLIABILITIES, EQUITY, AND PARTNERS’ CAPITAL
Current liabilitiesCurrent liabilities
Current liabilities
Current liabilities
Accounts and imbalance payables
Accounts and imbalance payables
Accounts and imbalance payablesAccounts and imbalance payables$367,132 $404,468 
Short-term debt
Short-term debt
2,532 215,780 
Accrued ad valorem taxesAccrued ad valorem taxes35,827 72,875 
Accrued liabilitiesAccrued liabilities187,828 197,289 
Total current liabilitiesTotal current liabilities593,319 890,412 
Total current liabilities
Total current liabilities
Long-term liabilitiesLong-term liabilities
Long-term debt
Long-term debt
Long-term debt
Long-term debt
6,824,214 6,569,582 
Deferred income taxesDeferred income taxes15,279 14,424 
Asset retirement obligationsAsset retirement obligations301,975 290,021 
Other liabilitiesOther liabilities432,020 383,713 
Total long-term liabilities
Total long-term liabilities
7,573,488 7,257,740 
Total liabilities (3)
Total liabilities (3)
8,166,807 8,148,152 
Equity and partners’ capitalEquity and partners’ capital
Common units (318,675,578 units issued and outstanding at June 30, 2023, and December 31, 2022)3,017,357 3,092,012 
Common units (318,675,578 units issued and outstanding at March 31, 2024, and December 31, 2023)
Common units (318,675,578 units issued and outstanding at March 31, 2024, and December 31, 2023)
Common units (318,675,578 units issued and outstanding at March 31, 2024, and December 31, 2023)
Total partners’ capital
Total partners’ capital
Total partners’ capitalTotal partners’ capital3,017,357 3,092,012 
Noncontrolling interestNoncontrolling interest26,570 28,095 
Total equity and partners’ capitalTotal equity and partners’ capital3,043,927 3,120,107 
Total liabilities, equity, and partners’ capitalTotal liabilities, equity, and partners’ capital$11,210,734 $11,268,259 

(1)Other assets includes $3.7$5.5 million and $6.5$5.7 million of NGLs line-fill inventory as of June 30, 2023,March 31, 2024, and December 31, 2022,2023, respectively. Other assets also includes $78.4$107.1 million and $60.4$96.3 million of materials and supplies inventory as of June 30, 2023,March 31, 2024, and December 31, 2022,2023, respectively.
(2)Total assets includes related-party amounts of $997.3 million and $1.3 billion as of June 30, 2023,March 31, 2024, and December 31, 2022,2023, respectively, which includes related-party Accounts receivable, net of $346.7$407.9 million and $313.9$358.1 million as of June 30, 2023,March 31, 2024, and December 31, 2022,2023, respectively. See Note 56.
(3)Total liabilities includes related-party amounts of $353.8$406.0 million and $356.0$409.5 million as of June 30, 2023,March 31, 2024, and December 31, 2022,2023, respectively. See Note 56.
See accompanying Notes to Consolidated Financial Statements.
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Table of Contents
WESTERN MIDSTREAM OPERATING, LP
CONSOLIDATED STATEMENTS OF EQUITY AND PARTNERS’ CAPITAL
(UNAUDITED)
thousandsthousandsCommon
Units
Noncontrolling
Interest
TotalthousandsCommon
Units
Noncontrolling
Interest
Total
Balance at December 31, 2022$3,092,012 $28,095 $3,120,107 
Net income (loss)208,013 535 208,548 
Distributions to Chipeta noncontrolling interest owner— (2,240)(2,240)
Distributions to WES Operating unitholders(213,513)— (213,513)
Contributions of equity-based compensation from WES
7,058 — 7,058 
Balance at March 31, 2023$3,093,570 $26,390 $3,119,960 
Net income (loss)259,163 1,410 260,573 
Distributions to Chipeta noncontrolling interest owner (1,230)(1,230)
Distributions to WES Operating unitholders(342,895) (342,895)
Contributions of equity-based compensation from WES
7,519  7,519 
Balance at June 30, 2023$3,017,357 $26,570 $3,043,927 
Balance at December 31, 2023
Balance at December 31, 2023
Balance at December 31, 2023
Net income (loss)
Distributions to Chipeta noncontrolling interest owner
Distributions to WES Operating unitholders
Contributions of equity-based compensation from WES
Balance at March 31, 2024
Balance at March 31, 2024
Balance at March 31, 2024


thousandsthousandsCommon
Units
Noncontrolling
Interest
TotalthousandsCommon
Units
Noncontrolling
Interest
Total
Balance at December 31, 2021$3,063,289 $29,377 $3,092,666 
Net income (loss)315,772 2,636 318,408 
Distributions to Chipeta noncontrolling interest owner— (1,984)(1,984)
Distributions to WES Operating unitholders(140,217)— (140,217)
Contributions of equity-based compensation from Occidental
1,949 — 1,949 
Contributions of equity-based compensation from WES
5,663 — 5,663 
Net contributions from (distributions to) related parties409 — 409 
Balance at March 31, 2022$3,246,865 $30,029 $3,276,894 
Net income (loss)313,201 2,587 315,788 
Distributions to Chipeta noncontrolling interest owner— (1,198)(1,198)
Distributions to WES Operating unitholders(300,248)— (300,248)
Contributions of equity-based compensation from Occidental
241 — 241 
Contributions of equity-based compensation from WES
6,652 — 6,652 
Net contributions from (distributions to) related parties375 — 375 
Balance at June 30, 2022$3,267,086 $31,418 $3,298,504 
Balance at December 31, 2022
Balance at December 31, 2022
Balance at December 31, 2022
Net income (loss)
Distributions to Chipeta noncontrolling interest owner
Distributions to WES Operating unitholders
Contributions of equity-based compensation from WES
Contributions of equity-based compensation from WES
Contributions of equity-based compensation from WES
Balance at March 31, 2023
Balance at March 31, 2023
Balance at March 31, 2023
See accompanying Notes to Consolidated Financial Statements.
12

Table of Contents
WESTERN MIDSTREAM OPERATING, LP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Six Months Ended 
June 30,
thousandsthousands20232022
thousands
thousands
Cash flows from operating activities
Cash flows from operating activities
Cash flows from operating activitiesCash flows from operating activities
Net income (loss)Net income (loss)$469,121 $634,196 
Net income (loss)
Net income (loss)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Adjustments to reconcile net income (loss) to net cash provided by operating activities:Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortizationDepreciation and amortization288,118 273,618 
Depreciation and amortization
Depreciation and amortization
Long-lived asset and other impairments
Long-lived asset and other impairments
Long-lived asset and other impairments
Long-lived asset and other impairments
52,635 90 
Non-cash equity-based compensation expense
Non-cash equity-based compensation expense
14,577 14,505 
Non-cash equity-based compensation expense
Non-cash equity-based compensation expense
Deferred income taxes
Deferred income taxes
Deferred income taxesDeferred income taxes855 1,920 
Accretion and amortization of long-term obligations, net
Accretion and amortization of long-term obligations, net
4,095 3,586 
Accretion and amortization of long-term obligations, net
Accretion and amortization of long-term obligations, net
Equity income, net – related parties
Equity income, net – related parties
Equity income, net – related partiesEquity income, net – related parties(81,345)(98,071)
Distributions from equity-investment earnings – related parties
Distributions from equity-investment earnings – related parties
82,871 96,404 
Distributions from equity-investment earnings – related parties
Distributions from equity-investment earnings – related parties
(Gain) loss on divestiture and other, net
(Gain) loss on divestiture and other, net
(Gain) loss on divestiture and other, net(Gain) loss on divestiture and other, net2,188 780 
(Gain) loss on early extinguishment of debt(Gain) loss on early extinguishment of debt(6,813)(91)
(Gain) loss on early extinguishment of debt
(Gain) loss on early extinguishment of debt
Other
Other
OtherOther399 136 
Changes in assets and liabilities:Changes in assets and liabilities:
Changes in assets and liabilities:
Changes in assets and liabilities:
(Increase) decrease in accounts receivable, net
(Increase) decrease in accounts receivable, net
(Increase) decrease in accounts receivable, net(Increase) decrease in accounts receivable, net61 (279,830)
Increase (decrease) in accounts and imbalance payables and accrued liabilities, netIncrease (decrease) in accounts and imbalance payables and accrued liabilities, net(114,355)74,551 
Increase (decrease) in accounts and imbalance payables and accrued liabilities, net
Increase (decrease) in accounts and imbalance payables and accrued liabilities, net
Change in other items, net
Change in other items, net
Change in other items, netChange in other items, net67,490 14,889 
Net cash provided by operating activitiesNet cash provided by operating activities779,897 736,683 
Net cash provided by operating activities
Net cash provided by operating activities
Cash flows from investing activities
Cash flows from investing activities
Cash flows from investing activitiesCash flows from investing activities
Capital expendituresCapital expenditures(334,570)(191,357)
Capital expenditures
Capital expenditures
Acquisitions from third parties
Acquisitions from third parties
Acquisitions from third parties
Contributions to equity investments – related partiesContributions to equity investments – related parties(132)(5,040)
Contributions to equity investments – related parties
Contributions to equity investments – related parties
Distributions from equity investments in excess of cumulative earnings – related parties
Distributions from equity investments in excess of cumulative earnings – related parties
Distributions from equity investments in excess of cumulative earnings – related partiesDistributions from equity investments in excess of cumulative earnings – related parties23,179 25,407 
Proceeds from the sale of assets to third partiesProceeds from the sale of assets to third parties 1,096 
Proceeds from the sale of assets to third parties
Proceeds from the sale of assets to third parties
(Increase) decrease in materials and supplies inventory and other(Increase) decrease in materials and supplies inventory and other(19,145)(1,053)
Net cash used in investing activities(330,668)(170,947)
(Increase) decrease in materials and supplies inventory and other
(Increase) decrease in materials and supplies inventory and other
Net cash provided by (used in) investing activities
Net cash provided by (used in) investing activities
Net cash provided by (used in) investing activities
Cash flows from financing activities
Cash flows from financing activities
Cash flows from financing activitiesCash flows from financing activities
Borrowings, net of debt issuance costsBorrowings, net of debt issuance costs956,225 634,010 
Borrowings, net of debt issuance costs
Borrowings, net of debt issuance costs
Repayments of debtRepayments of debt(918,332)(883,548)
Repayments of debt
Repayments of debt
Commercial paper borrowings (repayments), net
Commercial paper borrowings (repayments), net
Commercial paper borrowings (repayments), net
Increase (decrease) in outstanding checks
Increase (decrease) in outstanding checks
Increase (decrease) in outstanding checksIncrease (decrease) in outstanding checks(2,951)13,142 
Distributions to WES Operating unitholders (1)
Distributions to WES Operating unitholders (1)
(556,408)(440,465)
Distributions to WES Operating unitholders (1)
Distributions to WES Operating unitholders (1)
Distributions to Chipeta noncontrolling interest ownerDistributions to Chipeta noncontrolling interest owner(3,470)(3,182)
Net contributions from (distributions to) related parties 784 
Distributions to Chipeta noncontrolling interest owner
Distributions to Chipeta noncontrolling interest owner
Other
Other
OtherOther(1,550)(2,177)
Net cash provided by (used in) financing activitiesNet cash provided by (used in) financing activities(526,486)(681,436)
Net cash provided by (used in) financing activities
Net cash provided by (used in) financing activities
Net increase (decrease) in cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Net increase (decrease) in cash and cash equivalentsNet increase (decrease) in cash and cash equivalents(77,257)(115,700)
Cash and cash equivalents at beginning of periodCash and cash equivalents at beginning of period286,101 195,598 
Cash and cash equivalents at beginning of period
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of periodCash and cash equivalents at end of period$208,844 $79,898 
Cash and cash equivalents at end of period
Cash and cash equivalents at end of period
Supplemental disclosures
Supplemental disclosures
Supplemental disclosuresSupplemental disclosures
Interest paid, net of capitalized interestInterest paid, net of capitalized interest$158,376 $181,790 
Interest paid, net of capitalized interest
Interest paid, net of capitalized interest
Income taxes paid (reimbursements received)
Income taxes paid (reimbursements received)
Income taxes paid (reimbursements received)Income taxes paid (reimbursements received)1,271 905 
Accrued capital expendituresAccrued capital expenditures116,466 51,878 
Accrued capital expenditures
Accrued capital expenditures

(1)Includes related-party amounts. See Note 5.6.
See accompanying Notes to Consolidated Financial Statements.
13

Table of Contents
WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

General. Western Midstream Partners, LP is a Delaware master limited partnership formed in September 2012. Western Midstream Operating, LP (together with its subsidiaries, “WES Operating”) is a Delaware limited partnership formed in 2007 to acquire, own, develop, and operate midstream assets. Western Midstream Partners, LP owns, directly and indirectly, a 98.0% limited partner interest in WES Operating, and directly owns all of the outstanding equity interests of Western Midstream Operating GP, LLC, which holds the entire non-economic general partner interest in WES Operating.
For purposes of these consolidated financial statements, the “Partnership” refers to Western Midstream Partners, LP in its individual capacity or to Western Midstream Partners, LP and its subsidiaries, including Western Midstream Operating GP, LLC and WES Operating, as the context requires. “WES Operating GP” refers to Western Midstream Operating GP, LLC, individually as the general partner of WES Operating. The Partnership’s general partner, Western Midstream Holdings, LLC (the “general partner”), is a wholly owned subsidiary of Occidental Petroleum Corporation. “Occidental” refers to Occidental Petroleum Corporation, as the context requires, and its subsidiaries, excluding the general partner. “Anadarko” refers to Anadarko Petroleum Corporation and its subsidiaries, excluding Western Midstream Holdings, LLC. Anadarko became a wholly owned subsidiary of Occidental as a result of Occidental’s acquisition by merger of Anadarko on August 8, 2019. “Related parties” refers to Occidental (see Note 56), the Partnership’s investments accounted for under the equity method of accounting (see Note 67), and the Partnership and WES Operating for transactions that eliminate upon consolidation (see Note 56).
The Partnership is engaged in the business of gathering, compressing, treating, processing, and transporting natural gas; gathering, stabilizing, and transporting condensate, natural-gas liquids (“NGLs”), and crude oil; and gathering and disposing of produced water. In its capacity as a natural-gas processor, the Partnership also buys and sells natural gas, NGLs, and condensate on behalf of itself and as an agent for its customers under certain contracts. As of June 30, 2023,March 31, 2024, the Partnership’s assets and investments consisted of the following:
Wholly
Owned and
Operated
Operated
Interests
Non-Operated
Interests
Equity
Interests
Wholly
Owned and
Operated
Wholly
Owned and
Operated
Wholly
Owned and
Operated
Gathering systems (1)
Gathering systems (1)
Gathering systems (1)
Gathering systems (1)
17 
Treating facilitiesTreating facilities37 — — 
Treating facilities
Treating facilities
Natural-gas processing plants/trains
Natural-gas processing plants/trains
Natural-gas processing plants/trains
Natural-gas processing plants/trains
25 — 
NGLs pipelinesNGLs pipelines— — 
NGLs pipelines
NGLs pipelines
Natural-gas pipelines
Natural-gas pipelines
Natural-gas pipelines
Natural-gas pipelines
— — 
Crude-oil pipelines
Crude-oil pipelines
— 
Crude-oil pipelines
Crude-oil pipelines

(1)Includes the DBM water systems.

These assets and investments are located in Texas, New Mexico, the Rocky Mountains (Colorado, Utah, and Wyoming), and North-central Pennsylvania.

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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Basis of presentation. The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and include the accounts of the Partnership and entities in which it holds a controlling financial interest, including WES Operating, WES Operating GP, proportionately consolidated interests, and equity investments (see table below). All significant intercompany transactions have been eliminated.
The following table outlines the ownership interests and the accounting method of consolidation used in the consolidated financial statements for entities not wholly owned (see Note 6)7):
Percentage Interest
Full consolidation
Chipeta (1)
75.00 %
Proportionate consolidation (2)
Springfield system50.10 %
Marcellus Interest systems33.75 %
Equity investments (3)
Mi Vida JV LLC (“Mi Vida”)50.00 %
Front Range Pipeline LLC (“FRP”)33.33 %
Red Bluff Express Pipeline, LLC (“Red Bluff Express”)30.00%
Enterprise EF78 LLC (“Mont Belvieu JV”)25.00 %
Rendezvous Gas Services, LLC (“Rendezvous”)22.00 %
Texas Express Pipeline LLC (“TEP”)20.00 %
Texas Express Gathering LLC (“TEG”)20.00%
Whitethorn Pipeline Company LLC (“Whitethorn LLC”)20.00 %
Saddlehorn Pipeline Company, LLC (“Saddlehorn”)20.00 %
Panola Pipeline Company, LLC (“Panola”)15.00 %
White Cliffs Pipeline, LLC (“White Cliffs”)10.00 %

(1)The 25% third-party interest in Chipeta Processing LLC (“Chipeta”) is reflected within noncontrolling interests in the consolidated financial statements. See Noncontrolling interests below.
(2)The Partnership proportionately consolidates its associated share of the assets, liabilities, revenues, and expenses attributable to these assets.
(3)Investments in non-controlled entities over which the Partnership exercises significant influence are accounted for under the equity method of accounting. “Equity-investment throughput” refers to the Partnership’s share of average throughput for these investments.

Certain information and note disclosures commonly included in annual financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, the accompanying consolidated financial statements and notes should be read in conjunction with the Partnership’s 20222023 Form 10-K, as filed with the SEC on February 22, 2023.21, 2024. Management believes that the disclosures made are adequate to make the information not misleading.
The consolidated financial results of WES Operating are included in the Partnership’s consolidated financial statements. Throughout these notes to consolidated financial statements, and to the extent material, any differences between the consolidated financial results of the Partnership and WES Operating are discussed separately. The Partnership’s consolidated financial statements differ from those of WES Operating primarily as a result of (i) the presentation of noncontrolling interest ownership (see Noncontrolling interests below), (ii) the elimination of WES Operating GP’s investment in WES Operating with WES Operating GP’s underlying capital account, (iii) the general and administrative expenses incurred by the Partnership, which are separate from, and in addition to, those incurred by WES Operating, (iv) the inclusion of the impact of Partnership equity balances and Partnership distributions, and (v) transactions between the Partnership and WES Operating that eliminate upon consolidation.
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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Presentation of the Partnership’s assets. The Partnership’s assets include assets owned and ownership interests accounted for by the Partnership under the equity method of accounting, through its 98.0% partnership interest in WES Operating, as of June 30, 2023March 31, 2024 (see Note 67). The Partnership also owns and controls the entire non-economic general partner interest in WES Operating GP, and the Partnership’s general partner is owned by Occidental.

Use of estimates. In preparing financial statements in accordance with GAAP, management makes informed judgments and estimates that affect the reported amounts of assets, liabilities, revenues, and expenses. Management evaluates its estimates and related assumptions regularly, using historical experience and other reasonable methods. Changes in facts and circumstances or additional information may result in revised estimates, and actual results may differ from these estimates. Effects on the business, financial condition, and results of operations resulting from revisions to estimates are recognized when the facts that give rise to the revisions become known. The information included herein reflects all normal recurring adjustments which are, in the opinion of management, necessary for a fair presentation of the consolidated financial statements.

Noncontrolling interests. The Partnership’s noncontrolling interests in the consolidated financial statements consist of (i) the 25% third-party interest in Chipeta and (ii) the 2.0% limited partner interest in WES Operating owned by an Occidental subsidiary. WES Operating’s noncontrolling interest in the consolidated financial statements consists of the 25% third-party interest in Chipeta. See Note 4.5.

Segments. The Partnership’s operations continue to be organized into a single operating segment, the assets of which gather, compress, treat, process, and transport natural gas; gather, stabilize, and transport condensate, NGLs, and crude oil; and gather and dispose of produced water in the United States.
In November 2023, the Financial Accounting Standards Board issued Accounting Standards Update 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” The standard improves reportable segment disclosure requirements for public business entities primarily through enhanced disclosures about significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit (referred to as the “significant expense principle”). The standard will become effective for the Partnership for the fiscal year 2024 annual financial statements and interim financial statements thereafter and will be applied retrospectively for all prior periods presented in the financial statements, with early adoption permitted. The Partnership plans to adopt the standard when it becomes effective beginning with the fiscal year 2024 annual financial statements. The Partnership is currently evaluating the impact this guidance will have on disclosures in the Notes to Consolidated Financial Statements. This standard will have no impact to the Partnership’s financial statements, but will result in additional disclosure.

Equity-based compensation. During the sixthree months ended June 30, 2023,March 31, 2024, the Partnership issued 830,272970,155 common units under its long-term incentive plans. Compensation expense was $7.7$9.4 million and $14.9$7.2 million for the three and six months ended June 30,March 31, 2024 and 2023, respectively, and $6.8 million and $12.6 million for the three and six months ended June 30, 2022, respectively.

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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
2. REVENUE FROM CONTRACTS WITH CUSTOMERS

The following table summarizes revenue from contracts with customers:
Three Months Ended 
June 30,
Six Months Ended 
June 30,
thousandsthousands2023202220232022
thousands
thousands
Revenue from customers
Revenue from customers
Revenue from customersRevenue from customers
Service revenues – fee basedService revenues – fee based$661,506 $655,952 $1,309,373 $1,287,550 
Service revenues – fee based
Service revenues – fee based
Service revenues – product based
Service revenues – product based
Service revenues – product basedService revenues – product based46,956 70,498 93,766 111,365 
Product salesProduct sales29,659 149,736 68,684 235,325 
Product sales
Product sales
Total revenue from customersTotal revenue from customers738,121 876,1861,471,823 1,634,240
Total revenue from customers
Total revenue from customers
Revenue from other than customers
Revenue from other than customers
Revenue from other than customersRevenue from other than customers
OtherOther152 233 432 476 
Other
Other
Total revenues and otherTotal revenues and other$738,273 $876,419 $1,472,255 $1,634,716 
Total revenues and other
Total revenues and other

Contract balances. Receivables from customers, which are included in Accounts receivable, net on the consolidated balance sheets were $551.9$711.0 million and $545.0$661.6 million as of June 30, 2023,March 31, 2024, and December 31, 2022,2023, respectively.
Contract assets primarily relate to (i) revenue accrued but not yet billed under cost-of-service contracts with fixed and variable fees and (ii) accrued deficiency fees the Partnership expects to charge customers once the related performance periods are completed. The following table summarizes activity related to contract assets from contracts with customers:
thousands
Contract assets balance at December 31, 20222023$22,56139,292 
Amounts transferred to Accounts receivable, net that were included in the contract assets balance at the beginning of the period(1)
(2,688)(1,928)
Additional estimated revenues recognized(2)
7,3441,974 
Contract assets balance at June 30, 2023March 31, 2024$27,21739,338 
Contract assets at June 30, 2023March 31, 2024
Other current assets$9,3908,708 
Other assets17,82730,630 
Total contract assets from contracts with customers$27,21739,338 

(1)Includes $(1.4) million for the three months ended June 30, 2023.
(2)Includes $2.1 million for the three months ended June 30, 2023.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
2. REVENUE FROM CONTRACTS WITH CUSTOMERS

Contract liabilities primarily relate to (i) fixed and variable fees under cost-of-service contracts that are received from customers for which revenue recognition is deferred, (ii) aid-in-construction payments received from customers that must be recognized over the expected period of customer benefit, and (iii) fees that are charged to customers for only a portion of the contract term and must be recognized as revenues over the expected period of customer benefit. The following table summarizes activity related to contract liabilities from contracts with customers:
thousands
Contract liabilities balance at December 31, 20222023$369,285445,499 
Cash received or receivable, excluding revenues recognized during the period(1)
41,22636,960 
Revenues recognized that were included in the contract liability balance at the beginning of the period(2)
(13,818)(11,715)
Contract liabilities balance at June 30, 2023March 31, 2024$396,693470,744 
Contract liabilities at June 30, 2023March 31, 2024
Accrued liabilities$14,90511,875 
Other liabilities381,788458,869 
Total contract liabilities from contracts with customers$396,693470,744 

(1)Includes $17.5 million for the three months ended June 30, 2023.
(2)Includes $(3.6) million for the three months ended June 30, 2023.

Transaction price allocated to remaining performance obligations. Revenues expected to be recognized from certain performance obligations that are unsatisfied (or partially unsatisfied) as of June 30, 2023,March 31, 2024, are presented in the following table.table below. The Partnership applies the optional exemptions in Revenue from Contracts with Customers (Topic 606) and does not disclose consideration for remaining performance obligations with an original expected duration of one year or less or for variable consideration related to unsatisfied (or partially unsatisfied) performance obligations. Therefore, the following table represents only a portion of expected future revenues from existing contracts as most future revenues from customers are dependent on future variable customer volumes and, in some cases, variable commodity prices for those volumes.
thousandsthousands
Remainder of 2023$550,406 
20241,144,937 
Remainder of 2024
Remainder of 2024
Remainder of 2024
202520251,097,142 
20262026992,822 
20272027903,367 
2028
ThereafterThereafter2,513,102 
TotalTotal$7,201,776 

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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
3. ACQUISITIONS AND DIVESTITURES

Mont Belvieu JV, Whitethorn LLC, Panola, and Saddlehorn. During the first quarter of 2024, the Partnership closed on the sale of the following equity investments to third parties: (i) the 25.00% interest in Enterprise EF78 LLC (the “Mont Belvieu JV”), (ii) the 20.00% interest in Whitethorn Pipeline Company LLC (“Whitethorn LLC”), (iii) the 15.00% interest in Panola Pipeline Company, LLC (“Panola”), and (iv) the 20.00% interest in Saddlehorn Pipeline Company, LLC (“Saddlehorn”). The combined proceeds received in the first quarter of 2024 of $588.6 million includes $5.9 million in pro-rata distributions through closing, resulting in a net gain on sale of $239.7 million that was recorded as Gain (loss) on divestiture and other, net in the consolidated statement of operations. The sale of the interests in the Mont Belvieu JV and Whitethorn LLC also resolved outstanding legal proceedings associated with those assets.

Marcellus Interest systems. In April 2024, the Partnership closed on the sale of its 33.75% interest in the Marcellus Interest systems for proceeds of $206.2 million, resulting in an estimated net gain on sale of approximately $65.0 million that will be recorded as Gain (loss) on divestiture and other, net in the consolidated statement of operations during the second quarter of 2024. As of March 31, 2024, the Marcellus Interest systems satisfied criteria to be considered held for sale. At March 31, 2024, the consolidated balance sheet included current assets of $6.6 million, long-term assets of $142.7 million, current liabilities of $5.9 million, and long-term liabilities of $2.1 million associated with assets held for sale.

Meritage. On October 13, 2023, the Partnership closed on the acquisition of Meritage Midstream Services II, LLC (“Meritage”) for $885.0 million (subject to certain customary post-closing adjustments) funded with cash, including proceeds from the Partnership’s $600.0 million senior note issuance in September 2023 (see Note 10) and borrowings on the senior unsecured revolving credit facility (“RCF”). The cash purchase price, adjusted for working capital and certain customary post-closing adjustments and reduced by the $38.4 million of cash acquired (as presented in the table below), was $878.2 million.
The assets acquired, located in Converse, Campbell, and Johnson counties, Wyoming, include approximately 1,500 miles of high- and low-pressure natural-gas gathering pipelines, approximately 380 MMcf/d of natural-gas processing capacity, and the Thunder Creek NGL pipeline, which is a 120 mile, 38 MBbls/d FERC-regulated NGL pipeline that connects to the processing facility. The acquisition expands the Partnership’s existing Powder River Basin asset base, increasing total natural-gas processing capacity in that region to 440 MMcf/d.
The Meritage acquisition has been accounted for under the acquisition method of accounting. The assets acquired and liabilities assumed in the Meritage acquisition were recorded in the consolidated balance sheet at their estimated fair values as of the acquisition date. Results of operations attributable to the Meritage acquisition were included in the Partnership’s consolidated statements of operations beginning on the acquisition date in the fourth quarter of 2023.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
3. ACQUISITIONS AND DIVESTITURES

The following is the final acquisition-date fair value for the assets acquired and liabilities assumed in the Meritage acquisition on October 13, 2023.

thousands
Assets acquired:
Cash and cash equivalents$38,412 
Accounts receivable, net34,060 
Other current assets1,980 
Property, plant, and equipment926,347 
Other assets6,498 
Total assets acquired1,007,297 
Liabilities assumed:
Accounts payable and accrued liabilities34,733 
Other current liabilities5,451 
Asset retirement obligation22,156 
Other liabilities28,356 
Total liabilities assumed90,696 
Net assets acquired$916,601 

The acquisition-date fair values are based on an assessment of the fair value of the assets acquired and liabilities assumed in the Meritage acquisition using inputs that are not observable in the market and thus represent Level 3 inputs. The fair values of the processing plants, gathering system, and related facilities and equipment are based on market and cost approaches.

4. PARTNERSHIP DISTRIBUTIONS

Partnership distributions. Under its partnership agreement, the Partnership distributes all of its available cash to unitholders of record on the applicable record date within 55 days following each quarter’s end. The amount of available cash (beyond proper reserves as defined in the partnership agreement) generally is all cash on hand at the end of the quarter, plus, at the discretion of the general partner, working capital borrowings made subsequent to the end of such quarter, less the amount of cash reserves established by the general partner to provide for the proper conduct of the Partnership’s business, including (i) to fund future capital expenditures; (ii) to comply with applicable laws, debt instruments, or other agreements; or (iii) to provide funds for unitholder distributions for any one or more of the next four quarters. Working capital borrowings generally include borrowings made under a credit facility or similar financing arrangement and are intended to be repaid or refinanced within 12 months. In all cases, working capital borrowings are used solely for working capital purposes or to fund unitholder distributions.


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
4. PARTNERSHIP DISTRIBUTIONS

The Board of Directors of the general partner (the “Board”) declared the following cash distributions to the Partnership’s unitholders for the periods presented:
thousands except per-unit amounts
Quarters Ended
thousands except per-unit amounts
Quarters Ended
Total Quarterly
Per-unit
Distribution
Total Quarterly
Cash Distribution
Distribution
Date
Record
Date
thousands except per-unit amounts
Quarters Ended
Total Quarterly
Per-unit
Distribution
Total Quarterly
Cash Distribution
Distribution
Date
Record
Date
2022
March 31$0.500 $206,197 May 13, 2022May 2, 2022
2023
2023
2023
March 31 (1)
March 31 (1)
March 31 (1)
$0.856 $336,987 May 15, 2023May 1, 2023
June 30June 300.500 197,744 August 12, 2022August 1, 2022June 300.5625 221,442 221,442 August 14, 2023August 14, 2023July 31, 2023
September 30September 300.500 197,065 November 14, 2022October 31, 2022September 300.575 223,432 223,432 November 13, 2023November 13, 2023November 1, 2023
December 31December 310.500 196,569 February 13, 2023February 1, 2023December 310.575 223,438 223,438 February 13, 2024February 13, 2024February 1, 2024
2023
March 31 (1)
$0.856 $336,987 May 15, 2023May 1, 2023
June 300.5625 221,442 August 14, 2023July 31, 2023
2024
March 31
March 31
March 31$0.875 $340,858 May 15, 2024May 1, 2024

(1)Includes the regular quarterly distribution of $0.500 per unit, or $196.8 million, as well as the Enhanced Distribution of $0.356 per unit discussed below.

To facilitate the distribution of available cash, during 2022 the Partnership adopted a financial policy that provided for an additional distribution (“Enhanced Distribution”) to be paid in conjunction with the regular first-quarter distribution of the following year (beginning in 2023), in a target amount equal to Free cash flow generated in the prior year after subtracting Free cash flow used for the prior year’s debt repayments, regular-quarter distributions, and unit repurchases. This Enhanced Distribution is subject to Board discretion, the establishment of cash reserves for the proper conduct of the Partnership’s business and is also contingent on the attainment of prior year-end net leverage thresholds (the ratio of total principal debt outstanding less total cash on hand as of the end of such period, as compared to trailing-twelve-months Adjusted EBITDA), after taking the Enhanced Distribution for such prior year into effect. Free cash flow and Adjusted EBITDA are defined under the caption Reconciliation of Non-GAAP Financial Measures within Part I, Item 2 of this Form 10-Q. In April 2023, the Board approved an Enhanced Distribution of $0.356 per unit, or $140.1 million, related to the Partnership’s 2022 performance, which was paid in conjunction with the regular first-quarter 2023 distribution on May 15, 2023.

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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
3. PARTNERSHIP DISTRIBUTIONS

WES Operating partnership distributions. WES Operating makes quarterly cash distributions to the Partnership and WGR Asset Holding Company LLC (“WGRAH”), a subsidiary of Occidental, in proportion to their share of limited partner interests in WES Operating. See Note 45. WES Operating made and/or declared the following cash distributions to its limited partners for the periods presented:
thousands
Quarters Ended
Total Quarterly
Cash Distribution
Distribution
Date
2022
March 31$213,513 May 2022
June 30213,513 August 2022
September 30213,513 November 2022
December 31213,513 February 2023
2023
March 31 (1)
$342,895 May 2023
June 30226,260 August 2023
September 30229,446 November 2023
December 31229,446 February 2024
2024
March 31$347,675May 2024

(1)Includes amounts related to the Enhanced Distribution discussed above.

In addition to the distributions above, during the three months ended June 30, 2022, WES Operating made distributions of $86.7 million to the Partnership and WGRAH. The Partnership used its portion of the distribution to repurchase common units. See Note 4.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
4.5. EQUITY AND PARTNERS’ CAPITAL

Holdings of Partnership equity. The Partnership’s common units are listed on the New York Stock Exchange under the ticker symbol “WES.” As of June 30, 2023,March 31, 2024, Occidental held 190,281,578185,181,578 common units, representing a 48.3%47.6% limited partner interest in the Partnership, and through its ownership of the general partner, Occidental indirectly held 9,060,641 general partner units, representing a 2.3% general partner interest in the Partnership. The public held 194,332,356195,308,560 common units, representing a 49.4%50.1% limited partner interest in the Partnership.

Partnership equity repurchases. In 2022, the Board authorized the Partnership to buy back up to $1.25 billion of the Partnership’s common units through December 31, 2024 (the “$1.25 billion Purchase Program”). The common units may be purchased from time to time in the open market at prevailing market prices or in privately negotiated transactions. During the sixthree months ended June 30,March 31, 2024, there were no common units repurchased. During the three months ended March 31, 2023, the Partnership repurchased 287,322285,688 common units for an aggregate purchase price of $7.1 million. During the six months ended June 30, 2022, the Partnership repurchased 3,314,562 common units on the open market for an aggregate purchase price of $79.2 million. The units were canceled immediately upon receipt. As of June 30, 2023,March 31, 2024, the Partnership had an authorized amount of $755.3$627.8 million remaining under the program.

Holdings of WES Operating equity. As of June 30, 2023,March 31, 2024, (i) the Partnership, directly and indirectly through its ownership of WES Operating GP, owned a 98.0% limited partner interest and the entire non-economic general partner interest in WES Operating and (ii) Occidental, through its ownership of WGRAH, owned a 2.0% limited partner interest in WES Operating, which is reflected as a noncontrolling interest within the consolidated financial statements of the Partnership (see Note 1).

Partnership’s net income (loss) per common unit. The common and general partner unitholders’ allocation of net income (loss) attributable to the Partnership was equal to their cash distributions plus their respective allocations of undistributed earnings or losses in accordance with their weighted-average ownership percentage during each period using the two-class method.
The Partnership’s basic net income (loss) per common unit is calculated by dividing the limited partners’ interest in net income (loss) by the weighted-average number of common units outstanding during the period. Diluted net income (loss) per common unit includes the effect of outstanding units issued under the Partnership’s long-term incentive plans.
The following table provides a reconciliation between basic and diluted net income (loss) per common unit:
Three Months Ended 
June 30,
Six Months Ended 
June 30,
thousands except per-unit amountsthousands except per-unit amounts2023202220232022
thousands except per-unit amounts
thousands except per-unit amounts
Net income (loss)
Net income (loss)
Net income (loss)Net income (loss)
Limited partners’ interest in net income (loss)Limited partners’ interest in net income (loss)$247,100 $299,550 $446,059 $601,484 
Limited partners’ interest in net income (loss)
Limited partners’ interest in net income (loss)
Weighted-average common units outstanding
Weighted-average common units outstanding
Weighted-average common units outstandingWeighted-average common units outstanding
BasicBasic384,614 403,027 384,542 403,140 
Basic
Basic
Dilutive effect of non-vested phantom units
Dilutive effect of non-vested phantom units
Dilutive effect of non-vested phantom unitsDilutive effect of non-vested phantom units896 1,135 1,123 1,140 
DilutedDiluted385,510 404,162 385,665 404,280 
Diluted
Diluted
Excluded due to anti-dilutive effect
Excluded due to anti-dilutive effect
Excluded due to anti-dilutive effectExcluded due to anti-dilutive effect1,159 618 873 731 
Net income (loss) per common unitNet income (loss) per common unit
Net income (loss) per common unit
Net income (loss) per common unit
Basic
Basic
BasicBasic$0.64 $0.74 $1.16 $1.49 
DilutedDiluted$0.64 $0.74 $1.16 $1.49 
Diluted
Diluted

WES Operating’s net income (loss) per common unit. Net income (loss) per common unit for WES Operating is not calculated because it has no publicly traded units.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
5.6. RELATED-PARTY TRANSACTIONS

Summary of related-party transactions. The following tables summarize material related-party transactions included in the Partnership’s consolidated financial statements:
Consolidated statements of operations
Consolidated statements of operations
Consolidated statements of operationsConsolidated statements of operations
Three Months Ended 
June 30,
Six Months Ended 
June 30,
thousands
thousands
thousandsthousands2023202220232022
Revenues and otherRevenues and other
Revenues and other
Revenues and other
Service revenues – fee based
Service revenues – fee based
Service revenues – fee basedService revenues – fee based$423,330 $428,631 $846,831 $843,530 
Service revenues – product basedService revenues – product based6,642 21,808 14,758 24,051 
Service revenues – product based
Service revenues – product based
Product sales
Product sales
Product salesProduct sales11,611 6,342 28,779 17,909 
Total revenues and otherTotal revenues and other441,583 456,781 890,368 885,490 
Total revenues and other
Total revenues and other
Equity income, net – related parties (1)
Equity income, net – related parties (1)
Equity income, net – related parties (1)
Equity income, net – related parties (1)
42,324 48,464 81,345 98,071 
Operating expensesOperating expenses
Operating expenses
Operating expenses
Cost of product (2)
Cost of product (2)
Cost of product (2)
Cost of product (2)
(15,184)(12,148)(19,131)(31,691)
Operation and maintenanceOperation and maintenance903 702 1,650 643 
General and administrative (3)
217 233 284 2,208 
Operation and maintenance
Operation and maintenance
General and administrative
General and administrative
General and administrative
Total operating expenses
Total operating expenses
Total operating expensesTotal operating expenses(14,064)(11,213)(17,197)(28,840)

(1)See Note 67.
(2)Includes related-party natural-gas and NGLs imbalances.
(3)Balances for the three and six months ended June 30, 2022, include equity-based compensation expense allocated to the Partnership by Occidental, which is not reimbursed to Occidental and is reflected as a contribution to partners’ capital in the consolidated statements of equity and partners’ capital.

Consolidated balance sheetsConsolidated balance sheets
Consolidated balance sheets
Consolidated balance sheets
thousands
thousands
thousandsthousandsJune 30,
2023
December 31,
2022
March 31,
2024
December 31,
2023
AssetsAssets
Accounts receivable, net
Accounts receivable, net
Accounts receivable, netAccounts receivable, net$346,688 $313,937 
Other current assetsOther current assets3,755 1,578 
Equity investments (1)
Equity investments (1)
920,123 944,696 
Other assetsOther assets38,623 29,058 
Total assetsTotal assets1,309,189 1,289,269 
LiabilitiesLiabilities
Accounts and imbalance payablesAccounts and imbalance payables33,632 32,150 
Accounts and imbalance payables
Accounts and imbalance payables
Accrued liabilitiesAccrued liabilities2,350 11,756 
Other liabilities (2)
Other liabilities (2)
310,131 268,399 
Total liabilitiesTotal liabilities346,113 312,305 

(1)See Note 67.
(2)Includes contract liabilities from contracts with customers. See Note 2.

2223

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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
5.6. RELATED-PARTY TRANSACTIONS

Consolidated statements of cash flowsConsolidated statements of cash flows
Consolidated statements of cash flows
Consolidated statements of cash flows
Three Months Ended
March 31,
Three Months Ended
March 31,
Three Months Ended
March 31,
thousands
thousands
thousands
Distributions from equity-investment earnings – related parties
Distributions from equity-investment earnings – related parties
Distributions from equity-investment earnings – related parties
Six Months Ended 
June 30,
thousands20232022
Distributions from equity-investment earnings – related parties
$82,871 $96,404 
Contributions to equity investments – related parties
Contributions to equity investments – related parties
Contributions to equity investments – related partiesContributions to equity investments – related parties(132)(5,040)
Distributions from equity investments in excess of cumulative earnings – related partiesDistributions from equity investments in excess of cumulative earnings – related parties23,179 25,407 
Distributions from equity investments in excess of cumulative earnings – related parties
Distributions from equity investments in excess of cumulative earnings – related parties
Distributions to Partnership unitholders (1)
Distributions to Partnership unitholders (1)
Distributions to Partnership unitholders (1)
Distributions to Partnership unitholders (1)
(270,308)(173,126)
Distributions to WES Operating unitholders (2)
Distributions to WES Operating unitholders (2)
(11,131)(8,812)
Net contributions from (distributions to) related parties 784 
Distributions to WES Operating unitholders (2)
Distributions to WES Operating unitholders (2)

(1)Represents common and general partner unit distributions paid to Occidental pursuant to the partnership agreement of the Partnership (see Note 34 and Note 45).
(2)Represents distributions paid to Occidental, through its ownership of WGRAH, pursuant to WES Operating’s partnership agreement (see Note 34 and Note 45).

The following tables summarize material related-party transactions for WES Operating (which are included in the Partnership’s consolidated financial statements) to the extent the amounts differ materially from the Partnership’s consolidated financial statements:
Consolidated statements of operations
Consolidated statements of operations
Consolidated statements of operationsConsolidated statements of operations
Three Months Ended 
June 30,
Six Months Ended 
June 30,
thousands
thousands
thousandsthousands2023202220232022
General and administrative (1)
General and administrative (1)
$853 $919 $2,134 $3,867 
General and administrative (1)
General and administrative (1)

(1)Includes (i) an intercompany service fee between the Partnership and WES Operating and (ii) equity-based compensation expense allocated to WES Operating by Occidental, which is not reimbursed to Occidental and is reflected as a contribution to partners’ capital in the consolidated statements of equity and partners’ capital.Operating.

Consolidated balance sheetsConsolidated balance sheets
Consolidated balance sheets
Consolidated balance sheets
thousandsthousandsJune 30,
2023
December 31,
2022
thousands
thousandsMarch 31,
2024
December 31,
2023
Accounts receivable, net (1)
Other current assetsOther current assets$3,540 $1,487 
Other assetsOther assets36,868 28,459 
Accounts and imbalance payables (1)
41,623 76,131 
Accounts and imbalance payables
Accrued liabilitiesAccrued liabilities2,033 11,439 

(1)Includes balances related to transactions between the Partnership and WES Operating.

Consolidated statements of cash flows
Three Months Ended 
March 31,
thousands20242023
Distributions to WES Operating unitholders (1)
$(229,446)$(213,513)

(1)Represents distributions paid to the Partnership and Occidental, through its ownership of WGRAH, pursuant to WES Operating’s partnership agreement. See Note 4 and Note 5.
23
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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
5.6. RELATED-PARTY TRANSACTIONS

Consolidated statements of cash flows
Six Months Ended 
June 30,
thousands20232022
Distributions to WES Operating unitholders (1)
$(556,408)$(440,465)

(1)Represents distributions paid to the Partnership and Occidental, through its ownership of WGRAH, pursuant to WES Operating’s partnership agreement. Includes distributions made from WES Operating to the Partnership that were used by the Partnership to repurchase common units. See Note 3 and Note 4.    

Related-party revenues. Related-party revenues include amounts earned by the Partnership from services provided to Occidental and from the sale of natural gas, condensate, and NGLs to Occidental.

Gathering and processing agreements. The Partnership has significant gathering, processing, and produced-water disposal arrangements with affiliates of Occidental on most of its systems. While Occidental is the contracting counterparty of the Partnership, these arrangements with Occidental include not just Occidental-produced volumes, but also, in some instances, the volumes of other working-interest owners of Occidental who rely on the Partnership’s facilities and infrastructure to bring their volumes to market. Natural-gas throughput (excluding equity-investment throughput) attributable to production owned or controlled by Occidental was 34%31% and 35% for the three and six months ended June 30,March 31, 2024 and 2023, respectively, and 35% and 36% for the three and six months ended June 30, 2022, respectively. Crude-oil and NGLs throughput (excluding equity-investment throughput) attributable to production owned or controlled by Occidental was 87%89% and 88% for the three and six months ended June 30,March 31, 2024 and 2023, respectively, and 88% and 89% for the three and six months ended June 30, 2022, respectively. Produced-water throughput attributable to production owned or controlled by Occidental was 76%77% and 78%80% for the three and six months ended June 30,March 31, 2024 and 2023, respectively, and 81% and 82% for the three and six months ended June 30, 2022, respectively.
The Partnership is currently discussing varying interpretations of certain contractual provisions with Occidental regarding the calculation of the cost-of-service rates under an oil-gathering contract related to the Partnership’s DJ Basin oil-gathering system. If such discussions are resolved in a manner adverse to the Partnership, such resolution could have a negative impact on the Partnership’s financial condition and results of operations, including a reduction in rates and a non-cash charge to earnings.
In connection with the sale of its Eagle Ford assets in 2017, Anadarko remained the primary counterparty to the Partnership’s Brasada gas processing agreement and entered into an agency relationship with Sanchez Energy Corporation (“Sanchez”), nowsubsequently Mesquite Energy, Inc. (“Mesquite”), that allowed Mesquite to process gas under such agreement. In December 2021, the Brasada gas processing agreement was assigned from Anadarko to Mesquite effective July 1, 2023. For this reason, Anadarko is not liable for any obligations under the Brasada gas processing agreement after June 30, 2023. For all periods presented, either Mesquite or its successor, a subsidiary of Javelin Energy Partners, performed Anadarko’s obligations under the Brasada gas processing agreement pursuant to its agency arrangement with Anadarko.
Further, in connection with the sale of its Uinta Basin assets in 2020, Kerr McGee Oil & Gas Onshore LP, a subsidiary of Occidental, retained the deficiency payment obligations under a gas processing agreement at the Chipeta plant. This contingent payment obligation ended as of September 30, 2022.

Marketing Transition Services Agreement. During the year ended December 31, 2020, Occidental provided marketing-related services to certain of the Partnership’s subsidiaries (the “Marketing Transition Services Agreement”). While the Partnership still has some marketing agreements with affiliates of Occidental, on January 1, 2021, the Partnership began marketing and selling substantially all of its crude oil, and residue gas, and a majority of its NGLs directly to third parties.


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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
5. RELATED-PARTY TRANSACTIONS

Related-party expenses. Operation and maintenance expense includes amounts accrued for or paid to related parties for field-related costs, shared field offices, and easements (seeRelated-party commercial agreement below) supporting the Partnership’s operations at certain assets. A portion of general and administrative expense is paid by Occidental, which results in related-party transactions pursuant to the reimbursement provisions of the Partnership’s and WES Operating’s agreements with Occidental. Cost of product expense includes amounts related to certain continuing marketing arrangements with affiliates of Occidental, related-party imbalances, and transactions with affiliates accounted for under the equity method of accounting. See Marketing Transition Services Agreement in the section above. Related-party expenses bear no direct relationship to related-party revenues, and third-party expenses bear no direct relationship to third-party revenues.

Services Agreement. Occidental performed certain centralized corporate functions for the Partnership and WES Operating pursuant to the agreement dated as of December 31, 2019, by and among Occidental, Anadarko, and WES Operating GP (“Services Agreement”). Most of the administrative and operational services previously provided by Occidental fully transitioned to the Partnership by December 31, 2021, with certain limited transition services remaining in place pursuant to the terms of the Services Agreement.


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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
6. RELATED-PARTY TRANSACTIONS

Construction reimbursement agreements and purchases and sales with related parties. From time to time, the Partnership enters into construction reimbursement agreements with Occidental providing that the Partnership will manage the construction of certain midstream infrastructure for Occidental in the Partnership’s areas of operation. Such arrangements generally provide for a reimbursement of costs incurred by the Partnership on a cost or cost-plus basis.
Additionally, from time to time, in support of the Partnership’s business, the Partnership purchases and sells equipment, inventory, and other miscellaneous assets from or to Occidental or its affiliates.

Related-party commercial agreement. During the first quarter of 2021, an affiliate of Occidental and certain wholly owned subsidiaries of the Partnership entered into a Commercial Understanding Agreement (“CUA”). Under the CUA, certain West Texas surface-use and salt-water disposal agreements were amended to reduce usage fees owed by the Partnership in exchange for the forgiveness of certain deficiency fees owed by Occidental and other unrelated contractual amendments. The present value of the reduced usage fees under the CUA was $30.0 million at the time the agreement was executed. Also, as a result of the amendments under the CUA, these agreements are classified as operating leases and a $30.0 million right-of-use (“ROU”) asset, included in Other assets on the consolidated balance sheets, was recognized during the first quarter of 2021. The ROU asset is being amortized to Operation and maintenance expense through 2038, the remaining term of the agreements.

Customer concentration. Occidental was the only customer from which revenues exceeded 10% of consolidated revenues for all periods presented in the consolidated statements of operations.
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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
6.7. EQUITY INVESTMENTS

The following table presentstables present the financial statement impact of the Partnership’s equity investments for the sixthree months ended June 30, 2023:March 31, 2024:

thousands
thousands
thousandsthousandsBalance at December 31, 2022Equity
income, net
ContributionsDistributions
Distributions
in excess of
cumulative
earnings (1)
Balance at June 30, 2023Balance at December 31, 2023Equity
income, net
Distributions
Distributions
in excess of
cumulative
earnings (1)
Acquisitions and Divestitures (2)
Balance at March 31, 2024
White CliffsWhite Cliffs$16,095 $985 $ $(611)$(1,631)$14,838 
RendezvousRendezvous16,114 (1,286) (344)(1,062)13,422 
Mont Belvieu JVMont Belvieu JV91,310 14,103  (14,122)(903)90,388 
TEGTEG15,856 3,462  (3,375)(75)15,868 
TEPTEP184,687 19,939  (20,065)(6,755)177,806 
FRPFRP192,716 22,090  (22,177)(4,163)188,466 
Whitethorn LLCWhitethorn LLC146,595 (1,614)132 1,753 (1,083)145,783 
SaddlehornSaddlehorn104,191 11,286  (11,057)(1,875)102,545 
PanolaPanola19,311 1,186  (1,318)(169)19,010 
Mi VidaMi Vida48,862 3,973  (4,334)(4,358)44,143 
Red Bluff ExpressRed Bluff Express108,959 7,221  (7,221)(1,105)107,854 
TotalTotal$944,696 $81,345 $132 $(82,871)$(23,179)$920,123 

(1)Distributions in excess of cumulative earnings, classified as investing cash flows in the consolidated statements of cash flows, are calculated on an individual-investment basis.
(2)See Note 3.

During the first quarter of 2024, the Partnership closed on the sale of the following equity investments to third parties: (i) the 25.00% interest in Mont Belvieu JV, (ii) the 20.00% interest in Whitethorn LLC, (iii) the 15.00% interest in Panola, and (iv) the 20.00% interest in Saddlehorn. See Note 3.
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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
7.8. PROPERTY, PLANT, AND EQUIPMENT

A summary of the historical cost of property, plant, and equipment is as follows:
thousands
thousands
thousandsthousandsEstimated Useful LifeJune 30,
2023
December 31,
2022
Estimated Useful LifeMarch 31,
2024
December 31,
2023
LandLandN/A$10,982 $10,982 
Gathering systems – pipelinesGathering systems – pipelines30 years5,558,416 5,519,592 
Gathering systems – compressorsGathering systems – compressors15 years2,361,002 2,266,410 
Processing complexes and treating facilitiesProcessing complexes and treating facilities25 years3,452,005 3,419,201 
Transportation pipeline and equipmentTransportation pipeline and equipment3 to 48 years192,126 174,241 
Produced-water disposal systems
Produced-water disposal systems
20 years1,031,623 932,627 
Assets under constructionAssets under constructionN/A318,171 263,353 
OtherOther3 to 40 years816,586 779,187 
Total property, plant, and equipmentTotal property, plant, and equipment13,740,911 13,365,593 
Less accumulated depreciationLess accumulated depreciation5,139,941 4,823,993 
Net property, plant, and equipmentNet property, plant, and equipment$8,600,970 $8,541,600 

“Assets under construction” represents property that is not yet placed into productive service as of the respective balance sheet date and is excluded from capitalized costs being depreciated.

Long-lived asset impairments. During the sixthree months ended June 30,March 31, 2023, the Partnership recognized a long-lived asset impairment of $52.1 million for assets located in the Rockies due to a reduction in estimated future cash flows resulting from a contract termination notice received in the first quarter of 2023. This asset was impaired to its estimated fair value of $22.8 million. The fair value was measured using the income approach and Level-3 fair value inputs. The income approach was based on the Partnership’s projected future earnings before interest, taxes, depreciation, and amortization (“EBITDA”)EBITDA and free cash flows, which requires significant assumptions including, among others, future throughput volumes based on current expectations of producer activity and operating costs.

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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
8.9. SELECTED COMPONENTS OF WORKING CAPITAL

A summary of accounts receivable, net is as follows:
The PartnershipThe PartnershipWES Operating
The PartnershipWES Operating
thousands
thousands
thousandsthousandsJune 30,
2023
December 31,
2022
June 30,
2023
December 31,
2022
March 31,
2024
December 31,
2023
March 31,
2024
December 31,
2023
Trade receivables, netTrade receivables, net$553,461 $548,859 $553,461 $548,859 
Other receivables, netOther receivables, net761 5,404 741 5,404 
Total accounts receivable, netTotal accounts receivable, net$554,222 $554,263 $554,202 $554,263 

A summary of other current assets is as follows:
The PartnershipThe PartnershipWES Operating
The PartnershipWES Operating
thousands
thousands
thousandsthousandsJune 30,
2023
December 31,
2022
June 30,
2023
December 31,
2022
March 31,
2024
December 31,
2023
March 31,
2024
December 31,
2023
NGLs inventoryNGLs inventory$1,904 $3,797 $1,904 $3,797 
Imbalance receivablesImbalance receivables2,158 32,658 2,158 32,658 
Prepaid insurancePrepaid insurance1,289 13,262 172 11,139 
Contract assetsContract assets9,390 3,381 9,390 3,381 
OtherOther14,287 6,408 14,072 6,316 
Total other current assetsTotal other current assets$29,028 $59,506 $27,696 $57,291 

A summary of accrued liabilities is as follows:
The PartnershipThe PartnershipWES Operating
The PartnershipWES Operating
thousands
thousands
thousandsthousandsJune 30,
2023
December 31,
2022
June 30,
2023
December 31,
2022
March 31,
2024
December 31,
2023
March 31,
2024
December 31,
2023
Accrued interest expenseAccrued interest expense$117,188 $110,486 $117,188 $110,486 
Short-term asset retirement obligations
Short-term asset retirement obligations
4,716 10,493 4,716 10,493 
Short-term remediation and reclamation obligations
Short-term remediation and reclamation obligations
8,226 5,383 8,226 5,383 
Income taxes payableIncome taxes payable3,647 2,428 3,647 2,428 
Contract liabilitiesContract liabilities14,905 20,903 14,905 20,903 
Accrued payroll and benefitsAccrued payroll and benefits35,889 44,855  — 
OtherOther39,316 60,092 39,146 47,596 
Total accrued liabilitiesTotal accrued liabilities$223,887 $254,640 $187,828 $197,289 
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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
9.10. DEBT AND INTEREST EXPENSE

WES Operating is the borrower for all outstanding debt and is expected to be the borrower for all future debt issuances. The following table presents the outstanding debt:
June 30, 2023December 31, 2022 March 31, 2024December 31, 2023
thousandsthousandsPrincipalCarrying
Value
Fair
Value (1)
PrincipalCarrying
Value
Fair
Value (1)
thousandsPrincipalCarrying
Value
Fair
Value (1)
PrincipalCarrying
Value
Fair
Value (1)
Short-term debt
Short-term debt
Floating-Rate Senior Notes due 2023
$ $ $ $213,138 $213,121 $214,823 
Commercial paper
Commercial paper
Commercial paper
Finance lease liabilitiesFinance lease liabilities2,532 2,532 2,532 2,659 2,659 2,659 
Total short-term debt
Total short-term debt
$2,532 $2,532 $2,532 $215,797 $215,780 $217,482 
Long-term debt
Long-term debt
Long-term debt
Long-term debt
3.100% Senior Notes due 2025
3.100% Senior Notes due 2025
3.100% Senior Notes due 20253.100% Senior Notes due 2025$677,859 $675,888 $648,908 $730,706 $727,953 $692,491 
3.950% Senior Notes due 20253.950% Senior Notes due 2025399,163 397,288 383,780 399,163 396,825 379,107 
4.650% Senior Notes due 20264.650% Senior Notes due 2026468,970 467,186 451,768 474,242 472,161 452,201 
4.500% Senior Notes due 20284.500% Senior Notes due 2028397,182 394,188 375,297 400,000 396,698 368,346 
4.750% Senior Notes due 20284.750% Senior Notes due 2028382,888 380,541 364,054 400,000 397,340 368,141 
6.350% Senior Notes due 2029
4.050% Senior Notes due 20304.050% Senior Notes due 20301,160,471 1,152,608 1,045,828 1,200,000 1,191,345 1,053,038 
6.150% Senior Notes due 20336.150% Senior Notes due 2033750,000 741,039 755,873 — — — 
5.450% Senior Notes due 20445.450% Senior Notes due 2044600,000 593,954 511,260 600,000 593,878 503,742 
5.300% Senior Notes due 20485.300% Senior Notes due 2048700,000 687,613 587,440 700,000 687,494 580,570 
5.500% Senior Notes due 20485.500% Senior Notes due 2048350,000 342,847 294,126 350,000 342,783 291,194 
5.250% Senior Notes due 20505.250% Senior Notes due 20501,000,000 984,069 833,880 1,000,000 983,945 829,804 
RCF   375,000 375,000 375,000 
Finance lease liabilities
Finance lease liabilities
Finance lease liabilitiesFinance lease liabilities6,993 6,993 6,993 4,160 4,160 4,160 
Total long-term debt
Total long-term debt
$6,893,526 $6,824,214 $6,259,207 $6,633,271 $6,569,582 $5,897,794 

(1)Fair value is measured using the market approach and Level-2 fair value inputs.

Debt activity. The following table presents the debt activity for the six months ended June 30, 2023:
thousandsCarrying Value
Balance at December 31, 2022$6,785,362 
RCF borrowings220,000
Repayments of RCF borrowings(595,000)
Issuance of 6.150% Senior Notes due 2033750,000
Repayment of Floating-Rate Senior Notes due 2023(213,138)
Repayment of 3.100% Senior Notes due 2025(52,847)
Repayment of 4.650% Senior Notes due 2026(5,272)
Repayment of 4.500% Senior Notes due 2028(2,818)
Repayment of 4.750% Senior Notes due 2028(17,112)
Repayment of 4.050% Senior Notes due 2030(39,529)
Finance lease liabilities2,706
Other(5,606)
Balance at June 30, 2023$6,826,746

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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
9.10. DEBT AND INTEREST EXPENSE

Debt activity. The following table presents the debt activity for the three months ended March 31, 2024:
thousandsCarrying Value
Balance at December 31, 2023$7,901,304 
Commercial paper borrowings (repayments), net (1)
(510,379)
Repayment of 3.100% Senior Notes due 2025(2,650)
Repayment of 3.950% Senior Notes due 2025(518)
Repayment of 4.500% Senior Notes due 2028(6,919)
Repayment of 4.750% Senior Notes due 2028(1,040)
Repayment of 4.050% Senior Notes due 2030(3,981)
Finance lease liabilities2,751
Other1,905
Balance at March 31, 2024$7,380,473

(1)Net of borrowings and repayments related to commercial paper notes with original maturities of 90 days or less.

WES Operating Senior Notes. WES Operating issued the Fixed-Rate 3.100% Senior Notes due 2025, 4.050% Senior Notes due 2030, 5.250% Senior Notes due 2050, and the Floating-Rate Senior Notes due 2023 in January 2020. Including the effects of the issuance prices, underwriting discounts, and interest-rate adjustments, the effective interest rates of the Senior Notes due 2025, 2030, and 2050, were 3.791%3.290%, 4.671%4.169%, and 5.869%5.363%, respectively, at June 30, 2023,March 31, 2024, and were 3.790%, 4.671%, and 5.869%, respectively, at June 30, 2022.March 31, 2023. The effective interest rate of these notes is subject to adjustment from time to time due to a change in credit rating.
During the three months ended March 31, 2024, WES Operating purchased and retired $15.1 million of certain of its senior notes via open-market repurchases with cash from operations (see Debt activity above) and a gain of $0.5 million was recognized for the early retirement of portions of these notes. As of March 31, 2024, the 3.100% Senior Notes due 2025 were classified as long-term debt on the consolidated balance sheet as WES Operating has the ability and intent to refinance these obligations using long-term debt. Subsequent to March 31, 2024, WES Operating purchased and retired $134.9 million of certain of its senior notes via open-market repurchases.
During the third quarter of 2023, WES Operating completed the public offering of $600.0 million in aggregate principal amount of 6.350% Senior Notes due 2029. Net proceeds from the offering were used to fund a portion of the aggregate purchase price for the Meritage acquisition (see Note 3), to pay related costs and expenses, and for general partnership purposes. During the second quarter of 2023, WES Operating completed the public offering of $750.0 million in aggregate principal amount of 6.150% Senior Notes due 2033. Interest is payable semi-annually on April 1st and October 1st of each year, with the initial interest payment being due on October 1, 2023. Net proceeds from the offering were used to repay borrowings under the RCF and for general partnership purposes.
Also In addition, during the second quarter of 2023, WES Operating purchased and retired $117.6$276.7 million of certain of its senior notes via open-market repurchases (see Debt activity above). For the three months ended June 30, 2023, a gain of $6.8 million was recognized for the early retirement of portions of these notes. Subsequent to June 30, 2023, WES Operating purchased and retired $159.1 million of certain of its senior notes via open-market repurchases. During the first quarter of 2023, WES Operating redeemed the total principal amount outstanding on the Floating-Rate Senior Notes due 2023 at par value with cash on hand.
During the second quarter of 2022, WES Operating (i) redeemed the total principal amount outstanding of the 4.000% Senior Notes due 2022 at par value and (ii) purchased and retired $1.4 million of the 3.100% Senior Notes due 2025 via open-market repurchases.
As of June 30, 2023,March 31, 2024, WES Operating was in compliance with all covenants under the relevant governing indentures.

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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
10. DEBT AND INTEREST EXPENSE

Revolving credit facility. In April 2023, WES Operating (i) repaid all then-outstanding borrowings under its senior unsecured revolving credit facility (“RCF”)RCF with proceeds from the 6.150% Senior Notes due 2033 offering, and (ii) entered into an amendment to its RCF to, among other things, extend the maturity date to April 2028 and provide for a maximum borrowing capacity up to $2.0 billion, expandable to a maximum of $2.5 billion, through the maturity date.
As of June 30, 2023,March 31, 2024, there were no outstanding borrowings and $5.1$0.5 million of outstanding letters of credit, resulting in $2.0$1.9 billion of availablein effective borrowing capacity under the RCF.RCF, after taking into account the $100.0 million of outstanding commercial paper borrowings (see below), for which we maintain availability under the RCF as support for WES Operating’s commercial paper program. As of June 30,March 31, 2024 and 2023, and 2022, the interest rate on any outstanding RCF borrowings was 6.44%6.63% and 3.12%6.21%, respectively. The facility-fee rate was 0.20% at March 31, 2024 and 0.25% at June 30, 2023 and 2022, respectively.2023. As of June 30, 2023,March 31, 2024, WES Operating was in compliance with all covenants under the RCF.

Commercial paper program. In November 2023, WES operating entered into an unsecured commercial paper program under which it may issue (and have outstanding at any one time) an aggregate principal amount up to $2.0 billion. WES Operating intends to maintain a minimum aggregate available borrowing capacity under the RCF equal to the aggregate amount of outstanding commercial paper borrowings. The maturities of the notes may vary, but may not exceed 397 days. As of March 31, 2024, there were $100.0 million aggregate principal amount of short-term notes outstanding under the commercial paper program at a weighted-average interest rate of 6.00% and weighted-average maturity of four days.

Interest expense. The following table summarizes the amounts included in interest expense:
Three Months Ended 
June 30,
Six Months Ended 
June 30,
thousandsthousands2023202220232022
thousands
thousands
Long-term and short-term debt
Long-term and short-term debt
Long-term and short-term debt
Long-term and short-term debt
$(85,088)$(78,577)$(166,239)$(162,005)
Finance lease liabilitiesFinance lease liabilities(230)(31)(393)(73)
Finance lease liabilities
Finance lease liabilities
Commitment fees and amortization of debt-related costsCommitment fees and amortization of debt-related costs(3,414)(3,068)(6,295)(6,100)
Commitment fees and amortization of debt-related costs
Commitment fees and amortization of debt-related costs
Capitalized interest
Capitalized interest
Capitalized interestCapitalized interest2,550 904 5,075 1,951 
Interest expenseInterest expense$(86,182)$(80,772)$(167,852)$(166,227)
Interest expense
Interest expense

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WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
10.11. COMMITMENTS AND CONTINGENCIES

Environmental obligations. The Partnership is subject to various environmental-remediation obligations arising from federal, state, and local regulations regarding air and water quality, hazardous and solid waste disposal, and other environmental matters. As of June 30, 2023,March 31, 2024 and December 31, 2022,2023, the consolidated balance sheets included $12.1$3.5 million and $7.4$7.3 million, respectively, of liabilities for remediation and reclamation obligations. The current portion of these amounts is included in Accrued liabilities, and the long-term portion of these amounts is included in Other liabilities. The majority of payments related to these obligations are expected to be made over the next year. See Note 8.

Litigation and legal proceedings. From time to time, the Partnership is involved in legal, tax, regulatory, and other proceedings in various forums regarding performance, contracts, and other matters that arise in the ordinary course of business. Management is not aware of any such proceeding for which the final disposition could have a material adverse effect on the Partnership’s financial condition, results of operations, or cash flows.

Other commitments. The Partnership has payment obligations, or commitments, that include, among other things, a revolving credit facility, other third-party long-term debt, obligations related to the Partnership’s capital spending programs, pipeline and offload commitments, and various operating and finance leases. The payment obligations related to the Partnership’s capital spending programs, the majority of which is expected to be paid in the next 12 months, primarily relate to expansion, construction, and asset-integrity projects at the West Texas complex, DBM water systems, DJ Basin complex, Powder River Basin complex, and DBM oil system, and DJ Basin complex.

system.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion analyzes our financial condition and results of operations and should be read in conjunction with the Consolidated Financial Statements and Notes to Consolidated Financial Statements, wherein WES Operating is fully consolidated, and which are included under Part I, Item 1 of this quarterly report, and the historical consolidated financial statements, and the notes thereto, which are included under Part II, Item 8 of the 20222023 Form 10-K as filed with the SEC on February 22, 2023.21, 2024.
The Partnership’s assets include assets owned and ownership interests accounted for by us under the equity method of accounting, through our 98.0% partnership interest in WES Operating, as of June 30, 2023March 31, 2024 (see Note 6—7—Equity Investments in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q). We also own and control the entire non-economic general partner interest in WES Operating GP, and our general partner is owned by Occidental.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

We have made in this Form 10-Q, and may make in other public filings, press releases, and statements by management, forward-looking statements concerning our operations, economic performance, and financial condition. These forward-looking statements include statements preceded by, followed by, or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “estimates,” “projects,” “target,” “goal,” “plans,” “objective,” “should,” or similar expressions or variations on such expressions. These statements discuss future expectations, contain projections of results of operations or financial condition, or include other “forward-looking” information.
Although we and our general partner believe that the expectations reflected in our forward-looking statements are reasonable, neither we nor our general partner can provide any assurance that such expectations will prove correct. These forward-looking statements involve risks and uncertainties. Important factors that could cause actual results to differ materially from expectations include, but are not limited to, the following:

our ability to pay distributions to our unitholders;unitholders and the amount of such distributions;

our assumptions about the energy market;

future throughput (including Occidental production) that is gathered or processed by, or transported through, our assets;

our operating results;

competitive conditions;

technology;

the availability of capital resources to fund acquisitions, capital expenditures, and other contractual obligations, and our ability to access financing through the debt or equity capital markets;

the supply of, demand for, and price of oil, natural gas, NGLs, and related products or services;

commodity-price risks inherent in percent-of-proceeds, percent-of-product, keep-whole, and fixed-recovery processing contracts;

weather and natural disasters;

inflation;

the availability of goods and services;

general economic conditions, internationally, domestically, or in the jurisdictions in which we are doing business;
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federal, state, and local laws and state-approved voter ballot initiatives, including those laws or ballot initiatives that limit producers’ hydraulic-fracturing activities or other oil and natural-gas development or operations;

environmental liabilities;

legislative or regulatory changes, including changes affecting our status as a partnership for federal income tax purposes;

changes in the financial or operational condition of Occidental;

the creditworthiness of Occidental or our other counterparties, including financial institutions, operating partners, and other parties;

changes in Occidental’s capital program, corporate strategy, or other desired areas of focus;

our commitments to capital projects;

our ability to access liquidity under the RCF;RCF and commercial paper program;

our ability to repay debt;

the resolution of litigation or other disputes;

conflicts of interest among us and our general partner and its related parties, including Occidental, with respect to, among other things, the allocation of capital and operational and administrative costs, and our future business opportunities;

our ability to maintain and/or obtain rights to operate our assets on land owned by third parties;

our ability to acquire assets on acceptable terms from third parties;

non-payment or non-performance of significant customers, including under gathering, processing, transportation, and disposal agreements;

the timing, amount, and terms of future issuances of equity and debt securities;

the outcome of pending and future regulatory, legislative, or other proceedings or investigations, and continued or additional disruptions in operations that may occur as we and our customers comply with any regulatory orders or other state or local changes in laws or regulations;

cyber attackscyber-attacks or security breaches; and

other factors discussed below, in “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates” included in the 20222023 Form 10-K, in our quarterly reports on Form 10-Q, and in our other public filings and press releases.

Risk factors and other factors noted throughout or incorporated by reference in this Form 10-Q could cause actual results to differ materially from those contained in any forward-looking statement. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.



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EXECUTIVE SUMMARY

We are a midstream energy company organized as a publicly traded partnership, engaged in the business of gathering, compressing, treating, processing, and transporting natural gas; gathering, stabilizing, and transporting condensate, NGLs, and crude oil; and gathering and disposing of produced water. In our capacity as a natural-gas processor, we also buy and sell natural gas, NGLs, and condensate on behalf of ourselves and as an agent for our customers under certain contracts. To provide superior midstream service, we focus on ensuring the reliability and performance of our systems, creating sustainable cost efficiencies, enhancing our safety culture, and protecting the environment. We own or have investments in assets located in Texas, New Mexico, the Rocky Mountains (Colorado, Utah, and Wyoming), and North-central Pennsylvania. As of June 30, 2023,March 31, 2024, our assets and investments consisted of the following:
Wholly
Owned and
Operated
Operated
Interests
Non-Operated
Interests
Equity
Interests
Wholly
Owned and
Operated
Wholly
Owned and
Operated
Operated
Interests
Non-Operated
Interests
Equity
Interests
Gathering systems (1)
Gathering systems (1)
17 
Treating facilitiesTreating facilities37 — — 
Natural-gas processing plants/trains
Natural-gas processing plants/trains
25 — 
NGLs pipelinesNGLs pipelines— — 
Natural-gas pipelines
Natural-gas pipelines
— — 
Crude-oil pipelines
Crude-oil pipelines
— 

(1)Includes the DBM water systems.

Significant financial and operational events during the sixthree months ended June 30, 2023,March 31, 2024, included the following:

WES Operating completedDuring the public offeringfirst quarter of $750.02024, we (i) closed on the sale of several equity investments to third parties for combined proceeds of $588.6 million, which included $5.9 million in aggregate principal amountpro-rata distributions through closing, and (ii) entered into a definitive agreement for the divestment of 6.150% Senior Notes due 2033. Net proceeds from this offering were used to repay borrowings underour 33.75% interest in the RCF and for general partnership purposes.Marcellus Interest systems, which closed in April 2024. See LiquidityAcquisitions and Capital ResourcesDivestitures within this Item 2 for additional information.

WES Operating redeemed the $213.1 million total principal amount outstanding of the Floating-Rate Senior Notes due 2023 at par value with cash on hand.

WES Operating purchased and retired $117.6$15.1 million of certain of its senior notes via open-market repurchases.

Our secondfirst-quarter 20232024 per-unit distribution of $0.5625$0.875 increased $0.0625$0.300 from the regular first-quarterfourth-quarter 2023 per-unit distribution of $0.500.

The Board approved an Enhanced Distribution of $0.356 per unit, or $140.1 million, related to our 2022 performance. This Enhanced Distribution was paid, along with our regular first-quarter 2023 distribution, on May 15, 2023, to our unitholders of record at the close of business on May 1, 2023.

We repurchased 287,322 common units for an aggregate purchase price of $7.1 million.$0.575.

Natural-gas throughput attributable to WES totaled 4,254 MMcf/d and 4,1814,990 MMcf/d for the three and six months ended June 30, 2023, respectively,March 31, 2024, representing a 4%2% increase and a 21% increase compared to the three months ended MarchDecember 31, 2023, and no change compared to the six months ended June 30, 2022,March 31, 2023, respectively.

Crude-oil and NGLs throughput attributable to WES totaled 626 MBbls/d and 619565 MBbls/d for the three and six months ended June 30, 2023, respectively,March 31, 2024, representing a 2% increase20% decrease and an 8% decrease compared to the three months ended MarchDecember 31, 2023, and six months ended June 30, 2022,March 31, 2023, respectively.

Produced-water throughput attributable to WES totaled 943 MBbls/d and 9501,126 MBbls/d for the three and six months ended June 30, 2023, respectively,March 31, 2024, representing a 1% decrease7% increase and an 18% increase compared to the three months ended December 31, 2023, and March 31, 2023, and six months ended June 30, 2022, respectively.
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Gross margin was $550.0 million and $1,087.9$683.7 million for the three and six months ended June 30, 2023, respectively,March 31, 2024, representing a 2%5% increase and a 5% decrease27% increase compared to the three months ended MarchDecember 31, 2023, and six months ended June 30, 2022,March 31, 2023, respectively. See Reconciliation of Non-GAAP Financial Measures within this Item 2.

Adjusted gross margin for natural-gas assets (as defined under the caption Reconciliation of Non-GAAP Financial Measures within this Item 2) averaged $1.26 per Mcf and $1.28$1.32 per Mcf for the three and six months ended June 30, 2023, respectively,March 31, 2024, representing a 3% decrease and a 5% decrease2% increase compared to the three months ended MarchDecember 31, 2023, and six months ended June 30, 2022, respectively.March 31, 2023.
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Adjusted gross margin for crude-oil and NGLs assets (as defined under the caption Reconciliation of Non-GAAP Financial Measures within this Item 2) averaged $2.58 per Bbl and $2.61$2.92 per Bbl for the three and six months ended June 30, 2023, respectively,March 31, 2024, representing a 3% decrease20% increase and a 4%10% increase compared to the three months ended MarchDecember 31, 2023, and six months ended June 30, 2022,March 31, 2023, respectively.

Adjusted gross margin for produced-water assets (as defined under the caption Reconciliation of Non-GAAP Financial Measures within this Item 2) averaged $0.83 per Bbl and $0.82$0.95 per Bbl for the three and six months ended June 30, 2023, respectively,March 31, 2024, representing a 2%10% increase and a 14% decrease17% increase compared to the three months ended MarchDecember 31, 2023, and six months ended June 30, 2022,March 31, 2023, respectively.

The following table provides additional information on throughput for the periods presented below:
Three Months Ended
Three Months Ended
Three Months Ended
March 31, 2024
Three Months EndedSix Months Ended
March 31, 2024
June 30, 2023March 31, 2023Inc/
(Dec)
June 30, 2023June 30, 2022Inc/
(Dec)
March 31, 2024
Throughput for natural-gas assets (MMcf/d)
Throughput for natural-gas assets (MMcf/d)
Throughput for natural-gas assets (MMcf/d)
Delaware BasinDelaware Basin1,592 1,569 %1,581 1,410 12 %
DJ BasinDJ Basin1,309 1,306 — %1,308 1,329 (2)%
DJ Basin
DJ Basin
Powder River Basin
Powder River Basin
Powder River Basin
Equity investments
Equity investments
Equity investmentsEquity investments454 423 %438 498 (12)%
OtherOther1,061 948 12 %1,004 1,082 (7)%
Other
Other
Total throughput for natural-gas assets
Total throughput for natural-gas assets
4,416 4,246 %4,331 4,319 — %
Total throughput for natural-gas assets
Total throughput for natural-gas assets
Throughput for crude-oil and NGLs assets (MBbls/d)
Throughput for crude-oil and NGLs assets (MBbls/d)
Throughput for crude-oil and NGLs assets (MBbls/d)
Delaware BasinDelaware Basin208 205 %206 195 %
DJ BasinDJ Basin66 69 (4)%67 85 (21)%
DJ Basin
DJ Basin
Powder River Basin
Powder River Basin
Powder River Basin
Equity investments
Equity investments
Equity investmentsEquity investments323 314 %319 367 (13)%
OtherOther42 35 20 %40 37 %
Other
Other
Total throughput for crude-oil and NGLs assets
Total throughput for crude-oil and NGLs assets
639 623 %632 684 (8)%
Total throughput for crude-oil and NGLs assets
Total throughput for crude-oil and NGLs assets
Throughput for produced-water assets (MBbls/d)
Throughput for produced-water assets (MBbls/d)
Throughput for produced-water assets (MBbls/d)
Delaware BasinDelaware Basin963 977 (1)%970 824 18 %
Total throughput for produced-water assets
Total throughput for produced-water assets
963 977 (1)%970 824 18 %
Total throughput for produced-water assets
Total throughput for produced-water assets

NMNot meaningful
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OUTLOOK

We expect our business to be affected by the below-described key trends and uncertainties. Our expectations are based on assumptions made by us and information currently available to us. To the extent our underlying assumptions about, or interpretations of, available information prove incorrect, our actual results may vary materially from expected results.

Impact of producer activity. Our business is primarily driven by the level of production of crude-oilcrude oil and natural gas by producers in our areas of operation. This activity, however, can be impacted negatively by, among other things, commodity-price fluctuations and operational challenges. Fluctuating crude-oil, natural-gas, and NGLs prices can reduce the level of our customers’ activities and change the allocation of capital within their own asset portfolios. Such fluctuations can also impact us directly to the extent we take ownership of and sell certain volumes at the tailgate of our plants for our own account. During 2020, oil and natural-gas prices were negatively impacted by the worldwide macroeconomic downturn that followed the global outbreak of COVID-19. In 2021, prices began to increase and in the first quarter of 2022, commodity prices increased significantly in connection with the war in Ukraine. For example, the New York Mercantile Exchange (“NYMEX”) West Texas Intermediate crude-oil daily settlement prices during 2022 ranged from a high of $123.70 per barrel in March 2022 to a low of $71.02 per barrel in December 2022, and prices during the six months ended June 30, 2023 ranged from a high of $83.26 per barrel in April 2023 to a low of $66.74 per barrel in March 2023.2023 to a high of $93.68 per barrel in September 2023, and prices during the three months ended March 31, 2024, ranged from a low of $70.38 per barrel in January 2024 to a high of $83.47 per barrel in March 2024. Similar disruptions could occur as a consequence of the current conflict in the Middle East. The extent and duration of commodity-price volatility, and the associated direct and indirect impact on our business, cannot be predicted. To address the risks posed by fluctuating commodity prices, we intend to continue evaluating the relevant price environments and adjust our capital spending plans to reflect our customers’ anticipated activity levels, while maintaining appropriate liquidity and financial flexibility.
Additionally, even when the commodity-price environments are favorable, our customers must manage numerous operational challenges, including severe weather disruptions, downstream and produced-water takeaway constraints, seismicity concerns, new regulatory requirements, and the ability to optimize the efficiency and results of large, complex drilling programs. Our producers’ ability to mitigate or manage such challenges can have a significant impact on the volumes available for us to service in the short term. For this reason, we strive to work proactively with our customers whenever possible to provide high levels of reliability on our systems and help them meet these operational challenges as they arise.

Impact of inflation and supply-chain disruptions. The U.S. economy has recently experienced significant inflation relative to historical precedent, from, among other things, supply-chain disruptions caused by, or governmental stimulus or fiscal policies adopted in response to, the COVID-19 crisis and in connection with the war in Ukraine. More specifically, the continued bottlenecks and disruptions from the lingering effects of the COVID-19 crisis have caused difficulties within the U.S. and global supply chains, creating logistical delays along with labor shortages. Continued inflation has raised our costs for steel products, automation components, power supply, labor, materials, fuel, and services, which has increased our operating costs and capital expenditures. Increases in inflationary pressure could materially and negatively impact our financial results. To the extent permitted by regulations and escalation provisions in certain of our existing agreements, we have the ability to recover a portion of increased costs in the form of higher fees.

Impact of interest rates. Short- and long-term interest rates increased during 2022, and have continued to increase during 2023,can be volatile, resulting in increasedimmediate changes to interest expense on RCF borrowings and commercial paper borrowings. Any future increases in interest rates likely will result in additional increases in financing costs. As with other yield-oriented securities, our unit price could be impacted by our implied distribution yield relative to market interest rates. Therefore, changes in interest rates, either positive or negative, may affect the yield requirements of investors who invest in our units, and a rising interest-rate environment could have an adverse impact on our unit price and our ability to issue additional equity, or increase the cost of issuing equity, to make acquisitions, to reduce debt, or for other purposes. However, we expect our cost of capital to remain competitive, as our competitors face similar interest-rate dynamics.


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ACQUISITIONS AND DIVESTITURES

Cactus II.Mont Belvieu JV, Whitethorn LLC, Panola, and Saddlehorn. In November 2022,During the first quarter of 2024, we sold ourclosed on the sale of the following equity investments to third parties: (i) the 25.00% interest in Mont Belvieu JV, (ii) the 20.00% interest in Whitethorn LLC, (iii) the 15.00% interest in Cactus II to two third parties for $264.8 million, which includes a $1.8 million pro-rata distribution through closing. TotalPanola, and (iv) the 20.00% interest in Saddlehorn. The combined proceeds were received duringin the fourthfirst quarter of 2022,2024 of $588.6 million includes $5.9 million in pro-rata distributions through closing, resulting in a net gain on sale of $109.9$239.7 million that was recorded as Gain (loss) on divestiture and other, net in the consolidated statementsstatement of operations. The sale of the interests in the Mont Belvieu JV and Whitethorn LLC also resolved outstanding legal proceedings associated with those assets.

Ranch Westex. Marcellus Interest systems.In September 2022,April 2024, we acquiredclosed on the remaining 50%sale of our 33.75% interest in Ranch Westex from a third partythe Marcellus Interest systems for $40.1 million. Subsequentproceeds of $206.2 million, resulting in an estimated net gain on sale of approximately $65.0 million that will be recorded as Gain (loss) on divestiture and other, net in the consolidated statement of operations during the second quarter of 2024. As of March 31, 2024, the Marcellus Interest systems satisfied criteria to be considered held for sale. At March 31, 2024, the acquisition, (i) we are the sole ownerconsolidated balance sheet included current assets of $6.6 million, long-term assets of $142.7 million, current liabilities of $5.9 million, and operatorlong-term liabilities of the asset, (ii) Ranch Westex is no longer accounted$2.1 million associated with assets held for under the equity method of accounting, and (iii) the Ranch Westex processing plant is included as part of the operations of the West Texas complex.sale.

Meritage. In October 2023, we closed on the acquisition of Meritage for $885.0 million (subject to certain customary post-closing adjustments) funded with cash, including proceeds from our $600.0 million senior note issuance in September 2023and borrowings on the RCF.

See Note 3—Acquisitions and Divestitures and Note 10—Debt and Interest Expense under Part I, Item 1 of this Form 10-Q.

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RESULTS OF OPERATIONS

OPERATING RESULTS

The following tables and discussion present a summary of our results of operations:
Three Months Ended
Three Months Ended
Three Months Ended
Three Months Ended Six Months Ended
thousandsthousandsJune 30, 2023March 31, 2023June 30, 2023June 30, 2022
thousands
thousands
Total revenues and other (1)
Total revenues and other (1)
Total revenues and other (1)
Total revenues and other (1)
$738,273 $733,982 $1,472,255 $1,634,716 
Equity income, net – related partiesEquity income, net – related parties42,324 39,021 81,345 98,071 
Equity income, net – related parties
Equity income, net – related parties
Total operating expenses (1)
Total operating expenses (1)
Total operating expenses (1)
Total operating expenses (1)
443,855 480,673 924,528 929,795 
Gain (loss) on divestiture and other, netGain (loss) on divestiture and other, net(70)(2,118)(2,188)(780)
Gain (loss) on divestiture and other, net
Gain (loss) on divestiture and other, net
Operating income (loss)
Operating income (loss)
Operating income (loss)Operating income (loss)336,672 290,212 626,884 802,212 
Interest expenseInterest expense(86,182)(81,670)(167,852)(166,227)
Interest expense
Interest expense
Gain (loss) on early extinguishment of debt
Gain (loss) on early extinguishment of debt
Gain (loss) on early extinguishment of debtGain (loss) on early extinguishment of debt6,813 — 6,813 91 
Other income (expense), netOther income (expense), net2,872 1,215 4,087 61 
Other income (expense), net
Other income (expense), net
Income (loss) before income taxes
Income (loss) before income taxes
Income (loss) before income taxesIncome (loss) before income taxes260,175 209,757 469,932 636,137 
Income tax expense (benefit)Income tax expense (benefit)659 1,416 2,075 3,296 
Income tax expense (benefit)
Income tax expense (benefit)
Net income (loss)
Net income (loss)
Net income (loss)Net income (loss)259,516 208,341 467,857 632,841 
Net income (loss) attributable to noncontrolling interestsNet income (loss) attributable to noncontrolling interests6,595 4,696 11,291 17,807 
Net income (loss) attributable to noncontrolling interests
Net income (loss) attributable to noncontrolling interests
Net income (loss) attributable to Western Midstream Partners, LP (2)
Net income (loss) attributable to Western Midstream Partners, LP (2)
$252,921 $203,645 $456,566 $615,034 
Net income (loss) attributable to Western Midstream Partners, LP (2)
Net income (loss) attributable to Western Midstream Partners, LP (2)

(1)Total revenues and other includes amounts earned from services provided to related parties and from the sale of natural gas, condensate, and NGLs to related parties. Total operating expenses includes amounts charged by related parties for services received. See Note 5—6—Related-Party Transactions in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.
(2)For reconciliations to comparable consolidated results of WES Operating, see Items Affecting the Comparability of Financial Results with WES Operating within this Item 2.

For purposes of the following discussion, any increases or decreases “for the three months ended June 30, 2023” refer to the comparison of the three months ended June 30,March 31, 2024, to the three months ended December 31, 2023, or to the three months ended March 31, 2023; and any increases or decreases “for the six months ended June 30, 2023” refer to the comparison of the six months ended June 30, 2023, to the six months ended June 30, 2022.

as applicable.
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Throughput
Three Months Ended
Three Months Ended
Three Months Ended
March 31, 2024
Three Months EndedSix Months Ended
March 31, 2024
June 30, 2023March 31, 2023Inc/
(Dec)
June 30, 2023June 30, 2022Inc/
(Dec)
March 31, 2024
Throughput for natural-gas assets (MMcf/d)
Throughput for natural-gas assets (MMcf/d)
Throughput for natural-gas assets (MMcf/d)
Gathering, treating, and transportationGathering, treating, and transportation395 369 %382 408 (6)%
ProcessingProcessing3,567 3,454 %3,511 3,413 %
Processing
Processing
Equity investments (1)
Equity investments (1)
Equity investments (1)
Equity investments (1)
454 423 %438 498 (12)%
Total throughputTotal throughput4,416 4,246 %4,331 4,319 — %
Total throughput
Total throughput
Throughput attributable to noncontrolling interests (2)
Throughput attributable to noncontrolling interests (2)
Throughput attributable to noncontrolling interests (2)
Throughput attributable to noncontrolling interests (2)
162 139 17 %150 154 (3)%
Total throughput attributable to WES for natural-gas assets
Total throughput attributable to WES for natural-gas assets
4,254 4,107 %4,181 4,165 — %
Total throughput attributable to WES for natural-gas assets
Total throughput attributable to WES for natural-gas assets
Throughput for crude-oil and NGLs assets (MBbls/d)
Throughput for crude-oil and NGLs assets (MBbls/d)
Throughput for crude-oil and NGLs assets (MBbls/d)
Gathering, treating, and transportationGathering, treating, and transportation316 309 %313 317 (1)%
Equity investments (1)
Equity investments (1)
323 314 %319 367 (13)%
Equity investments (1)
Equity investments (1)
Total throughput
Total throughput
Total throughputTotal throughput639 623 %632 684 (8)%
Throughput attributable to noncontrolling interests (2)
Throughput attributable to noncontrolling interests (2)
13 12 %13 14 (7)%
Throughput attributable to noncontrolling interests (2)
Throughput attributable to noncontrolling interests (2)
Total throughput attributable to WES for crude-oil and NGLs assets
Total throughput attributable to WES for crude-oil and NGLs assets
626 611 %619 670 (8)%
Total throughput attributable to WES for crude-oil and NGLs assets
Total throughput attributable to WES for crude-oil and NGLs assets
Throughput for produced-water assets (MBbls/d)
Throughput for produced-water assets (MBbls/d)
Throughput for produced-water assets (MBbls/d)
Gathering and disposalGathering and disposal963 977 (1)%970 824 18 %
Throughput attributable to noncontrolling interests (2)
Throughput attributable to noncontrolling interests (2)
20 20 — %20 16 25 %
Throughput attributable to noncontrolling interests (2)
Throughput attributable to noncontrolling interests (2)
Total throughput attributable to WES for produced-water assets
Total throughput attributable to WES for produced-water assets
943 957 (1)%950 808 18 %
Total throughput attributable to WES for produced-water assets
Total throughput attributable to WES for produced-water assets

(1)Represents our share of average throughput for investments accounted for under the equity method of accounting.
(2)For all periods presented, includesIncludes (i) the 2.0% limited partner interest in WES Operating owned by an Occidental subsidiary and (ii) for natural-gas assets, the 25% third-party interest in Chipeta, which collectively represent WES’s noncontrolling interests.

Natural-gas assets

Total throughput attributable to WES for natural
-gas assets increased by 114 MMcf/d compared to the three months ended December 31, 2023, primarily due to (i) higher volumes at the West Texas and DJ Basin complexes due to increased production in the areas, (ii) higher volumes at the Powder River Basin complex due to the Meritage acquisition, and (iii) higher volumes on the Red Bluff Express pipeline due to the addition of a new receipt point into the pipeline. These increases were offset partially by lower volumes at the Granger complex due to a contract expiration in the fourth quarter of 2023.
Total throughput attributable to WES for natural-gas assets increased by 147883 MMcf/d forcompared to the three months ended June 30,March 31, 2023, primarily due to (i) higher volumes at the ChipetaPowder River Basin complex due to volumes being diverted away from the plant for part of December 2022 through February 2023,Meritage acquisition, (ii) higher volumes at the West Texas complexand DJ Basin complexes due to increased production in the area,areas, (iii) higher volumes at the MIGC and Marcellus Interest systems and the Chipeta and Brasada complexes, (iv) higher volumes on the Red Bluff Express (iv) higher volumes around the Granger complexpipeline due to production declines and extended winter weather conditions during the first quarteraddition of 2023,a new receipt point into the pipeline, and (v) higher volumes at the MIGC system.
Total throughput attributable to WES for natural-gas assets increased by 16 MMcf/d for the six months ended June 30, 2023, primarilySpringfield gas-gathering system due to higher volumes at the West Texas complex due to increased production in the area. This increase wasnew third-party production. These increases were offset partially by (i) lower volumes due to production declines in the areas around the Marcellus Interest systems and DJ Basin complex, (ii) decreased volumes at the Ranch Westex plant, which we acquired in the third quarter of 2022 and is included as part of the West Texas complex subsequent to the acquisition, (iii) lower volumes due to production declines and extended winter weather conditions during the first quarter of 2023 in areas around the Granger and Red Desert complexes, (iv) lower volumes at the BrasadaGranger complex due to downstream issues causing volumes to be diverted away froma contract expiration in the plant and maintenance activities, (v) lower volumes at the Chipeta complex due to volumes being diverted away from the plant for partfourth quarter of December 2022 through February 2023, and (vi) lower volumes at the Mi Vida plant.2023.


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Crude-oil and NGLs assets

Total throughput attributable to WES for crude-oil and NGLs assets increased by 15 MBbls/d for the three months ended June 30, 2023, primarily due to (i) higher volumes on the GNB NGL pipeline due to higher volumes received from the Chipeta complex compared to the first quarter of 2023 along with increased producer activity and (ii) higher volumes on the Saddlehorn pipeline.
Total throughput attributable to WES for crude-oil and NGLs assets decreased by 51137 MBbls/d forcompared to the sixthree months ended June 30,December 31, 2023, primarily due to (i) lower volumes on the Cactus II pipeline, which was solddivestiture of Whitethorn LLC, Mont Belvieu JV, Saddlehorn, and Panola in the fourthfirst quarter of 2022,2024.

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Total throughput attributable to WES for crude-oil and (ii) lower volumes atNGLs assets decreased by 46 MBbls/d compared to the DJ Basin oil system resulting from production declinesthree months ended March 31, 2023, primarily due to the divestiture of Whitethorn LLC, Mont Belvieu JV, Saddlehorn, and Panola in the area.first quarter of 2024. These decreases were offset partially by (i) increasedhigher volumes on the WhitethornThunder Creek NGL pipeline which was acquired as part of the Meritage acquisition and (ii) higher volumes at the DBM and DJ Basin oil systemsystems resulting from increased production in the area.areas.

Produced-water assets

Total throughput attributable to WES for produced-water assets increased by 14272 MBbls/d forand 169 MBbls/d compared to the sixthree months ended June 30,December 31, 2023, and March 31, 2023, respectively, due to higher production and new third-party connections brought online during the first half of 2023.production.

Service Revenues
Three Months Ended
Three Months Ended
Three Months Ended
Three Months EndedSix Months Ended
thousands except percentagesthousands except percentagesJune 30, 2023March 31, 2023Inc/
(Dec)
June 30, 2023June 30, 2022Inc/
(Dec)
thousands except percentages
thousands except percentages
Service revenues – fee based
Service revenues – fee based
Service revenues – fee basedService revenues – fee based$661,506 $647,867 %$1,309,373 $1,287,550 %
Service revenues – product basedService revenues – product based46,956 46,810 — %93,766 111,365 (16)%
Service revenues – product based
Service revenues – product based
Total service revenuesTotal service revenues$708,462 $694,677 %$1,403,139 $1,398,915 — %
Total service revenues
Total service revenues

Service revenues – fee based

Service revenues – fee based increased by $13.6$17.4 million forcompared to the three months ended June 30,December 31, 2023, primarily due to increases of (i) $8.1$16.5 million at the West Texas complex as a result of a higher average fee resulting from a cost-of-service rate redetermination effective January 1, 2024, increased throughput, and increased deficiency fees on certain contracts with increasing throughput minimums, (ii) $5.4$13.4 million at the DBM water systems due to a higher average fee resulting from a cost-of-service rate redetermination effective January 1, 2024, and increased throughput, (iii) $6.3 million at the Powder River Basin complex as a result of increased throughput attributable to the acquisition of Meritage, and (iv) $5.9 million at the DJ Basin complex due to increased throughput and deficiency fees.throughput. These increases were offset partially offset by a decreasedecreases of $2.8(i) $12.6 million at the Springfield system primarily due to an annual cost-of-service rate adjustment that increased revenue during the fourth quarter of 2023, (ii) $7.4 million at the DJ Basin oil system primarily due to decreased throughput.an annual cost-of-service rate adjustment that increased revenue during the fourth quarter of 2023, partially offset by increased throughput, and (iii) $2.3 million at the Granger complex primarily due to a contract expiration in the fourth quarter of 2023.
Service revenues – fee based increased by $21.8$133.4 million forcompared to the sixthree months ended June 30,March 31, 2023, primarily due to increases of (i) $45.7$48.9 million at the Powder River Basin complex attributable to the acquisition of Meritage, (ii) $45.8 million at the West Texas complex as a result of increased throughput, (ii) $4.3 million at the DBM oil system due to increased throughput, partially offset by a lowerhigher average fee resulting from a cost-of-service rate redetermination effective January 1, 2023,2024, and increased deficiency fees on certain contracts with increasing throughput minimums, (iii) $3.0$26.0 million at the DBM water systems due toas a result of increased throughput partially offset by decreased deficiency fees and a lowerhigher average fee resulting from a cost-of-service rate redetermination effective January 1, 2023.2024, (iv) $20.4 million at the DJ Basin complex due to increased throughput, and (v) $6.7 million at the DBM oil system as a result of increased throughput and a higher average fee resulting from a cost-of-service rate redetermination effective January 1, 2024. These increases were offset partially offset by decreases of (i) $10.3$6.6 million at the ChipetaBrasada complex due to decreased deficiency fees and throughput,a change in contract terms effective July 1, 2023, (ii) $8.4$2.8 million at the DJ Basin oil system primarily due to decreased throughput,deficiency fees on demand volumes, partially offset by increased deficiency fees,throughput, and (iii) $6.1$2.3 million at the Springfield systemGranger complex primarily due to decreased demand-fee revenue, and (iv) $4.5 million ata contract expiration in the Marcellus Interest systems due to decreased throughput.fourth quarter of 2023.

Service revenues – product based

Service revenues – product based increased by $17.2 million compared to the three months ended December 31, 2023, primarily due to increases of $12.4 million at the West Texas complex as a result of increased volumes sold and $2.4 million at the DJ Basin complex due to increased average prices.
Service revenues – product based decreasedincreased by $17.6$19.9 million forcompared to the sixthree months ended June 30,March 31, 2023, primarily due to decreasesincreases of (i) $5.1 million at the Red Desert complex due to decreased average prices and volumes sold, (ii) $4.3 million, $4.1 million, and $3.5 million at the Granger complex, Hilight system, and DJ Basin complex, respectively, due to decreased average prices, and (iii) $3.6 million at the Chipeta complex due to decreased volumes sold. These decreases were partially offset by an increase of $4.0$14.8 million at the West Texas complex primarily due to increased volumes sold and $2.4 million at the DBM water systems due to increased electricity-related rates billed to customers.

volumes sold and average prices.
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Product Sales
Three Months Ended
Three Months Ended
Three Months Ended
Three Months EndedSix Months Ended
thousands except percentages and per-unit amountsthousands except percentages and per-unit amountsJune 30, 2023March 31, 2023Inc/
(Dec)
June 30, 2023June 30, 2022Inc/
(Dec)
thousands except percentages and per-unit amounts
thousands except percentages and per-unit amounts
Natural-gas sales
Natural-gas sales
Natural-gas sales
Natural-gas sales
$7,237 $2,775 161 %$10,012 $66,363 (85)%
NGLs salesNGLs sales22,422 36,250 (38)%58,672 168,962 (65)%
NGLs sales
NGLs sales
Total Product sales
Total Product sales
Total Product salesTotal Product sales$29,659 $39,025 (24)%$68,684 $235,325 (71)%
Per-unit gross average sales price:
Per-unit gross average sales price:
Per-unit gross average sales price:
Per-unit gross average sales price:
Natural gas (per Mcf)
Natural gas (per Mcf)
Natural gas (per Mcf)Natural gas (per Mcf)$1.33 $1.75 (24)%$1.53 $5.76 (73)%
NGLs (per Bbl)NGLs (per Bbl)23.65 28.78 (18)%26.17 46.53 (44)%
NGLs (per Bbl)
NGLs (per Bbl)

Natural-gas sales

Natural
-gas sales decreased by $11.0 million compared to the three months ended December 31, 2023, primarily due to decreases of (i) $8.3 million at the West Texas complex as a result of decreased volumes sold and average prices and (ii) $2.8 million at the DJ Basin complex as a result of decreased volumes sold.
Natural-gas sales increased by $4.5$0.4 million forcompared to the three months ended June 30,March 31, 2023, primarily due to an increase of $2.7 million at the DJ Basin complex as a result of increased volumes sold,average prices, partially offset by decreased average prices at the DJ Basin complex.
Natural-gas sales decreasedvolumes sold. This increase was offset partially by $56.4 million for the six months ended June 30, 2023, primarily due to decreasesa decrease of (i) $53.4$2.2 million at the West Texas complex due to decreased average prices, partially offset by higher volumes sold, and (ii) $8.2 million at the Red Desert complex due to decreased average prices andincreased volumes sold.

NGLs sales

NGLs sales decreasedincreased by $13.8$5.6 million forcompared to the three months ended June 30,December 31, 2023, primarily due to increases of (i) $3.7 million and $1.6 million at the DJ Basin and Chipeta complexes, respectively, due to increased average prices and (ii) $2.4 million at the Powder River Basin complex as a result of increased volumes sold attributable to the acquisition of Meritage. These increases were offset partially by a decrease of $8.2 million at the West Texas complex due to a mix in contract structures, partially offset by increased average prices.
NGLs sales decreased by $0.2 million compared to the three months ended March 31, 2023, primarily due to decreases of $7.1$7.7 million and $6.6$5.8 million at the DJ Basin and West Texas complexes, respectively, due to decreased average prices.prices, partially offset by increased volumes sold. These decreases were offset partially offset by an increaseincreases of (i) $6.4 million at the Powder River Basin complex attributable to the acquisition of Meritage, (ii) $2.5 million at the DBM water systems due to increased skim-oil volumes sold and average prices, and (iii) $2.4 million at the Chipeta complex due to higherincreased volumes sold.
NGLs sales decreased by $110.3 million for the six months ended June 30, 2023, primarily due to decreases of (i) $75.3 million and $7.1 million at the West Texas and Granger complexes, respectively, due to decreased volumes sold and average prices, (ii) $16.0 million at the Chipeta complex due to decreased average prices, and (iii) $6.7 million at the Brasada complex due to a contract expiration in the third quarter of 2022.

Equity Income, Net – Related Parties
Three Months Ended
Three Months Ended
Three Months Ended
Three Months EndedSix Months Ended
thousands except percentagesthousands except percentagesJune 30, 2023March 31, 2023Inc/
(Dec)
June 30, 2023June 30, 2022Inc/
(Dec)
thousands except percentages
thousands except percentages
Equity income, net – related partiesEquity income, net – related parties$42,324 $39,021 %$81,345 $98,071 (17)%
Equity income, net – related parties
Equity income, net – related parties

Equity income, net – related parties increaseddecreased by $3.3 million forcompared to the three months ended June 30,December 31, 2023, primarily due to increasesdecreases of (i)$6.9 million at Mont Belvieu JV and $2.2 million at FRP and (ii) $1.0Saddlehorn due to the divestment of our interests in the first quarter of 2024. These decreases were partially offset by an increase of $4.8 million at Mi Vida.Whitethorn LLC due to commercial activities prior to the divestment of our interest in the first quarter of 2024.
Equity income, net – related parties decreased by $16.7$6.2 million forcompared to the sixthree months ended June 30,March 31, 2023, primarily due to decreases of (i) $7.3$6.8 million at Cactus IIMont Belvieu JV due to the divestituredivestment of our interest in the fourthfirst quarter of 2022 (see Acquisitions2024 and Divestitures within this Item 2), (ii) $4.7$2.9 million at Ranch Westex, which we acquired in the third quarterTEP. These decreases were partially offset by increases of 2022$1.9 million and is included as part of the West Texas complex subsequent to the acquisition (see Acquisitions and Divestitures within this Item 2), and (iii) $3.1$1.8 million at Mi Vida due to a decrease in gross margin.Red Bluff Express and FRP, respectively.

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Cost of Product and Operation and Maintenance Expenses
Three Months Ended
Three Months Ended
Three Months Ended
Three Months EndedSix Months Ended
thousands except percentagesthousands except percentagesJune 30, 2023March 31, 2023Inc/
(Dec)
June 30, 2023June 30, 2022Inc/
(Dec)
thousands except percentages
thousands except percentages
Residue purchases
Residue purchases
Residue purchasesResidue purchases$6,066 $15,638 (61)%$21,704 $100,160 (78)%
NGLs purchasesNGLs purchases48,942 51,829 (6)%100,771 173,054 (42)%
NGLs purchases
NGLs purchases
Other
Other
OtherOther(10,262)(16,008)36 %(26,270)(51,810)49 %
Cost of productCost of product44,746 51,459 (13)%96,205 221,404 (57)%
Cost of product
Cost of product
Operation and maintenance
Operation and maintenance
Operation and maintenanceOperation and maintenance183,431 174,239 %357,670 297,129 20 %
Total Cost of product and Operation and maintenance expensesTotal Cost of product and Operation and maintenance expenses$228,177 $225,698 %$453,875 $518,533 (12)%
Total Cost of product and Operation and maintenance expenses
Total Cost of product and Operation and maintenance expenses

Residue purchases

Residue purchases decreased by $9.6$6.4 million forcompared to the three months ended June 30,March 31, 2023, primarily due to decreases of (i) $5.6$5.1 million at the Granger complex due to decreased volumes purchaseda contract expiration in the fourth quarter of 2023 and (ii) $1.4 million at the Red Desert complex due to lower average prices.
Residue purchases decreased by $78.5 million for the six months ended June 30, 2023, primarily due to decreases of (i) $54.7$1.9 million at the West Texas complex attributable to changes in contract mix during 2022 and lower average prices, (ii) $9.4 million and $6.7 million at the Chipeta and Red Desert complexes, respectively, due to decreased volumes purchased and lower average prices, and (iii) $5.4 million at the DJ Basin complex primarily due to lower average prices.

NGLs purchases

NGLs purchases decreasedincreased by $2.9$10.1 million forcompared to the three months ended June 30,December 31, 2023, primarily due to increased volumes purchased at the West Texas complex.
NGLs purchases increased by $18.6 million compared to the three months ended March 31, 2023, primarily due to increases of (i) $16.7 million at the West Texas complex attributable to increased volumes purchased, (ii) $2.4 million at the Powder River Basin complex attributable to the acquisition of Meritage, and (iii) $2.3 million at the DBM water systems due to increased skim-oil volumes and average prices. These increases were offset partially by a decrease of $5.2 million at the DJ Basin complex primarily due to a change in contract mix during the first quarter of 2024.

Other items
Other items decreased by $6.1 million compared to the three months ended December 31, 2023, primarily due to a decrease of $2.8$10.3 million at the DJWest Texas complex due to changes in imbalance positions, partially offset by an increase of $4.2 million at the Powder River Basin complex due to lower average prices.changes in imbalance positions.
NGLs purchasesOther items decreased by $72.3$17.6 million forcompared to the sixthree months ended June 30,March 31, 2023, primarily due to decreases of (i) $42.6 million, $9.2 million, and $4.6$13.7 million at the West Texas DJ Basin, and Granger complexes, respectively, primarily due to lower average prices, (ii) $6.8 million at the Brasada complex due to a contract expiration in the third quarter of 2022, and (iii) $5.6 million at the Chipeta complex due to decreased volumes purchased and lower average prices.

Other items

Other items increased by $5.7 million for the three months ended June 30, 2023, primarily due to changes in imbalance positions, across several systems.
Other items increasedpartially offset by $25.5higher offload costs, and (ii) $2.7 million for the six months ended June 30, 2023, primarily due to an increase of $29.6and $2.6 million at the Chipeta and DJ Basin complex, partially offset by a decrease of $2.8 million at the Red Desert complex,complexes, respectively, attributable to changes in imbalance positions.

Operation and maintenance expense

Operation and maintenance expense increaseddecreased by $9.2$5.5 million forcompared to the three months ended June 30,December 31, 2023, primarily due to increasesdecreases of (i) $6.6$2.4 million in equipment rental costs, (ii) $2.0 million in each of utility expense and (ii) $3.2equipment maintenance and repair expense, (iii) $1.8 million forin mechanical-integrity costs, and (iv) $1.7 million in land-related costs. These decreases were offset partially by an increase of $5.9 million in salaries and wages costs.
Operation and maintenance expense increased by $60.5$20.7 million forcompared to the sixthree months ended June 30,March 31, 2023, primarily due to increases of (i) $19.7$11.4 million for maintenance and repair expense, (ii) $12.4 million forin salaries and wages costs, (iii) $5.4 million in regulatory and environmental expense, (iv) $4.9 million in mechanical-integrity costs, (v)(ii) $4.6 million in utility expense, (vi) $3.9(iii) $2.9 million in land-related costs,chemical and (vii) $3.3treating services, and (iv) $2.9 million in water-disposalland-related costs.

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Other Operating Expenses
Three Months EndedSix Months Ended
thousands except percentagesJune 30, 2023March 31, 2023Inc/
(Dec)
June 30, 2023June 30, 2022Inc/
(Dec)
General and administrative$53,405 $51,117 %$104,522 $96,450 %
Property and other taxes18,547 6,831 172 %25,378 41,104 (38)%
Depreciation and amortization143,492 144,626 (1)%288,118 273,618 %
Long-lived asset and other impairments
234 52,401 (100)%52,635 90 NM
Total other operating expenses$215,678 $254,975 (15)%$470,653 $411,262 14 %

NMNot meaningful
Three Months Ended
thousands except percentagesMarch 31, 2024December 31, 2023Inc/
(Dec)
March 31, 2023Inc/
(Dec)
General and administrative$67,839 $73,060 (7)%$51,117 33 %
Property and other taxes13,920 16,497 (16)%6,831 104 %
Depreciation and amortization157,991 165,187 (4)%144,626 %
Long-lived asset and other impairments
23 NM52,401 (100)%
Total other operating expenses$239,773 $254,748 (6)%$254,975 (6)%

General and administrative expenses

General and administrative expenses increaseddecreased by $2.3$5.2 million forcompared to the three months ended June 30,December 31, 2023, primarily due to increasesa decrease of (i) $3.9 million in corporate-related costs, primarily related to information technology costs, and (ii) $2.9$6.2 million in contract labor and consulting costs. These increases werecosts, partially offset by a decreasean increase of $4.4$1.1 million in personnel costs.
General and administrative expenses increased by $8.1$16.7 million forcompared to the sixthree months ended June 30,March 31, 2023, primarily due to increases of (i) $3.1 million in corporate-related costs, primarily related to information technology costs, (ii) $2.5$7.1 million in personnel costs, (ii) $5.5 million in information technology costs, and (iii) $2.5$1.6 million in contract labor and consulting costs.expense.

Property and other taxes

Property and other taxes increaseddecreased by $11.7$2.6 million forcompared to the three months ended June 30,December 31, 2023, primarily due to decreasesa decrease in the ad valorem property tax accrual during the first quarter of 2023 related to the finalization of 20222023 assessments at the DJ Basin complex.
Property and other taxes decreasedincreased by $15.7$7.1 million forcompared to the sixthree months ended June 30,March 31, 2023, primarily due to decreases in thea lower ad valorem property tax accrual recorded during the first quarter of 2023 related to the finalization of 2022 assessments at the DJ Basin complex.

Depreciation and amortization expense

Depreciation and amortization expense decreased by $1.1$7.2 million forcompared to the three months ended June 30,December 31, 2023, primarily due to a decreasedecreases of $5.1(i) $2.9 million at the DJ Basin complex due to acceleration of depreciation expense during the first quarter of 2023, partially offset by increases of (i) $2.3 million related to depreciation for capitalized information technology implementation costsupdated salvage values and (ii) $2.3$1.7 million and $1.2 million at the West Texas complex as a result of accretion adjustmentsRed Desert and Powder River Basin complexes, respectively, due to our asset retirement obligation during the first quarter of 2023.revisions.
Depreciation and amortization expense increased by $14.5$13.4 million forcompared to the sixthree months ended June 30,March 31, 2023, primarily due to increases of (i) $4.5$15.1 million at the Powder River Basin complex attributable to the acquisition of Meritage and (ii) $4.8 million and $2.5$3.1 million at the West Texas complex and DBM water systems, respectively, primarily related to capital projects being placed into service. These increases were offset partially by a decrease of $7.9 million at the DJ Basin and Red Desert complexes, respectively,complex primarily due to acceleration of depreciation expense as well as accretion adjustments to our asset retirement obligation during 2023 (ii) $3.5 million at the West Texas complex primarily resulting from capital projects being placed into service, and (iii) $2.5 million related to depreciation for capitalized information technology implementation costs.updated salvage values.

Long-lived asset and other impairment expense

Long-livedLong-lived asset and other impairment expense for the three months ended March 31, 2023, was primarily due to a $52.1 million impairment for assets located in the Rockies.
For further information on Long-lived asset and other impairment expense, see Note 7—8—Property, Plant, and Equipment in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

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Interest Expense
Three Months EndedSix Months Ended
thousands except percentagesJune 30, 2023March 31, 2023Inc/
(Dec)
June 30, 2023June 30, 2022Inc/
(Dec)
Long-term and short-term debt
$(85,088)$(81,151)%$(166,239)$(162,005)%
Finance lease liabilities(230)(163)41 %(393)(73)NM
Commitment fees and amortization of debt-related costs(3,414)(2,881)19 %(6,295)(6,100)%
Capitalized interest2,550 2,525 %5,075 1,951 160 %
Interest expense$(86,182)$(81,670)%$(167,852)$(166,227)%

Interest expense
Three Months Ended
thousands except percentagesMarch 31, 2024December 31, 2023Inc/
(Dec)
March 31, 2023Inc/
(Dec)
Long-term and short-term debt
$(95,956)$(98,977)(3)%$(81,151)18 %
Finance lease liabilities(677)(467)45 %(163)NM
Commitment fees and amortization of debt-related costs(3,200)(3,196)— %(2,881)11 %
Capitalized interest5,327 5,018 %2,525 111 %
Interest expense$(94,506)$(97,622)(3)%$(81,670)16 %

Interest expense increaseddecreased by $4.5$3.1 million forcompared to the three months ended June 30,December 31, 2023, primarily due to a decrease of $5.7 million resulting from no outstanding borrowings under the RCF during the first quarter of 2024, partially offset by an increase of $11.3$2.7 million due to borrowings on the commercial paper program that was established during the fourth quarter of 2023.
Interest expense increased by $12.8 million compared to the three months ended March 31, 2023, primarily due to increases of (i) $11.7 million of interest incurred on the 6.150% Senior Notes due 2033 that were issued during the second quarter of 2023, partially offset by a decrease of $6.3 million due to lower outstanding borrowings under the RCF during the second quarter of 2023.
Interest expense increased by $1.6 million for the six months ended June 30, 2023, primarily due to increases of (i) $11.3(ii) $9.8 million of interest incurred on the 6.150%6.350% Senior Notes due 20332029 that were issued during the secondthird quarter of 2023, and (ii) $5.8(iii) $5.7 million primarily due to higher outstanding borrowings and average interest rates underon the RCFcommercial paper program that was established during the firstfourth quarter of 2023. These increases were offset partially by decreases of (i) $5.1 million due to the redemption of the total principal amount outstanding of the 4.000% Senior Notes due 2022 during the second quarter of 2022, (ii) $3.7$4.5 million due to credit-rating related interest rate changes and a lower outstanding balancebalances on certain senior notes, (ii) $7.0 million due to no outstanding borrowings under the 4.050% Senior Notes due 2030RCF during the first quarter of 2024, and 3.100% Senior Notes due 2025, (iii) $3.1$2.8 million due to higher capitalized interest, (iv) $2.0 million due to the redemption of the total principal amount outstanding of the Floating-Rate Senior Notes due 2023 during the first quarter of 2023, and (v) $1.9 million due to credit-rating related interest rate changes on the 5.250% Senior Notes due 2050.
interest. See Liquidity and Capital Resources—Debt and credit facilities within this Item 2.

Other Income (Expense), Net
Three Months EndedSix Months Ended
thousands except percentagesJune 30, 2023March 31, 2023Inc/
(Dec)
June 30, 2023June 30, 2022Inc/
(Dec)
Other income (expense), net$2,872 $1,215 136%$4,087 $61 NM

Other income (expense), net increased by $1.7 million and $4.0 million for the three and six months ended June 30, 2023, respectively, primarily due to interest income earned resulting from higher interest rates and cash and cash equivalent balances throughout 2023.

Income Tax Expense (Benefit)

We are not a taxable entity for U.S. federal income tax purposes; therefore, our federal statutory rate is zero percent. However, income apportionable to Texas is subject to Texas margin tax.

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RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

Adjusted gross margin. We define Adjusted gross margin attributable to Western Midstream Partners, LP (“Adjusted gross margin”) as total revenues and other (less reimbursements for electricity-related expenses recorded as revenue), less cost of product, plus distributions from equity investments, and excluding the noncontrolling interest owners’ proportionate share of revenues and cost of product. We believe Adjusted gross margin is an important performance measure of our operations’ profitability and performance as compared to other companies in the midstream industry. Cost of product expenses include (i) costs associated with the purchase of natural gas and NGLs pursuant to our percent-of-proceeds, percent-of-product, and keep-whole contracts, (ii) costs associated with the valuation of gas and NGLs imbalances, (iii) costs associated with our obligations under certain contracts to redeliver a volume of natural gas to shippers, which is thermally equivalent to condensate retained by us and sold to third parties, and (iv) costs associated with our offload commitments with third parties providing firm-processing capacity. The electricity-related expenses included in our Adjusted gross margin definition relate to pass-through expenses that are reimbursed by certain customers (recordedrecorded as revenueOperation and maintenance expense with an offset recorded as Operation and maintenance expense).revenue for the reimbursement by certain customers.

Adjusted EBITDA. We define Adjusted EBITDA attributable to Western Midstream Partners, LP (“Adjusted EBITDA”) as net income (loss), plus (i) distributions from equity investments, (ii) non-cash equity-based compensation expense, (iii) interest expense, (iv) income tax expense, (v) depreciation and amortization, (vi) impairments, and (vii) other expense (including lower of cost or market inventory adjustments recorded in cost of product), less (i) gain (loss) on divestiture and other, net, (ii) gain (loss) on early extinguishment of debt, (iii) income from equity investments, (iv) interest income, (v) income tax benefit, (vi) other income, and (vii) the noncontrolling interest owners’ proportionate share of revenues and expenses. We believe the presentation of Adjusted EBITDA provides information useful to investors in assessing our financial condition and results of operations and that Adjusted EBITDA is a widely accepted financial indicator of a company’s ability to incur and service debt, fund capital expenditures, and make distributions. Adjusted EBITDA is a supplemental financial measure that management and external users of our consolidated financial statements, such as industry analysts, investors, commercial banks, and rating agencies, use, among other measures, to assess the following:
our operating performance as compared to other publicly traded partnerships in the midstream industry, without regard to financing methods, capital structure, or historical cost basis;
the ability of our assets to generate cash flow to make distributions; and
the viability of acquisitions and capital expenditures and the returns on investment of various investment opportunities.

Free cash flow. We define “Free cash flow” as net cash provided by operating activities less total capital expenditures and contributions to equity investments, plus distributions from equity investments in excess of cumulative earnings. Management considers Free cash flow an appropriate metric for assessing capital discipline, cost efficiency, and balance-sheet strength. Although Free cash flow is the metric used to assess WES’s ability to make distributions to unitholders, this measure should not be viewed as indicative of the actual amount of cash that is available for distributions or planned for distributions for a given period. Instead, Free cash flow should be considered indicative ofrepresents the amount of cash that is available in aggregate for distributions, debt repayments, and other general partnership purposes.


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Adjusted gross margin, Adjusted EBITDA, and Free cash flow are not defined in GAAP. The GAAP measure that is most directly comparable to Adjusted gross margin is gross margin. Net income (loss) and net cash provided by operating activities are the GAAP measures that are most directly comparable to Adjusted EBITDA. The GAAP measure that is most directly comparable to Free cash flow is net cash provided by operating activities. Our non-GAAP financial measures of Adjusted gross margin, Adjusted EBITDA, and Free cash flow should not be considered as alternatives to the GAAP measures of gross margin, net income (loss), net cash provided by operating activities, or any other measure of financial performance presented in accordance with GAAP. Adjusted gross margin, Adjusted EBITDA, and Free cash flow have important limitations as analytical tools because they exclude some, but not all, items that affect gross margin, net income (loss), and net cash provided by operating activities. Adjusted gross margin, Adjusted EBITDA, and Free cash flow should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Our definitions of Adjusted gross margin, Adjusted EBITDA, and Free cash flow may not be comparable to similarly titled measures of other companies in our industry, thereby diminishing their utility as comparative measures.
Management compensates for the limitations of Adjusted gross margin, Adjusted EBITDA, and Free cash flow as analytical tools by reviewing the comparable GAAP measures, understanding the differences between Adjusted gross margin, Adjusted EBITDA, and Free cash flow compared to (as applicable) gross margin, net income (loss), and net cash provided by operating activities, and incorporating this knowledge into its decision-making processes. We believe that investors benefit from having access to the same financial measures that our management considers in evaluating our operating results.
The following tables present (i) a reconciliation of the GAAP financial measure of gross margin to the non-GAAP financial measure of Adjusted gross margin, (ii) a reconciliation of the GAAP financial measures of net income (loss) and net cash provided by operating activities to the non-GAAP financial measure of Adjusted EBITDA, and (iii) a reconciliation of the GAAP financial measure of net cash provided by operating activities to the non-GAAP financial measure of Free cash flow:
Three Months Ended
Three Months Ended
Three Months Ended
thousands
thousands
Three Months EndedSix Months Ended
thousandsthousandsJune 30, 2023March 31, 2023June 30, 2023June 30, 2022
Reconciliation of Gross margin to Adjusted gross marginReconciliation of Gross margin to Adjusted gross margin
Reconciliation of Gross margin to Adjusted gross margin
Reconciliation of Gross margin to Adjusted gross margin
Total revenues and other
Total revenues and other
Total revenues and otherTotal revenues and other$738,273 $733,982 $1,472,255 $1,634,716 
Less:Less:
Less:
Less:
Cost of product
Cost of product
Cost of productCost of product44,746 51,459 96,205 221,404 
Depreciation and amortizationDepreciation and amortization143,492 144,626 288,118 273,618 
Depreciation and amortization
Depreciation and amortization
Gross margin
Gross margin
Gross marginGross margin550,035 537,897 1,087,932 1,139,694 
Add:Add:
Add:
Add:
Distributions from equity investments
Distributions from equity investments
Distributions from equity investmentsDistributions from equity investments54,075 51,975 106,050 121,811 
Depreciation and amortizationDepreciation and amortization143,492 144,626 288,118 273,618 
Depreciation and amortization
Depreciation and amortization
Less:
Less:
Less:Less:
Reimbursed electricity-related charges recorded as revenuesReimbursed electricity-related charges recorded as revenues23,286 23,569 46,855 37,446 
Reimbursed electricity-related charges recorded as revenues
Reimbursed electricity-related charges recorded as revenues
Adjusted gross margin attributable to noncontrolling interests (1)
Adjusted gross margin attributable to noncontrolling interests (1)
Adjusted gross margin attributable to noncontrolling interests (1)
Adjusted gross margin attributable to noncontrolling interests (1)
16,914 15,774 32,688 37,256 
Adjusted gross marginAdjusted gross margin$707,402 $695,155 $1,402,557 $1,460,421 
Adjusted gross margin
Adjusted gross margin

(1)For all periods presented, includesIncludes (i) the 25% third-party interest in Chipeta and (ii) the 2.0% limited partner interest in WES Operating owned by an Occidental subsidiary, which collectively represent WES’s noncontrolling interests.


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To facilitate investor and industry analysis, we also disclose per-Mcf Adjusted gross margin for natural-gas assets, per-Bbl Adjusted gross margin for crude-oil and NGLs assets, and per-Bbl Adjusted gross margin for produced-water assets.
Three Months Ended
Three Months Ended
Three Months Ended
thousands except per-unit amounts
thousands except per-unit amounts
Three Months EndedSix Months Ended
thousands except per-unit amountsthousands except per-unit amountsJune 30, 2023March 31, 2023June 30, 2023June 30, 2022
Gross marginGross margin
Gross margin
Gross margin
Gross margin for natural-gas assets (1)
Gross margin for natural-gas assets (1)
Gross margin for natural-gas assets (1)
Gross margin for natural-gas assets (1)
$409,634 $393,673 $803,307 $850,980 
Gross margin for crude-oil and NGLs assets (1)
Gross margin for crude-oil and NGLs assets (1)
88,024 89,281 177,305 180,135 
Gross margin for crude-oil and NGLs assets (1)
Gross margin for crude-oil and NGLs assets (1)
Gross margin for produced-water assets (1)
Gross margin for produced-water assets (1)
Gross margin for produced-water assets (1)
Gross margin for produced-water assets (1)
59,130 59,549 118,679 118,646 
Per-Mcf Gross margin for natural-gas assets (2)
Per-Mcf Gross margin for natural-gas assets (2)
1.02 1.03 1.02 1.09 
Per-Mcf Gross margin for natural-gas assets (2)
Per-Mcf Gross margin for natural-gas assets (2)
Per-Bbl Gross margin for crude-oil and NGLs assets (2)
Per-Bbl Gross margin for crude-oil and NGLs assets (2)
Per-Bbl Gross margin for crude-oil and NGLs assets (2)
Per-Bbl Gross margin for crude-oil and NGLs assets (2)
1.51 1.59 1.55 1.45 
Per-Bbl Gross margin for produced-water assets (2)
Per-Bbl Gross margin for produced-water assets (2)
0.68 0.68 0.68 0.80 
Per-Bbl Gross margin for produced-water assets (2)
Per-Bbl Gross margin for produced-water assets (2)
Adjusted gross margin
Adjusted gross margin
Adjusted gross marginAdjusted gross margin
Adjusted gross margin for natural-gas assets
Adjusted gross margin for natural-gas assets
$489,476 $480,009 $969,485 $1,017,892 
Adjusted gross margin for natural-gas assets
Adjusted gross margin for natural-gas assets
Adjusted gross margin for crude-oil and NGLs assets
Adjusted gross margin for crude-oil and NGLs assets
Adjusted gross margin for crude-oil and NGLs assets
Adjusted gross margin for crude-oil and NGLs assets
147,036 145,577 292,613 303,933 
Adjusted gross margin for produced-water assets
Adjusted gross margin for produced-water assets
70,890 69,569 140,459 138,596 
Adjusted gross margin for produced-water assets
Adjusted gross margin for produced-water assets
Per-Mcf Adjusted gross margin for natural-gas assets (3)
Per-Mcf Adjusted gross margin for natural-gas assets (3)
Per-Mcf Adjusted gross margin for natural-gas assets (3)
Per-Mcf Adjusted gross margin for natural-gas assets (3)
1.26 1.30 1.28 1.35 
Per-Bbl Adjusted gross margin for crude-oil and NGLs assets (3)
Per-Bbl Adjusted gross margin for crude-oil and NGLs assets (3)
2.58 2.65 2.61 2.50 
Per-Bbl Adjusted gross margin for crude-oil and NGLs assets (3)
Per-Bbl Adjusted gross margin for crude-oil and NGLs assets (3)
Per-Bbl Adjusted gross margin for produced-water assets (3)
Per-Bbl Adjusted gross margin for produced-water assets (3)
0.83 0.81 0.82 0.95 
Per-Bbl Adjusted gross margin for produced-water assets (3)
Per-Bbl Adjusted gross margin for produced-water assets (3)

(1)Excludes corporate-level depreciation and amortization.
(2)Average for period. Calculated as Gross margin for natural-gas assets, crude-oil and NGLs assets, or produced-water assets, divided by the respective total throughput (MMcf or MBbls) for natural-gas assets, crude-oil and NGLs assets, or produced-water assets.
(3)Average for period. Calculated as Adjusted gross margin for natural-gas assets, crude-oil and NGLs assets, or produced-water assets, divided by the respective total throughput (MMcf or MBbls) attributable to WES for natural-gas assets, crude-oil and NGLs assets, or produced-water assets.

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Three Months Ended
Three Months Ended
Three Months Ended
thousands
thousands
Three Months EndedSix Months Ended
thousandsthousandsJune 30, 2023March 31, 2023June 30, 2023June 30, 2022
Reconciliation of Net income (loss) to Adjusted EBITDA
Reconciliation of Net income (loss) to Adjusted EBITDA
Reconciliation of Net income (loss) to Adjusted EBITDA
Net income (loss)Net income (loss)$259,516 $208,341 $467,857 $632,841 
Add:Add:
Add:
Add:
Distributions from equity investments
Distributions from equity investments
Distributions from equity investmentsDistributions from equity investments54,075 51,975 106,050 121,811 
Non-cash equity-based compensation expense
Non-cash equity-based compensation expense
7,665 7,199 14,864 14,781 
Non-cash equity-based compensation expense
Non-cash equity-based compensation expense
Interest expense
Interest expense
Interest expenseInterest expense86,182 81,670 167,852 166,227 
Income tax expenseIncome tax expense659 1,416 2,075 3,296 
Income tax expense
Income tax expense
Depreciation and amortization
Depreciation and amortization
Depreciation and amortizationDepreciation and amortization143,492 144,626 288,118 273,618 
ImpairmentsImpairments234 52,401 52,635 90 
Impairments
Impairments
Other expense
Other expense
Other expenseOther expense199 200 399 181 
Less:Less:
Less:
Less:
Gain (loss) on divestiture and other, net
Gain (loss) on divestiture and other, net
Gain (loss) on divestiture and other, netGain (loss) on divestiture and other, net(70)(2,118)(2,188)(780)
Gain (loss) on early extinguishment of debtGain (loss) on early extinguishment of debt6,813 — 6,813 91 
Gain (loss) on early extinguishment of debt
Gain (loss) on early extinguishment of debt
Equity income, net – related parties
Equity income, net – related parties
Equity income, net – related partiesEquity income, net – related parties42,324 39,021 81,345 98,071 
Other incomeOther income2,872 1,215 4,087 106 
Other income
Other income
Adjusted EBITDA attributable to noncontrolling interests (1)
Adjusted EBITDA attributable to noncontrolling interests (1)
Adjusted EBITDA attributable to noncontrolling interests (1)
Adjusted EBITDA attributable to noncontrolling interests (1)
11,737 11,015 22,752 27,989 
Adjusted EBITDAAdjusted EBITDA$488,346 $498,695 $987,041 $1,087,368 
Adjusted EBITDA
Adjusted EBITDA
Reconciliation of Net cash provided by operating activities to Adjusted EBITDA
Reconciliation of Net cash provided by operating activities to Adjusted EBITDA
Reconciliation of Net cash provided by operating activities to Adjusted EBITDA
Net cash provided by operating activitiesNet cash provided by operating activities$490,823 $302,424 $793,247 $743,439 
Interest (income) expense, netInterest (income) expense, net86,182 81,670 167,852 166,227 
Interest (income) expense, net
Interest (income) expense, net
Accretion and amortization of long-term obligations, net
Accretion and amortization of long-term obligations, net
Accretion and amortization of long-term obligations, net
Accretion and amortization of long-term obligations, net
(2,403)(1,692)(4,095)(3,586)
Current income tax expense (benefit)Current income tax expense (benefit)728 492 1,220 1,376 
Current income tax expense (benefit)
Current income tax expense (benefit)
Other (income) expense, net
Other (income) expense, net
Other (income) expense, netOther (income) expense, net(2,872)(1,215)(4,087)(61)
Distributions from equity investments in excess of cumulative earnings – related partiesDistributions from equity investments in excess of cumulative earnings – related parties10,813 12,366 23,179 25,407 
Distributions from equity investments in excess of cumulative earnings – related parties
Distributions from equity investments in excess of cumulative earnings – related parties
Changes in assets and liabilities:
Changes in assets and liabilities:
Changes in assets and liabilities:Changes in assets and liabilities:
Accounts receivable, netAccounts receivable, net(4,078)4,037 (41)279,830 
Accounts receivable, net
Accounts receivable, net
Accounts and imbalance payables and accrued liabilities, net
Accounts and imbalance payables and accrued liabilities, net
Accounts and imbalance payables and accrued liabilities, netAccounts and imbalance payables and accrued liabilities, net(36,885)136,460 99,575 (82,909)
Other items, netOther items, net(42,225)(24,832)(67,057)(14,366)
Other items, net
Other items, net
Adjusted EBITDA attributable to noncontrolling interests (1)
Adjusted EBITDA attributable to noncontrolling interests (1)
Adjusted EBITDA attributable to noncontrolling interests (1)
Adjusted EBITDA attributable to noncontrolling interests (1)
(11,737)(11,015)(22,752)(27,989)
Adjusted EBITDAAdjusted EBITDA$488,346 $498,695 $987,041 $1,087,368 
Adjusted EBITDA
Adjusted EBITDA
Cash flow information
Cash flow information
Cash flow information
Net cash provided by operating activitiesNet cash provided by operating activities$490,823 $302,424 $793,247 $743,439 
Net cash used in investing activities(151,490)(179,178)(330,668)(170,947)
Net cash provided by (used in) investing activities
Net cash provided by (used in) investing activities
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activitiesNet cash provided by (used in) financing activities(238,025)(297,257)(535,282)(677,057)
Net cash provided by (used in) financing activities
Net cash provided by (used in) financing activities

(1)For all periods presented, includesIncludes (i) the 25% third-party interest in Chipeta and (ii) the 2.0% limited partner interest in WES Operating owned by an Occidental subsidiary, which collectively represent WES’s noncontrolling interests.

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Three Months Ended
Three Months Ended
Three Months Ended
thousands
thousands
Three Months EndedSix Months Ended
thousandsthousandsJune 30, 2023March 31, 2023June 30, 2023June 30, 2022
Reconciliation of Net cash provided by operating activities to Free cash flow
Reconciliation of Net cash provided by operating activities to Free cash flow
Reconciliation of Net cash provided by operating activities to Free cash flow
Net cash provided by operating activitiesNet cash provided by operating activities$490,823 $302,424 $793,247 $743,439 
Less:Less:
Less:
Less:
Capital expenditures
Capital expenditures
Capital expendituresCapital expenditures161,482 173,088 334,570 191,357 
Contributions to equity investments – related partiesContributions to equity investments – related parties22 110 132 5,040 
Contributions to equity investments – related parties
Contributions to equity investments – related parties
Add:
Add:
Add:Add:
Distributions from equity investments in excess of cumulative earnings – related partiesDistributions from equity investments in excess of cumulative earnings – related parties10,813 12,366 23,179 25,407 
Distributions from equity investments in excess of cumulative earnings – related parties
Distributions from equity investments in excess of cumulative earnings – related parties
Free cash flow
Free cash flow
Free cash flowFree cash flow$340,132 $141,592 $481,724 $572,449 
Cash flow informationCash flow information
Cash flow information
Cash flow information
Net cash provided by operating activitiesNet cash provided by operating activities$490,823 $302,424 $793,247 $743,439 
Net cash used in investing activities(151,490)(179,178)(330,668)(170,947)
Net cash provided by operating activities
Net cash provided by operating activities
Net cash provided by (used in) investing activities
Net cash provided by (used in) investing activities
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities
Net cash provided by (used in) financing activities
Net cash provided by (used in) financing activitiesNet cash provided by (used in) financing activities(238,025)(297,257)(535,282)(677,057)

Gross margin. Refer to Operating Results within this Item 2 for a discussion of the components of Gross margin as compared to the prior periods, including Service Revenues, Product Sales, Cost of Product (Residue purchases, NGLs purchases, and Other items), and Other Operating Expenses (Depreciation and amortization expense).
Gross margin increased by $12.1$31.4 million forcompared to the three months ended June 30,December 31, 2023, due to (i) a $6.7$29.5 million decrease in cost of product and (ii) a $4.3 million increase in total revenues and other.
Gross margin decreased by $51.8 million for the six months ended June 30, 2023, due to (i) a $162.5 million decrease in total revenues and other and (ii) a $14.5$7.2 million increasedecrease in depreciation and amortization. These amounts were offset partially by a $125.2$5.3 million increase in cost of product.
Gross margin increased by $145.8 million compared to the three months ended March 31, 2023, due to (i) a $153.7 million increase in total revenues and other and (ii) a $5.4 million decrease in cost of product. These amounts were offset partially by a $13.4 million increase in depreciation and amortization.

Net income (loss). Refer to Operating Results within this Item 2 for a discussion of the primary components of Net income (loss) as compared to the prior periods.
Net income (loss) increased by $51.2$290.5 million forcompared to the three months ended June 30,December 31, 2023, primarily due to (i) a $36.8 million decrease in total operating expenses, (ii) a $6.8$246.1 million increase in gain (loss) on early extinguishment of debt,divestiture and (iii)other, net, (ii) a $4.3$29.5 million increase in total revenues and other.other, and (iii) a $15.2 million decrease in total operating expenses.
Net income (loss) decreasedincreased by $165.0$377.9 million forcompared to the sixthree months ended June 30,March 31, 2023, primarily due to (i) a $162.5$241.7 million decreaseincrease in gain (loss) on divestiture and other, net and (ii) a $153.7 million increase in total revenues and otherother. These amounts were offset partially by (i) a $12.8 million increase in interest expense and (ii) a $16.7$6.2 million decrease in equity income, net – related parties. These amounts were offset partially by (i) a $6.7 million increase in gain (loss) on early extinguishment of debt and (ii) a $5.3 million decrease in total operating expenses.

Net cash provided by operating activities. Refer to Historical cash flow within this Item 2 for a discussion of the primary components of Net cash provided by operating activities as compared to the prior periods.

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KEY PERFORMANCE METRICS
Three Months Ended
Three Months Ended
Three Months Ended
thousands except percentages and per-unit amounts
Three Months EndedSix Months Ended
thousands except percentages and per-unit amounts
thousands except percentages and per-unit amountsthousands except percentages and per-unit amountsJune 30, 2023March 31, 2023Inc/
(Dec)
June 30, 2023June 30, 2022Inc/
(Dec)
Adjusted gross marginAdjusted gross margin$707,402 $695,155 %$1,402,557 $1,460,421 (4)%
Adjusted gross margin
Adjusted gross margin
Per-Mcf Adjusted gross margin for natural-gas assets (1)
Per-Mcf Adjusted gross margin for natural-gas assets (1)
Per-Mcf Adjusted gross margin for natural-gas assets (1)
Per-Mcf Adjusted gross margin for natural-gas assets (1)
1.26 1.30 (3)%1.28 1.35 (5)%
Per-Bbl Adjusted gross margin for crude-oil and NGLs assets (1)
Per-Bbl Adjusted gross margin for crude-oil and NGLs assets (1)
2.58 2.65 (3)%2.61 2.50 %
Per-Bbl Adjusted gross margin for crude-oil and NGLs assets (1)
Per-Bbl Adjusted gross margin for crude-oil and NGLs assets (1)
Per-Bbl Adjusted gross margin for produced-water assets (1)
Per-Bbl Adjusted gross margin for produced-water assets (1)
Per-Bbl Adjusted gross margin for produced-water assets (1)
Per-Bbl Adjusted gross margin for produced-water assets (1)
0.83 0.81 %0.82 0.95 (14)%
Adjusted EBITDAAdjusted EBITDA488,346 498,695 (2)%987,041 1,087,368 (9)%
Adjusted EBITDA
Adjusted EBITDA
Free cash flowFree cash flow340,132 141,592 140 %481,724 572,449 (16)%
Free cash flow
Free cash flow

(1)Average for period. Calculated as Adjusted gross margin for natural-gas assets, crude-oil and NGLs assets, or produced-water assets, divided by the respective total throughput (MMcf or MBbls) attributable to WES for natural-gas assets, crude-oil and NGLs assets, or produced-water assets.

Adjusted gross margin. Adjusted gross margin increased by $12.2$25.7 million forcompared to the three months ended June 30,December 31, 2023, primarily due to (i) a higher average fee resulting from a cost-of-service rate redetermination effective January 1, 2024, increased throughput, and increased deficiency fees on certain contracts with increasing throughput minimums at the West Texas complex, (ii) a higher average fee resulting from a cost-of-service rate redetermination effective January 1, 2024, and increased throughput at the DBM water systems, (iii) increased throughput at the DJ Basin complex, (iv) commercial activities prior to the divestment of our interest in the first quarter of 2024 at Whitethorn LLC, and (v) increased throughput and a higher average fee resulting from a cost-of-service rate redetermination effective January 1, 2024, at the DBM oil system. These increases were offset partially by decreases due to annual cost-of-service rate adjustments that increased revenue during the fourth quarter of 2023 at the Springfield and DJ Basin oil systems.
Adjusted gross margin increased by $149.9 million compared to the three months ended March 31, 2023, primarily due to (i) increased throughput, a higher average fee resulting from a cost-of-service rate redetermination effective January 1, 2024, and increased deficiency fees on certain contracts with increasing throughput minimums at the Chipeta,West Texas complex, (ii) increased throughput at the Powder River Basin complex attributable to the acquisition of Meritage, (iii) a higher average fee resulting from a cost-of-service rate redetermination effective January 1, 2024, and increased throughput at the DBM water systems, and (iv) increased throughput at the DJ Basin and Granger complexes,complex. These increases were offset partially by (i) decreased processing fees at the Brasada complex resulting from a change in contract terms effective July 1, 2023, and (ii) an increase in distributions from Saddlehorn.
Adjusted gross margin decreased by $57.9 million for the six months ended June 30, 2023, primarily due to (i) a decrease in distributions from Cactus II, which was sold in the fourth quarter of 2022, (ii) decreased deficiency fees and throughput at the Chipeta complex, (iii) decreased throughput at the DJ Basin complex, DJ Basin oil system, and Granger complex, and (iv) a decrease in distributions from Ranch Westex, which was acquired in the third quarter of 2022 and is included in the West Texas complex subsequent to the acquisition. These decreases were partially offset by increased throughput at the West Texas complex.TEP.
Per-Mcf Adjusted gross margin for natural-gas assets decreasedincreased by $0.04 for$0.03 compared to the three months ended June 30,December 31, 2023, primarily due to higherincreased throughput across several assets that have lower-than averageat the West Texas complex, which has a higher-than-average per-Mcf marginsmargin as compared to our other natural-gas assets.assets, in addition to a higher average fee resulting from a cost-of-service rate redetermination effective January 1, 2024, and increased deficiency fees on certain contracts with increasing throughput minimums. This increase was offset partially by a decrease resulting from an annual cost-of-service rate adjustment that increased revenue during the fourth quarter of 2023 at the Springfield system.
Per-Mcf Adjusted gross margin for natural-gas assets decreasedincreased by $0.07 for$0.02 compared to the sixthree months ended June 30,March 31, 2023, primarily due to contract mix and lower commodity prices, partially offset by(i) increased throughput at the West Texas complex.complex, which has a higher-than-average per-Mcf margin as compared to our other natural-gas assets, in addition to a higher average fee resulting from a cost-of-service rate redetermination effective January 1, 2024, and increased deficiency fees on certain contracts with increasing throughput minimums, and (ii) increased throughput at the DJ Basin complex, which has a higher-than-average per-Mcf margin as compared to our other natural-gas assets. These increases were offset partially by decreased processing fees at the Brasada complex resulting from a change in contract terms effective July 1, 2023.

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Per-Bbl Adjusted gross margin for crude-oil and NGLs assets decreasedincreased by $0.07 for$0.49 compared to the three months ended June 30,December 31, 2023, primarily due to the sale of our interests in Whitethorn LLC, Saddlehorn, Panola, and Mont Belvieu JV in the first quarter of 2024, all of which had lower-than-average per-Bbl margins as compared to our other crude-oil and NGLs assets. These increases were offset partially by decreases in demand-feerelated to (i) an annual cost-of-service rate adjustment that increased revenue andduring the fourth quarter of 2023, partially offset by increased throughput, at the DJ Basin oil system, which has a higher-than-average per-Bbl margin as compared to our other crude-oil and NGLs assets.assets, and (ii) an annual cost-of-service rate adjustment that increased revenue during the fourth quarter of 2023 at the Springfield system.
Per-Bbl Adjusted gross margin for crude-oil and NGLs assets increased by $0.11 for$0.27 compared to the sixthree months ended June 30,March 31, 2023, primarily due to (i) decreasesthe sale of our interests in throughputWhitethorn LLC, Saddlehorn, Panola, and distributions from Cactus II, which was soldMont Belvieu JV in the fourthfirst quarter of 2022, and2024, all of which had lower-than-average per-Bbl marginmargins as compared to our other crude-oil and NGLs assets, and (ii) increased throughput and a higher average fee resulting from a cost-of-service rate redetermination effective January 1, 2024, at the DBM oil system, which has a higher-than-average per-Bbl margin as compared to our other crude-oil and NGLs assets. These increases were offset partially by (i) decreased deficiency fees on demand volumes at the DJ Basin oil system and (ii) a decrease in distributions from FRP and TEP.
Per-Bbl Adjusted gross margin for produced-water assets increased by $0.02 for$0.09 and $0.14 compared to the three months ended June 30,December 31, 2023, and March 31, 2023, respectively, primarily due to increased throughput on certain fee-based contracts.
Per-Bbl Adjusted gross margin for produced-water assets decreased by $0.13 for the six months ended June 30, 2023, primarily due toand a lowerhigher average fee resulting from a cost-of-service rate redetermination effective January 1, 2023, and lower deficiency fee revenues.2024.

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Adjusted EBITDA. Adjusted EBITDA decreasedincreased by $10.3$37.7 million forcompared to the three months ended June 30,December 31, 2023, primarily due to (i) an $11.7a $29.5 million increase in propertytotal revenues and other, taxes and (ii) a $9.2$5.5 million increasedecrease in operation and maintenance expenses.expenses, (iii) a $4.7 million decrease in general and administrative expenses excluding non-cash equity-based compensation expense, and (iv) a $2.6 million decrease in property taxes. These amounts were offset partially by a $5.2 million increase in cost of product (net of lower of cost or market inventory adjustments).
Adjusted EBITDA increased by $109.7 million compared to the three months ended March 31, 2023, primarily due to (i) a $6.7$153.7 million increase in total revenues and other and (ii) a $5.3 million decrease in cost of product (net of lower of cost or market inventory adjustments), (ii) a $4.3 million increase in total revenues and other, and (iii) a $2.1 million increase in distributions from equity investments.
Adjusted EBITDA decreased. These amounts were offset partially by $100.3 million for the six months ended June 30, 2023, primarily due to (i) a $162.5 million decrease in total revenues and other, (ii) a $60.5$20.7 million increase in operation and maintenance expenses, (iii)(ii) a $15.8 million decrease in distributions from equity investments, and (iv) an $8.0$14.5 million increase in general and administrative expenses excluding non-cash equity-based compensation expense. These amounts were offset partially by (i)expense, (iii) a $125.5$7.1 million decrease in cost of product (net of lower of cost or market inventory adjustments) and (ii) a $15.7 million decreaseincrease in property and other taxes.taxes, and (iv) a $3.6 million decrease in distributions from equity investments.

Free cash flow. Free cash flow increaseddecreased by $198.5$57.1 million forcompared to the three months ended June 30,December 31, 2023, primarily due to (i) a $188.4$73.6 million increasedecrease in net cash provided by operating activities, partially offset by (i) an $11.6 million increase in distributions from equity investments in excess of cumulative earnings and (ii) an $11.6a $4.9 million decrease in capital expenditures.
Free cash flow decreasedincreased by $90.7$83.4 million forcompared to the sixthree months ended June 30,March 31, 2023, primarily due to a $143.2 million increase in capital expenditures, offset partially by (i) a $49.8$97.3 million increase in net cash provided by operating activities and (ii) a $4.9$6.7 million decreaseincrease in contributions todistributions from equity investments.investments in excess of cumulative earnings. These amounts were offset partially by a $20.7 million increase in capital expenditures.
See Capital Expenditures and Historical Cash Flow within this Item 2 for further information.

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LIQUIDITY AND CAPITAL RESOURCES

Our primary cash uses include equity and debt service, operating expenses, and capital expenditures. Our sources of liquidity, as of June 30, 2023,March 31, 2024, included cash and cash equivalents, cash flows generated from operations, availableeffective borrowing capacity under the RCF, our commercial paper program, and potential issuances of additional equity or debt securities. We believe that cash flows generated from these sources will be sufficient to satisfy our short-term working capital requirements and long-term capital-expenditure and debt-service requirements.
The amount of future distributions to unitholders will be determined by the Board on a quarterly basis. Under our partnership agreement, we distribute all of our available cash (beyond proper reserves as defined in our partnership agreement) within 55 days following each quarter’s end. Our cash flow and resulting ability to make cash distributions are dependent on our ability to generate cash flow from operations. Generally, our available cash is our cash on hand at the end of a quarter after the payment of our expenses and the establishment of cash reserves and cash on hand resulting from working capital borrowings made after the end of the quarter. The general partner establishes cash reserves to provide for the proper conduct of our business, including (i) to fund future capital expenditures, (ii) to comply with applicable laws, debt instruments, or other agreements, or (iii) to provide funds for unitholder distributions for any one or more of the next four quarters. The Board declared a cash distribution to unitholders for the secondfirst quarter of 20232024 of $0.5625$0.875 per unit, a 12.5% increase from the prior quarter, or $221.4$340.9 million in the aggregate. The cash distribution is payable on August 14, 2023,May 15, 2024, to our unitholders of record at the close of business on July 31, 2023.May 1, 2024.
To facilitate the distribution of available cash, during 2022 we adopted a financial policy that provided for an additional distribution (“Enhanced Distribution”) to be paid in conjunction with the regular first-quarter distribution of the following year (beginning in 2023), in a target amount equal to Free cash flow generated in the prior year after subtracting Free cash flow used for the prior year’s debt repayments, regular-quarter distributions, and unit repurchases. This Enhanced Distribution is subject to Board discretion, the establishment of cash reserves for the proper conduct of our business, and is also contingent on the attainment of prior year-end net leverage thresholds (the ratio of our total principal debt outstanding less total cash on hand as of the end of such period, as compared to our trailing-twelve-months Adjusted EBITDA), after taking the Enhanced Distribution for such prior year into effect. Free cash flow and Adjusted EBITDA are defined under the caption Reconciliation of Non-GAAP Financial Measures within this Item 2. In April 2023, the Board approved an Enhanced Distribution of $0.356 per unit, or $140.1 million, related to our 2022 performance, which was paid in conjunction with our regular first-quarter 2023 distribution on May 15, 2023.
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In 2022, we announced a common-unit buyback program of up to $1.25 billion through December 31, 2024. The common units may be purchased from time to time in the open market at prevailing market prices or in privately negotiated transactions. The timing and amount of purchases under the program will be determined based on ongoing assessments of capital needs, our financial performance, the market price of our common units, and other factors, including organic growth and acquisition opportunities and general market conditions. The program does not obligate us to purchase any specific dollar amount or number of units and may be suspended or discontinued at any time. During the sixthree months ended June 30,March 31, 2024, there were no common units repurchased. During the three months ended March 31, 2023, we repurchased 287,322285,688 common units for an aggregate purchase price of $7.1 million. The units were canceled immediately upon receipt. As of June 30, 2023,March 31, 2024, we had an authorized amount of $755.3$627.8 million remaining under the program.
For the year ended December 31, 2023, capital expenditures are expected to range between $700.0 million to $800.0 million (accrual-based, includes equity investments, excludes capitalized interest, and excludes capital expenditures associated with the 25% third-party interest in Chipeta), representing a $125.0 million increase to the midpoint of our previously announced guidance in February 2023. Total-year capital expenditures guidance includes capital expenditures attributable to (i) a portion of Mentone Train III, (ii) a portion of the North Loving plant, a new 250 MMcf/d cryogenic processing plant in the North Loving area of our West Texas complex that was sanctioned in May 2023, and (iii) additional expansion capital needed to support new commercial activity.
Management continuously monitors our leverage position and other financial projections to manage the capital structure according to long-term objectives. We may, from time to time, seek to retire, rearrange, or amend some or all of our outstanding debt or financing agreements through cash purchases, exchanges, open-market repurchases, privately negotiated transactions, tender offers, or otherwise. Such transactions, if any, will depend on prevailing market conditions, our liquidity position and requirements, contractual restrictions, and other factors, and the amounts involved may be material. Our ability to generate cash flows is subject to a number of factors, some of which are beyond our control. Read Risk Factors under Part II, Item 1A of this Form 10-Q.

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Working capital. Working capital is an indication of liquidity and potential needs for short-term funding. Working capital requirements are driven by changes in accounts receivable and accounts payable and other factors such as credit extended to, and the timing of collections from, our customers, and the level and timing of our spending for acquisitions, maintenance, and other capital activities. As of June 30, 2023,March 31, 2024, we had a $175.7$358.2 million working capital surplus, which we define as the amount by which current assets exceed current liabilities. As of June 30, 2023,March 31, 2024, there was $2.0$1.9 billion available forin effective borrowing capacity under the RCF.RCF, after taking into account the $100.0 million of outstanding commercial paper borrowings, for which we maintain availability under the RCF as support for our commercial paper program. See Note 8—9—Selected Components of Working Capital and Note 9—10—Debt and Interest Expense in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

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Capital expenditures. Our business is capital intensive, requiring significant investment to maintain and improve existing facilities or to develop new midstream infrastructure. Capital expenditures include maintenance capital expenditures, which include those expenditures required to maintain existing operating capacity and service capability of our assets, and expansion capital expenditures, which include expenditures to construct new midstream infrastructure and expenditures incurred to reduce costs, increase revenues, or increase system throughput or capacity from current levels.
Capital expenditures in the consolidated statements of cash flows reflect capital expenditures on a cash basis, when payments are made. Capital incurred is presented on an accrual basis. CapitalAcquisitions and capital expenditures as presented in the consolidated statements of cash flows and capital incurred were as follows:
Six Months Ended 
June 30,
Three Months Ended
March 31,
Three Months Ended
March 31,
Three Months Ended
March 31,
thousandsthousands20232022
thousands
thousands
Acquisitions
Acquisitions
Acquisitions
Capital expenditures (1)
Capital expenditures (1)
Capital expenditures (1)
Capital expenditures (1)
$334,570 $191,357 
Capital incurred (1)
Capital incurred (1)
368,683 207,996 
Capital incurred (1)
Capital incurred (1)

(1)For the sixthree months ended June 30,March 31, 2024 and 2023, and 2022, included $5.1$5.3 million and $2.0$2.5 million, respectively, of capitalized interest.

Capital expenditures increased by $143.2$20.7 million for the sixthree months ended June 30, 2023,March 31, 2024, primarily due to increases of (i) $66.5$12.4 million at the West Texas complex, primarily attributable to facility expansion, including ongoing constructionengineering and equipment milestone payments for the North Loving Plant, (ii) $10.9 million related to the acquisition of Mentone Train III,Meritage, (iii) $6.2 million at the DJ Basin complex due to the purchase of a field office in the first quarter of 2024 and an increase in well connection and pipeline projects, (ii) $54.3and (iv) $5.4 million in corporate-level capital expenditures. These increases were offset partially by a decrease of $13.3 million at the DBM water systems due to reduced construction of additional water-disposal wells and facilities and pipeline projects, and (iii) $17.1 million at the DBM oil system, primarily related to an increase in pipeline, oil treating, and oil pumpingwell-connect projects.
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Historical cash flow. The following table and discussion present a summary of our net cash flows provided by (used in) operating, investing, and financing activities:
Three Months Ended
March 31,
Three Months Ended
March 31,
Three Months Ended
March 31,
Six Months Ended 
June 30,
thousands
thousands
thousandsthousands20232022
Net cash provided by (used in):Net cash provided by (used in):
Net cash provided by (used in):
Net cash provided by (used in):
Operating activities
Operating activities
Operating activitiesOperating activities$793,247 $743,439 
Investing activitiesInvesting activities(330,668)(170,947)
Investing activities
Investing activities
Financing activities
Financing activities
Financing activitiesFinancing activities(535,282)(677,057)
Net increase (decrease) in cash and cash equivalentsNet increase (decrease) in cash and cash equivalents$(72,703)$(104,565)
Net increase (decrease) in cash and cash equivalents
Net increase (decrease) in cash and cash equivalents

Operating activities. Net cash provided by operating activities increased for the sixthree months ended June 30, 2023,March 31, 2024, primarily due to the impact of changes in assets and liabilities. This increase washigher cash operating income, partially offset by (i) lower cash operating income, (ii) lower distributions from equity investments and (iii) higher interest expense. Refer to Operating Results within this Item 2 for a discussion of our results of operations as compared to the prior periods.

Investing activities. Net cash used inprovided by investing activities for the sixthree months ended June 30, 2023,March 31, 2024, primarily included the following:
$334.6582.7 million of proceeds related to the sale of several equity investments to third parties;

$19.0 million of distributions received from equity investments in excess of cumulative earnings;

$193.8 million of capital expenditures, primarily related to expansion, construction, and asset-integrity projects at the West Texas complex, DBM water systems, DJ Basin complex, Powder River Basin complex, and DBM oil system; and

$10.7 million of increases to materials and supplies inventory.

Net cash used in investing activities for the three months ended March 31, 2023, primarily included the following:
$173.1 million of capital expenditures, primarily related to construction, expansion, and asset-integrity projects at the West Texas complex, DBM water systems, DBM oil system, and DJ Basin complex;

$19.118.3 million of increases to materials and supplies inventory; and

$23.2 million of distributions received from equity investments in excess of cumulative earnings.

Net cash used in investing activities for the six months ended June 30, 2022, primarily included the following:
$191.4 million of capital expenditures, primarily related to construction, expansion, and asset-integrity projects at the West Texas complex, DBM water systems, DJ Basin complex, and DBM oil system;

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$5.0 million of capital contributions primarily paid to Red Bluff Express; and

$25.412.4 million of distributions received from equity investments in excess of cumulative earnings.

Financing activities. Net cash used in financing activities for the sixthree months ended June 30, 2023,March 31, 2024, primarily included the following:
$595.0510.4 million of net repayments of outstanding borrowings under the RCF;commercial paper program;

$548.2229.1 million of distributions paid to WES unitholders and noncontrolling interest owners; and

$14.5 million to purchase and retire portions of certain of WES Operating’s senior notes via open-market repurchases.

Net cash used in financing activities for the three months ended March 31, 2023, primarily included the following:
$213.1 million to redeem the total principal amount outstanding on the Floating-Rate Senior Notes due 2023 at par value;

$110.2203.1 million of distributions paid to purchaseWES unitholders and retire portionsnoncontrolling interest owners;

$100.0 million of certainrepayments of WES Operating’s senior notes via open-market repurchases;outstanding borrowings under the RCF;
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$7.1 million of unit repurchases;

$740.9 million of net proceeds from the 6.150% Senior Notes due 2033 issued in April 2023, which were used to repay borrowings under the RCF and for general partnership purposes; and

$220.0 million of borrowings under the RCF, which were used for general partnership purposes.

Net cash used in financing activities for the six months ended June 30, 2022, primarily included the following:
$883.5 million to redeem the total principal amount outstanding of WES Operating’s 4.000% Senior Notes due 2022 and repay borrowings under the RCF;

$340.9 million of distributions paid to WES unitholders;

$79.2 million of unit repurchases;

$8.8 million of distributions paid to the noncontrolling interest owner of WES Operating;

$3.2 million of distributions paid to the noncontrolling interest owner of Chipeta;

$634.0 million of borrowings under the RCF, which were used for general partnership purposes and to redeem portions of certain of WES Operating’s senior notes; and

$13.0 million of increases in outstanding checks.

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Debt and credit facilities. As of June 30, 2023,March 31, 2024, the carrying value of outstanding debt was $6.8$7.4 billion and we have no borrowings due within the next year, and have $2.0$1.9 billion of availablein effective borrowing capacity under WES Operating’s $2.0 billion RCF.RCF, after taking into account the $100.0 million of outstanding commercial paper borrowings, for which we maintain availability under the RCF as support for WES Operating’s commercial paper program.
During the second quarter of 2023,three months ended March 31, 2024, WES Operating (i) completed the public offering of $750.0 million in aggregate principal amount of 6.150% Senior Notes due 2033, (ii) entered into an amendment to our RCF to, among other things, extend the maturity date to April 2028 and provide for a maximum borrowing capacity up to $2.0 billion through the maturity date, and (iii) purchased and retired $117.6$15.1 million of certain of its senior notes via open-market repurchases.
In May 2023, Fitch Ratings upgraded WES Operating’srepurchases with cash from operations and a gain of $0.5 million was recognized for the early retirement of portions of these notes. As of March 31, 2024, the 3.100% Senior Notes due 2025 were classified as long-term debt from “BB+”on the consolidated balance sheet as WES Operating has ability and intent to “BBB-.” WES Operating’s senior unsecured debt ratings is now investment grade at Standard and Poor’s, Moody’s Investors Services, and Fitch Ratings. As a result of the upgrade, annualized borrowing costs will decrease by $6.9 million on WES Operating’s senior notes that are subject to effective interest-rate adjustments from a change in credit rating.
refinance these obligations using long-term debt. Subsequent to June 30, 2023,March 31, 2024, WES Operating purchased and retired $159.1$134.9 million of certain of its senior notes via open-market repurchases.
For additional information on our senior notes, RCF, and the RCF,commercial paper program, see Note 9—10—Debt and Interest Expense in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

Offload commitments. We have entered into offload agreements with third parties providing firm-processing capacity through 2025. As of June 30, 2023, we have future minimum payments under offload agreements totaling $9.2 million for the remainder of 2023 and a total of $11.7 million in years thereafter.

Pipeline commitments. We have entered into transportation contracts with volume commitments on multiple pipelines through 2033. As of June 30, 2023, we have estimated future minimum-volume-commitment fees totaling $3.1 million for the remainder of 2023, and a total of $51.7 million in years thereafter.

Credit risk. We bear credit risk through exposure to non-payment or non-performance by our counterparties, including Occidental, financial institutions, customers, and other parties. Generally, non-payment or non-performance results from a customer’s inability to satisfy payables to us for services rendered, minimum-volume-commitment deficiency payments owed, or volumes owed pursuant to gas- or NGLs-imbalance agreements. We examine and monitor the creditworthiness of customers and may establish credit limits for customers. We are subject to the risk of non-payment or late payment by producers for gathering, processing, transportation, and disposal fees. Additionally, we continue to evaluate counterparty credit risk and, in certain circumstances, are exercising our contractual rights to request adequate assurance.assurance of performance.
We expect our exposure to the concentrated risk of non-payment or non-performance to continue for as long as our commercial relationships with Occidental generate a significant portion of our revenues. While Occidental is our contracting counterparty, gathering and processing arrangements with affiliates of Occidental on most of our systems include not just Occidental-produced volumes, but also, in some instances, the volumes of other working-interest owners of Occidental who rely on our facilities and infrastructure to bring their volumes to market. See Note 5—6—Related-Party Transactions in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.
Our ability to make cash distributions to our unitholders may be adversely impacted if Occidental becomes unable to perform under the terms of gathering, processing, transportation, and disposal agreements.

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ITEMS AFFECTING THE COMPARABILITY OF FINANCIAL RESULTS WITH WES OPERATING

Our consolidated financial statements include the consolidated financial results of WES Operating. Our results of operations do not differ materially from the results of operations and cash flows of WES Operating, which are reconciled below.

Reconciliation of net income (loss). The differences between net income (loss) attributable to WES and WES Operating are reconciled as follows:
Three Months Ended
Three Months Ended
Three Months Ended
Three Months EndedSix Months Ended
thousandsthousandsJune 30, 2023March 31, 2023June 30, 2023June 30, 2022
thousands
thousands
Net income (loss) attributable to WES
Net income (loss) attributable to WES
Net income (loss) attributable to WESNet income (loss) attributable to WES$252,921 $203,645 $456,566 $615,034 
Limited partner interest in WES Operating not held by WES (1)
Limited partner interest in WES Operating not held by WES (1)
5,185 4,161 9,346 12,584 
Limited partner interest in WES Operating not held by WES (1)
Limited partner interest in WES Operating not held by WES (1)
General and administrative expenses (2)
General and administrative expenses (2)
General and administrative expenses (2)
General and administrative expenses (2)
1,186 232 1,418 1,362 
Other income (expense), netOther income (expense), net(129)(25)(154)(7)
Other income (expense), net
Other income (expense), net
Income taxes
Income taxes
Income taxes
Net income (loss) attributable to WES OperatingNet income (loss) attributable to WES Operating$259,163 $208,013 $467,176 $628,973 
Net income (loss) attributable to WES Operating
Net income (loss) attributable to WES Operating

(1)Represents the portion of net income (loss) allocated to the limited partner interest in WES Operating not held by WES. A subsidiary of Occidental held a 2.0% limited partner interest in WES Operating for all periods presented.
(2)Represents general and administrative expenses incurred by WES separate from, and in addition to, those incurred by WES Operating.

Reconciliation of net cash provided by (used in) operating and financing activities. The differences between net cash provided by (used in) operating and financing activities for WES and WES Operating are reconciled as follows:
Three Months Ended
March 31,
Six Months Ended 
June 30,
Three Months Ended
March 31,
Three Months Ended
March 31,
thousands
thousands
thousandsthousands20232022
WES net cash provided by operating activitiesWES net cash provided by operating activities$793,247 $743,439 
WES net cash provided by operating activities
WES net cash provided by operating activities
General and administrative expenses (1)
General and administrative expenses (1)
General and administrative expenses (1)
General and administrative expenses (1)
1,418 1,362 
Non-cash equity-based compensation expense
Non-cash equity-based compensation expense
(287)(276)
Non-cash equity-based compensation expense
Non-cash equity-based compensation expense
Changes in working capitalChanges in working capital(14,327)(7,835)
Changes in working capital
Changes in working capital
Other income (expense), net
Other income (expense), net
Other income (expense), netOther income (expense), net(154)(7)
WES Operating net cash provided by operating activitiesWES Operating net cash provided by operating activities$779,897 $736,683 
WES Operating net cash provided by operating activities
WES Operating net cash provided by operating activities
WES net cash provided by (used in) financing activities
WES net cash provided by (used in) financing activities
WES net cash provided by (used in) financing activitiesWES net cash provided by (used in) financing activities$(535,282)$(677,057)
Distributions to WES unitholders (2)
Distributions to WES unitholders (2)
533,556 340,946 
Distributions to WES unitholders (2)
Distributions to WES unitholders (2)
Distributions to WES from WES Operating (3)
Distributions to WES from WES Operating (3)
Distributions to WES from WES Operating (3)
Distributions to WES from WES Operating (3)
(545,277)(431,653)
Increase (decrease) in outstanding checksIncrease (decrease) in outstanding checks 104 
Increase (decrease) in outstanding checks
Increase (decrease) in outstanding checks
Unit repurchases
Unit repurchases
Unit repurchasesUnit repurchases7,102 79,217 
OtherOther13,415 7,007 
Other
Other
WES Operating net cash provided by (used in) financing activitiesWES Operating net cash provided by (used in) financing activities$(526,486)$(681,436)
WES Operating net cash provided by (used in) financing activities
WES Operating net cash provided by (used in) financing activities

(1)Represents general and administrative expenses incurred by WES separate from, and in addition to, those incurred by WES Operating.
(2)Represents distributions to WES common unitholders paid under WES’s partnership agreement. See Note 3—4—Partnership Distributions and Note 4—5—Equity and Partners’ Capital in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.
(3)Difference attributable to elimination in consolidation of WES Operating’s distributions on partnership interests owned by WES. See Note 3—4—Partnership Distributions and Note 4—5—Equity and Partners’ Capital in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.


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Noncontrolling interest. WES Operating’s noncontrolling interest consists of the 25% third-party interest in Chipeta. See Note 1—Description of Business and Basis of Presentation in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

WES Operating distributions. WES Operating distributes all of its available cash on a quarterly basis to WES Operating unitholders in proportion to their share of limited partner interests in WES Operating. See Note 3—4—Partnership Distributions in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

CRITICAL ACCOUNTING ESTIMATES

The preparation of consolidated financial statements in accordance with GAAP requires management to make informed judgments and estimates that affect the amounts of assets and liabilities as of the date of the financial statements and the amounts of revenues and expenses recognized during the periods reported. There have been no significant changes to our critical accounting estimates from those disclosed in our annual report on Form 10-K for the fiscal year ended December 31, 2022.2023.

RECENT ACCOUNTING DEVELOPMENTS

See Note 1—Description of Business and Basis of Presentation in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Commodity-price risk. There have been no significant changes to our commodity-price risk discussion from the disclosure set forth under Part II, Item 7A in our Form 10-K for the year ended December 31, 2022,2023, except as noted below and in Outlook under Part I, Item 2 of this Form 10-Q.
For the sixthree months ended June 30, 2023,March 31, 2024, 95% of our wellhead natural-gas volume (excluding equity investments) and 100% of our crude-oil and produced-water throughput (excluding equity investments) were serviced under fee-based contracts. A 10% increase or decrease in commodity prices would not have a material impact on our operating income (loss), financial condition, or cash flows for the next 12 months, excluding the effect of imbalances.

Interest-rate risk. The Federal Open Market Committee increased its target range sevenfour times for the federal funds rate in 20222023 and increasedhas made no changes to its target range three times during the sixthree months ended June 30, 2023.March 31, 2024. Any future increases in the federal funds rate likely will result in an increase in financing costs. As of June 30, 2023,March 31, 2024, WES Operating had (i) no outstanding borrowings under the RCF that bear interest at a rate based on the Secured Overnight Financing Rate (“SOFR”) or an alternative base rate at WES Operating’s option.option and (ii) $100.0 million of outstanding commercial paper borrowings. While a 10% change in the applicable benchmark interest rate would not materially impact interest expense on our outstanding borrowings at June 30, 2023,March 31, 2024, it would impact the fair value of the senior notes.
Additional short-term or variable-rate debt may be issued in the future, either under the RCF or other financing sources, including commercial paper borrowings or debt issuances.

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Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures. The Chief Executive Officer and Chief Financial Officer of WES’s general partner and WES Operating GP (for purposes of this Item 4, “Management”) performed an evaluation of WES’s and WES Operating’s disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. WES’s and WES Operating’s disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports that are filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC, and to ensure that the information required to be disclosed in the reports that are filed or submitted under the Exchange Act is accumulated and communicated to management, including the principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Based on this evaluation, Management concluded that WES’s and WES Operating’s disclosure controls and procedures were effective as of June 30, 2023.March 31, 2024.

Changes in Internal Control Over Financial Reporting. On April 1, 2023, WES and WES Operating implemented a new Enterprise Resource Planning (“ERP”) system. As a result of this implementation, certain internal controls over financial reporting have been automated, modified, or implemented to address the new environment associated with the implementation of this type of system. While WES and WES Operating believe that this system will strengthen the internal control system, there are inherent risks in implementing any new system and WES and WES Operating will continue to evaluate these control changes as part of their assessments of internal control over financial reporting. Other than the ERP implementation, there have beenThere were no changes in WES or WES Operating’s internal control over financial reporting that occurred during the quarter ended June 30, 2023, that materially affected, or are reasonably likely to materially affect, WESWES’s or WES Operating’s internal control over financial reporting during the most recent fiscal quarter.quarter ended March 31, 2024, that have materially affected, or are reasonably likely to materially affect, WES’s or WES Operating’s internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

In 2020, the U.S. Department of Justice, on behalf of the U.S. Environmental Protection Agency (the “EPA”), and the State of Colorado, on behalf of the Colorado Department of Public Health and the Environment (the “CDPHE”) commenced an enforcement action in the United States District Court for the District of Colorado against Kerr-McGee Gathering LLC (“KMG”), a wholly owned subsidiary of WES, for alleged non-compliance with the leak detection and repair requirements of the federal Clean Air Act and the Colorado Air Pollution Prevention and Control Act at its Fort Lupton, Platte Valley, and Lancaster facilities in the DJ Basin complex. We reached an agreement to resolve these allegations with the EPA and the CDPHE pursuant to a consent decree that became effective on June 15, 2023. While such resolution includes an injunctive relief component and payment of a civil penalty, which exceeds the disclosure threshold amount required by Item 103 of Regulation S-K, the resolution of these claims did not have a material impact on WES’s results of operations, cash flows, or financial condition.
On October 29, 2020, WGR Operating, LP (“WGR”), on behalf of itself and derivatively on behalf of Mont Belvieu JV, filed suit against Enterprise Products Operating, LLC (“Enterprise”) and Mont Belvieu JV (as a nominal defendant) in the District Court of Harris County, Texas. Our lawsuit seeks a declaratory judgment regarding proper revenue allocation as set forth in the Operating Agreement between Mont Belvieu JV (of which WGR is a 25% owner) and Enterprise (the “Operating Agreement”) related to fractionation trains at the Mont Belvieu complex in Chambers County, Texas. Specifically, the Operating Agreement sets forth a revenue allocation structure, whereby revenue would be allocated to the various fracs at the Mont Belvieu complex in sequential order, with Fracs VII and VIII (which are owned by Mont Belvieu JV) following Fracs I through VI, but preceding any “Later Frac Facilities.” Subsequent to the construction of Fracs VII and VIII, Enterprise built Fracs IX, X, and XI, which it wholly owns, and has treated such subsequent fracs as outside the Mont Belvieu revenue allocation. We do not believe Enterprise’s attempt to bypass the agreed-to revenue allocation is proper under the parties’ agreements and now seek judicial determination. We currently sue only for declaratory judgment to avoid potential future damages. We cannot make any assurances regarding the ultimate outcome of this proceeding and its resulting impact on WGR or WES.
On November 22, 2022, WGR filed suit against Enterprise Crude Oil LLC (“ECO”) in the District Court of Harris County, Texas. Our lawsuit alleges that ECO breached a contract related to the Whitethorn joint venture pursuant to which ECO must share with WGR certain of the profits and losses generated by ECO’s hydrocarbon trading activity conducted utilizing the Whitethorn pipeline. Specifically, we claim that ECO has engaged in trades knowing that the revenue to be realized would be less than the minimum floor set under the contract and has failed to allocate revenues and expenses as prescribed by the contract, resulting in improper losses to WGR. Enterprise has filed a counterclaim to our lawsuit, alleging that, between 2017 and 2019, it had mistakenly overpaid WGR approximately $12.0 million in trading profits and seeking recovery of such amount. We cannot make any assurances regarding the ultimate outcome of this proceeding and its resulting impact on WGR or WES.
Except as discussed above, we are not a party to any legal, regulatory, or administrative proceedings other than proceedings arising in the ordinary course of business. Management believes that there are no such proceedings for which a final disposition could have a material adverse effect on results of operations, cash flows, or financial condition, or for which disclosure is otherwise required by Item 103 of Regulation S-K.
    
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Item 1A. Risk Factors

Security holders and potential investors in our securities should carefully consider the risk factors set forth under Part I, Item 1A in our Form 10-K for the year ended December 31, 2022,2023, together with all of the other information included in this document, and in our other public filings, press releases, and public discussions with management.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table sets forth information with respect to repurchases made by WES of its common units in the open market or in privately negotiated transactions under the $1.25 billion Purchase Program during the secondfirst quarter of 2023:2024:
PeriodTotal number of units purchasedAverage price paid per unit
Total number of units purchased as part of publicly announced plans or programs (1)
Approximate dollar value of units that may yet be purchased under the plans or programs (1)
April 1-30, 2023— $— — $755,348,136 
May 1-31, 20231,634 24.99 1,634 755,307,310 
June 1-30, 2023— — — 755,307,310 
Total1,634 24.99 1,634 
PeriodTotal number of units purchasedAverage price paid per unit
Total number of units purchased as part of publicly announced plans or programs (1)
Approximate dollar value of units that may yet be purchased under the plans or programs(1)
January 1-31, 2024— $— — $627,807,310 
February 1-29, 2024— — — 627,807,310 
March 1-31, 2024— — — 627,807,310 
Total— — — 
______________________________________________________________________________________

(1)In 2022, the Board authorized WES to buy back up to $1.25 billion of our common units through December 31, 2024. See Note 4—5—Equity and Partners’ Capital in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q for additional details.

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Item 5. Other Information

Insider Trading Arrangements

Rule 10b5-1 under the Exchange Act provides an affirmative defense that enables prearranged transactions in securities in a manner that avoids concerns about initiating transactions at a future date while possibly in possession of material nonpublic information. Our Insider Trading Policy permits our directors and executive officers to enter into trading plans designed to comply with Rule 10b5-1. During the three months ended June 30, 2023,March 31, 2024, none of our executive officers or directors adopted or terminated a Rule 10b5-1 trading planarrangement (as defined in Item 408(a)(1)(i) of Regulation S-K) or adopted or terminated a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K).

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Item 6. Exhibits

Exhibits designated by an asterisk (*) are filed herewith and those designated with asterisks (**) are furnished herewith; all exhibits not so designated are incorporated herein by reference to a prior filing as indicated.

Exhibit Index
Exhibit
Number
Description
#2.1
3.1
3.2
3.3
3.4
3.5
3.6
3.7
3.8
3.9
3.10
3.11
3.12
3.13
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Exhibit
Number
Description
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
4.9
4.10
4.11
4.12
4.13
4.14
4.15
4.16
4.17
4.18
Exhibit
Number
Description
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
4.9
4.10
4.11
4.12
4.13
4.14
4.15
4.16
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Exhibit
Number
Exhibit
Number
Description
4.19
4.20
4.21
4.22
4.23
4.24
10.1
Exhibit
Number
Exhibit
Number
Description
4.4.17
4.4.18
4.4.19
4.4.20
4.4.21
4.4.22
4.4.23
4.4.24
4.4.25
4.4.26
**10.1
**10.2
**10.3
*
*
**31.131.1
**31.2*31.2
**31.3*31.3
**31.4*31.4
****32.1**32.1
****32.2**32.2
*101.INSXBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
*101.SCHInline XBRL Schema Document
*101.CALInline XBRL Calculation Linkbase Document
*101.DEFInline XBRL Definition Linkbase Document
*101.LABInline XBRL Label Linkbase Document
*101.PREInline XBRL Presentation Linkbase Document
*104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
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Exhibit
Number
Description
*101.INSXBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
*101.SCHInline XBRL Schema Document
*101.CALInline XBRL Calculation Linkbase Document
*101.DEFInline XBRL Definition Linkbase Document
*101.LABInline XBRL Label Linkbase Document
*101.PREInline XBRL Presentation Linkbase Document
*104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

#Pursuant to Item 601(b)(2) of Regulation S-K, the registrant agrees to furnish supplementally a copy of any omitted schedule to the Securities and Exchange Commission upon request.
Portions of this exhibit have been omitted as confidential pursuant to Item 601(b)(10) of Regulation S-K or a request for confidential treatment.
Management contracts or compensatory plans or arrangements required to be filed pursuant to Item 15.
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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

WESTERN MIDSTREAM PARTNERS, LP
AugustMay 8, 20232024
/s/ Michael P. Ure
Michael P. Ure
President and Chief Executive Officer
Western Midstream Holdings, LLC
(as general partner of Western Midstream Partners, LP)
AugustMay 8, 20232024
/s/ Kristen S. Shults
Kristen S. Shults
Senior Vice President and Chief Financial Officer
Western Midstream Holdings, LLC
(as general partner of Western Midstream Partners, LP)
WESTERN MIDSTREAM OPERATING, LP
AugustMay 8, 20232024
/s/ Michael P. Ure
Michael P. Ure
President and Chief Executive Officer
Western Midstream Operating GP, LLC
(as general partner of Western Midstream Operating, LP)
AugustMay 8, 20232024
/s/ Kristen S. Shults
Kristen S. Shults
Senior Vice President and Chief Financial Officer
Western Midstream Operating GP, LLC
(as general partner of Western Midstream Operating, LP)
6364