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Item 1. Financial Statements

2024-08-08 compared with 2024-05-07 · 180 added, 84 removed, 364 unchanged (42% of the section changed)

24 unchanged sentences

Class A shares ( 91,421,383 shares issued and outstanding as of

March 31, 2024;

June 30, 2024;

68,367,647 shares issued and outstanding

1 unchanged sentence

Class B shares ( 129,400,488 shares issued and outstanding as of

March 31, 2024;

June 30, 2024;

157,941,441 shares issued and outstanding as of

8 unchanged sentences

CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(in millions, except per share data)

33 unchanged sentences

Balance at March 31, 2024

Equity-based compensation

Distributions - $ 0.6516 per share

Recognition of deferred tax asset

Sale of shares held by Sponsors

Class B unit repurchase

Transaction costs

Balance at June 30, 2024

Balance at December 31, 2022

5 unchanged sentences

Balance at March 31, 2023

Equity-based compensation

Distributions - $ 0.5851 per share

Recognition of deferred tax asset

Sale of shares held by Sponsors

Class B unit repurchase

Transaction costs

Balance at June 30, 2023

See accompanying notes to unaudited consolidated financial statements.

2 unchanged sentences

CONSOLIDATED S TATEMENTS OF CASH FLOWS

Three Months Ended March 31,

Six Months Ended June 30,

(in millions)

23 unchanged sentences

Bank borrowings with maturities of greater than 90 days

Proceeds from issuance of senior notes

Deferred financing costs

Transaction costs

15 unchanged sentences

Unless the context otherwise requires, references in this report to the “Company,” “we,” “our,” “us” or like terms, refer to Hess Midstream LP and its subsidiaries.

The consolidated financial statements included in this report reflect all normal and recurring adjustments which, in the opinion of management, are necessary for a fair presentation of our consolidated financial position at March 31, 2024 and December 31, 2023, the consolidated results of operations for the three months ended March 31, 2024 and 2023, and the consolidated cash flows for the three months ended March 31, 2024 and 2023.

The consolidated financial statements included in this report reflect all normal and recurring adjustments which, in the opinion of management, are necessary for a fair presentation of our consolidated financial position at June 30, 2024 and December 31, 2023, the consolidated results of operations for the three and six months ended June 30, 2024 and 2023, and the consolidated cash flows for the six months ended June 30, 2024 and 2023.

The Company has no items of other comprehensive income (loss);

11 unchanged sentences

Our noncontrolling interest represents the approximate 58.6 % interest in the Partnership retained by Hess Corporation (“Hess”) and GIP II Blue Holding, L.P.

(“GIP” and together with Hess, the “Sponsors”) at March 31, 2024 ( 69.8 % at December 31, 2023).

(“GIP” and together with Hess, the “Sponsors”) at June 30, 2024 ( 69.8 % at December 31, 2023).

See Note 2, Equity Transactions for a description of changes in noncontrolling interest related to the equity transactions.

4 unchanged sentences

The ASU does not change how an entity identifies its operating segments.

The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

We continue to assess the impact of this ASU on our consolidated financial statements.

The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

We adopted this ASU on April 1, 2024, and applied the amendments retrospectively to all prior periods presented in our consolidated financial statements (see Note 11, Segments ).

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

1 unchanged sentence

This ASU requires, among other disclosures, greater disaggregation of information, the use of certain categories in the rate reconciliation, and the disaggregation of income taxes paid by jurisdiction.

The ASU is effective for public business entities for fiscal years beginning after December 15, 2024, and interim periods within fiscal years beginning after December 15, 2025, with early adoption permitted.

The ASU is effective for public business entities for fiscal years beginning after December 15, 2024, with early adoption permitted.

We continue to assess the impact of this ASU on our consolidated financial statements.

Equity Transactions

Equity Offering Transaction

On February 8, 2024, GIP sold an aggregate of 11,500,000 of our Class A shares representing limited partner interests (the “Class A Shares”), inclusive of the underwriters’ option to purchase up to 1,500,000 of additional shares, which was fully exercised, in an underwritten public offering at a price of $ 33.10 per Class A Share, less underwriting discounts.

GIP received net proceeds from the offering of approximately $ 377.5 million, after deducting underwriting discounts.

Equity Offering Transactions

On May 19, 2023, the Sponsors sold an aggregate of 12,765,000 of our Class A Shares representing limited partner interests (the “Class A Shares”), inclusive of the underwriters’ option to purchase up to 1,665,000 of additional shares, which was fully exercised, in an underwritten public offering at a price to the public of $ 27.00 per Class A Share, less underwriting discounts.

The Sponsors received net proceeds from the offering of approximately $ 333.4 million, after deducting underwriting discounts.

PART I – FINANCIAL INFORMATION (CONT’D)

1 unchanged sentence

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The Company did no t receive any proceeds in the equity offering transaction.

The above equity offering transaction was conducted pursuant to a registration rights agreement among us and the Sponsors.

The Class A Shares sold in the offering were obtained by GIP by exchanging to us the respective number of their Class B units representing limited partner interests in the Partnership (the “Class B Units”), together with an equal number of Class B shares representing limited partner interests in the Company (the “Class B Shares”) held by the Company’s general partner.

On February 8, 2024, GIP sold an aggregate of 11,500,000 of our Class A shares, inclusive of the underwriter’s option to purchase up to 1,500,000 of additional shares, which was fully exercised, in an underwritten public offering at a price to the underwriter of $ 32.83 per Class A Share.

GIP received net proceeds from the offering of approximately $ 377.5 million.

On May 31, 2024, GIP sold an aggregate of 10,000,000 of our Class A shares in an underwritten public offering at a price to the underwriter of $ 34.025 per Class A Share.

GIP also granted the underwriter an option to purchase up to an additional 1,500,000 Class A shares at the same price per Class A share, which was exercised in full on June 3, 2024.

GIP received net proceeds from the offering of approximately $ 391.3 million.

The Company did no t receive any proceeds in the equity offering transactions.

The above equity offering transactions were conducted pursuant to a registration rights agreement among us and the Sponsors.

The Class A Shares sold in the offerings were obtained by GIP by exchanging to us the respective number of their Class B units representing limited partner interests in the Partnership (the “Class B Units”), together with an equal number of Class B shares representing limited partner interests in the Company (the “Class B Shares”) held by the Company’s general partner.

As a result, the total number of Class A and Class B Shares did not change.

The Company retained control in the Partnership based on the delegation of control provisions, as described in Note 1, Basis of Presentation .

As a result of the equity offering transaction described above, we recognized adjustments increasing the carrying amount of the Class A shareholders’ capital balance by $ 5.2 million and decreasing the carrying amount of noncontrolling interest by an equal amount to reflect the change in ownership interest.

As a result of the equity offering transactions described above, we recognized adjustments increasing the carrying amount of the Class A shareholders’ capital balance by $ 2.5 mi llion (six months ended June 30, 2023:

$ 11.0 million) and decreasing the carrying amount of noncontrollin g interest by an equal amount to reflect the change in ownership interest.

Class B Unit Repurchases

2 unchanged sentences

The purchase price per Class B Unit was $ 27.63 , the closing price of the Class A Shares on March 27, 2023.

On June 26, 2023, the Company, the Partnership and our Sponsors entered into a unit repurchase agreement pursuant to which the Partnership agreed to purchase from the Sponsors 3,350,084 Class B Units for an aggregate purchase price of approximately $ 100.0 million.

The repurchase transaction was consummated on June 29, 2023.

The purchase price per Class B Unit was $ 29.85 , the closing price of the Class A Shares on June 26, 2023.

On March 11, 2024, the Company, the Partnership and our Sponsors entered into a unit repurchase agreement pursuant to which the Partnership agreed to purchase from the Sponsors 2,816,901 Class B Units for an aggregate purchase price of approximately $ 100.0 million.

1 unchanged sentence

The purchase price per Class B Unit was $ 35.50 , the closing price of the Class A Shares on March 11, 2024.

The repurchase transactions described above were funded using borrowings under the Partnership’s existing revolving credit facility (see Note 6, Debt and Interest Expense ).

On June 24, 2024, the Company, the Partnership and our Sponsors entered into a unit repurchase agreement pursuant to which the Partnership agreed to purchase from the Sponsors 2,724,052 Class B Units for an aggregate purchase price of approximately $ 100.0 million.

The repurchase transaction was consummated on June 26, 2024.

The purchase price per Class B Unit was $ 36.71 , the closing price of the Class A Shares on June 24, 2024.

The repurchase transactions described above were funded using borrowings under the Partnership’s existing revolving credit facility and cash on hand (see Note 6, Debt and Interest Expense ).

Pursuant to the terms of the repurchase agreements described above, immediately following each purchase of the Class B Units from the Sponsors, the Partnership cancelled the repurchased units, and the Company cancelled, for no consideration, an equal number of its Class B Shares.

1 unchanged sentence

The carrying amounts of the noncontrolling interest were adjusted to reflect the changes in the ownership interest with the difference between the amounts of consideration paid and the amounts by which the noncontrolling interest were adjusted recognized as a reduction in equity attributable to Class A shareholders.

Distributions to noncontrolling interest holders related to the March 11, 2024 repurchase transaction exceeded the noncontrolling interest’s carrying value resulting in a deficit balance as shown in the accompanying consolidated statement of changes in partners’ capital (deficit).

We incurred approximately $ 0.7 million of costs directly attributable to the repurchase transactions that were charged to equity (three months ended March 31, 2023:

Distributions to noncontrolling interest holders related to the 2024 repurchase transactions exceeded the noncontrolling interest’s carrying value resulting in a deficit balance as shown in the accompanying consolidated statement of changes in partners’ capital (deficit).

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

We incurred approximately $ 1.5 million of costs directly attributable to the repurchase transactions that were charged to equity (six months ended June 30, 2023:

$ 1.8 million).

As a result of the equity offering and the unit repurchase transactions described above, we also recognized an additional deferred tax asset of $ 100.4 million (three months ended March 31, 2023:

$ 4.3 million ) related to the change in the temporary difference between the carrying amount and the tax basis of our investment in the Partnership.

As a result of the equity offering and the unit repurchase transactions described above, we also recognized an additional deferred tax asset of $ 207.4 million (six months ended June 30, 2023:

$ 91.5 million) related to the change in the temporary difference between the carryi ng amount and the tax basis of our investment in the Partnership.

The effect of recognizing the additional deferred tax asset was included in Class A shareholders’ equity balance in the accompanying consolidated statement of changes in partners’ capital (deficit) due to the transactions being characterized as transactions among or with shareholders.

2 unchanged sentences

Commercial Agreements

We have long-term fee based commercial agreements with certain subsidiaries of Hess to provide i) gas gathering, ii) crude oil gathering, iii) gas processing and fractionation, iv) storage services, v) terminaling and export services, and (vi) water handing services.

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the services performed under these commercial agreements, we receive a fee per barrel of crude oil, barrel of water, Mcf of natural gas, or Mcf equivalent of NGLs, as applicable, delivered during each month, and Hess is obligated to provide us with minimum volumes of crude oil, water, natural gas and NGLs.

10 unchanged sentences

Upon the expiration of the Secondary Term, if any, the agreements will automatically renew for subsequent one-year periods unless terminated by either party no later than 180 days prior to the end of the applicable Secondary Term.

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Consistent with the existing terms of the commercial agreements, during the Secondary Term of each of our commercial agreements other than our storage services agreement and terminal and export services agreement (with respect to crude oil terminaling services), the fee recalculation model under each applicable agreement is replaced by an inflation-based fee structure.

4 unchanged sentences

The shortfall amounts received under MVCs during the Secondary Term (except for the crude oil terminaling and water handling services) are recorded as deferred revenue and recognized as revenue as the credits are utilized or expire .

At March 31, 2024, deferred revenue included in Accrued liabilities in the accompanying consolidated balance sheet was $ 1.3 million (December 31, 2023:

For the three months ended March 31, 2024 and 2023, approximately 98 % and 100 %, respectively, of our revenues were attributable to our fee‑based commercial agreements with Hess, including revenues from third‑party volumes contracted with Hess and delivered to us under these agreements.

At June 30, 2024, deferred revenue included in Accrued liabilities in the accompanying consolidated balance sheet was $ 1.3 million (December 31, 2023 :

Revenues attributable to our fee‑based commercial agreements with Hess, including revenues from third‑party volumes contracted with Hess and delivered to us under these agreements, for the three and six months ended June 30, 2024 were 98 % for both periods, compared with approximately 100 % of revenues for the three and six months ended June 30, 2023.

In 2023, we began providing our services directly to third-party customers.

Together with Hess, we are pursuing strategic relationships with third‑party producers and other midstream companies with operations in the Bakken in order to maximize our utilization rates.

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Revenues from contracts with customers, including affiliated services and third-party services, on a disaggregated basis are as follows:

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(in millions)

8 unchanged sentences

Total revenues

During the three months ended March 31, 2024, we earned $ 0.1 million of MVC shortfall fees (three months ended March 31, 2023:

$ 4.3 million).

The following table presents third-party pass-through costs for which we recognize revenues in an amount equal to the costs.

These pass-through revenues are included in Affiliate services and the related pass-through costs are included in Operating and maintenance expenses in the accompanying unaudited consolidated statements of operations.

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(in millions)

2 unchanged sentences

Rail transportation costs

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Omnibus and Employee Secondment Agreements

Under our omnibus and employee secondment agreements, Hess provides substantial operational and administrative services to us in support of our assets and operations.

For the three months ended March 31, 2024 and 2023 , we had the following charges from Hess.

For the three and six months ended June 30, 2024 and 2023 , we had the following charges from Hess.

The classification of these charges between operating and maintenance expenses and general and administrative expenses is based on the fundamental nature of the services being performed for our operations.

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(in millions)

1 unchanged sentence

General and administrative expenses

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

LM4 Agreements

2 unchanged sentences

In addition, we share profits and losses and receive distributions from LM4 under the LM4 amended and restated limited liability company agreement based on our ownership interest.

For the three months ended March 31, 2024 and 2023, we had the following activity related to our agreements with LM4:

Three Months Ended March 31,

For the three and six months ended June 30, 2024 and 2023, we had the following activity related to our agreements with LM4:

Three Months Ended June 30,

Six Months Ended June 30,

(in millions)

5 unchanged sentences

Estimated useful lives

March 31, 2024

June 30, 2024

December 31, 2023

17 unchanged sentences

Property, plant and equipment, net

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Accrued Liabilities

Accrued liabilities are as follows:

March 31, 2024

June 30, 2024

December 31, 2023

3 unchanged sentences

Other accruals

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Debt and Interest Expense

Fixed‑Rate Senior Notes

As of March 31, 2024, the Partnership had:

On May 16, 2024 the Partnership issued $ 600.0 million aggregate principal amount of 6.500 % fixed‑rate se nior unsecured notes due 2029 to qualified institutional investors.

Interest is payable semi‑annually on June 1 and December 1, commencing December 1, 2024.

The Partnership used the proceeds to reduce indebtedness outstanding under the Partnership’s revolving credit facility, with the remaining net proceeds for general corporate purposes.

As of June 30, 2024, the Partnership had:

• $ 400.0 million aggregate principal amount of 5.500 % fixed‑rate senior unsecured notes due 2030 that were issued to qualified institutional investors.

5 unchanged sentences

• $ 550.0 million aggregate principal amount of 5.125 % fixed‑rate senior unsecured notes due 2028 that were issued to qualified institutional investors.

Interest is payable semi‑annually on June 15 and December 15.

• $ 800.0 million aggregate principal amount of 5.625 % fixed‑rate senior unsecured notes due 2026 that were issued to qualified institutional investors.

Interest is payable semi‑annually on February 15 and August 15.

4 unchanged sentences

or (iv) make restricted investments, unless, at the time of and immediately after giving pro forma effect to such restricted payments and any related incurrence of indebtedness or other transactions, no default has occurred and is continuing or would occur as a consequence of such restricted payment and if the leverage ratio does not exceed 4.25 to 1.00.

As of March 31, 2024, we were in compliance with all debt covenants under the indentures.

As of June 30, 2024, we were in compliance with all debt covenants under the indentures.

In addition, the covenants included in the indentures governing the senior unsecured notes contain provisions that allow the Company to satisfy the Partnership’s reporting obligations under the indenture, as long as any such financial information of the Company contains information reasonably sufficient to identify the material differences, if any, between the financial information of the Company, on the one hand, and the Partnership and its subsidiaries on a stand-alone basis, on the other hand and the Company does not directly own capital stock of any person other than the Partnership and its subsidiaries, or material business operations that would not be consolidated with the financial results of the Partnership and its subsidiaries.

1 unchanged sentence

Other than the interest in the Partnership and the effect of federal and state income taxes that are recognized at the Company level, there are no material differences between the consolidated financial statements of the Partnership and the consolidated financial statements of the Company.

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Credit Facilities

As of March 31, 2024 , the Partnership had $ 1.4 billion senior secured credit facilities (the “Credit Facilities”) consisting of a $ 1.0 billion 5 -year revolving credit facility and a $ 400.0 million 5 ‑year Term Loan A facility.

As of June 30, 2024 , the Partnership had $ 1.4 billion senior secured credit facilities (the “Credit Facilities”) consisting of a $ 1.0 billion 5 -year revolving credit facility and a $ 400.0 million 5 ‑year Term Loan A facility.

The Credit Facilities mature in July 2027 .

3 unchanged sentences

If the Partnership obtains an investment grade credit rating, the pricing levels will be based on the Partnership’s credit ratings in effect from time to time.

As of March 31, 2024, borrowings of $ 455.0 million were drawn and outstanding under the Partnership’s revolving credit facility, and borrowings of $ 395.0 million, excluding deferred issuance costs, were drawn and outstanding under the Partnership’s Term Loan A facility.

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of June 30, 2024 , there were no borrowings outstanding under the Partnership’s revolving credit facility, and borro wings of $ 392.5 million, excluding deferred issuance costs, were drawn and outstanding under the Partnership’s Term Loan A facility.

The Credit Facilities can be used for borrowings and letters of credit for general corporate purposes.

1 unchanged sentence

The Credit Facilities contain representations and warranties, affirmative and negative covenants and events of default that the Partnership considers to be customary for an agreement of this type, including a covenant that requires the Partnership to maintain a ratio of total debt to EBITDA (as defined in the Credit Facilities) for the prior four fiscal quarters of not greater than 5.00 to 1.00 as of the last day of each fiscal quarter ( 5.50 to 1.00 during the specified period following certain acquisitions) and, prior to the Partnership obtaining an investment grade credit rating, a ratio of secured debt to EBITDA for the prior four fiscal quarters of not greater than 4.00 to 1.00 as of the last day of each fiscal quarter.

As of March 31, 2024, the Partnership was in compliance with these financial covenants.

As of June 30, 2024, the Partnership was in compliance with these financial covenants.

Fair Value Measurement

At March 31, 2024, our total debt had a carrying value of $ 3,325.4 million and had a fair value of approximately $ 3,249.1 million, based on Level 2 inputs in the fair value measurement hierarchy.

The carrying value of the amounts under the Term Loan A facility and revolving credit facility at March 31, 2024 , approximated their fair value.

At June 30, 2024, our total debt had a carrying value of $ 3,460.3 million and had a fair value of approximately $ 3,397.8 million, based on Level 2 inputs in the fair value measurement hierarchy.

The carrying value of the amounts under the Term Loan A facility and revolving credit facility at June 30, 2024 , approximated their fair value.

Any changes in interest rates do not impact cash outflows associated with fixed rate interest payments or settlement of debt principal, unless a debt instrument is repurchased prior to maturity.

15 unchanged sentences

First Quarter 2024

Second Quarter 2024 (1)

August 8, 2024

August 14, 2024

(1) For more information, see Note 12, Subsequent Events.

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Earnings per Share

4 unchanged sentences

Diluted earnings per Class A Share are calculated using the “treasury stock method” or “if-converted method,” whichever is more dilutive.

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(in millions, except per share amounts)

4 unchanged sentences

Weighted average Class A shares outstanding:

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

For the three months ended March 31, 2024 and 2023 the weighted average number of Class A Shares outstanding included 40,427 and 60,566 d ilutive restricted shares, respectively.

For the three and six months ended June 30, 2024 the weighted average number of Class A Shares outstanding included 17,859 and 29,143 d ilutive restricted shares, respectively, compared with 19,640 and 40,103 dilutive restricted shares for the three and six months ended June 30, 2023 , respectively.

Concentration of Credit Risk

As of March 31, 2024 and 2023, Hess and its affiliates represented approximately 98 % and 100 %, respectively, of accounts receivable from contracts with customers.

Total revenues attributable to Hess for the three months ended March 31, 2024 and 2023 were approximately 98 % and 100 %, respectively.

As of June 30, 2024 and 2023, Hess and its affiliates represented 97 % and 100 % , respectively, of accounts receivable from contracts with customers.

Total revenues attributable to Hess for the three and six months ended June 30, 2024 were 98 % for both periods, compared with approximately 100 % of revenues for the three and six months ended June 30, 2023 .

Commitments and Contingencies

4 unchanged sentences

Remediation infrastructure was put in place and remediation and monitoring is ongoing.

As of March 31, 2024 our reserves for all estimated remediation liabilities, inclusive of the produced water release above, in Accrued liabilities and Other noncurrent liabilities were $ 2.2 million and $ 3.8 million, respectively, compared with $ 1.7 million and $ 5.3 million, respectively, as of December 31, 2023.

As of June 30, 2024 our reserves for all estimated remediation liabilities, inclusive of the produced water release above, in Accrued liabilities and Other noncurrent li abilities were $ 2.2 million and $ 3.3 million, respectively, compared with $ 1.7 million and $ 5.3 million, respectively, as of December 31, 2023.

Legal Proceedings

3 unchanged sentences

If a range of amounts can be reasonably estimated and no amount within the range is a better estimate than any other amount, then the minimum of the range is accrued.

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

On or about March 14, 2023, the Company received a Notice of Violation (the “Notice”) from the North Dakota Department of Environmental Quality (“DEQ”) in connection with the produced water release described under Environmental Contingencies above.

3 unchanged sentences

Based on currently available information, we believe it is remote that the outcome of known matters, including the produced water release described above, would have a material adverse impact on our financial condition, results of operations or cash flows.

Accordingly, as of March 31, 2024 and December 31, 2023 , we did no t have material accrued liabilities for legal contingencies.

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Accordingly, as of June 30, 2024 and December 31, 2023 , we did no t have material accrued liabilities for legal contingencies.

Our operations are located in the United States and are organized into three reportable segments:

(1) gathering, (2) processing and storage and (3) terminaling and export.

Our reportable segments comprise the structure used by our Chief Operating Decision Maker (“CODM”) to make key operating decisions and assess performance.

Our reportable segments comprise the structure used by our Chief Executive Officer and Chief Financial Officer, who, collectively, have been determined to be our Chief Operating Decision Maker (“CODM”) to make key operating decisions and assess performance.

These segments are strategic business units with differing products and services.

Our CODM evaluates the segments’ operating performance based on multiple measures including Adjusted EBITDA, defined as net income (loss) before net interest expense, income tax expense (benefit), depreciation and amortization and our proportional share of depreciation of equity affiliates, as further adjusted to eliminate the impact of certain items that we do not consider indicative of our ongoing operating performance, such as transaction costs, other income and other non-cash, non‑recurring items, if applicable.

Interest and Other includes certain functional departments that do not recognize revenues.

Our CODM evaluates the segments’ operating performance based on Adjusted EBITDA, defined as net income (loss) before interest expense, income tax expense (benefit), and depreciation and amortization, as further adjusted for other non-cash, non‑recurring items, if applicable.

For all of the segments, the CODM uses segment Adjusted EBITDA in the annual budgeting and monthly forecasting process.

The CODM considers budget-to-current forecast and prior forecast-to-current forecast variances for Adjusted EBITDA on a monthly basis for evaluating performance of each segment and making decisions about allocating capital and other resources to each segment.

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The following tables reflect certain financial data for each reportable segment:

1 unchanged sentence

Terminaling and Export

Total Reportable Segments

Interest and Other

(in millions)

For the Three Months Ended March 31, 2024

For the Three Months Ended June 30, 2024

Revenues and other income

Net income (loss)

Net income (loss) attributable to

Hess Midstream LP

Operating and maintenance expenses

(exclusive of depreciation shown

separately below)

Depreciation expense

Proportional share of equity affiliates'

General and administrative expenses

Income from equity investments

5 unchanged sentences

Terminaling and Export

Total Reportable Segments

Interest and Other

(in millions)

For the Three Months Ended March 31, 2023

For the Three Months Ended June 30, 2023

Revenues and other income

Net income (loss)

Net income (loss) attributable to

Operating and maintenance expenses

(exclusive of depreciation shown

separately below)

Depreciation expense

General and administrative expenses

Income from equity investments

Interest expense, net

Income tax expense

Adjusted EBITDA

Capital expenditures

PART I – FINANCIAL INFORMATION (CONT’D)

HESS MIDSTREAM LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Processing and Storage

Terminaling and Export

Total Reportable Segments

Interest and Other

(in millions)

For the Six Months Ended June 30, 2024

Revenues and other income

Operating and maintenance expenses

(exclusive of depreciation shown

separately below)

Depreciation expense

Proportional share of equity affiliates'

General and administrative expenses

Income from equity investments

3 unchanged sentences

Capital expenditures

Processing and Storage

Terminaling and Export

Total Reportable Segments

Interest and Other

(in millions)

For the Six Months Ended June 30, 2023

Revenues and other income

Operating and maintenance expenses

(exclusive of depreciation shown

separately below)

Depreciation expense

General and administrative expenses

Income from equity investments

Interest expense, net

Income tax expense

Adjusted EBITDA

Capital expenditures

The following table presents a reconciliation of reportable segment Adjusted EBITDA to income before income tax expense:

Three Months Ended June 30,

Six Months Ended June 30,

(in millions)

Reconciliation of reportable segment Adjusted

EBITDA to income before income tax expense:

Total reportable segment Adjusted EBITDA

Depreciation expense

Unallocated general and administrative expenses

Interest expense, net

Income before income tax expense

PART I – FINANCIAL INFORMATION (CONT’D)

2 unchanged sentences

Total assets for the reportable segments are as follows:

March 31, 2024

June 30, 2024

December 31, 2023

3 unchanged sentences

Interest and Other

(1) Includes investment in equity investees of $ 89.4 million as of March 31, 2024 an d $ 90.2 million as of December 31, 2023 .

(1) Includes investment in equity investees of $ 89.2 million as of June 30, 2024 an d $ 90.2 million as of December 31, 2023 .

Subsequent Events

On April 22, 2024 , the board of directors of our general partner declared a quarterly cash distribution of $ 0.6516 per Class A Share for the quarter ended March 31, 2024.

The distribution represents an approximate 2.7 % increase in the quarterly distribution per Class A Share for the first quarter of 2024 as compared with the fourth quarter of 2023.

The distribution will be payable on May 14, 2024 , to shareholders of record as of the close of business on May 2, 2024 .

On July 29, 2024 , the board of directors of our general partner declared a quarterly cash distribution of $ 0.6677 per Class A Share for the quarter ended June 30, 2024 .

The distribution represents an increase of $ 0.0161 per Class A Share for the second quarter of 2024 as compared with the first quarter of 2024.

The distribution will be payable on August 14, 2024 , to shareholders of record as of the close of business on August 8, 2024 .

Simultaneously, the Partnership will make a distribution of $ 0.6677 per Class B Unit of the Partnership to the Sponsors.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements