Western Midstream Partners LP

The following tables and discussion present a summary of our results of operations:

(1)Total revenues and other includes amounts earned from services provided to related parties and from the sale of natural gas, condensate, and NGLs to related parties. Total operating expenses includes amounts charged by related parties for services received. See Note 6—Related-Party Transactions in the Notes to Consolidated Financial Statements under Part II, Item 8 of this Form 10-K.

(2)For reconciliations to comparable consolidated results of WES Operating, see Items Affecting the Comparability of Financial Results with WES Operating within this Item 7.

For purposes of the following discussion, any increases or decreases “for the year ended December 31, 2024” refer to the comparison of the year ended December 31, 2024, to the year ended December 31, 2023.

Discussion of 2022 items and comparison of the year ended December 31, 2023, to the year ended December 31, 2022, that are not included in this annual report on Form 10-K can be found under Management’s Discussion and Analysis of Financial Condition and Results of Operations, which is included under Part II, Item 7 of our annual report on Form 10-K for the year ended December 31, 2023, and is available via the SEC’s website atwww.sec.gov and our website atwww.westernmidstream.com.

Throughput

(1)Represents our share of average throughput for investments accounted for under the equity method of accounting.

(2)Includes (i) the 2.0% limited partner interest in WES Operating owned by an Occidental subsidiary and (ii) for natural-gas assets, the 25% third-party interest in Chipeta, which collectively represent WES’s noncontrolling interests.

Natural-gas assets

Total throughput attributable to WES for natural-gas assets increased by 620 MMcf/d for the year ended December 31, 2024, primarily due to (i) higher volumes at the Powder River Basin complex due to the Meritage acquisition, (ii) higher volumes at the West Texas and DJ Basin complexes due to increased production in the areas, (iii) higher volumes at the Red Bluff Express pipeline due to the addition of a new receipt point into the pipeline, and (iv) higher volumes at the Springfield gas-gathering system due to new third-party production. These increases were offset partially by (i) lower volumes at the Marcellus Interest systems due to the sale of the asset during the second quarter of 2024 and (ii) lower volumes at the Granger complex due to a contract expiration in the fourth quarter of 2023.

Crude-oil and NGLs assets

Total throughput attributable to WES for crude-oil and NGLs assets decreased by 122 MBbls/d for the year ended December 31, 2024, primarily due to (i) the divestiture of Whitethorn LLC, Mont Belvieu JV, Saddlehorn, and Panola in the first quarter of 2024. These decreases were offset partially by (i) higher volumes at the DBM and DJ Basin oil systems due to increased production in the areas and (ii) higher volumes at the Thunder Creek NGL pipeline, which was acquired as part of the Meritage acquisition.

Produced-water assets

Total throughput attributable to WES for produced-water assets increased by 115 MBbls/d for the year ended December 31, 2024, due to higher production, partially offset by increased recycling activities in the upstream operations of our producers.

Service Revenues

Service revenues – fee based

Service revenues – fee based increased by $479.5 million for the year ended December 31, 2024, primarily due to increases of (i) $184.0 million at the West Texas complex due to increased throughput, a higher average fee resulting from a cost-of-service rate redetermination effective January 1, 2024, and increased deficiency fees on certain contracts with increasing throughput minimums, (ii) $140.2 million at the Powder River Basin complex attributable to the acquisition of Meritage, (iii) $89.8 million at the DJ Basin complex primarily due to increased throughput and increased electricity-related rates billed to customers, partially offset by a decrease in deficiency fees, (iv) $87.5 million and $36.7 million at the DBM water and DBM oil systems, respectively, as a result of increased throughput and higher average fees resulting from cost-of-service rate redeterminations effective January 1, 2024, and (v) $6.7 million at the Chipeta complex primarily due to new and amended contracts effective July 2024. These increases were offset partially by decreases of (i) $23.7 million at the Marcellus Interest systems due to the sale of the asset during the second quarter of 2024, (ii) $16.8 million and $4.3 million at the Springfield and DJ Basin oil systems, respectively, primarily due to decreased revenues associated with demand volumes and lower cumulative catch-up adjustments for changes in estimated consideration in 2024 compared to 2023, partially offset by increased throughput and higher average fees resulting from cost-of-service rate redeterminations effective January 1, 2024, (iii) $11.8 million at the Granger complex due to a contract expiration in the fourth quarter of 2023, and (iv) $10.5 million at the Brasada complex due to a change in contract terms effective July 1, 2023, partially offset by increased throughput.

Service revenues – product based

Service revenues – product based increased by $24.0 million for the year ended December 31, 2024, primarily due to increases of (i) $15.4 million at the West Texas complex due to increased volumes sold, (ii) $5.3 million at the DJ Basin complex due to a contract change effective during the second quarter of 2024, partially offset by decreased average prices, (iii) $4.7 million at the Powder River Basin complex attributable to the acquisition of Meritage, and (iv) $2.3 million at the DBM water systems due to increased skim-oil volumes sold. These increases were offset partially by a decrease of $3.4 million at the Chipeta complex due to decreased volumes sold.

Product Sales

Natural-gas sales

Natural-gas sales decreased by $27.2 million for the year ended December 31, 2024, primarily due to a decrease of $33.6 million at the West Texas complex due to decreased average prices. This decrease was offset partially by increases of (i) $8.9 million at the Powder River Basin complex attributable to the acquisition of Meritage and (ii) $3.1 million at the DJ Basin complex as a result of changes in contract mix during the second quarter of 2023.

NGLs sales

NGLs sales increased by $22.3 million for the year ended December 31, 2024, primarily due to increases of (i) $21.3 million at the Powder River Basin complex attributable to the acquisition of Meritage and (ii) $14.8 million at the DJ Basin complex due to increased volumes sold, partially offset by decreased average prices and the impact of a contract change effective during the second quarter of 2024. These increases were offset partially by decreases of (i) $7.8 million at the West Texas complex due to changes in contract mix and decreased average prices, partially offset by increased volumes sold and (ii) $4.7 million at the Chipeta complex due to a contract change effective during the third quarter of 2024.

Equity Income, Net – Related Parties

Equity income, net – related parties decreased by $40.6 million for the year ended December 31, 2024, primarily due to decreases of (i) $37.6 million resulting from the sale of several equity investments to third parties in the first quarter of 2024 and (ii) $8.0 million at TEP. These decreases were offset partially by an increase of $4.6 million at Red Bluff. See Note 3—Acquisitions and Divestituresin the Notes to Consolidated Financial Statements under Part II, Item 8 of this Form 10-K.

Cost of Product and Operation and Maintenance Expenses

Natural-gas purchases

Natural-gas purchases decreased by $21.9 million for the year ended December 31, 2024, primarily due to decreases of (i) $15.3 million at the West Texas complex due to lower average prices and (ii) $6.2 million at the Granger complex attributable to a contract change effective during 2023 and decreased volumes purchased.

NGLs purchases

NGLs purchases increased by $41.1 million for the year ended December 31, 2024, primarily due to increases of (i) $39.4 million at the West Texas complex primarily attributable to increased volumes purchased and average prices and (ii) $4.2 million at the DJ Basin complex due to a contract change effective during the second quarter of 2024. These increases were offset partially by a decrease of $5.6 million at the Chipeta complex due to a contract change effective during the third quarter of 2024.

Other items

Other items decreased by $11.5 million for the year ended December 31, 2024, primarily due to decreases of $32.5 million and $2.3 million at the West Texas and Chipeta complexes, respectively, due to changes in imbalance positions. These decreases were offset partially by increases of (i) $14.9 million at the Powder River Basin complex primarily attributable to the acquisition of Meritage and (ii) $13.6 million at the DJ Basin complex primarily attributable to changes in imbalance positions.

Operation and maintenance expense

Including the impact of operating the assets acquired with Meritage, operation and maintenance expense increased by $118.0 million for the year ended December 31, 2024, primarily due to increases of (i) $38.5 million in salaries and wages costs, (ii) $25.1 million in equipment, materials, maintenance, and repair costs, (iii) $16.7 million in chemical and treating services, (iv) $10.2 million in land-related costs, (v) $9.0 million in equipment rental costs, (vi) $7.1 million in water-disposal costs, and (vii) $5.4 million in utility expense.

Other Operating Expenses

General and administrative expenses

General and administrative expenses increased by $38.9 million for the year ended December 31, 2024, primarily due to increases of (i) $27.5 million in personnel costs, (ii) $10.5 million in information technology costs, and (iii) $7.0 million in other corporate-related expenses. These increases were offset partially by a decrease of $6.1 million in contract labor and consulting costs.

Property and other taxes

Property and other taxes increased by $6.2 million for the year ended December 31, 2024, primarily due to increases of (i) $2.4 million at the DJ Basin complex primarily due to a lower ad valorem property tax accrual recorded during 2023 related to the finalization of 2022 assessments, (ii) $2.3 million at the Powder River Basin complex due to the acquisition of Meritage, and (iii) $2.0 million due to higher property tax values from expansion in West Texas.

Depreciation and amortization expense

Depreciation and amortization expense increased by $49.8 million for the year ended December 31, 2024, primarily due to increases of (i) $44.7 million at the Powder River Basin complex primarily attributable to the acquisition of Meritage and (ii) $22.5 million and $7.2 million at the West Texas complex and DBM water systems, respectively, primarily related to capital projects being placed into service. These increases were offset partially by decreases of (i) $13.3 million at the DJ Basin complex primarily due to acceleration of depreciation expense during 2023 and updated salvage values, (ii) $6.4 million due to the sale of the Marcellus Interest systems in the second quarter of 2024, and (iii) $4.3 million at the Brasada complex due to an update in the expected useful life.

Long-lived asset and other impairment expense

Long-lived asset and other impairment expense for the year ended December 31, 2024, was primarily due to a $4.2 million impairment of certain corporate office leases that are no longer being utilized.

Long-lived asset and other impairment expense for the year ended December 31, 2023, was primarily due to a $52.1 million impairment for assets located in the Rockies.

For further information on Long-lived asset and other impairment expense, see Note 9—Property, Plant, and Equipmentin the Notes to Consolidated Financial Statements under Part II, Item 8 of this Form 10-K.

Interest Expense

Interest expense increased by $30.3 million for the year ended December 31, 2024, primarily due to increases of (i) $29.3 million of interest incurred on the 6.350% Senior Notes due 2029 that were issued during the third quarter of 2023, (ii) $16.1 million of interest incurred on the 5.450% Senior Notes due 2034 that were issued during the third quarter of 2024, (iii) $12.1 million of interest incurred on the 6.150% Senior Notes due 2033 that were issued during the second quarter of 2023, and (iv) $2.7 million due to borrowings in 2024 on the commercial paper program that was established during the fourth quarter of 2023. These increases were offset partially by decreases of (i) $14.8 million primarily due to no outstanding borrowings under the RCF during 2024 and (ii) $14.6 million due to credit-rating related interest-rate changes and lower outstanding balances on certain senior notes due to debt repurchases. See Liquidity and Capital Resources—Debt and credit facilities within this Item 7.

Other Income (Expense), Net

Other income (expense), net increased by $26.1 million for the year ended December 31, 2024, primarily due to interest income earned resulting from higher cash and cash equivalent balances throughout 2024.

Income Tax Expense (Benefit)

We are not a taxable entity for U.S. federal income tax purposes; therefore, our federal statutory rate is zero percent. However, income apportionable to Texas is subject to Texas margin tax. For the year ended December 31, 2024, the variance from the federal statutory rate was primarily impacted by a state margin tax rate increase associated with no longer being included in Occidental’s affiliated group tax return beginning in September 2024 due to Occidental’s sale of 19.5 million WES common units in August 2024 and the resulting decrease in WES ownership, inclusive of its ownership in WES Operating.