WES - Earnings call transcript Q4 2024 | Western Midstream Partners, LP

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon. My name is Joanna, and I will be your conference operator today. At this time, I would like to welcome everyone to the Western Midstream Partners Fourth Quarter and Full Year 2024 Earnings Conference Call. [Operator Instructions] I would now like to turn the conference over to Daniel Jenkins, Director of Investor Relations. Please go ahead.

Daniel Jenkins

you. Thank could Call. for you Quarter Midstream's us Conference XXXX join glad Western today Fourth I'm to you important like last statements I'd remind non-GAAP night's slide the and earnings deck accompanying release contain reconciliations. disclosures forward-looking that regarding today's call, XX-K from Midstream's a filings today. what risk that we Form of results actual other could public discuss Please reference cause recent to and Western factors most for description differ materially

website. will I'm Western Relevant available pleased inform following reference on materials beginning the KX are week. you Hard be website Midstream our our Partners X. copies be posted via that March mailed to Friday, will out

I today are call over now Oscar. me Shults, Officer; Officer; turn Chief Executive to Kristen Danny Commercial. Holderman, our Chief With and will Brown, Chief Officer; Operating Oscar the our Financial our of [indiscernible]

Oscar Brown

and you, Daniel, Thank afternoon, good everyone.

and our and and day to XXX,XXX minimum long-term barrels Loving anchored operational the that large supported gathering of West by capacity Petroleum by discuss long-haul volume provide disposal day capacity up water the produced Delaware in up year barrels we Occidental announce financial to transportation sanctioned to of gathering soon-to-be and barrels long of to the results, per XXX,XXX fourth pipeline corresponding a water midstream per project and our constructed XX-inch existing of produced facilities quarter Eastern pipeline, new This to in full our a a development firm County. is transport agreement commitments. excited XXX,XXX firm with day Pathfinder be over produced continued water able upstream will to infrastructure over expansion and XXXX that a term. Before disposal support I'm Basin

plans. have fixed support Basin. agreements announce new legacy amendments development cost the I that of customers' to Delaware with and agreements retain the fee our executed also and our am of These better Oxy in components the original to amendments pleased long-term water service produced we

extension continue provide customer flow the years. with excellent our the further distribution continued Oxy service for customer will water to and original support in agreements Basin. Delaware provide gathering growth the in We demonstrate to produced our X.X-year with largest relationship the assurance of strength and sustainable firm a over These for exchange agreement coming

water will the over that excited from will are solution As over of Basin solution to operators aware, provides it time. produced disposal long presents production water areas long-term enhance via the within as and transportation managing customers' water with amount and areas a to ratable pipeline Permian experiencing of optionality innovative high-intensity oil us excess platform the an basin tremendous the gas to the the well provide water responsible, midstream of that handle asset WES the disposal Loving facilitate Eastern long-term and County. space in assurance our is away challenges create more basin. significant development generates flow produced a term new strategic that This with can port matures Pathfinder

attractively are assets, on customers' existing shortly. gas activities. continue we opportunities development expansion Kristin produced John volumes our on as derisk water in water and our grow oil businesses, to and with positioned enhance provide natural will plan crude ensure more our of line take details will all Pathfinder growth to our

growth time. project focus base WES continued our However, in line our unitholders prioritizing distribution that for like generates is advances strategy this sustaining and and that stress returns of I organic over strong to growing ultimately would of capital-efficient the with

lines; across and in Train of X the XXXX; III record XXXX throughput all operational results. to Mentone WES achievements: product turning the and successful very had million our includes and the $XXX completion following financial cash flow the another pivotal operations and which March growth sales free and annual commencement Now agreements for the announcement and year, total in EBITDA at of our respectively. growth successful integration Midstream XX% and operating numerous Meritage adjusted core of several basins; consideration; of of commercial of asset XX%, noncore Double-digit

XXXX. to base commenced also framework, base which total relative levels. payout amongst yield peers in of first continue has to allocation quarter the increase of out is execute pre-COVID investment-grade to company a record now our paying on This highest $X.XXX XX% than companies billion distributions. the midstream included and distribution a XXXX XX% higher and the included capital We that in distribution WES distribution the the Russell in

than low potential percentage to organic Additionally, we acquisitions. growth in will projects single excludes Furthermore, we balance now earlier growth initially achieved our continue anticipated, great pursuing with be position long-term of growth XXXX which conjunction or large accretive distribution rate increases Xx annual mid- digits, a opportunities sheet approximately targeting threshold which future bolt-on and puts leverage in organic of acquisitions. our to year-end

improve further attractive will And structure, chances and projects such improving competitiveness increasing we which thus growth focus business finally, customers, productivity Pathfinder. organic our serve winning our and and increasing on our as are more better sanctioning of efficiency our commercial cost to more our

call Operating Officer, With Holderman, that, to discuss our fourth I quarter. the Danny to will performance in Chief over turn our the operational

Daniel Holderman

Oscar, you, good and afternoon, Thank everyone.

X% we resulted strong This by becoming Basin quarter stand-alone DJ consecutive and quarter of performance eighth gas highest of levels our a Delaware in natural fourth a at from in Our a achieved natural DJ the and as our growth the throughput Basin, since record gas throughput the sequential partnership. on result basis both throughput Basin. Delaware increased quarter

due the customer sequential and quarter Our fourth primarily Delaware in DJ Basin. throughput increased oil quarter NGL both on crude strong activity levels X% by to a basis,

due increasing used throughput, producer volumes a to strong and X% levels record fewer experienced water activity sequential recycling produced quarter on purposes. Our for basis

compared prior in adjusted our gas the our Our fourth with per prior quarter unchanged Mcf quarter and to gross for natural assets line expectations. remained margin

fourth we first gross margin per Going with in to quarter. our expect line forward, quarter adjusted Mcf be the

of to primarily due system revenue of higher margin barrel quarter crude favorable service assets by a gross adjusted DJ cost per the distribution quarter timing payments $X.XX NGL quarter, for with rates and our recognition, in cumulative oil fourth at fourth the and oil our prior equity investment. our associated Basin the to adjustment associated recorded Our compared with increased

We in expect fourth per line with quarter our gross to adjusted margin the first be quarter. barrel

Our line per fourth the barrel expectations. adjusted quarter to unchanged gross our our for assets margin remained in water prior quarter compared and produced prior with

adjusted fourth water margin on effective Oxy of expect quarter redetermination, due and rate the decrease our slightly which to the produced first became compared barrel amendment We both gross of the quarter to new service cost per to January X. with

results. X digits double all for year-over-year, noncore in products increased of year assets year. several half full closed the our first throughput of across to by the the adjusting Turning sale Average that

throughput day cubic gas cubic represents XX% with day early billion throughput of and quarter day. For year-over-year averaged million Marcellus full closed respectively, million that X.X of a sale feet cubic our XXXX. increase, which XXX XXXX excludes feet year XX assets This the approximately natural per feet second of per associated an XXXX, in in average XXXX, per and of the

first in XXXX, and year increase, and a of day. crude XX,XXX barrels per average throughput respectively, X.X day, of water XXX,XXX year per to averaged day million throughput in per several barrels that quarter. excludes increase year-over-year the XXXX XXXX. Full full sale which of XXX,XXX Full XX% NGLs an throughput averaged of with equity XXXX approximately assets barrels day per oil an investment XX% This year all associated produced barrels represents the compared closed XXXX and late

digits digits sales noncore by we low crude XXXX Turning in year-over-year year-over-year purposes. mid-single portfolio-wide closed single increase the that throughput Keep mind, and asset average and natural comparative gas our and to throughput associated XXXX, expectations our for exclude volumes for our percentage produced growth attention percentage expect for oil both the NGL. to growth with in water early

lines continue the and In to X and modestly we continued year-over-year average the to XXXX., levels the of strong growth due all throughput Delaware steady number throughout main Basin, year. in wells throughput activity for online to the a increase for of come to being engine basin producer primarily expect expected product

complete the across year-over-year to producers of gas based natural slightly remain flat and In for on to several been be forecast. NGLs the to efficiencies current operational and able basin, customer average rigs. DJ to our on throughput we wells fewer and to As have them have oil flat more Basin, we drilling that expect enable down seen crude capitalize with for

In activity. from that increased XXXX, benefited activity increased a the basin full worth rig year's and commenced XXXX of in onload

that As to overall supported third-party of come to we expect number that but market onload decrease wells market XX will that customers. be and certain natural gas additional to we latest Phillips activity from wells volumes by forecast year-over-year, of steady our come from forecast, the

gas natural River Powder slightly throughput current average based and the and to oil forecast. expect both Basin, increase NGLs on we crude for producer year-over-year In

our offset by natural from loss the processing throughput partially increased to the customer online gas in other of be activity in back volumes basin expected benefit the facilities of as which onload come half second XXXX. expect We will levels,

increase producers We reservoirs due to levels and activity to NGLs expect targeting content. volumes liquids slightly, primarily oil our higher crude and increased with

we should for Furthermore, our capital about the XXXX, the service. most on And approximately that was drilling basin to plan XX% exited to total our active count we plans, in the we capital facilities, of In to which XXXX active to customers additional allocate benefit beyond. Powder rig WES operating and XXXX, the and in basin customers' continue compression our River acreage in Basin. to as gathering of response XX% budget expenditure allocate

in to by XXXX. this expect of a grow now throughput result to we investment, a rate relative percentage natural XXXX increased mid-teens average As growth gas

West in the throughput half volumes driven third in of Morgan's we assets, our Kinder expansion commence Utah second of pipeline Finally, our the Mountain Pipeline quarter. from into Chipeta gas and during other expect Altamont increased to Williams by natural natural processing XXXX, early plant tie-in meaningful from gas specifically the growth the

I call over financial performance during Kristin to With turn our quarter. the that, discuss to will the

Kristen Shults

Danny, you, everyone. Thank good and afternoon,

DJ $XXX quarter, fourth $X.X certain cumulative from on gross redetermined we primarily to increase of service contracts EBITDA Basin. Basin million, generated of of quarter, increased was favorable and third by $XXX rates driven million During associated our Delaware of Relative our the adjusted included recognition, limited recording in income The assets adjusted and partners our DJ attributable million. cost and throughput associated the $XX with [indiscernible] Texas which adjustments also increased the by South with of revenue the net million margin to

and repair utility field flat offset land expenses, higher fees to to produced higher and due sequentially lower related use maintenance our by increased Our maintenance remained surface level costs, and personnel operation expense water business. costs

anticipate operation lowest and quarter the expense, quarter maintenance historical where trends operation [indiscernible] of we slight in year. first forward, with decrease Going expense and consistent maintenance sequential a the the

true-up of onetime expense annual Our a administrative increased bonus general associated and accrual. the due to primarily costs sequentially with

would we forward, administrative levels. general Going and back to towards revert quarter prior expense expect our

flow. Turning to cash

distribution Our generating Free fourth quarter approximately November $XXX in cash flow million, cash from $XX distribution cash XXXX after free cash quarter operating flow million. $XXX payment totaled of a third of use was of activities flow to our relative million. paid In XX January, unit which prior quarter and February February in declared we per of November on unchanged on base was of record a to paid was unitholders X. $X.XXX distribution

results. recorded full limited net range Turning generating the guidance $X.X midpoint XXXX income EBITDA, billion EBITDA year We billion. partners to adjusted to $X.X attributable billion of to of of $X.XX of our exceeding $X.XX adjusted billion our

year DJ in was Basin adjusted which Basin acquisition. deliver This Delaware positioned the by driven X performance the contribution increased Meritage strong and products approximately another throughput Basin, the of flow, totaled XXXX. operating billion Powder full in Our cash from all throughput increased year in growth the to a $X.XX WES River from EBITDA from volume primarily

million natural plant XXXX processing customers the construction consisted our support $XXX million North totaled Our projects needs in and Loving of Basin. and the of in $XXX capital associated expenditures range of to with other guidance capital million Delaware the largely growing $XXX XXXX our within to of the gas

also investing our assets. in and new DJ commercial to second Utah We began capital the Basin quarter announced pertaining the associated agreements we with

guidance the high $X.XX Our flow $X.XX of totaled billion. XXXX our generation exceeding range end to of free in $X.XX billion billion and cash

paid distribution year distribution base unit calendar per distributions declared of with $X.XX in Base totaled that the our WES per of were recent within per fourth quarter line Finally, full base XXXX unit. for guidance XXXX, including $X.XX base year distribution our $X.XXX unit.

to our guidance. XXXX financial Turning

$X.XX year-over-year EBITDA to X% to $X.XX growth the billion adjusted between our at midpoint. billion, implying expect $X.XX for of midpoint We the of billion year, represents range which a approximately

of expected We expect to Powder Basin contribute and largest Delaware that our are will while adjusted our respectively, the XX%, contributor X%, XX% Basin overall the remain and Basin at River the EBITDA. DJ

on This expect the XXXX midpoint primarily of opportunities million. completion the gas with with and new both North water remaining to between announcement. capital Delaware, Loving a the continued existing our range of be processing support and includes system $XX Danny the The and natural implying our pipeline and plant capital Basin, capital and produced DJ Pathfinder system to We spent $XXX mentioned. Powder success million, River in previously customers of associated yesterday's commercial million million expansion expenditures as approximately expansion $XXX $XXX will

addition, In growing commissioning begin remain of XXXX. approximately capital budget first enables continue Loving processors Basin, towards we North Basin. gas begun of asset in exit the the as our North we largest benefiting X natural XXXX estimated WES we and and the Loving our Delaware it the plant expect to will quarter processing to financially of the be allocated half have expenditure from The gas of expect Delaware base top one completion as natural to

cash and of to represents billion implying growth $X.XXX to of generate at in year-over-year produced yesterday's $X.XXX billion, the X% a of expect impact expansion We XXXX, free billion midpoint. the announcement between flow which includes system water midpoint $X.XXX

with our recommend distributions in the to to quarterly per annual paid as increase least year prior at represents within $X.XXX X% to $X.XXX full This base to distribution. distribution starting increase distribution per per includes of a to intend a increase XXXX. guiding which year's of of $X.XX paid unit, of be a And first we're such, distribution We XX% to quarter unit calendar our distribution compared year May. Turning and unit. $X.XX compared prior distribution a our

annual underlying generation. incremental low mentioned, flow which cash Oscar single-digit growth to will Going and forward, rate, as the distribution business previously in targeting we'll mid- be supported by percentage be a free growth

distribution these to the the not an Additionally, complete given pay yesterday's and and Directors growth announcement Management projects, required capital of enhanced project organic to XXXX. and decided Board time have in

focus have made capital distribution the we our retire simplify the sustainable distribution enhanced base on decision and to framework to Furthermore, further concept, growth. allocation

Going strategy percentage support prioritize mid- and base forward, a distribution capital rate. low will increase acquisitions organic synergistic allocation provide the annual to growth our that bolt-on will at growth the projects. to single-digit

target increases rate. we completing As excess are the we of growth in acquisitions future, successful projects additional in in organic consummating bigger recommend our distribution may growth

unitholders grow its [indiscernible] on I return better maintaining sheet. We now strong yesterday's organic and call investment-grade over position these believe decisions the announcement. project WES will balance to to to turn incremental capital while details to provide growth more

Unknown Executive

excited the I'm development Kristen. you provide that details long-term you, the in our more Thank the plans Basin. of support customers will the of to Delaware announcement about pipeline Pathfinder

transporting pipeline, constructing barrels XX First, steel of any before over miles the we be Pathfinder will day poly of XXX,XXX water capable will of which line of than per produced more expansions. consist

insured Pathfinder is pursuant to facilities that and system gathering customers' series water we disposal Additionally, existing on aggregate also delivered develop commitments. off our of a will produced water our and of will to

in located where additional wells build us in will away County Eastern SWD space we in responsible we will on provide areas basis. for disposal. located accessing water long-term Loving from a in high-intensity a strategic These areas on facilities and also can manner disposal ratable with Finally, capacity focus X

new minimum We corresponding are by a commitments volume are with excited developments these agreement that Oxy. long-term and anchored

development long-term plans. our and there derisking are we together, working By

to provides flow Given understand midstream gathering crude our importance true produced for across our unique real operator large-scale our customers solutions gas, assurance we position and water, oil as of the natural and the processing only scale providing in and that this we and New and all at including Texas. With strategically those work production positioning mind, Delaware to all streams. allow of producers with in infrastructure to Basin the Mexico both their in us of sizing also in are that

and relationships owners infrastructure forward, by responsible we be on over customers more expand port alignment to will protect leverage to critical agreements to and access optionality of This provide our land to partnerships continue existing time. some supported space mineral is for alignment development. midstream This ensure that our we going interest, through and and also plan strategic these with space, even unlock protect that to port

to a ago, and We to innovative expertise subsurface mover is and challenges. being a these and subsurface water decade will we deep to water. will challenges infrastructure a further to better step mitigate an produced produced taking we providing began look that disposal solution midstream have focused dispersion to and addressing close on and seismicity designed our mindset that our by and build been and the produced continue Ever building since we producer-centric water long-haul first leverage facilitate out pressure forward operate technical to design, assets

return strategy volumes opportunities believe growth enhanced, of yield platform capital of with to opportunities solutions that to basis. to can Not move the attract to the Basin greatly for appropriate new but manage more volumes also to and customers. that evaluate life growth targeted on allow us towards will mid-teens potential will aggregate volumes substantial profile we an produced to the that coming up the of as project and This Delaware allocate our further recycling water to only that to to and alternative areas return provide pipeline. the we do work organic we anticipate other expansions to Pathfinder forward, over flows to over the years. we further aligns be continue project that to As deploy of will upstream evaluate consistent technologies in expect this more disposal we risk-adjusted to the our capital rate help open us transport

comments. closing Oscar over now With that, some I'll turn call the to for

Oscar Brown

John. Thanks,

pre-pandemic of dedicated strategic a partnership's strong formation the performance. stems WES operational driven with opportunities These The stand-alone partnership; customers and financial success of of partnerships generating a in approximately poised XXXX presents XXXX, XX% leverage robust which to helped focusing and for to recommend Xx midstream in base incremental has history positioning a of technologies by of X for customers taking from cash and down customers establish into diversified existing to years XXXX; as materially to resulted first and stands X.Xx X% in from our WES quarter board lines potential intend from generation, for efforts, increase onto driving we the all included: the debt business enter when we has have throughput flow just system. people increase expansion. under Investing a above growing As group free growth, across the that distribution which attracting and today; reduction strong account by new on levels on efforts producing the and focus product

While stand-alone additional the our as be of X of deleveraging, first X infrastructure characterized a period as growth next period a be expect success. we a years our can and out an as that years internal enterprise characterized building will

natural presence Now organic capitalize constructed base our and our well that balance we positioned to inorganic on to strong River plants, Powder balance delevered sheet, our utilize and in have Basin gas are X incremental we increased asset the sheet substantially new greatly processing opportunities. and growth

benefit with parties. basins strength both with ability look the their volume contract development Basin By and further project throughput growth opportunities of by The water our we in well agreement the coupled the enhancing Oxy, successfully and to to We years. collaborating years. over a certain the as partnering over execute for Oxy demonstrate announced to extension new new Pathfinder continue customers, with commitments as anchored in multiple pipeline for forward our agreements our the relationship grown last relationship programs with meaningfully coming and DJ consummate extension minimum our Oxy XX-year third-party Occidental for as they produced recently have X on that to

to also and of provide for all to will focus customers We throughput producing this our creativity growth in their objectives. order continue level support

and is at organic grow we shaping investment this be WES, rate profitability a up and meaningful year. to in XXXX for of a to expect year projects throughput strategic growth

volume long-term most Our assets of the economics supported the backed commitments. best basins are contracts stable by minimum that of continues active are with West located by heart to and some in be the

Our to once which serve, we online. organic be we announced customers growth basins resulting to projects the growth allocate continue recently steady capital throughput greatly enhanced should bring in our

support are making leading The flow drive investments generation, and further will ultimately will today generate free unitholder we cash sustainable distribution which time. and profitability returns growth increased over

team [indiscernible] rather energy after from the the noticed call for turn you surely Bob XX this Commercial, including He's into than Pathfinder over companies our will been the best. and him with commercial of Jon the retiring predecessor of in nearly very over glorious at and a today call our huge Western Midstream. X years some partnership-wide to and to its the spent and here time stepping I role XX be SVP growth years Q&A, Before is week contributor we leadership the of joined wish industry, will partnership Bob lead discuss the Born. efforts. next years WES WES having

look toward our partnership. dedication wish our first are best him our engine like I us XXXX partnership, the expecting updating things and achieve also on achieve all enabled to to quarter goals as call stakeholders hard can landmark primary team our and continued would accomplishments the We entire great I progress on our work workforce of the the to forward as in also and we thank what to May. seeing West their we in for XXXX. of from John which his growth in very

With will open that, we the questions. for line

Operator

Dounis question from the at Spiro [Operator Citi. Instructions] first Your line of comes

Spiro Dounis

with to I want start growth outlook. maybe the

but it growth changed of introduced or You forward. sort at EBITDA your Kristen, like bit to digits. for comments suggest going should kind growth distribution your low framework here. less mirror target of sounds And a capital new more here, allocation that mid-single this

you part spending about here. And going amount that growth, right that as drive capital thinking up levels two the why kind Curious, with about that's how you to and amount did what think you maybe forward. are question necessary come of there? the So

Kristen Shults

capital and forecasting pretty EBITDA looked be growth what distribution to expected to far what point, growth and what we we at, Spiro, do and obviously continue to base would quite of into do a your could to we felt support a go that planning future. was then the we up that sustainable So bit level

So growth through capital growth would go you single-digit CapEx we've growth year, low distribution From how with be us that little perspective, to that's to from perspective. that, a up that we back that up the historically XXXX spend we there. relatively had if keep our mid- in something after going came to a said, bit that flat a would

what in seeing right the I think few the we're now from Pathfinder PRB we've quite got. a a are pipeline growth of that both organic with projects perspective, introduction

And little year. to so to million incremental related a Capital, to $XXX these $XX million, in script bring to spent this that's of bit I'd for now expect talked specifically it Pathfinder, fruition. projects about $XXX time spending the have being to we million capital

of that the as is so XXXX. look for into there'll as how million And growth have capital Basin we constructed. of do organic but perspective, PRB to continues our and be a very capital $XXX get a the And a the Obviously, take about quite XXXX, optimistic around growth spend bit year that at from PRB we're well. for we'll future to pipeline to then next get

Spiro Dounis

it helpful. Got Very

versus gap XXX,XXX of just pipeline to the one, big size contract the day from a Second Oxy. between pretty initial going at Pathfinder, of the sort

that 'XX underwriting the I do of you more a to in that a that space, return that does multiple fronts few do One, or little that what think time? here. effectively entire on And So as 'XX? expect Oxy XXX. curious up do by could over from kind to you take Or that initial about And time? guess, is contract

Unknown Executive

This John. question. is Great

that of to going things upgrading. But spent also of we the can those we're midstream-centric is to that couple capital about, of that a Oxy out there's think A pipeline together it, on that to the very with that can is disposal capacity to to at spend existing do connect that helping be look have Not rate it Loving. also on us systems the you're to projects in do spend is side we you efficient some and have we on most transportation upsize additional these I eastern contract of that build the and right, you today capital hand system think pipeline. when we get all to think And where return to get capital of right? is lot returns. that the

up think can also today, to higher get that it. from accrete put a return happy pipeline we lot is of more that, that sets already of it that We where go significantly us out rate really we're opportunity where with that and

of to so over what the Basin to opportunity very it's responsibly of produce areas large challenge the time. price goes more of back we to I in that be and with all just position is out growth dispose dealing think lot about disperse is that aligned the trying and finding And how where responsibly to size to just think ourselves the We're here. really what with a

more our and we go capital want right, as so perspective, time that the what think, is growth also opportunistic but to we we And return midstream of efficient way. comes that even with over capture exactly set rate up need very from to ourselves a of be

Operator

at comes of question Research. next Your Wolfe Keith from line the Stanley

Keith Stanley

to I wanted check help to up returns. to on improve if just and point last already with follow customers this at the discussions the fill other up question in pipeline actively you're in

Unknown Executive

No, absolutely.

regulatory it think a is you and working long we a the and not give regime. overnight. of a this We've that this to also how discussion that only for a time, time from isn't have takes been progress with actively something the to with lot like also landowners background I work the you just this really happened there producers, but

all open other put of have over a some we on discussions. So where producer it is next one lot have thing the I'd the we'll certainly, the as and in of in say, And terms customers. to hopefully go getting designed X we to that with a discussions more [indiscernible] and system. continue those in on a the absolutely, way focused point years way those we've executing we're can the development of put infrastructure, And pipeline is front of to on volumes building really

Keith Stanley

Great. about your competitors term, who one it grow And on thinking talk see main water Can time? the you set business potentially and a you as over is in what little to opportunity to another follow-up longer the consolidate produced water. water bit today? try And Permian

Oscar Brown

and much is right? a contracts. very here unique it's Oscar. a It's it can one major long-term Keith, it's a jump contracts this project construct, I'll and a to is John. back midstream midstream over really in like This But solution. turn say then look solution. Our

this think of long business we with there. a for the that Oxy bit term, other This potential works the shorter-term service is a So out and developing different or solution solutions some our oilfield type other unlike of customers. discussions and then in with then model this a is

just start So John and to little [indiscernible] can talk wanted bit with about that, a maybe then

Unknown Executive

Yes.

we proper on happy don't take think rates acceptable there's how that. our been not differentiation ourselves we because I we've necessarily water the value don't on return of on there capital with for. some to less we think willing that we're where, risk opportunity are aren't do the system, we've historically, we as but a competition want or we're -- certainly kind we're that And there we've focused that on the to and have attacking or to of constrained deploy created mitigation

believe to long-term a off at Oscar way And in think we way. this here, differentiated that we're so it do that can more goes we're it is grow platform. we extent, midstream I actually a in a of looking which solution, direction, absolutely really that where And the that we see moving like said, seeing it's

Operator

the from next comes JPMorgan. Tonet line of Your at Jeremy question

Noah Katz

This Jeremy. Noah for Katz on is

First, agreements system produced disposal other these new on be long-term gathering contracts Oxy. extending I And the there contracts and going want any water Oxy likely touch to with centered with would you'd what most around? Are that consider forward?

Oscar Brown

The in gas I extensions Maybe the the side in we've already on extensions -- announced general, DJ. Oscar. mean the it's

to water on or... know we customers and time. extensions meant all you with opportunities there's the But So I don't all in busy is on specifically John pretty if that and general. that work contract

Noah Katz

Yes, water.

Oscar Brown

have... think I we

Unknown Executive

long-term portfolio continually and everyone. on but Yes, to we're And those. like have Oxy throughout especially the with we looking extend generally contracts, Oscars, maintain side, the

Oscar Brown

I be sort you're seeing new Northern know think at of water Delaware solutions. And of is you water in long the in Basin for or sort Western first who's X particularly basin. long-term substantial got ratio the oil here to step to term. production, XXx has sort the probably Again, is got this looking those anyone in what in construct of but this, the to

other good So a water we're and producing of too. lot then pretty at some hydrocarbons

growing challenge and is great so a start problem. we think And that and to sort a big this of way mitigating it's

Noah Katz

CapEx expect if year-over-year? state we And be And forward, what River Basin similar the Powder is going could to ex steady $XXX be I Sounds there ahead good. as then And the initial a with range the on guess, follow-up, CapEx? same XXXX Pathfinder from the are into flowing your would the what range? to I looking thoughts, CapEx, the CapEx guess, Pathfinder CapEx million XXXX

Kristen Shults

Yes.

that there, what it's very up I dependent vast. we be the to pieces. much what to So kind capital PRB in Obviously, of it higher you're apart landscape of The as majority XXXX. like. just add a Pathfinder say and pulling that few the just that vast for expect would seeing is what into is than XXXX From XXXX, appears see in growth so additional we looks be into on

bit up to little And of it be money so it's going volume, better building capture we to there. that of at the rate to a want out more at, return cost

is, Pathfinder aspect and obviously, customers periods them to to we impacting on that John XXXX infrastructure as would other the The bring required the capital that that amount and Pathfinder, beyond to that. mentioning, bring those on dollars incremental just would thus, was

is grown continue rate [indiscernible] the So have of in the general, in Delaware with we've Like the because it engine capital growth grown, work a higher the than normal your I more bit acquisition, is was run and previously a think kind the in of more because quite We PRB. put we company. still bit grown main we've with capital just us Basin to to it little right? of

between growing that going need all that capital as coming we're that like going with new you're a we stronger to that well to as so be organic areas see And have Pathfinder, forward. up little the projects just are

Noah Katz

he's say me to to for to wanted John, And excited come Jeremy you back. be

Operator

Gupta from at the Instructions] UBS. of next Manav line question [Operator Your comes

Manav Gupta

mentioned give to kind you return of is you grow criterias here I'm deal guys, some be question which could through synergies. deals. trying us you a that for you can to looking My bolt-on a of understand, make would bolt-on rate investment good deal

just through talk could things. help those us If you

Oscar Brown

to thought past. the consistent in acquisitions Oscar. It's where -- we've that. the very way always for about It's Thanks

meet in it towards there. that our acquisition obviously with return results of a we're competencies like a be obviously, existing to of able from on you're our the our inorganic growth, or the organic some course, perspective, bring level midstream to to geographies be of But to seeing and typical and of to So returns side, any add which today. our or biased here little some We'd needs to requirements. needs complementary a generate synergy value fit

too and sort again, typical to Meritage very those So point deal we well. [ pretty all to a the we And where template is boxes much, it's pretty ] not like check surprising. stuff of that hopefully

So criteria. nothing the but that's new,

Manav Gupta

Perfect.

XX guidance. is all on follow-up quick Second Slide versus the outperformed matrix you like looks

interested particularly or could to moving as do flow towards Now cash even cash you flow free in XX, free what it the able X.XXX beat your were guidance. maybe drive where that XXXX above to you in Slide

Kristen Shults

Yes.

just we we a and going the adjusted free do that's part throughput around have expectations the to it of on has flow, to our system. that obviously a right? how I when to of lot us producers and EBITDA, cash So come perform on think from just components is with big for

gets and and expectations a forecast those the make the things exceeding they're a type we if can bit EBITDA. on in that have So earlier, adjusted of little throughput big our difference

also We recovery have fixed our contracts.

would then there. say large commodity cost guidance what can I it everything With impact a major a the help get Pathfinder, [indiscernible] play to the do And a the that, and that cash sell a range product from very on standpoint also and for the that of to is savings and on there we we flow. project. in capital aspect that's will keep [indiscernible] free obviously So expenditures

or some through keep year pushes year. that you it where the so heading into can that's more the maybe bit year see larger, little the chunkier accelerate, little more year move continues. But and next capital projects, if pieces see that can a longer, things capital we around into whenever we as bit have these we a as this taking And are might push there's

Operator

line Your of Fargo. next the Wells from Baramov question Ned at comes

Ned Baramov

question more may. One on if capital I allocation,

XXXX. So you CapEx $XXX talked the Board million elevated capital just requirements recently into a authorized about and buyback program, guidance and

distribution increases. You also planned out laid the

it So room is there doesn't for much unit repurchases. seem

whether unit timing So attractive balance how and you you an could capacity maybe prices leaning of for through buybacks something is walk buybacks. sheet would should opportunity you the into present about think consider the

Oscar Brown

it's Thanks for the question, Oscar.

expires. So significant just yes, of nice in this just have much literally, least really term. those with one there's projects there's we of housekeeping. we event. It's there the at serve in good other But it's program, near opportunities program market -- unlikely We us growth front to the one have last agree all that's [indiscernible] really our do that is and some would the on some dislocation,

to something strong our a but that environment the in wanted least mind. signal we as that's put that, current just in place, take at So something don't on it that's

Operator

turn Mr. to questions no I time. further call at Oscar the back you. There over are this Brown,

Oscar Brown

you future to with our done interest in call. talking Thank work again our your We May forward the next the and company. to but for all and for looking look so next call. also much earnings road, forward on care. and Really we're And where everybody thanks to questions and they've your team Great. WES Take the the the today. headed to

Operator

concludes conference you. Thank call. This today's

now disconnect lines. your You may

Western Midstream Partners (WES) 27 Feb 252024 Q4 Earnings call transcript