What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-08-03 compared with 2022-05-10 · 155 added, 81 removed, 829 unchanged (22% of the section changed)

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

thousands except per-unit amounts 2022 2021 2022 2021

14 unchanged sentences

Long - lived asset and other impairments

90 12,738 90 27,604

Total operating expenses (2)

24 unchanged sentences

_________________________________________________________________________________________

(1) Total revenues and other includes related-party amounts of $ 428.7 million and $ 378.3 million for the three months ended March 31, 2022 and 2021, respectively.

(2) Total operating expenses includes related-party amounts of $( 17.6 ) million and $ 39.9 million for the three months ended March 31, 2022 and 2021, respectively.

(1) Total revenues and other includes related-party amounts of $ 456.8 million and $ 885.5 million for the three and six months ended June 30, 2022, respectively, and $ 415.4 million and $ 793.7 million for the three and six months ended June 30, 2021, respectively.

(2) Total operating expenses includes related-party amounts of $( 11.2 ) million and $( 28.8 ) million for the three and six months ended June 30, 2022, respectively, and $ 29.0 million and $ 68.8 million for the three and six months ended June 30, 2021, respectively.

(3) See Note 5.

See accompanying Notes to Consolidated Financial Statements.

WESTERN MIDSTREAM PARTNERS, LP

CONSOLIDATED BALANCE SHEETS

thousands except number of units March 31,

thousands except number of units June 30,

2022 December 31,

34 unchanged sentences

Equity and partners’ capital

Common units ( 403,333,810 and 402,993,919 units issued and outstanding at March 31, 2022, and December 31, 2021, respectively)

Common units ( 400,248,341 and 402,993,919 units issued and outstanding at June 30, 2022, and December 31, 2021, respectively)

3,164,328 2,966,955

General partner units ( 9,060,641 units issued and outstanding at March 31, 2022, and December 31, 2021)

General partner units ( 9,060,641 units issued and outstanding at June 30, 2022, and December 31, 2021)

( 2,825 ) ( 8,882 )

4 unchanged sentences

________________________________________________________________________________________

(1) Other assets includes $ 14.6 million and $ 9.8 million of NGLs line - fill inventory as of March 31, 2022, and December 31, 2021, respectively.

Other assets also includes $ 51.9 million and $ 56.2 million of materials and supplies inventory as of March 31, 2022, and December 31, 2021, respectively.

(2) Total assets includes related - party amounts of $ 1.5 billion and $ 1.4 billion as of March 31, 2022, and December 31, 2021, respectively, which includes related - party Accounts receivable, net of $ 274.2 million and $ 180.2 million as of March 31, 2022, and December 31, 2021, respectively.

(3) Total liabilities includes related - party amounts of $ 275.7 million and $ 270.5 million as of March 31, 2022, and December 31, 2021, respectively.

(1) Other assets includes $ 12.2 million and $ 9.8 million of NGLs line - fill inventory as of June 30, 2022, and December 31, 2021, respectively.

Other assets also includes $ 55.3 million and $ 56.2 million of materials and supplies inventory as of June 30, 2022, and December 31, 2021, respectively.

(2) Total assets includes related - party amounts of $ 1.5 billion and $ 1.4 billion as of June 30, 2022, and December 31, 2021, respectively, which includes related - party Accounts receivable, net of $ 322.7 million and $ 180.2 million as of June 30, 2022, and December 31, 2021, respectively.

(3) Total liabilities includes related - party amounts of $ 288.3 million and $ 270.5 million as of June 30, 2022, and December 31, 2021, respectively.

See accompanying Notes to Consolidated Financial Statements.

20 unchanged sentences

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

Equity - based compensation expense

6,797 — — 6,797

Net contributions from (distributions to) related parties 375 — — 375

Other ( 918 ) — — ( 918 )

Balance at June 30, 2022 $ 3,164,328 $ ( 2,825 ) $ 143,500 $ 3,305,003

_________________________________________________________________________________________

(1) See Note 5 .

18 unchanged sentences

Balance at March 31, 2021 $ 2,821,455 $ ( 16,033 ) $ 136,698 $ 2,942,120

Net income (loss) 226,295 4,964 7,018 238,277

Distributions to Chipeta noncontrolling interest owner — — ( 1,245 ) ( 1,245 )

Distributions to noncontrolling interest owner of WES Operating — — ( 2,741 ) ( 2,741 )

Distributions to Partnership unitholders ( 130,115 ) ( 2,854 ) — ( 132,969 )

Contributions of equity - based compensation from Occidental

2,375 — — 2,375

Equity - based compensation expense

4,746 — — 4,746

Net contributions from (distributions to) related parties 2,881 — — 2,881

Other ( 571 ) — — ( 571 )

Balance at June 30, 2021 $ 2,927,066 $ ( 13,923 ) $ 139,730 $ 3,052,873

_________________________________________________________________________________________

(1) See Note 5 .

2 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Six Months Ended

thousands 2022 2021

5 unchanged sentences

Non - cash equity - based compensation expense

14,781 13,855

Deferred income taxes 1,920 1,273

38 unchanged sentences

_________________________________________________________________________________________

(1) Includes purchases from related parties of $ 2.0 million for the three months ended March 31, 2021.

(1) Includes purchases from related parties of $ 2.0 million for the six months ended June 30, 2021.

(2) See Note 6 .

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

thousands 2022 2021 2022 2021

14 unchanged sentences

Long - lived asset and other impairments

90 12,738 90 27,604

Total operating expenses (2)

11 unchanged sentences

________________________________________________________________________________________

(1) Total revenues and other includes related - party amounts of $ 428.7 million and $ 378.3 million for the three months ended March 31, 2022 and 2021, respectively.

(2) Total operating expenses includes related - party amounts of $( 16.7 ) million and $ 40.4 million for the three months ended March 31, 2022 and 2021, respectively.

(2) Total operating expenses includes related-party amounts of $( 10.5 ) million and $( 27.2 ) million for the three and six months ended June 30, 2022, respectively, and $ 29.6 million and $ 69.9 million for the three and six months ended June 30, 2021, respectively.

See accompanying Notes to Consolidated Financial Statements.

1 unchanged sentence

CONSOLIDATED BALANCE SHEETS

thousands except number of units March 31,

thousands except number of units June 30,

2022 December 31,

34 unchanged sentences

Equity and partners’ capital

Common units ( 318,675,578 units issued and outstanding at March 31, 2022, and December 31, 2021)

Common units ( 318,675,578 units issued and outstanding at June 30, 2022, and December 31, 2021)

3,267,086 3,063,289

4 unchanged sentences

_________________________________________________________________________________________

(1) Other assets includes $ 14.6 million and $ 9.8 million of NGLs line - fill inventory as of March 31, 2022, and December 31, 2021, respectively.

Other assets also includes $ 51.9 million and $ 56.2 million of materials and supplies inventory as of March 31, 2022, and December 31, 2021, respectively.

(3) Total liabilities includes related - party amounts of $ 292.3 million and $ 318.7 million as of March 31, 2022, and December 31, 2021, respectively.

(1) Other assets includes $ 12.2 million and $ 9.8 million of NGLs line - fill inventory as of June 30, 2022, and December 31, 2021, respectively.

Other assets also includes $ 55.3 million and $ 56.2 million of materials and supplies inventory as of June 30, 2022, and December 31, 2021, respectively.

(3) Total liabilities includes related - party amounts of $ 314.2 million and $ 318.7 million as of June 30, 2022, and December 31, 2021, respectively.

See accompanying Notes to Consolidated Financial Statements.

14 unchanged sentences

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

Contributions of equity - based compensation from WES

6,652 — 6,652

Net contributions from (distributions to) related parties 375 — 375

Balance at June 30, 2022 $ 3,267,086 $ 31,418 $ 3,298,504

thousands Common

11 unchanged sentences

Balance at March 31, 2021 $ 2,909,877 $ 30,909 $ 2,940,786

Net income (loss) 237,611 2,264 239,875

Distributions to Chipeta noncontrolling interest owner — ( 1,245 ) ( 1,245 )

Distributions to WES Operating unitholders ( 137,030 ) — ( 137,030 )

Contributions of equity - based compensation from Occidental

2,375 — 2,375

Contributions of equity - based compensation from WES

4,613 — 4,613

Net contributions from (distributions to) related parties 2,881 — 2,881

Balance at June 30, 2021 $ 3,020,327 $ 31,928 $ 3,052,255

See accompanying Notes to Consolidated Financial Statements.

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Six Months Ended

thousands 2022 2021

5 unchanged sentences

Non - cash equity - based compensation expense

14,505 21,024

Deferred income taxes 1,920 1,273

36 unchanged sentences

________________________________________________________________________________________

(1) Includes purchases from related parties of $ 2.0 million for the three months ended March 31, 2021.

(1) Includes purchases from related parties of $ 2.0 million for the six months ended June 30, 2021.

(2) See Note 6 .

17 unchanged sentences

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 March 31, 2022, the Partnership’s assets and investments consisted of the following:

As of June 30, 2022, the Partnership’s assets and investments consisted of the following:

Operated Operated

52 unchanged sentences

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 March 31, 2022 (see Note 6 ).

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.

12 unchanged sentences

Equity-based compensation.

During the three months ended March 31, 2022, the Partnership issued 565,246 common units under its long-term incentive plans.

Compensation expense was $ 5.8 million and $ 3.5 million for the three months ended March 31, 2022 and 2021, respectively.

During the six months ended June 30, 2022, the Partnership issued 568,984 common units under its long-term incentive plans.

Compensation expense was $ 6.8 million and $ 12.6 million for the three and six months ended June 30, 2022, respectively, and $ 4.7 million and $ 8.3 million for the three and six months ended June 30, 2021, respectively.

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

thousands 2022 2021 2022 2021

6 unchanged sentences

Lease revenue (1)

— 46,378 — 89,240

Other 233 87 476 329

4 unchanged sentences

Contract balances.

Receivables from customers, which are included in Accounts receivable, net on the consolidated balance sheets were $ 589.5 million and $ 424.6 million as of March 31, 2022 and December 31, 2021, respectively.

Receivables from customers, which are included in Accounts receivable, net on the consolidated balance sheets were $ 705.3 million and $ 424.6 million as of June 30, 2022, and December 31, 2021, 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.

3 unchanged sentences

Additional estimated revenues recognized (2)

Contract assets balance at March 31, 2022

Contract assets at March 31, 2022

Contract assets balance at June 30, 2022

Contract assets at June 30, 2022

Other current assets $ 16,512

1 unchanged sentence

Total contract assets from contracts with customers $ 34,665

_________________________________________________________________________________________

(1) Includes $( 0.1 ) million for the three months ended June 30, 2022.

(2) Includes $ 5.9 million for the three months ended June 30, 2022.

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

6 unchanged sentences

Revenues recognized that were included in the contract liability balance at the beginning of the period (2)

Contract liabilities balance at March 31, 2022

Contract liabilities at March 31, 2022

Contract liabilities balance at June 30, 2022

Contract liabilities at June 30, 2022

Accrued liabilities $ 9,142

1 unchanged sentence

Total contract liabilities from contracts with customers $ 327,250

_________________________________________________________________________________________

(1) Includes $ 19.8 million for the three months ended June 30, 2022.

(2) Includes $( 2.7 ) million for the three months ended June 30, 2022.

Transaction price allocated to remaining performance obligations.

Revenues expected to be recognized from certain performance obligations that are unsatisfied (or partially unsatisfied) as of March 31, 2022, are presented in the following table.

Revenues expected to be recognized from certain performance obligations that are unsatisfied (or partially unsatisfied) as of June 30, 2022, are presented in the following table.

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.

5 unchanged sentences

Total $ 6,538,746

ACQUISITIONS AND DIVESTITURES

Bison facility.

In October 2020, the Partnership entered into an option agreement to sell the Bison treating facility, located in Northeast Wyoming, to a third party.

During the second quarter of 2021, the third party exercised its option to purchase the Bison treating facility and the sale closed.

The Partnership received total proceeds of $ 8.0 million, $ 7.0 million in the fourth quarter of 2020 and $ 1.0 million when the sale closed in the second quarter of 2021, resulting in a net gain on sale of $ 5.4 million that was recorded as Gain (loss) on divestiture and other, net in the consolidated statements of operations.

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

14 unchanged sentences

March 31 $ 0.50000 $ 206,197 May 13, 2022 May 2, 2022

June 30 0.50000 197,744 August 12, 2022 August 1, 2022

Available cash.

15 unchanged sentences

March 31 $ 213,513 May 2022

June 30 213,513 August 2022

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.

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

2 unchanged sentences

Holdings of Partnership equity.

The Partnership’s common units are listed on the New York Stock Exchange under the ticker symbol “WES.” As of March 31, 2022, Occidental held 200,281,578 common units, representing a 48.6 % 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 2.2 % general partner interest in the Partnership.

The Partnership’s common units are listed on the New York Stock Exchange under the ticker symbol “WES.” As of June 30, 2022, Occidental held 200,281,578 common units, representing a 48.9 % 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 2.2 % general partner interest in the Partnership.

The public held 199,966,763 common units, representing a 48.9 % limited partner interest in the Partnership.

4 unchanged sentences

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 three months ended March 31, 2022, the Partnership repurchased 225,355 common units on the open market for an aggregate purchase price of $ 5.1 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.

From July 1, 2022, through July 29, 2022, the Partnership repurchased 13,800,805 common units, which includes 10,000,000 common units repurchased from Occidental, for an aggregate purchase price of $ 346.1 million.

The units were canceled immediately upon receipt.

As of March 31, 2022, the Partnership had an authorized amount of $ 994.9 million remaining under the program.

As of July 29, 2022, Occidental held 190,281,578 common units and the public held 196,168,502 common units, representing a 48.1 % and 49.6 % limited partner interest in the Partnership, respectively.

General partner units remained at 9,060,641 , representing a 2.3 % general partner interest in the Partnership.

Inclusive of the unit repurchases through July 29, 2022, the Partnership had an authorized amount of $ 574.6 million remaining under the $1.0 billion Purchase Program.

In November 2020, the Board authorized the Partnership to buy back up to $ 250.0 million of the Partnership’s common units through December 31, 2021 (the “$250.0 million Purchase Program”).

The common units were purchased from time to time in the open market at prevailing market prices or in privately negotiated transactions.

During the three months ended March 31, 2021, the Partnership repurchased 1,115,808 common units on the open market for an aggregate purchase price of $ 16.2 million.

During the six months ended June 30, 2021, the Partnership repurchased 1,115,808 common units on the open market for an aggregate purchase price of $ 16.2 million.

The units were canceled by the Partnership immediately upon receipt.

1 unchanged sentence

Holdings of WES Operating equity.

As of March 31, 2022, (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 ).

As of June 30, 2022, (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.

7 unchanged sentences

Three Months Ended

June 30, Six Months Ended

thousands except per-unit amounts 2022 2021 2022 2021

16 unchanged sentences

Three Months Ended

June 30, Six Months Ended

thousands 2022 2021 2022 2021

11 unchanged sentences

General and administrative (3)

233 7,102 2,208 11,195

Total operating expenses ( 11,213 ) 28,954 ( 28,840 ) 68,816

7 unchanged sentences

Consolidated balance sheets

thousands March 31,

thousands June 30,

2022 December 31,

12 unchanged sentences

Consolidated statements of cash flows

Three Months Ended

Six Months Ended

thousands 2022 2021

15 unchanged sentences

RELATED-PARTY TRANSACTIONS

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 from the Partnership’s consolidated financial statements:

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

Three Months Ended

June 30, Six Months Ended

thousands 2022 2021 2022 2021

4 unchanged sentences

Consolidated balance sheets

thousands March 31,

thousands June 30,

2022 December 31,

Other current assets $ 14,475 $ 12,490

Other assets 45,235 45,494

5 unchanged sentences

Consolidated statements of cash flows

Three Months Ended

Six Months Ended

thousands 2022 2021

9 unchanged sentences

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 36 % and 35 % for the three months ended March 31, 2022 and 2021, respectively.

Crude-oil and NGLs throughput (excluding equity-investment throughput) attributable to production owned or controlled by Occidental was 89 % and 88 % for the three months ended March 31, 2022 and 2021, respectively.

Produced-water throughput attributable to production owned or controlled by Occidental was 84 % and 86 % for the three months ended March 31, 2022 and 2021, respectively.

The Partnership is currently involved in a dispute 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 dispute is 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.

Natural - gas throughput (excluding equity - investment throughput) attributable to production owned or controlled by Occidental was 35 % and 36 % for the three and six months ended June 30, 2022, respectively, and 36 % and 35 % for the three and six months ended June 30, 2021, respectively.

Crude - oil and NGLs throughput (excluding equity - investment throughput) attributable to production owned or controlled by Occidental was 88 % and 89 % for the three and six months ended June 30, 2022, respectively, and 90 % and 89 % for the three and six months ended June 30, 2021, respectively.

Produced - water throughput attributable to production owned or controlled by Occidental was 81 % and 82 % for the three and six months ended June 30, 2022, respectively, and 86 % for the three and six months ended June 30, 2021.

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

1 unchanged sentence

RELATED-PARTY TRANSACTIONS

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”), now Mesquite Energy, Inc.

11 unchanged sentences

As a result of the surface - use and salt - water disposal agreements being amended under the CUA (see Related-party commercial agreement below), these agreements are now 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 will be amortized to Operation and maintenance expense over the remaining term of the agreements.

The ROU asset is being amortized to Operation and maintenance expense over the remaining term of the agreements.

Effective December 31, 2019, an affiliate of Occidental and a wholly owned subsidiary of the Partnership, the lessor, entered into an operating and maintenance agreement pursuant to which Occidental provided operational and maintenance services with respect to a crude - oil gathering system and associated treating facilities owned by the Partnership through December 31, 2021.

1 unchanged sentence

In April 2021, the Partnership exercised its option to terminate the operating and maintenance agreement with Occidental effective December 31, 2021.

For the three months ended March 31, 2021, the Partnership recognized fixed-lease revenue of $ 43.9 million and variable-lease revenue of $( 1.1 ) million related to these agreements, with such amounts included in Service revenues – fee based in the consolidated statements of operations.

For the three and six months ended June 30, 2021, the Partnership recognized fixed-lease revenue of $ 44.0 million and $ 87.9 million, respectively, and variable-lease revenue of $ 2.4 million and $ 1.3 million, respectively, related to these agreements, with such amounts included in Service revenues – fee based in the consolidated statements of operations.

Related-party expenses.

12 unchanged sentences

General and administrative expense includes non - cash equity - based compensation expense allocated to the Partnership by Occidental for awards granted to the executive officers of the general partner and to other employees prior to their employment with the Partnership under (i) the Anadarko Petroleum Corporation 2012 Omnibus Incentive Compensation Plan, as amended and restated, (ii) Occidental’s 2015 Long - Term Incentive Plan, and (iii) Occidental’s Phantom Share Unit Award Plan (collectively referred to as the “Incentive Plans”).

General and administrative expense includes costs related to the Incentive Plans of $ 1.9 million and $ 3.2 million for the three months ended March 31, 2022 and 2021, respectively.

General and administrative expense includes costs related to the Incentive Plans of $ 0.2 million and $ 2.2 million for the three and six months ended June 30, 2022, respectively, and $ 2.4 million and $ 5.6 million for the three and six months ended June 30, 2021, respectively.

These amounts are reflected as contributions to partners’ capital in the consolidated statements of equity and partners’ capital.

12 unchanged sentences

EQUITY INVESTMENTS

The following table presents the financial statement impact of the Partnership’s equity investments for the three months ended March 31, 2022:

The following table presents the financial statement impact of the Partnership’s equity investments for the six months ended June 30, 2022:

thousands Balance at December 31, 2021 Equity

income, net Contributions Distributions Distributions

Balance at March 31, 2022

Balance at June 30, 2022

White Cliffs $ 40,753 $ 438 $ — $ ( 147 ) $ ( 1,773 ) $ 39,271

14 unchanged sentences

(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.

During the six months ended June 30, 2021, the Partnership recognized an impairment loss on its investment in Ranch Westex of $ 11.6 million that resulted from a decline in value below the carrying value, which was determined to be other than temporary in nature.

This investment was impaired to its estimated fair value of $ 2.9 million, using the income approach and Level-3 fair value inputs, due to a reduction in estimated future cash flows resulting from lower forecasted producer throughput.

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

2 unchanged sentences

A summary of the historical cost of property, plant, and equipment is as follows:

thousands Estimated Useful Life March 31,

thousands Estimated Useful Life June 30,

2022 December 31,

16 unchanged sentences

Long-lived asset and other impairments.

During the three months ended March 31, 2021, the Partnership recognized impairments of $ 14.9 million, primarily attributable to $ 13.5 million of impairments at the DJ Basin complex due to cancellation of projects.

During the six months ended June 30, 2021, the Partnership recognized impairments of $ 27.6 million, primarily attributable to (i) $ 14.0 million of impairments at the DJ Basin complex due to cancellation of projects and (ii) an $ 11.6 million other-than-temporary impairment of the Partnership’s investment in Ranch Westex (see Note 7 ).

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

3 unchanged sentences

The Partnership WES Operating

thousands March 31,

thousands June 30,

2022 December 31,

2021 March 31,

2021 June 30,

2022 December 31,

4 unchanged sentences

The Partnership WES Operating

thousands March 31,

thousands June 30,

2022 December 31,

2021 March 31,

2021 June 30,

2022 December 31,

7 unchanged sentences

The Partnership WES Operating

thousands March 31,

thousands June 30,

2022 December 31,

2021 March 31,

2021 June 30,

2022 December 31,

6 unchanged sentences

Contract liabilities 9,142 27,763 9,142 27,763

Accrued payroll and benefits 34,072 41,311 — 20

Other 42,995 44,094 38,493 32,829

5 unchanged sentences

The following table presents the outstanding debt:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

thousands Principal Carrying

3 unchanged sentences

$ — $ — $ — $ 502,246 $ 502,138 $ 505,153

Floating - Rate Senior Notes due 2023

213,138 212,760 212,425 — — —

Finance lease liabilities 2,613 2,613 2,613 3,794 3,794 3,794

24 unchanged sentences

1,000,000 983,824 809,805 1,000,000 983,709 1,183,514

RCF 255,000 255,000 255,000 — — —

Finance lease liabilities 540 540 540 1,533 1,533 1,533

7 unchanged sentences

Debt activity.

The following table presents the debt activity for the three months ended March 31, 2022:

The following table presents the debt activity for the six months ended June 30, 2022:

thousands Carrying Value

Balance at December 31, 2021 $ 6,906,548

RCF borrowings 635,000

Repayments of RCF borrowings ( 380,000 )

Repayment of 4.000 % Senior Notes due 2022

Repayment of 3.100 % Senior Notes due 2025

Finance lease liabilities ( 2,172 )

Balance at March 31, 2022 $ 6,906,903

Balance at June 30, 2022 $ 6,658,736

WES Operating Senior Notes.

In mid - January 2020, WES Operating issued the Fixed - Rate 3.100 % Senior Notes due 2025, 4.050 % Senior Notes due 2030, and 5.250 % Senior Notes due 2050 (collectively referred to as the “Fixed - Rate Senior Notes”) and the Floating - Rate Senior Notes due 2023 (the “Floating - Rate Senior Notes”).

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 3.790 %, 4.671 %, and 5.869 %, respectively, at March 31, 2022, and were 4.542 %, 5.424 %, and 6.629 %, respectively, at March 31, 2021.

The interest rate on the Floating - Rate Senior Notes was 1.84 % and 2.33 % at March 31, 2022 and 2021, respectively.

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 3.790 %, 4.671 %, and 5.869 %, respectively, at June 30, 2022, and were 4.542 %, 5.424 %, and 6.629 %, respectively, at June 30, 2021.

The interest rate on the Floating - Rate Senior Notes was 2.12 % and 2.29 % at June 30, 2022 and 2021, respectively.

The effective interest rate of these notes is subject to adjustment from time to time due to a change in credit rating.

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.

During the first quarter of 2021, WES Operating redeemed the total principal amount outstanding of the 5.375 % Senior Notes due 2021 at par value, pursuant to the optional redemption terms in WES Operating’s indenture.

As of March 31, 2022, the 4.000 % Senior Notes due 2022 and the Floating-Rate Senior Notes were classified as short-term debt on the consolidated balance sheet.

Subsequent to March 31, 2022, WES Operating redeemed the 4.000% Senior Notes due 2022 at par value on April 1, 2022, pursuant to the optional redemption terms in WES Operating’s indenture.

At March 31, 2022, WES Operating was in compliance with all covenants under the relevant governing indentures.

As of June 30, 2022, the Floating-Rate Senior Notes 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.

At June 30, 2022, WES Operating was in compliance with all covenants under the relevant governing indentures.

Revolving credit facility.

WES Operating’s $ 2.0 billion senior unsecured revolving credit facility (“RCF”) is expandable to a maximum of $ 2.5 billion, and matures in February 2025 for each extending lender.

In June 2022, WES Operating entered into an amendment to its $ 2.0 billion senior unsecured revolving credit facility (“RCF”), which is expandable to a maximum of $ 2.5 billion, to, among other things, (i) extend the maturity date applicable to the loans and commitments of certain lenders totaling $ 1.6 billion to February 2026, (ii) provide for the ability of WES Operating to extend the maturity date by one year on up to two additional occasions, (iii) provide that loans under the RCF with a fixed interest rate for a specified period bear interest based on the Secured Overnight Financing Rate (“SOFR”) instead of the London Interbank Offered Rate (“LIBOR”), and (iv) include an additional level of pricing if WES Operating’s senior unsecured debt rating is less than or equal to BB/Ba2/BB (Standard and Poor’s / Moody’s Investors Service / Fitch Ratings).

The non - extending lender’s commitments mature in February 2025 and represent $ 400.0 million out of $ 2.0 billion of total commitments from all lenders.

As of March 31, 2022, there were no outstanding borrowings and $ 5.1 million of outstanding letters of credit, resulting in $ 2.0 billion of available borrowing capacity under the RCF.

As of March 31, 2022 and 2021, the interest rate on any outstanding RCF borrowings was 1.95 % and 1.61 %, respectively.

The facility - fee rate was 0.25 % at March 31, 2022 and 2021.

At March 31, 2022, WES Operating was in compliance with all covenants under the RCF.

Finance lease liabilities.

During the first quarter of 2020, the Partnership entered into finance leases with third parties for equipment and vehicles.

Certain of these equipment leases were amended during the third quarter of 2021 requiring reassessment of lease classification.

As a result, these leases were classified as operating leases.

The Partnership has future payments for its finance leases of $ 4.3 million as of March 31, 2022.

As of June 30, 2022, there were $ 255.0 million of outstanding borrowings and $ 5.2 million of outstanding letters of credit, resulting in $ 1.7 billion of available borrowing capacity under the RCF.

As of June 30, 2022 and 2021, the interest rate on any outstanding RCF borrowings was 3.12 % and 1.60 %, respectively.

The facility - fee rate was 0.25 % at June 30, 2022 and 2021.

At June 30, 2022, WES Operating was in compliance with all covenants under the RCF.

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

4 unchanged sentences

Three Months Ended

June 30, Six Months Ended

thousands 2022 2021 2022 2021

8 unchanged sentences

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 March 31, 2022 and December 31, 2021, the consolidated balance sheets included $ 9.8 million and $ 10.1 million, respectively, of liabilities for remediation and reclamation obligations.

As of June 30, 2022 and December 31, 2021, the consolidated balance sheets included $ 9.0 million and $ 10.1 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.

4 unchanged sentences

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 commitments, and various operating and finance leases.

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 construction, expansion, and asset - integrity projects at the West Texas complex, DBM water systems, DBM oil system, and DJ Basin complex.

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