10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021

Or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to      

WESTERN MIDSTREAM PARTNERS, LP

WESTERN MIDSTREAM OPERATING, LP

(Exact name of registrant as specified in its charter)

	Commission file number:	State or other jurisdiction of incorporation or organization:	I.R.S. Employer Identification No.:
Western Midstream Partners, LP	001-35753	Delaware	46-0967367
Western Midstream Operating, LP	001-34046	Delaware	26-1075808

	Address of principal executive offices:			Zip Code:	Registrant’s telephone number, including area code:
Western Midstream Partners, LP	9950 Woodloch Forest Drive, Suite 2800	The Woodlands,	Texas	77380	(346)	786-5000
Western Midstream Operating, LP	9950 Woodloch Forest Drive, Suite 2800	The Woodlands,	Texas	77380	(346)	786-5000

Securities registered pursuant to Section 12(b) of the Act:

	Title of each class	Trading symbol	Name of exchange on which registered	Common units outstanding as of November 4, 2021:
Western Midstream Partners, LP	Common units	WES	New York Stock Exchange	408,390,278
Western Midstream Operating, LP	None	None	None	None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Western Midstream Partners, LP	Yes	þ	No	¨
Western Midstream Operating, LP	Yes	þ	No	¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Western Midstream Partners, LP	Yes	þ	No	¨
Western Midstream Operating, LP	Yes	þ	No	¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Western Midstream Partners, LP	Large Accelerated Filer	Accelerated Filer	Non-accelerated Filer	Smaller Reporting Company	Emerging Growth Company
	þ	☐	☐	☐	☐
Western Midstream Operating, LP	Large Accelerated Filer	Accelerated Filer	Non-accelerated Filer	Smaller Reporting Company	Emerging Growth Company
	☐	☐	þ	☐	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Western Midstream Partners, LP	¨
Western Midstream Operating, LP	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Western Midstream Partners, LP	Yes	☐	No	þ
Western Midstream Operating, LP	Yes	☐	No	þ

FILING FORMAT

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

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

TABLE OF CONTENTS
		PAGE
PART I		FINANCIAL INFORMATION (UNAUDITED)
	Item 1.	Financial Statements
		Western Midstream Partners, LP
		Consolidated Statements of Operations for the three and nine months ended September 30, 2021 and 2020	7
		Consolidated Balance Sheets as of September 30, 2021, and December 31, 2020	8
		Consolidated Statements of Equity and Partners’ Capital for the three and nine months ended September 30, 2021 and 2020	9
		Consolidated Statements of Cash Flows for the nine months ended September 30, 2021 and 2020	11
		Western Midstream Operating, LP
		Consolidated Statements of Operations for the three and nine months ended September 30, 2021 and 2020	12
		Consolidated Balance Sheets as of September 30, 2021, and December 31, 2020	13
		Consolidated Statements of Equity and Partners’ Capital for the three and nine months ended September 30, 2021 and 2020	14
		Consolidated Statements of Cash Flows for the nine months ended September 30, 2021 and 2020	16
		Notes to Consolidated Financial Statements	17
		Note 1. Description of Business and Basis of Presentation	17
		Note 2. Revenue from Contracts with Customers	20
		Note 3. Acquisitions and Divestitures	22
		Note 4. Partnership Distributions	23
		Note 5. Equity and Partners’ Capital	24
		Note 6. Related-Party Transactions	26
		Note 7. Equity Investments	31
		Note 8. Property, Plant, and Equipment	32
		Note 9. Goodwill	33
		Note 10. Selected Components of Working Capital	34
		Note 11. Debt and Interest Expense	35
		Note 12. Commitments and Contingencies	37
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	38
		Cautionary Note Regarding Forward-Looking Statements	38
		Executive Summary	40
		Outlook	43
		Acquisitions and Divestitures	43
		Results of Operations	44
		Operating Results	44
		Key Performance Metrics	53
		Liquidity and Capital Resources	59
		Items Affecting the Comparability of Financial Results with WES Operating	64
		Critical Accounting Estimates	65
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	65
	Item 4.	Controls and Procedures	66
PART II		OTHER INFORMATION
	Item 1.	Legal Proceedings	67
	Item 1A.	Risk Factors	67
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	69
	Item 6.	Exhibits	70

3

COMMONLY USED TERMS AND DEFINITIONS

Unless the context otherwise requires, references to “we,” “us,” “our,” “WES,” “the Partnership,” or “Western Midstream Partners, LP” refer to Western Midstream Partners, LP (formerly Western Gas Equity Partners, LP) and its subsidiaries. As used in this Form 10-Q, the terms and definitions below have the following meanings:

AESC: Anadarko Energy Services Company, a subsidiary of Occidental.

Anadarko: Anadarko Petroleum Corporation and its subsidiaries, excluding our general partner, which became a wholly owned subsidiary of Occidental upon closing of the Occidental Merger on August 8, 2019.

Anadarko note receivable: The 30-year $260.0 million note established in May 2008 between WES Operating as the lender and Anadarko as the borrower. The note bore interest at a fixed annual rate of 6.50%, payable quarterly. Following the Occidental Merger, Occidental became the ultimate counterparty. On September 11, 2020, the Partnership and Occidental entered into a Unit Redemption Agreement, pursuant to which (i) WES Operating transferred and assigned its interest in the Anadarko note receivable to its limited partners on a pro-rata basis, transferring 98% of its interest in (and accrued interest owed under) the Anadarko note receivable to the Partnership and the remaining 2% to WGRAH, a subsidiary of Occidental, (ii) the Partnership subsequently assigned the 98% interest in (and accrued interest owed under) the Anadarko note receivable to Anadarko, which Anadarko canceled and retired immediately upon receipt, in exchange for which Occidental caused certain of its subsidiaries to transfer an aggregate of 27,855,398 common units of the Partnership to the Partnership, and (iii) the Partnership canceled such common units immediately upon receipt.

Barrel or Bbl: 42 U.S. gallons measured at 60 degrees Fahrenheit.

Bbls/d: Barrels per day.

Board of Directors: The board of directors of WES’s general partner.

Cactus II: Cactus II Pipeline LLC.

Chipeta: Chipeta Processing, LLC.

Condensate: A natural-gas liquid with a low vapor pressure compared to drip condensate, mainly composed of propane, butane, pentane, and heavier hydrocarbon fractions.

Cryogenic: The process by which liquefied gases are used to bring natural-gas volumes to very low temperatures (below approximately -238 degrees Fahrenheit) to separate natural-gas liquids from natural gas. Through cryogenic processing, more natural-gas liquids are extracted as compared to traditional refrigeration methods.

DBM: Delaware Basin Midstream, LLC.

DBM water systems: The produced-water gathering and disposal systems in West Texas.

DJ Basin complex: The Platte Valley system, Wattenberg system, Lancaster plant, Latham plant, and Wattenberg processing plant.

EBITDA: Earnings before interest, taxes, depreciation, and amortization. For a definition of “Adjusted EBITDA,” see Key Performance Metrics under Part I, Item 2 of this Form 10-Q.

Exchange Act: The Securities Exchange Act of 1934, as amended.

Fixed-Rate Senior Notes: WES Operating’s fixed-rate 3.100% Senior Notes due 2025, 4.050% Senior Notes due 2030, and 5.250% Senior Notes due 2050, issued in January 2020.

4

Floating-Rate Senior Notes: WES Operating’s floating-rate Senior Notes due 2023.

Fort Union: Fort Union Gas Gathering, LLC.

Fractionation: The process of applying various levels of high pressure and low temperature to separate a stream of natural-gas liquids into ethane, propane, normal butane, isobutane, and natural gasoline for end-use sale.

FRP: Front Range Pipeline LLC.

GAAP: Generally accepted accounting principles in the United States.

General partner: Western Midstream Holdings, LLC, the general partner of the Partnership.

Hydraulic fracturing: The high-pressure injection of fluids into the wellbore to create fractures in rock formations, stimulating the production of oil or gas.

Imbalance: Imbalances result from (i) differences between gas and NGLs volumes nominated by customers and gas and NGLs volumes received from those customers and (ii) differences between gas and NGLs volumes received from customers and gas and NGLs volumes delivered to those customers.

LIBOR: London Interbank Offered Rate.

Marcellus Interest: The 33.75% interest in the Larry’s Creek, Seely, and Warrensville gas-gathering systems and related facilities located in northern Pennsylvania.

MBbls/d: Thousand barrels per day.

Mcf: Thousand cubic feet.

MGR: Mountain Gas Resources, LLC.

MGR assets: The Red Desert complex and the Granger straddle plant.

Mi Vida: Mi Vida JV LLC.

MLP: Master limited partnership.

MMcf: Million cubic feet.

MMcf/d: Million cubic feet per day.

Mont Belvieu JV: Enterprise EF78 LLC.

Natural-gas liquid(s) or NGL(s): The combination of ethane, propane, normal butane, isobutane, and natural gasolines that, when removed from natural gas, become liquid under various levels of pressure and temperature.

Occidental: Occidental Petroleum Corporation and, as the context requires, its subsidiaries, excluding our general partner.

Occidental Merger: Occidental’s acquisition by merger of Anadarko pursuant to the Agreement and Plan of Merger, dated as of May 9, 2019, by and among Occidental, Baseball Merger Sub 1, Inc., and Anadarko, which closed on August 8, 2019.

Panola: Panola Pipeline Company, LLC.

Produced water: Byproduct associated with the production of crude oil and natural gas that often contains a number of dissolved solids and other materials found in oil and gas reservoirs.

Purchase Program: The buyback program announced in November 2020, pursuant to which we may purchase up to $250.0 million in aggregate value of our common units through December 31, 2021. The common units may be purchased from time to time in the open market at prevailing market prices or in privately negotiated transactions.

5

Ranch Westex: Ranch Westex JV LLC.

RCF: WES Operating’s $2.0 billion senior unsecured revolving credit facility that matures in February 2025.

Red Bluff Express: Red Bluff Express Pipeline, LLC.

Red Desert complex: The Patrick Draw processing plant, the Red Desert processing plant, associated gathering lines, and related facilities.

Related parties: Occidental and the Partnership’s equity interests in Fort Union (until divested in October 2020), White Cliffs, Rendezvous, the Mont Belvieu JV, TEP, TEG, FRP, Whitethorn LLC, Cactus II, Saddlehorn, Panola, Mi Vida, Ranch Westex, and Red Bluff Express.

Rendezvous: Rendezvous Gas Services, LLC.

Residue: The natural gas remaining after the unprocessed natural-gas stream has been processed or treated.

Saddlehorn: Saddlehorn Pipeline Company, LLC.

SEC: U.S. Securities and Exchange Commission.

Services Agreement: That certain amended and restated Services, Secondment, and Employee Transfer Agreement, dated as of December 31, 2019, by and among Occidental, Anadarko, and WES Operating GP.

Springfield system: The Springfield gas-gathering system and Springfield oil-gathering system.

TEFR Interests: The interests in TEP, TEG, and FRP.

TEG: Texas Express Gathering LLC.

TEP: Texas Express Pipeline LLC.

Term loan facility: WES Operating’s senior unsecured credit facility entered into in December 2018, which was repaid and terminated in January 2020.

WES Operating: Western Midstream Operating, LP, formerly known as Western Gas Partners, LP, and its subsidiaries.

WES Operating GP: Western Midstream Operating GP, LLC, the general partner of WES Operating.

West Texas complex: The DBM complex and DBJV and Haley systems.

WGRAH: WGR Asset Holding Company LLC.

WGRI: Western Gas Resources, Inc., a subsidiary of Occidental.

White Cliffs: White Cliffs Pipeline, LLC.

Whitethorn LLC: Whitethorn Pipeline Company LLC.

Whitethorn: A crude-oil and condensate pipeline, and related storage facilities, owned by Whitethorn LLC.

6

PART I. FINANCIAL INFORMATION (UNAUDITED)

Item 1.  Financial Statements

WESTERN MIDSTREAM PARTNERS, LP

CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands except per-unit amounts	2021		2020		2021		2020
Revenues and other
Service revenues – fee based	$	650,482	$	636,522	$	1,841,742	$	1,980,546
Service revenues – product based	28,812		12,316		88,267		35,237
Product sales	84,298		30,106		227,359		108,491
Other	248		100		577		838
Total revenues and other (1)	763,840		679,044		2,157,945		2,125,112
Equity income, net – related parties	48,506		61,026		159,337		176,788
Operating expenses
Cost of product	83,232		31,739		250,245		153,611
Operation and maintenance	140,838		132,293		434,198		436,670
General and administrative	50,409		41,578		139,973		118,466
Property and other taxes	13,641		19,392		45,992		57,263
Depreciation and amortization	139,002		132,564		407,404		384,688
Long-lived asset and other impairments	1,594		34,640		29,198		200,575
Goodwill impairment	—		—		—		441,017
Total operating expenses (2)	428,716		392,206		1,307,010		1,792,290
Gain (loss) on divestiture and other, net	(364)		(768)		278		(3,651)
Operating income (loss)	383,266		347,096		1,010,550		505,959
Interest income – Anadarko note receivable	—		3,286		—		11,736
Interest expense	(93,257)		(95,571)		(287,040)		(278,811)
Gain (loss) on early extinguishment of debt	(24,655)		1,632		(24,944)		10,372
Other income (expense), net	110		720		(1,013)		612
Income (loss) before income taxes	265,464		257,163		697,553		249,868
Income tax expense (benefit)	1,826		3,028		4,403		3,792
Net income (loss)	263,638		254,135		693,150		246,076
Net income (loss) attributable to noncontrolling interests	7,913		7,524		20,375		(17,045)
Net income (loss) attributable to Western Midstream Partners, LP	$	255,725	$	246,611	$	672,775	$	263,121
Limited partners’ interest in net income (loss):
Net income (loss) attributable to Western Midstream Partners, LP	$	255,725	$	246,611	$	672,775	$	263,121
General partner interest in net (income) loss	(5,527)		(5,132)		(14,484)		(5,462)
Limited partners’ interest in net income (loss) (3)	250,198		241,479		658,291		257,659
Net income (loss) per common unit – basic (3)	$	0.61	$	0.55	$	1.60	$	0.58
Net income (loss) per common unit – diluted (3)	$	0.61	$	0.55	$	1.59	$	0.58
Weighted-average common units outstanding – basic (3)	411,909		438,857		412,690		442,255
Weighted-average common units outstanding – diluted (3)	412,714		438,926		413,150		442,275

_________________________________________________________________________________________

(1)Total revenues and other includes related-party amounts of $431.7 million and $1.2 billion for the three and nine months ended September 30, 2021, respectively, and $455.6 million and $1.4 billion for the three and nine months ended September 30, 2020, respectively. See Note 6.

(2)Total operating expenses includes related-party amounts of $22.7 million and $91.5 million for the three and nine months ended September 30, 2021, respectively, and $10.4 million and $161.5 million for the three and nine months ended September 30, 2020, respectively. See Note 6.

(3)See Note 5.

See accompanying Notes to Consolidated Financial Statements.

7

WESTERN MIDSTREAM PARTNERS, LP

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

thousands except number of units	September 30, 2021		December 31, 2020
ASSETS
Current assets
Cash and cash equivalents	$	99,862	$	444,922
Accounts receivable, net	583,652		452,880
Other current assets	73,196		45,262
Total current assets	756,710		943,064
Property, plant, and equipment
Cost	12,732,926		12,641,745
Less accumulated depreciation	4,208,845		3,931,800
Net property, plant, and equipment	8,524,081		8,709,945
Goodwill	4,783		4,783
Other intangible assets	752,659		776,409
Equity investments	1,181,181		1,224,813
Other assets (1)	199,964		171,013
Total assets (2)	$	11,419,378	$	11,830,027
LIABILITIES, EQUITY, AND PARTNERS’ CAPITAL
Current liabilities
Accounts and imbalance payables	$	341,220	$	210,691
Short-term debt	726,429		438,870
Accrued ad valorem taxes	49,065		41,427
Accrued liabilities	190,628		269,947
Total current liabilities	1,307,342		960,935
Long-term liabilities
Long-term debt	6,399,874		7,415,832
Deferred income taxes	24,470		22,195
Asset retirement obligations	271,022		260,283
Other liabilities	320,224		275,570
Total long-term liabilities	7,015,590		7,973,880
Total liabilities (3)	8,322,932		8,934,815
Equity and partners’ capital
Common units (408,610,916 and 413,839,863 units issued and outstanding at September 30, 2021, and December 31, 2020, respectively)	2,965,944		2,778,339
General partner units (9,060,641 units issued and outstanding at September 30, 2021, and December 31, 2020)	(11,286)		(17,208)
Total partners’ capital	2,954,658		2,761,131
Noncontrolling interests	141,788		134,081
Total equity and partners’ capital	3,096,446		2,895,212
Total liabilities, equity, and partners’ capital	$	11,419,378	$	11,830,027

________________________________________________________________________________________

(1)Other assets includes $11.2 million and $4.2 million of NGLs line-fill inventory as of September 30, 2021, and December 31, 2020, respectively. Other assets also includes $63.1 million and $71.9 million of materials and supplies inventory as of September 30, 2021, and December 31, 2020, respectively.

(2)Total assets includes related-party amounts of $1.6 billion as of September 30, 2021, and December 31, 2020, which includes related-party Accounts receivable, net of $289.4 million and $291.3 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

(3)Total liabilities includes related-party amounts of $250.7 million and $164.7 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

See accompanying Notes to Consolidated Financial Statements.

8

WESTERN MIDSTREAM PARTNERS, LP

CONSOLIDATED STATEMENTS OF EQUITY AND PARTNERS’ CAPITAL

(UNAUDITED)

	Partners’ Capital
thousands	Common Units		General Partner Units		Noncontrolling Interests		Total
Balance at December 31, 2020	$	2,778,339	$	(17,208)	$	134,081	$	2,895,212
Net income (loss)	181,798		3,993		5,444		191,235
Distributions to Chipeta noncontrolling interest owner	—		—		(276)		(276)
Distributions to noncontrolling interest owner of WES Operating	—		—		(2,551)		(2,551)
Distributions to Partnership unitholders	(128,447)		(2,818)		—		(131,265)
Unit repurchases (1)	(16,241)		—		—		(16,241)
Contributions of equity-based compensation from Occidental	3,210		—		—		3,210
Equity-based compensation expense	3,524		—		—		3,524
Net contributions from (distributions to) related parties	1,627		—		—		1,627
Other	(2,355)		—		—		(2,355)
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
Net income (loss)	250,198		5,527		7,913		263,638
Distributions to Chipeta noncontrolling interest owner	—		—		(1,213)		(1,213)
Distributions to noncontrolling interest owner of WES Operating	—		—		(4,642)		(4,642)
Distributions to Partnership unitholders	(131,772)		(2,890)		—		(134,662)
Unit repurchases (1)	(88,125)		—		—		(88,125)
Contributions of equity-based compensation from Occidental	2,311		—		—		2,311
Equity-based compensation expense	4,668		—		—		4,668
Net contributions from (distributions to) related parties	2,165		—		—		2,165
Other	(567)		—		—		(567)
Balance at September 30, 2021	$	2,965,944	$	(11,286)	$	141,788	$	3,096,446

_________________________________________________________________________________________

(1)See Note 5.

See accompanying Notes to Consolidated Financial Statements.

9

WESTERN MIDSTREAM PARTNERS, LP

CONSOLIDATED STATEMENTS OF EQUITY AND PARTNERS’ CAPITAL

(UNAUDITED)

	Partners’ Capital
thousands	Common Units		General Partner Units		Noncontrolling Interests		Total
Balance at December 31, 2019	$	3,209,947	$	(14,224)	$	149,570	$	3,345,293
Net income (loss)	(251,396)		(5,131)		(32,873)		(289,400)
Distributions to Chipeta noncontrolling interest owner	—		—		(1,738)		(1,738)
Distributions to noncontrolling interest owner of WES Operating	—		—		(5,807)		(5,807)
Distributions to Partnership unitholders	(276,151)		(5,635)		—		(281,786)
Acquisitions from related parties	(3,987)		—		3,987		—
Contributions of equity-based compensation from Occidental	4,105		—		—		4,105
Equity-based compensation expense	1,129		—		—		1,129
Net contributions from (distributions to) related parties (1)	489		—		20,000		20,489
Balance at March 31, 2020	$	2,684,136	$	(24,990)	$	133,139	$	2,792,285
Net income (loss)	267,576		5,461		8,304		281,341
Distributions to Chipeta noncontrolling interest owner	—		—		(1,037)		(1,037)
Distributions to noncontrolling interest owner of WES Operating	—		—		(2,869)		(2,869)
Distributions to Partnership unitholders	(138,075)		(2,818)		—		(140,893)
Contributions of equity-based compensation from Occidental	3,562		—		—		3,562
Equity-based compensation expense	2,115		—		—		2,115
Net contributions from (distributions to) related parties	1,343		—		—		1,343
Other	(330)		—		—		(330)
Balance at June 30, 2020	$	2,820,327	$	(22,347)	$	137,537	$	2,935,517
Net income (loss)	241,479		5,132		7,524		254,135
Distributions to Chipeta noncontrolling interest owner	—		—		(1,148)		(1,148)
Distributions to noncontrolling interest owner of WES Operating	—		—		(2,869)		(2,869)
Distributions to Partnership unitholders	(138,083)		(2,817)		—		(140,900)
Unit exchange with Occidental (2)	(256,640)		—		(5,238)		(261,878)
Contributions of equity-based compensation from Occidental	3,488		—		—		3,488
Equity-based compensation expense	2,128		—		—		2,128
Net contributions from (distributions to) related parties	842		—		—		842
Other	1,141		—		—		1,141
Balance at September 30, 2020	$	2,674,682	$	(20,032)	$	135,806	$	2,790,456

_________________________________________________________________________________________

(1)See Services Agreement within Note 6.

(2)See Note 6.

See accompanying Notes to Consolidated Financial Statements.

10

WESTERN MIDSTREAM PARTNERS, LP

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	Nine Months Ended  September 30,
thousands	2021		2020
Cash flows from operating activities
Net income (loss)	$	693,150	$	246,076
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	407,404		384,688
Long-lived asset and other impairments	29,198		200,575
Goodwill impairment	—		441,017
Non-cash equity-based compensation expense	20,834		16,527
Deferred income taxes	2,275		2,393
Accretion and amortization of long-term obligations, net	5,873		6,482
Equity income, net – related parties	(159,337)		(176,788)
Distributions from equity-investment earnings – related parties	164,772		187,816
(Gain) loss on divestiture and other, net	(278)		3,651
(Gain) loss on early extinguishment of debt	24,944		(10,372)
Cash paid to settle interest-rate swaps	—		(19,181)
Other	46		192
Changes in assets and liabilities:
(Increase) decrease in accounts receivable, net	(130,773)		(192,338)
Increase (decrease) in accounts and imbalance payables and accrued liabilities, net	56,495		37,814
Change in other items, net	(9,609)		3,341
Net cash provided by operating activities	1,104,994		1,131,893
Cash flows from investing activities
Capital expenditures	(217,757)		(372,262)
Purchases from related parties	(2,000)		—
Contributions to equity investments – related parties	(3,683)		(19,017)
Distributions from equity investments in excess of cumulative earnings – related parties	30,075		21,750
Proceeds from the sale of assets to third parties	8,002		—
(Increase) decrease in materials and supplies inventory and other	(1,924)		(57,141)
Net cash used in investing activities	(187,287)		(426,670)
Cash flows from financing activities
Borrowings, net of debt issuance costs	400,000		3,681,173
Repayments of debt	(1,132,966)		(3,780,390)
Increase (decrease) in outstanding checks	(11,757)		691
Distributions to Partnership unitholders (1)	(398,896)		(563,579)
Distributions to Chipeta noncontrolling interest owner	(2,734)		(3,923)
Distributions to noncontrolling interest owner of WES Operating	(9,934)		(11,545)
Net contributions from (distributions to) related parties	6,673		22,674
Finance lease payments (2)	(5,295)		(12,241)
Unit repurchases	(104,366)		—
Other	(3,492)		—
Net cash provided by (used in) financing activities	(1,262,767)		(667,140)
Net increase (decrease) in cash and cash equivalents	(345,060)		38,083
Cash and cash equivalents at beginning of period	444,922		99,962
Cash and cash equivalents at end of period	$	99,862	$	138,045
Supplemental disclosures
Non-cash unit exchange with Occidental (1)	$	—	$	(261,878)
Interest paid, net of capitalized interest	348,904		307,713
Income taxes paid (reimbursements received)	932		(384)
Accrued capital expenditures	29,085		20,275

_________________________________________________________________________________________

(1)See Note 6.

(2)For the nine months ended September 30, 2020, includes related-party payments of $6.4 million.

See accompanying Notes to Consolidated Financial Statements.

11

WESTERN MIDSTREAM OPERATING, LP

CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
Revenues and other
Service revenues – fee based	$	650,482	$	636,522	$	1,841,742	$	1,980,546
Service revenues – product based	28,812		12,316		88,267		35,237
Product sales	84,298		30,106		227,359		108,491
Other	248		100		577		838
Total revenues and other (1)	763,840		679,044		2,157,945		2,125,112
Equity income, net – related parties	48,506		61,026		159,337		176,788
Operating expenses
Cost of product	83,232		31,739		250,245		153,611
Operation and maintenance	140,838		132,293		434,198		436,670
General and administrative	50,689		41,483		137,767		115,783
Property and other taxes	13,641		19,392		45,992		57,263
Depreciation and amortization	139,002		132,564		407,404		384,688
Long-lived asset and other impairments	1,594		34,640		29,198		200,575
Goodwill impairment	—		—		—		441,017
Total operating expenses (2)	428,996		392,111		1,304,804		1,789,607
Gain (loss) on divestiture and other, net	(364)		(768)		278		(3,651)
Operating income (loss)	382,986		347,191		1,012,756		508,642
Interest income – Anadarko note receivable	—		3,286		—		11,736
Interest expense	(93,257)		(95,571)		(287,040)		(278,811)
Gain (loss) on early extinguishment of debt	(24,655)		1,632		(24,944)		10,372
Other income (expense), net	106		718		(1,022)		606
Income (loss) before income taxes	265,180		257,256		699,750		252,545
Income tax expense (benefit)	1,823		3,028		4,400		3,792
Net income (loss)	263,357		254,228		695,350		248,753
Net income (loss) attributable to noncontrolling interest	2,699		2,488		6,596		(22,471)
Net income (loss) attributable to Western Midstream Operating, LP	$	260,658	$	251,740	$	688,754	$	271,224

________________________________________________________________________________________

(1)Total revenues and other includes related-party amounts of $431.7 million and $1.2 billion for the three and nine months ended September 30, 2021, respectively, and $455.6 million and $1.4 billion for the three and nine months ended September 30, 2020, respectively. See Note 6.

(2)Total operating expenses includes related-party amounts of $23.7 million and $93.6 million for the three and nine months ended September 30, 2021, respectively, and $11.1 million and $162.2 million for the three and nine months ended September 30, 2020, respectively. See Note 6.

See accompanying Notes to Consolidated Financial Statements.

12

WESTERN MIDSTREAM OPERATING, LP

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

thousands except number of units	September 30, 2021		December 31, 2020
ASSETS
Current assets
Cash and cash equivalents	$	92,863	$	418,537
Accounts receivable, net	583,652		407,549
Other current assets	70,907		43,244
Total current assets	747,422		869,330
Property, plant, and equipment
Cost	12,732,926		12,641,745
Less accumulated depreciation	4,208,845		3,931,800
Net property, plant, and equipment	8,524,081		8,709,945
Goodwill	4,783		4,783
Other intangible assets	752,659		776,409
Equity investments	1,181,181		1,224,813
Other assets (1)	199,964		171,013
Total assets (2)	$	11,410,090	$	11,756,293
LIABILITIES, EQUITY, AND PARTNERS’ CAPITAL
Current liabilities
Accounts and imbalance payables	$	382,406	$	210,532
Short-term debt	726,429		438,870
Accrued ad valorem taxes	49,065		41,427
Accrued liabilities	145,241		230,833
Total current liabilities	1,303,141		921,662
Long-term liabilities
Long-term debt	6,399,874		7,415,832
Deferred income taxes	24,470		22,195
Asset retirement obligations	271,022		260,283
Other liabilities	320,224		275,570
Total long-term liabilities	7,015,590		7,973,880
Total liabilities (3)	8,318,731		8,895,542
Equity and partners’ capital
Common units (318,675,578 units issued and outstanding at September 30, 2021, and December 31, 2020)	3,057,945		2,831,199
Total partners’ capital	3,057,945		2,831,199
Noncontrolling interest	33,414		29,552
Total equity and partners’ capital	3,091,359		2,860,751
Total liabilities, equity, and partners’ capital	$	11,410,090	$	11,756,293

_________________________________________________________________________________________

(1)Other assets includes $11.2 million and $4.2 million of NGLs line-fill inventory as of September 30, 2021, and December 31, 2020, respectively. Other assets also includes $63.1 million and $71.9 million of materials and supplies inventory as of September 30, 2021, and December 31, 2020, respectively.

(2)Total assets includes related-party amounts of $1.6 billion and $1.5 billion as of September 30, 2021, and December 31, 2020, respectively, which includes related-party Accounts receivable, net of $289.4 million and $246.1 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

(3)Total liabilities includes related-party amounts of $291.6 million and $164.3 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

See accompanying Notes to Consolidated Financial Statements.

13

WESTERN MIDSTREAM OPERATING, LP

CONSOLIDATED STATEMENTS OF EQUITY AND PARTNERS’ CAPITAL

(UNAUDITED)

thousands	Common Units		Noncontrolling Interest		Total
Balance at December 31, 2020	$	2,831,199	$	29,552	$	2,860,751
Net income (loss)	190,485		1,633		192,118
Distributions to Chipeta noncontrolling interest owner	—		(276)		(276)
Distributions to WES Operating unitholders	(127,470)		—		(127,470)
Contributions of equity-based compensation from Occidental	3,210		—		3,210
Contributions of equity-based compensation from WES	10,826		—		10,826
Net contributions from (distributions to) related parties	1,627		—		1,627
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
Net income (loss)	260,658		2,699		263,357
Distributions to Chipeta noncontrolling interest owner	—		(1,213)		(1,213)
Distributions to WES Operating unitholders	(232,055)		—		(232,055)
Contributions of equity-based compensation from Occidental	2,311		—		2,311
Contributions of equity-based compensation from WES	4,539		—		4,539
Net contributions from (distributions to) related parties	2,165		—		2,165
Balance at September 30, 2021	$	3,057,945	$	33,414	$	3,091,359

See accompanying Notes to Consolidated Financial Statements.

14

WESTERN MIDSTREAM OPERATING, LP

CONSOLIDATED STATEMENTS OF EQUITY AND PARTNERS’ CAPITAL

(UNAUDITED)

thousands	Common Units		Noncontrolling Interest		Total
Balance at December 31, 2019	$	3,286,620	$	55,199	$	3,341,819
Net income (loss)	(260,330)		(27,665)		(287,995)
Distributions to Chipeta noncontrolling interest owner	—		(1,738)		(1,738)
Distributions to WES Operating unitholders	(290,314)		—		(290,314)
Acquisitions from related parties	(3,987)		3,987		—
Contributions of equity-based compensation from Occidental	4,105		—		4,105
Net contributions from (distributions to) related parties (1)	20,489		—		20,489
Balance at March 31, 2020	$	2,756,583	$	29,783	$	2,786,366
Net income (loss)	279,814		2,706		282,520
Distributions to Chipeta noncontrolling interest owner	—		(1,037)		(1,037)
Distributions to WES Operating unitholders	(143,404)		—		(143,404)
Contributions of equity-based compensation from Occidental	3,562		—		3,562
Net contributions from (distributions to) related parties	1,343		—		1,343
Balance at June 30, 2020	$	2,897,898	$	31,452	$	2,929,350
Net income (loss)	251,740		2,488		254,228
Distributions to Chipeta noncontrolling interest owner	—		(1,148)		(1,148)
Distributions to WES Operating unitholders	(143,404)		—		(143,404)
Contributions of equity-based compensation from Occidental	3,488		—		3,488
Unit exchange with Occidental (2)	(261,878)		—		(261,878)
Net contributions from (distributions to) related parties	842		—		842
Other	1,545		—		1,545
Balance at September 30, 2020	$	2,750,231	$	32,792	$	2,783,023

_______________________________________________________________________________________

(1)See Services Agreement within Note 6.

(2)See Note 6.

See accompanying Notes to Consolidated Financial Statements.

15

WESTERN MIDSTREAM OPERATING, LP

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	Nine Months Ended  September 30,
thousands	2021		2020
Cash flows from operating activities
Net income (loss)	$	695,350	$	248,753
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	407,404		384,688
Long-lived asset and other impairments	29,198		200,575
Goodwill impairment	—		441,017
Non-cash equity-based compensation expense	27,874		11,155
Deferred income taxes	2,275		2,393
Accretion and amortization of long-term obligations, net	5,873		6,482
Equity income, net – related parties	(159,337)		(176,788)
Distributions from equity-investment earnings – related parties	164,772		187,816
(Gain) loss on divestiture and other, net	(278)		3,651
(Gain) loss on early extinguishment of debt	24,944		(10,372)
Cash paid to settle interest-rate swaps	—		(19,181)
Other	46		192
Changes in assets and liabilities:
(Increase) decrease in accounts receivable, net	(176,104)		(155,008)
Increase (decrease) in accounts and imbalance payables and accrued liabilities, net	91,508		4,836
Change in other items, net	(9,336)		3,763
Net cash provided by operating activities	1,104,189		1,133,972
Cash flows from investing activities
Capital expenditures	(217,757)		(372,262)
Purchases from related parties	(2,000)		—
Contributions to equity investments – related parties	(3,683)		(19,017)
Distributions from equity investments in excess of cumulative earnings – related parties	30,075		21,750
Proceeds from the sale of assets to third parties	8,002		—
(Increase) decrease in materials and supplies inventory and other	(1,924)		(57,141)
Net cash used in investing activities	(187,287)		(426,670)
Cash flows from financing activities
Borrowings, net of debt issuance costs	400,000		3,681,173
Repayments of debt	(1,132,966)		(3,780,390)
Increase (decrease) in outstanding checks	(11,699)		1,007
Distributions to WES Operating unitholders (1)	(496,555)		(577,122)
Distributions to Chipeta noncontrolling interest owner	(2,734)		(3,923)
Net contributions from (distributions to) related parties	6,673		22,674
Finance lease payments (2)	(5,295)		(12,241)
Net cash provided by (used in) financing activities	(1,242,576)		(668,822)
Net increase (decrease) in cash and cash equivalents	(325,674)		38,480
Cash and cash equivalents at beginning of period	418,537		98,122
Cash and cash equivalents at end of period	$	92,863	$	136,602
Supplemental disclosures
Non-cash unit exchange with Occidental (1)	$	—	$	(261,878)
Interest paid, net of capitalized interest	348,904		307,713
Income taxes paid (reimbursements received)	932		(384)
Accrued capital expenditures	29,085		20,275

________________________________________________________________________________________

(1)See Note 6.

(2)For the nine months ended September 30, 2020, includes related-party payments of $6.4 million.

See accompanying Notes to Consolidated Financial Statements.

16

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

General. Western Midstream Partners, LP is a Delaware master limited partnership formed in September 2012. Western Midstream Operating, LP (together with its subsidiaries, “WES Operating”) is a Delaware limited partnership formed in 2007 to acquire, own, develop, and operate midstream assets. Western Midstream Partners, LP owns, directly and indirectly, a 98.0% limited partner interest in WES Operating, and directly owns all of the outstanding equity interests of Western Midstream Operating GP, LLC, which holds the entire non-economic general partner interest in WES Operating.

For purposes of these consolidated financial statements, the “Partnership” refers to Western Midstream Partners, LP in its individual capacity or to Western Midstream Partners, LP and its subsidiaries, including Western Midstream Operating GP, LLC and WES Operating, as the context requires. “WES Operating GP” refers to Western Midstream Operating GP, LLC, individually as the general partner of WES Operating. The Partnership’s general partner, Western Midstream Holdings, LLC (the “general partner”), is a wholly owned subsidiary of Occidental Petroleum Corporation. “Occidental” refers to Occidental Petroleum Corporation, as the context requires, and its subsidiaries, excluding the general partner. “Anadarko” refers to Anadarko Petroleum Corporation and its subsidiaries, excluding Western Midstream Holdings, LLC. Anadarko became a wholly owned subsidiary of Occidental as a result of Occidental’s acquisition by merger of Anadarko on August 8, 2019. “Related parties” refers to Occidental (see Note 6), the Partnership’s investments accounted for under the equity method of accounting (see Note 7), and the Partnership and WES Operating for transactions that eliminate upon consolidation (see Note 6).

The Partnership is engaged in the business of gathering, compressing, treating, processing, and transporting natural gas; gathering, stabilizing, and transporting condensate, natural-gas liquids (“NGLs”), and crude oil; and gathering and disposing of produced water. In its capacity as a natural-gas processor, the Partnership also buys and sells natural gas, NGLs, and condensate on behalf of itself and as an agent for its customers under certain contracts. As of September 30, 2021, the Partnership’s assets and investments consisted of the following:

	Wholly Owned and Operated	Operated Interests	Non-Operated Interests	Equity Interests
Gathering systems (1)	17	2	3	1
Treating facilities	36	3	—	—
Natural-gas processing plants/trains	24	3	—	5
NGLs pipelines	2	—	—	5
Natural-gas pipelines	5	—	—	1
Crude-oil pipelines	3	1	—	4

_________________________________________________________________________________________

(1)Includes the DBM water systems.

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

17

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Basis of presentation. The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and include the accounts of the Partnership and entities in which it holds a controlling financial interest, including WES Operating, WES Operating GP, proportionately consolidated interests, and equity investments (see table below). All significant intercompany transactions have been eliminated.

The following table outlines the ownership interests and the accounting method of consolidation used in the consolidated financial statements for entities not wholly owned:

	Percentage Interest
Full consolidation
Chipeta (1)	75.00	%
Proportionate consolidation (2)
Springfield system	50.10	%
Marcellus Interest systems	33.75	%
Equity investments (3)
Mi Vida JV LLC (“Mi Vida”)	50.00	%
Ranch Westex JV LLC (“Ranch Westex”)	50.00	%
Front Range Pipeline LLC (“FRP”)	33.33	%
Red Bluff Express Pipeline, LLC (“Red Bluff Express”)	30.00	%
Enterprise EF78 LLC (“Mont Belvieu JV”)	25.00	%
Rendezvous Gas Services, LLC (“Rendezvous”)	22.00	%
Texas Express Pipeline LLC (“TEP”)	20.00	%
Texas Express Gathering LLC (“TEG”)	20.00	%
Whitethorn Pipeline Company LLC (“Whitethorn LLC”)	20.00	%
Saddlehorn Pipeline Company, LLC (“Saddlehorn”)	20.00	%
Cactus II Pipeline LLC (“Cactus II”)	15.00	%
Panola Pipeline Company, LLC (“Panola”)	15.00	%
White Cliffs Pipeline, LLC (“White Cliffs”)	10.00	%

_________________________________________________________________________________________

(1)The 25% third-party interest in Chipeta Processing LLC (“Chipeta”) is reflected within noncontrolling interests in the consolidated financial statements. See Noncontrolling interests below.

(2)The Partnership proportionately consolidates its associated share of the assets, liabilities, revenues, and expenses attributable to these assets.

(3)Investments in non-controlled entities over which the Partnership exercises significant influence are accounted for under the equity method of accounting. “Equity-investment throughput” refers to the Partnership’s share of average throughput for these investments.

Certain information and note disclosures commonly included in annual financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, the accompanying consolidated financial statements and notes should be read in conjunction with the Partnership’s 2020 Form 10-K, as filed with the SEC on February 26, 2021. Management believes that the disclosures made are adequate to make the information not misleading.

18

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

The consolidated financial results of WES Operating are included in the Partnership’s consolidated financial statements. Throughout these notes to consolidated financial statements, and to the extent material, any differences between the consolidated financial results of the Partnership and WES Operating are discussed separately. The Partnership’s consolidated financial statements differ from those of WES Operating primarily as a result of (i) the presentation of noncontrolling interest ownership (see Noncontrolling interests below), (ii) the elimination of WES Operating GP’s investment in WES Operating with WES Operating GP’s underlying capital account, (iii) the general and administrative expenses incurred by the Partnership, which are separate from, and in addition to, those incurred by WES Operating, (iv) the inclusion of the impact of Partnership equity balances and Partnership distributions, and (v) transactions between the Partnership and WES Operating that eliminate upon consolidation.

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 September 30, 2021 (see Note 7). The Partnership also owns and controls the entire non-economic general partner interest in WES Operating GP, and the Partnership’s general partner is owned by Occidental.

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

Noncontrolling interests. The Partnership’s noncontrolling interests in the consolidated financial statements consist of (i) the 25% third-party interest in Chipeta and (ii) the 2.0% Occidental subsidiary-owned limited partner interest in WES Operating. WES Operating’s noncontrolling interest in the consolidated financial statements consists of the 25% third-party interest in Chipeta. See Note 5.

Segments. The Partnership’s operations continue to be organized into a single operating segment, the assets of which gather, compress, treat, process, and transport natural gas; gather, stabilize, and transport condensate, NGLs, and crude oil; and gather and dispose of produced water in the United States.

Equity-based compensation. During the nine months ended September 30, 2021, the Partnership issued 357,472 common units under its long-term incentive plans. Compensation expense was $4.7 million and $12.9 million for the three and nine months ended September 30, 2021, respectively, and $2.1 million and $5.4 million for the three and nine months ended September 30, 2020, respectively.

On March 22, 2021, the Board of Directors approved the Western Midstream Partners, LP 2021 Long-Term Incentive Plan (the “2021 LTIP”). Subject to the capitalization adjustment provisions included in the 2021 LTIP, the total aggregate number of common units that may be delivered with respect to awards under the 2021 LTIP is 9,500,000 (the “2021 LTIP Limit”). Common units withheld from an award or surrendered by a participant to satisfy tax withholding obligations or to satisfy the payment of any exercise price with respect to an award will not be considered to be common units delivered under the 2021 LTIP for purposes of the 2021 LTIP Limit. If any award is forfeited, cancelled, exercised, settled in cash, or otherwise terminates or expires without the actual delivery of common units, the common units subject to such award will again be available for awards under the 2021 LTIP. The 2021 LTIP provides for the grant of unit options, unit appreciation rights, restricted units, phantom units, other unit-based awards, cash awards, and a unit award or a substitute award to employees and directors of the Partnership and its general partner. Affiliates of Occidental who held a majority of the Partnership’s outstanding common units as of March 22, 2021, approved the 2021 LTIP via written consent. On April 7, 2021, the Partnership mailed an information statement on Schedule 14C to its unitholders of record as of March 22, 2021. The 2021 LTIP became effective on April 27, 2021.

19

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Defined-contribution plan. Beginning in the first quarter of 2020, employees of the Partnership are eligible to participate in the Western Midstream Savings Plan, a defined-contribution benefit plan maintained by the Partnership. All regular employees may participate in the plan by making elective contributions that are matched by the Partnership, subject to certain limitations. The Partnership also makes other contributions based on plan guidelines. The Partnership recognized expense related to the plan of $5.3 million and $18.3 million for the three and nine months ended September 30, 2021, respectively, and $3.8 million and $8.2 million for the three and nine months ended September 30, 2020, respectively.

2. REVENUE FROM CONTRACTS WITH CUSTOMERS

The following table summarizes revenue from contracts with customers:

	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
Revenue from customers
Service revenues – fee based	$	605,967	$	582,725	$	1,707,987	$	1,806,097
Service revenues – product based	28,812		12,316		88,267		35,237
Product sales	84,298		30,106		227,359		108,491
Total revenue from customers	719,077		625,147		2,023,613		1,949,825
Revenue from other than customers
Lease revenue (1)	44,515		53,797		133,755		174,449
Other	248		100		577		838
Total revenues and other	$	763,840	$	679,044	$	2,157,945	$	2,125,112

_________________________________________________________________________________________

(1)Includes fixed- and variable-lease revenue from an operating and maintenance agreement entered into with Occidental. See Operating leases within Note 6.

Certain of the Partnership’s midstream services contracts have minimum-volume commitment demand fees and fees that require periodic rate redeterminations based on the related facility cost-of-service rate provisions. During the year ended December 31, 2020, and the six months ended June 30, 2021, the Partnership constrained revenue on certain cost-of-service agreements based on the status of commercial negotiations relating to a legal dispute with one of the contract counterparties. During the three months ended September 30, 2021, the Partnership determined it was no longer necessary to constrain revenue under these cost-of-service agreements. The Partnership updated its estimate of variable consideration and a cumulative catch-up revenue adjustment of $18.9 million was recorded to Service revenues – fee based. Future revenue reversals could occur to the extent the outcome of the legal proceedings and commercial negotiations differ from our current assumptions.

20

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

2. REVENUE FROM CONTRACTS WITH CUSTOMERS

Contract balances. Receivables from customers, which are included in Accounts receivable, net on the consolidated balance sheets were $572.8 million and $428.2 million as of September 30, 2021, and December 31, 2020, respectively.

Contract assets primarily relate to (i) revenue accrued but not yet billed under cost-of-service contracts with fixed and variable fees and (ii) accrued deficiency fees the Partnership expects to charge customers once the related performance periods are completed. The following table summarizes activity related to contract assets from contracts with customers:

thousands
Contract assets balance at December 31, 2020	$	56,344
Amounts transferred to Accounts receivable, net that were included in the contract assets balance at the beginning of the period (1)	(3,858)
Additional estimated revenues recognized (2)	17,472
Contract assets balance at September 30, 2021	$	69,958
Contract assets at September 30, 2021
Other current assets	$	23,766
Other assets	46,192
Total contract assets from contracts with customers	$	69,958

_________________________________________________________________________________________

(1)Includes $(3.9) million for the three months ended September 30, 2021.

(2)Includes $8.9 million for the three months ended September 30, 2021.

Contract liabilities primarily relate to (i) aid-in-construction payments received from customers that must be recognized over the expected period of customer benefit, (ii) fixed and variable fees under cost-of-service contracts that are received from customers for which revenue recognition is deferred, and (iii) fees that are charged to customers for only a portion of the contract term and must be recognized as revenues over the expected period of customer benefit. The following table summarizes activity related to contract liabilities from contracts with customers:

thousands
Contract liabilities balance at December 31, 2020	$	266,937
Cash received or receivable, excluding revenues recognized during the period (1)	60,786
Revenues recognized that were included in the contract liability balance at the beginning of the period (2)	(13,553)
Cumulative catch-up adjustment for change in estimated consideration (3)	(17,209)
Contract liabilities balance at September 30, 2021	$	296,961
Contract liabilities at September 30, 2021
Accrued liabilities	$	22,854
Other liabilities	274,107
Total contract liabilities from contracts with customers	$	296,961

_________________________________________________________________________________________

(1)Includes $26.7 million for the three months ended September 30, 2021.

(2)Includes $(5.5) million for the three months ended September 30, 2021, $(1.7) million of which is related to the cumulative catch-up revenue adjustment recognized for the nine months ended September 30, 2021.

(3)Includes $(17.2) million for the three months ended September 30, 2021.

21

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

2. REVENUE FROM CONTRACTS WITH CUSTOMERS

Transaction price allocated to remaining performance obligations. Revenues expected to be recognized from certain performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2021, 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. Therefore, the following table represents only a portion of expected future revenues from existing contracts as most future revenues from customers are dependent on future variable customer volumes and, in some cases, variable commodity prices for those volumes.

thousands
Remainder of 2021	$	211,353
2022	1,057,409
2023	1,002,351
2024	973,300
2025	890,903
Thereafter	2,719,380
Total	$	6,854,696

3. ACQUISITIONS AND DIVESTITURES

Fort Union and Bison facilities. In October 2020, the Partnership (i) sold its 14.81% interest in Fort Union Gas Gathering, LLC (“Fort Union”), which was accounted for under the equity method of accounting, and (ii) entered into an option agreement to sell the Bison treating facility, located in Northeast Wyoming, to a third party. The Partnership received combined proceeds of $27.0 million, resulting in a net gain on sale of $21.0 million related to the Fort Union interest that was recorded in the fourth quarter of 2020 as Gain (loss) on divestiture and other, net in the consolidated statements of operations.

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.

22

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

4. PARTNERSHIP DISTRIBUTIONS

Partnership distributions. Under its partnership agreement, the Partnership distributes all of its available cash (beyond proper reserves as defined in its partnership agreement) to unitholders of record on the applicable record date within 55 days following each quarter’s end. The Board of Directors of the general partner (the “Board of Directors”) declared the following cash distributions to the Partnership’s unitholders for the periods presented:

thousands except per-unit amounts Quarters Ended	Total Quarterly Per-unit Distribution		Total Quarterly Cash Distribution		Distribution Date
2020
March 31	$	0.31100	$	140,893	May 2020
June 30	0.31100		140,900		August 2020
September 30	0.31100		132,255		November 2020
December 31	0.31100		131,265		February 2021
2021
March 31	$	0.31500	$	132,969	May 2021
June 30	0.31900		134,662		August 2021
September 30 (1)	0.32300		134,862		November 2021

_________________________________________________________________________________________

(1)The Board of Directors declared a cash distribution to the Partnership’s unitholders for the third quarter of 2021 of $0.32300 per unit, or $134.9 million in aggregate. The cash distribution is payable on November 12, 2021, to unitholders of record at the close of business on November 1, 2021, including the general partner units.

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

WES Operating partnership distributions. WES Operating makes quarterly cash distributions to the Partnership and WGR Asset Holding Company LLC (“WGRAH”), a subsidiary of Occidental, in proportion to their share of limited partner interests in WES Operating. See Note 5. WES Operating made the following cash distributions to its limited partners for the periods presented:

thousands Quarters Ended	Total Quarterly Cash Distribution
2020
March 31	$	143,404
June 30	143,404
September 30	143,404
December 31	127,470
2021
March 31	$	137,030
June 30	140,217
September 30	140,217

23

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

4. PARTNERSHIP DISTRIBUTIONS

In addition to the distributions above, during the quarter ended September 30, 2021, WES Operating made a distribution of $91.8 million to the Partnership and WGRAH. The Partnership used its portion of the distribution to repurchase common units on the open market. See Note 5.

5. EQUITY AND PARTNERS’ CAPITAL

Holdings of Partnership equity. The Partnership’s common units are listed on the New York Stock Exchange under the ticker symbol “WES.” As of September 30, 2021, Occidental held 202,781,578 common units, representing a 48.5% 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 205,829,338 common units, representing a 49.3% limited partner interest in the Partnership.

In March 2021, an affiliate of Occidental sold 11,500,000 of the Partnership’s common units it held to the public through an underwritten offering, including 1,500,000 common units pursuant to the full exercise of the underwriters’ over-allotment option. The Partnership did not receive any proceeds from the public offering.

On September 11, 2020, the Partnership assigned its 98% interest in the 30-year $260.0 million note established in May 2008 between WES Operating and Anadarko (the “Anadarko note receivable”) to Anadarko, which Anadarko canceled and retired immediately upon receipt, in exchange for which Occidental caused certain of its subsidiaries to transfer an aggregate of 27,855,398 common units representing limited partner interests in the Partnership to the Partnership. The units were canceled by the Partnership immediately upon receipt. See Note 6.

Partnership equity repurchases. In November 2020, the Board of Directors authorized the Partnership to buy back up to $250.0 million of the Partnership’s common units through December 31, 2021 (the “Purchase Program”). The common units may be purchased from time to time in the open market at prevailing market prices or in privately negotiated transactions. During the nine months ended September 30, 2021, the Partnership repurchased 5,586,419 common units on the open market for an aggregate purchase price of $104.4 million. The units were canceled by the Partnership immediately upon receipt. As of September 30, 2021, the Partnership had an authorized amount of $113.1 million remaining under the Purchase Program.

Holdings of WES Operating equity. As of September 30, 2021, (i) the Partnership, directly and indirectly through its ownership of WES Operating GP, owned a 98.0% limited partner interest and the entire non-economic general partner interest in WES Operating and (ii) Occidental, through its ownership of WGRAH, owned a 2.0% limited partner interest in WES Operating, which is reflected as a noncontrolling interest within the consolidated financial statements of the Partnership (see Note 1).

Partnership’s net income (loss) per common unit. The common and general partner unitholders’ allocation of net income (loss) attributable to the Partnership was equal to their cash distributions plus their respective allocations of undistributed earnings or losses in accordance with their weighted-average ownership percentage during each period using the two-class method.

The Partnership’s basic net income (loss) per common unit is calculated by dividing the limited partners’ interest in net income (loss) by the weighted-average number of common units outstanding during the period. Diluted net income (loss) per common unit includes the effect of outstanding units issued under the Partnership’s long-term incentive plans.

24

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

5. EQUITY AND PARTNERS’ CAPITAL

The following table provides a reconciliation between basic and diluted net income (loss) per common unit:

	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands except per-unit amounts	2021		2020		2021		2020
Net income (loss)
Limited partners’ interest in net income (loss)	$	250,198	$	241,479	$	658,291	$	257,659
Weighted-average common units outstanding
Basic	411,909		438,857		412,690		442,255
Dilutive effect of non-vested phantom units	805		69		460		20
Diluted	412,714		438,926		413,150		442,275
Excluded due to anti-dilutive effect	4		1,084		700		1,271
Net income (loss) per common unit
Basic	$	0.61	$	0.55	$	1.60	$	0.58
Diluted	$	0.61	$	0.55	$	1.59	$	0.58

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

25

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

6. RELATED-PARTY TRANSACTIONS

Summary of related-party transactions. The following tables summarize material related-party transactions included in the Partnership’s consolidated financial statements:

Consolidated statements of operations
	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
Revenues and other
Service revenues – fee based	$	418,520	$	436,405	$	1,188,679	$	1,344,326
Service revenues – product based	1,499		2,544		9,662		6,690
Product sales	11,662		16,692		27,034		60,452
Total revenues and other	431,681		455,641		1,225,375		1,411,468
Equity income, net – related parties (1)	48,506		61,026		159,337		176,788
Operating expenses
Cost of product	17,384		1,483		53,968		85,353
Operation and maintenance	3,497		1,303		24,534		35,660
General and administrative (2)	1,808		7,607		13,003		40,456
Total operating expenses	22,689		10,393		91,505		161,469
Interest income – Anadarko note receivable	—		3,286		—		11,736

_________________________________________________________________________________________

(1)See Note 7.

(2)Includes (i) amounts charged by Occidental pursuant to the shared services agreement (see Services Agreement within this Note 6) and (ii) equity-based compensation expense allocated to the Partnership by Occidental, which is not reimbursed to Occidental and is reflected as a contribution to partners’ capital in the consolidated statements of equity and partners’ capital (see Incentive Plans within this Note 6).

Consolidated balance sheets
thousands	September 30, 2021		December 31, 2020
Assets
Accounts receivable, net	$	289,402	$	291,253
Other current assets	29,021		5,493
Equity investments (1)	1,181,181		1,224,813
Other assets	76,560		50,967
Total assets	1,576,164		1,572,526
Liabilities
Accounts and imbalance payables	42,384		6,664
Accrued liabilities	19,232		19,195
Other liabilities	189,119		138,796
Total liabilities	250,735		164,655

_________________________________________________________________________________________

(1)See Note 7.

26

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

6. RELATED-PARTY TRANSACTIONS

Consolidated statements of cash flows
	Nine Months Ended  September 30,
thousands	2021		2020
Distributions from equity-investment earnings – related parties	$	164,772	$	187,816
Purchases from related parties	(2,000)		—
Contributions to equity investments – related parties	(3,683)		(19,017)
Distributions from equity investments in excess of cumulative earnings – related parties	30,075		21,750
Distributions to Partnership unitholders (1)	(195,205)		(301,219)
Distributions to WES Operating unitholders (2)	(9,934)		(11,545)
Net contributions from (distributions to) related parties	6,673		22,674
Finance lease payments	—		(6,382)

_________________________________________________________________________________________

(1)Represents distributions paid to Occidental pursuant to the partnership agreement of the Partnership (see Note 4 and Note 5).

(2)Represents distributions paid to a certain subsidiary of Occidental pursuant to WES Operating’s partnership agreement (see Note 4 and Note 5).

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:

Consolidated statements of operations
	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
General and administrative (1)	$	2,775	$	8,314	$	15,061	$	41,220

_________________________________________________________________________________________

(1)Includes (i) amounts charged by Occidental pursuant to the shared services agreement (see Services Agreement within this Note 6), (ii) equity-based compensation expense allocated to WES Operating by Occidental, which is not reimbursed to Occidental and is reflected as a contribution to partners’ capital in the consolidated statements of equity and partners’ capital (see Incentive Plans within this Note 6), and (iii) an intercompany service fee between the Partnership and WES Operating.

Consolidated balance sheets
thousands	September 30, 2021		December 31, 2020
Accounts receivable, net	$	289,402	$	246,083
Accounts and imbalance payables (1)	83,576		6,664

_________________________________________________________________________________________

(1)As of September 30, 2021, includes balances related to transactions between the Partnership and WES Operating.

Consolidated statements of cash flows
	Nine Months Ended  September 30,
thousands	2021		2020
Distributions to WES Operating unitholders (1)	$	(496,555)	$	(577,122)

_________________________________________________________________________________________

(1)Represents distributions paid to the Partnership and a certain subsidiary of Occidental pursuant to WES Operating’s partnership agreement. Includes a distribution made from WES Operating to the Partnership during the quarter ended September 30, 2021, that was used by the Partnership to repurchase common units on the open market. See Note 4 and Note 5.

27

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

6. RELATED-PARTY TRANSACTIONS

Related-party revenues. Related-party revenues include (i) amounts earned by the Partnership from services provided to Occidental and from the sale of natural gas, condensate, and NGLs to Occidental and (ii) income from the Partnership’s investments accounted for under the equity method of accounting (see Note 7).

Gathering and processing agreements. The Partnership has significant gathering and processing arrangements with affiliates of Occidental on most of its systems. While Occidental is the contracting counterparty of the Partnership, these arrangements with Occidental include not just Occidental-produced volumes, but also, in some instances, the volumes of other working-interest owners of Occidental who rely on the Partnership’s facilities and infrastructure to bring their volumes to market. Natural-gas throughput (excluding equity-investment throughput) attributable to production owned or controlled by Occidental was 38% and 36% for the three and nine months ended September 30, 2021, respectively, and 41% and 42% for the three and nine months ended September 30, 2020, 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 nine months ended September 30, 2021, respectively, and 87% and 88% for the three and nine months ended September 30, 2020, respectively. Produced-water throughput attributable to production owned or controlled by Occidental was 89% and 87% for the three and nine months ended September 30, 2021, respectively, and 87% and 88% for the three and nine months ended September 30, 2020, 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.

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. (“Mesquite”) that allows Mesquite to process gas under such agreement. For this reason, Anadarko continues to be liable under the Brasada gas processing agreement through 2034 to the extent Mesquite does not perform. For all periods presented, Mesquite has performed Anadarko’s obligations under the Brasada gas processing agreement pursuant to its agency arrangement with Anadarko.

Further, in connection with the sale of its Uinta Basin assets in 2020, Kerr McGee Oil & Gas Onshore LP, a subsidiary of Occidental, retained the deficiency payment obligations under a gas processing agreement at the Chipeta plant. This contingent payment obligation extends through the earlier of October 1, 2022, or the termination of the processing agreement.

Commodity purchase and sale agreements. Through December 31, 2020, the Partnership purchased and sold a significant amount of natural gas and NGLs from and to Anadarko Energy Services Company (“AESC”), a marketing affiliate of Occidental. Prior to April 1, 2020, AESC acted as an agent on behalf of either the Partnership or the Partnership’s customers for third-party sales. Where AESC sold natural gas and NGLs on the Partnership’s customers’ behalf, the Partnership recognized associated service revenues and cost of product expense for the marketing services performed by AESC. When product sales were on the Partnership’s behalf, the Partnership recognized product sales revenues based on Occidental’s sales price to the third party and recorded the associated cost of product expense associated with the marketing activities provided by AESC. Effective April 1, 2020, changes to marketing-contract terms with AESC terminated AESC’s prior status as an agent of the Partnership for third-party sales and established AESC as a customer of the Partnership. Accordingly, the Partnership no longer recognizes service revenues and/or product sales revenues and the equivalent cost of product expense for the marketing services performed by AESC. This change has no impact to Operating income (loss), Net income (loss), the balance sheets, cash flows, or any non-GAAP metric used to evaluate the Partnership’s operations (see Key Performance Metrics under Part I, Item 2 of this Form 10-Q).

28

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

6. RELATED-PARTY TRANSACTIONS

Marketing Transition Services Agreement. Effective December 31, 2019, certain subsidiaries of Anadarko entered into a transition services agreement (the “Marketing Transition Services Agreement”) to provide marketing-related services to certain of the Partnership’s subsidiaries through December 31, 2020, subject to the option to extend such services for an additional six-month period. The Marketing Transition Services Agreement was terminated on December 31, 2020. While the Partnership still has some marketing agreements with affiliates of Occidental, the Partnership began marketing and selling substantially all of its natural gas and NGLs directly to third parties beginning on January 1, 2021.

Operating leases. 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.

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 provides operational and maintenance services with respect to a crude-oil gathering system and associated treating facilities owned by the Partnership through December 31, 2021. The agreement and underlying contracts include (i) fixed consideration, which is measured as the minimum-volume commitment for both gathering and treating, and (ii) variable consideration, which consists of all volumes above the minimum-volume commitment. Subsequent to the initial two-year term, the agreement provides for automatic one-year extensions, unless either party exercises its option to terminate the lease with advance notice. In April 2021, the Partnership exercised its option to terminate the operating and maintenance agreement with Occidental effective December 31, 2021. For the three and nine months ended September 30, 2021, the Partnership recognized fixed-lease revenue of $43.9 million and $131.9 million, respectively, and variable-lease revenue of $0.6 million and $1.9 million, respectively, related to these agreements. For the three and nine months ended September 30, 2020, the Partnership recognized fixed-lease revenue of $44.0 million and $131.8 million, respectively, and variable-lease revenue of $9.8 million and $42.6 million, respectively, related to these agreements, with such amounts included in Service revenues – fee based in the consolidated statements of operations.

Related-party expenses. Operation and maintenance expense includes amounts accrued for or paid to related parties for field-related costs provided by related parties at certain of the Partnership’s assets. A portion of general and administrative expense is paid by Occidental, which results in related-party transactions pursuant to the reimbursement provisions of the Partnership’s and WES Operating’s agreements with Occidental. Cost of product expense includes amounts related to certain continuing marketing arrangements with affiliates of Occidental, related-party imbalances, and transactions with affiliates accounted for under the equity method of accounting. See Commodity purchase and sale agreements and Marketing Transition Services Agreement in the sections above. Related-party expenses do not bear a direct relationship to related-party revenues, and third-party expenses do not bear a direct relationship to third-party revenues.

Services Agreement. General and administrative expense includes costs incurred pursuant to the agreement dated as of December 31, 2019, by and among Occidental, Anadarko, and WES Operating GP, under which Occidental has performed certain centralized corporate functions for the Partnership and WES Operating (“Services Agreement”).

Pursuant to the Services Agreement, which was amended and restated on December 31, 2019, specified employees of Occidental were seconded to WES Operating GP to provide, under the direction, supervision, and control of the general partner, (i) operating and routine maintenance service and (ii) corporate, administrative, and other services, with respect to the assets owned and operated by the Partnership. Occidental was reimbursed for the services provided by the seconded employees. In January 2020, pursuant to the Services Agreement, Occidental made a one-time cash contribution of $20.0 million to WES Operating for anticipated transition costs required to establish stand-alone human resources and information technology functions. In late March 2020, seconded employees’ employment was transferred to the Partnership. Occidental continues to provide certain limited administrative and operational services to the Partnership, with most services expected to be fully transitioned to the Partnership by December 31, 2021.

29

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

6. RELATED-PARTY TRANSACTIONS

Incentive Plans. 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 allocated expense related to the Incentive Plans of $2.3 million and $7.9 million for the three and nine months ended September 30, 2021, respectively, and $3.5 million and $11.2 million for the three and nine months ended September 30, 2020, respectively. These amounts are reflected as contributions to partners’ capital in the consolidated statements of equity and partners’ capital.

Construction reimbursement agreements and Purchases from related parties. From time to time, the Partnership enters into construction reimbursement agreements with Occidental providing that the Partnership will manage the construction of certain midstream infrastructure for Occidental in the Partnership’s areas of operation. Such arrangements generally provide for a reimbursement of costs incurred by the Partnership on a cost or cost-plus basis.

Additionally, from time to time, in support of the Partnership’s business, the Partnership purchases equipment, inventory, and other miscellaneous assets, from Occidental or its affiliates. These amounts are included in Purchases from related parties in the consolidated statements of cash flows.

Related-party commercial agreement. During the first quarter of 2021, an affiliate of Occidental and certain wholly owned subsidiaries of the Partnership entered into a Commercial Understanding Agreement (“CUA”). Under the CUA, certain West Texas surface-use and salt-water disposal agreements were amended to reduce usage fees owed by the Partnership in exchange for the forgiveness of certain deficiency fees owed by Occidental and other unrelated contractual amendments. The present value of the reduced usage fees under the CUA was $30.0 million at the time the agreement was executed.

Anadarko note receivable. In May 2008, WES Operating loaned $260.0 million to Anadarko in exchange for a 30-year note that bore interest at a fixed annual rate and was classified as interest income in the consolidated statements of operations. On September 11, 2020, the Partnership and Occidental entered into a Unit Redemption Agreement, pursuant to which WES Operating transferred the note receivable to Anadarko, which Anadarko immediately canceled and retired upon receipt.

Customer concentration. Occidental was the only customer from which revenues exceeded 10% of consolidated revenues for all periods presented in the consolidated statements of operations.

30

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

7. EQUITY INVESTMENTS

The following table presents the financial statement impact of the Partnership’s equity investments for the nine months ended September 30, 2021:

thousands	Balance at December 31, 2020		Other-than-temporary impairment expense (1)		Equity income, net		Contributions		Distributions		Distributions in excess of cumulative earnings (2)		Balance at September 30, 2021
White Cliffs	$	45,623	$	—	$	701	$	—	$	(266)	$	(4,583)	$	41,475
Rendezvous	28,198		—		(1,560)		—		(884)		(2,058)		23,696
Mont Belvieu JV	98,874		—		25,066		—		(25,095)		(2,193)		96,652
TEG	16,661		—		3,390		—		(3,409)		(299)		16,343
TEP	195,189		—		27,572		—		(27,623)		(4,491)		190,647
FRP	199,881		—		28,351		—		(28,482)		(4,004)		195,746
Whitethorn LLC	156,729		—		6,380		347		(5,736)		(4,018)		153,702
Cactus II	173,921		—		14,290		3,336		(14,415)		(3,926)		173,206
Saddlehorn	111,717		—		26,045		—		(26,157)		—		111,605
Panola	20,867		—		1,629		—		(1,628)		(555)		20,313
Mi Vida	55,031		—		7,445		—		(7,334)		(2,245)		52,897
Ranch Westex	18,898		(11,805)		9,267		—		(12,517)		(1,624)		2,219
Red Bluff Express	103,224		—		10,761		—		(11,226)		(79)		102,680
Total	$	1,224,813	$	(11,805)	$	159,337	$	3,683	$	(164,772)	$	(30,075)	$	1,181,181

_________________________________________________________________________________________

(1)Recorded in Long-lived asset and other impairments in the consolidated statements of operations.

(2)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.

The investment balance in Ranch Westex at September 30, 2021, was $37.1 million less than the Partnership’s underlying equity in Ranch Westex’s net assets. During the nine months ended September 30, 2021, the Partnership recognized an impairment loss of $11.8 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.

31

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

8. PROPERTY, PLANT, AND EQUIPMENT

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

thousands	Estimated Useful Life	September 30, 2021		December 31, 2020
Land	N/A	$	10,955	$	9,696
Gathering systems – pipelines	30 years	5,343,971		5,231,212
Gathering systems – compressors	15 years	2,111,639		2,096,905
Processing complexes and treating facilities	25 years	3,367,933		3,424,368
Transportation pipeline and equipment	6 to 45 years	168,384		168,205
Produced-water disposal systems	20 years	879,916		831,719
Assets under construction	N/A	123,115		176,834
Other	3 to 40 years	727,013		702,806
Total property, plant, and equipment		12,732,926		12,641,745
Less accumulated depreciation		4,208,845		3,931,800
Net property, plant, and equipment		$	8,524,081	$	8,709,945

The cost of property classified as “Assets under construction” is excluded from capitalized costs being depreciated. These amounts represent property that is not yet placed into productive service as of the respective balance sheet date.

Long-lived asset and other impairments. During the nine months ended September 30, 2021, the Partnership recognized impairments of $29.2 million, primarily attributable to (i) $14.1 million of impairments at the DJ Basin complex due to cancellation of projects and (ii) an $11.8 million other-than-temporary impairment of the Partnership’s investment in Ranch Westex (see Note 7).

During the nine months ended September 30, 2020, the Partnership recognized impairments of $200.6 million, primarily due to $150.2 million of impairments for assets located in Wyoming and Utah. These assets were impaired to estimated fair values of $112.2 million. The Partnership assesses whether events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The fair value of assets with impairment triggers were measured using the income approach and Level-3 fair value inputs. The income approach was based on the Partnership’s projected future earnings before interest, taxes, depreciation, and amortization (“EBITDA”) and free cash flows, which requires significant assumptions including, among others, future throughput volumes based on current expectations of producer activity and operating costs. These impairments were primarily triggered by reductions in estimated future cash flows resulting from lower forecasted producer throughput and lower commodity prices. The remaining impairments of $21.0 million were primarily at the DJ Basin complex and DBM water systems due to cancellation of projects and impairments of rights-of-way. Long-lived asset and other impairments on the consolidated statements of operations also includes a $29.4 million other-than-temporary impairment for the nine months ended September 30, 2020, of the Partnership’s investment in Ranch Westex.

32

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

8. PROPERTY, PLANT, AND EQUIPMENT

Potential future long-lived asset impairments. As of September 30, 2021, it is reasonably possible that future commodity-price declines, prolonged depression of commodity prices, changes to producers’ drilling plans in response to lower prices, and potential producer bankruptcies could result in future long-lived asset impairments. For example, on April 29, 2020, the Partnership received notice that Sanchez, in its bankruptcy, was seeking to reject a number of midstream and downstream agreements with commercial counterparties, including Sanchez’s Springfield gathering agreements and agreements obligating Sanchez to deliver the gas volumes gathered by the Springfield system to our Brasada processing plant. On May 6, 2021, the Bankruptcy Court issued an opinion determining, among other things, that Sanchez’s Springfield gathering agreements were rejected, but that such agreements contain covenants running with the land that survive rejection, thus preserving the acreage dedication to the Partnership’s Springfield system. Depending on the ultimate outcome of the Partnership’s continuing efforts to defend its contractual rights in the bankruptcy proceeding, as well as the Partnership’s ongoing commercial discussions, the Partnership’s South Texas assets could be impaired.

9. GOODWILL

Goodwill is recorded when the purchase price of a business acquired exceeds the fair market value of the tangible and separately measurable intangible net assets. Goodwill also includes the allocated historic carrying value of midstream goodwill attributed to the Partnership’s assets previously acquired from Anadarko. The Partnership’s goodwill has been allocated to two reporting units: (i) gathering and processing and (ii) transportation.

The Partnership evaluates goodwill for impairment at the reporting-unit level on an annual basis, as of October 1, or more often as facts and circumstances warrant. An initial qualitative assessment is performed to determine the likelihood of whether goodwill is impaired and if deemed necessary based on this assessment, a quantitative assessment is then performed. If the quantitative assessment indicates that the carrying value of the reporting unit, including goodwill, exceeds its fair value, a goodwill impairment is recorded for the amount by which the reporting unit’s carrying value exceeds its fair value.

During the three months ended March 31, 2020, the Partnership performed an interim goodwill impairment test due to a significant decline in the trading price of the Partnership’s common units, triggered by the combined impacts from the global outbreak of COVID-19 and the oil-market disruption resulting from significantly lower global demand and corresponding oversupply of crude oil. The Partnership primarily used the market approach and Level-3 inputs to estimate the fair value of its two reporting units. The market approach was based on multiples of EBITDA and the Partnership’s projected future EBITDA. The EBITDA multiples were based on current and historic multiples for comparable midstream companies of similar size and business profit to the Partnership. The EBITDA projections require significant assumptions including, among others, future throughput volumes based on current expectations of producer activity and operating costs. The reasonableness of the market approach was tested against an income approach that was based on a discounted cash-flow analysis. Key assumptions in this analysis include the use of an appropriate discount rate, terminal-year multiples, and estimated future cash flows, including estimates of throughput, capital expenditures, operating, and general and administrative costs. The Partnership also reviewed the reasonableness of the total fair value of both reporting units to the market capitalization as of March 31, 2020, and the reasonableness of an implied acquisition premium. Impairment determinations involve significant assumptions and judgments, and differing assumptions regarding any of these inputs could have a significant effect on the valuations. As a result of the interim impairment test, the Partnership recognized a goodwill impairment of $441.0 million during the first quarter of 2020, which reduced the carrying value of goodwill for the gathering and processing reporting unit to zero. Goodwill allocated to the transportation reporting unit of $4.8 million as of March 31, 2020, was not impaired. Recurring goodwill impairment assessments have indicated no further impairment.

33

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

10. SELECTED COMPONENTS OF WORKING CAPITAL

A summary of accounts receivable, net is as follows:

	The Partnership				WES Operating
thousands	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
Trade receivables, net	$	583,646	$	452,718	$	583,646	$	407,547
Other receivables, net	6		162		6		2
Total accounts receivable, net	$	583,652	$	452,880	$	583,652	$	407,549

A summary of other current assets is as follows:

	The Partnership				WES Operating
thousands	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
NGLs inventory	$	4,002	$	882	$	4,002	$	882
Imbalance receivables	14,958		12,976		14,958		12,976
Prepaid insurance	14,425		8,131		12,136		6,113
Contract assets	23,766		5,338		23,766		5,338
Other	16,045		17,935		16,045		17,935
Total other current assets	$	73,196	$	45,262	$	70,907	$	43,244

A summary of accrued liabilities is as follows:

	The Partnership				WES Operating
thousands	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
Accrued interest expense	$	69,570	$	137,307	$	69,570	$	137,307
Short-term asset retirement obligations	14,365		20,215		14,365		20,215
Short-term remediation and reclamation obligations	6,101		2,950		6,101		2,950
Income taxes payable	4,593		3,399		4,593		3,399
Contract liabilities	22,854		31,477		22,854		31,477
Other	73,145		74,599		27,758		35,485
Total accrued liabilities	$	190,628	$	269,947	$	145,241	$	230,833

34

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

11. DEBT AND INTEREST EXPENSE

WES Operating is the borrower for all outstanding debt and is expected to be the borrower for all future debt issuances. The following table presents the outstanding debt:

	September 30, 2021						December 31, 2020
thousands	Principal		Carrying Value		Fair Value (1)		Principal		Carrying Value		Fair Value (1)
Short-term debt
4.000% Senior Notes due 2022	$	502,246	$	502,086	$	510,243	$	—	$	—	$	—
5.375% Senior Notes due 2021	—		—		—		431,081		430,606		436,241
RCF	220,000		220,000		220,000		—		—		—
Finance lease liabilities	4,343		4,343		4,343		8,264		8,264		8,264
Total short-term debt	$	726,589	$	726,429	$	734,586	$	439,345	$	438,870	$	444,505
Long-term debt
4.000% Senior Notes due 2022	$	—	$	—	$	—	$	580,917	$	580,555	$	597,568
Floating-Rate Senior Notes due 2023	213,138		212,521		212,773		239,978		238,879		235,066
3.100% Senior Notes due 2025	732,106		727,794		774,328		1,000,000		992,900		1,028,614
3.950% Senior Notes due 2025	399,163		395,708		421,970		500,000		494,866		512,807
4.650% Senior Notes due 2026	474,242		471,500		513,758		500,000		496,708		524,880
4.500% Senior Notes due 2028	400,000		396,010		433,214		400,000		395,617		415,454
4.750% Senior Notes due 2028	400,000		396,840		437,005		400,000		396,555		418,786
4.050% Senior Notes due 2030	1,200,000		1,190,102		1,324,159		1,200,000		1,189,407		1,342,996
5.450% Senior Notes due 2044	600,000		593,699		691,067		600,000		593,598		607,234
5.300% Senior Notes due 2048	700,000		687,210		807,613		700,000		687,048		694,172
5.500% Senior Notes due 2048	350,000		342,629		409,945		350,000		342,543		343,928
5.250% Senior Notes due 2050	1,000,000		983,659		1,176,283		1,000,000		983,512		1,100,375
Finance lease liabilities	2,202		2,202		2,202		23,644		23,644		23,644
Total long-term debt	$	6,470,851	$	6,399,874	$	7,204,317	$	7,494,539	$	7,415,832	$	7,845,524

_________________________________________________________________________________________

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

35

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

11. DEBT AND INTEREST EXPENSE

Debt activity. The following table presents the debt activity for the nine months ended September 30, 2021:

thousands	Carrying Value
Balance at December 31, 2020	$	7,854,702
RCF borrowings	400,000
Repayments of RCF borrowings	(180,000)
Repayment of 5.375% Senior Notes due 2021	(431,081)
Repayment of 4.000% Senior Notes due 2022	(78,671)
Repayment of Floating-Rate Senior Notes due 2023	(26,840)
Repayment of 3.100% Senior Notes due 2025	(267,894)
Repayment of 3.950% Senior Notes due 2025	(100,837)
Repayment of 4.650% Senior Notes due 2026	(25,758)
Finance lease liabilities	(25,364)
Other	8,046
Balance at September 30, 2021	$	7,126,303

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 4.542%, 5.424%, and 6.629%, respectively, at September 30, 2021, and were 4.291%, 5.173%, and 6.375%, respectively, at September 30, 2020. The interest rate on the Floating-Rate Senior Notes was 2.23% and 2.12% at September 30, 2021 and 2020, 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 third quarter of 2021, WES Operating purchased and retired $500.0 million of certain of its senior notes via a tender offer (see Debt activity above). For the three months ended September 30, 2021, losses of $24.7 million were recognized for the early retirement of these notes. 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 September 30, 2021, the 4.000% Senior Notes due 2022 were classified as short-term debt on the consolidated balance sheet. At September 30, 2021, 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. The non-extending lender’s commitments mature in February 2024 and represent $100.0 million out of $2.0 billion of total commitments from all lenders.

As of September 30, 2021, there were $220.0 million of outstanding borrowings and $5.1 million of outstanding letters of credit, resulting in $1.8 billion of available borrowing capacity under the RCF. As of September 30, 2021 and 2020, the interest rate on any outstanding RCF borrowings was 1.58% and 1.65%, respectively. The facility-fee rate was 0.25% at September 30, 2021 and 2020. At September 30, 2021, WES Operating was in compliance with all covenants under the RCF. Any outstanding RCF borrowings are classified as short-term debt on the consolidated balance sheet due to management’s intent to repay within the next twelve months.

Term loan facility. In January 2020, WES Operating repaid the outstanding borrowings with proceeds from the issuance of the Fixed-Rate Senior Notes and Floating-Rate Senior Notes and terminated its $3.0 billion senior unsecured credit facility (“Term loan facility”), see WES Operating Senior Notes above. During the first quarter of 2020, a loss of $2.3 million was recognized for the early termination of the Term loan facility.

36

WESTERN MIDSTREAM PARTNERS, LP AND WESTERN MIDSTREAM OPERATING, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

11. DEBT AND INTEREST EXPENSE

Finance lease liabilities. The Partnership subleased equipment from Occidental via finance leases through April 2020. During the first quarter of 2020, the Partnership entered into finance leases with third parties for equipment and vehicles extending through 2029. Certain equipment leases were amended during the third quarter of 2021 requiring reassessment of lease classification. As a result, these leases are now classified as operating leases resulting in a reduction of $19.6 million in Net property, plant, and equipment and $20.3 million in Short-term and Long-term debt. The operating leases resulted in additions of $4.8 million in Other assets, $3.1 million in Accrued liabilities, and $2.4 million in Other liabilities, on the consolidated balance sheet. The Partnership has future payments for its finance leases of $6.7 million as of September 30, 2021.

Interest expense. The following table summarizes the amounts included in interest expense:

	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
Third parties
Long-term and short-term debt	$	(90,913)	$	(94,201)	$	(279,122)	$	(273,620)
Finance lease liabilities	(218)		(369)		(808)		(1,162)
Commitment fees and amortization of debt-related costs	(3,147)		(3,463)		(9,664)		(10,052)
Capitalized interest	1,021		2,462		2,554		6,066
Total interest expense – third parties	(93,257)		(95,571)		(287,040)		(278,768)
Related parties
Finance lease liabilities	—		—		—		(43)
Total interest expense – related parties	—		—		—		(43)
Interest expense	$	(93,257)	$	(95,571)	$	(287,040)	$	(278,811)

12. COMMITMENTS AND CONTINGENCIES

Environmental obligations. The Partnership is subject to various environmental-remediation obligations arising from federal, state, and local regulations regarding air and water quality, hazardous and solid waste disposal, and other environmental matters. As of September 30, 2021, and December 31, 2020, the consolidated balance sheets included $12.0 million and $8.2 million, respectively, of liabilities for remediation and reclamation obligations. The current portion of these amounts is included in Accrued liabilities, and the long-term portion of these amounts is included in Other liabilities. The majority of payments related to these obligations are expected to be made over the next five years.

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

Other commitments. The Partnership has payment obligations, or commitments, that include, among other things, a revolving credit facility, other third-party long-term debt, obligations related to the Partnership’s capital spending programs, pipeline 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 twelve months, primarily relate to construction, expansion, and asset-integrity projects at the West Texas complex, DBM water systems, DJ Basin complex, and DBM oil system.

37

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

The following discussion analyzes our financial condition and results of operations and should be read in conjunction with the Consolidated Financial Statements and Notes to Consolidated Financial Statements, wherein WES Operating is fully consolidated, and which are included under Part I, Item 1 of this quarterly report, and the historical consolidated financial statements, and the notes thereto, which are included under Part II, Item 8 of the 2020 Form 10-K as filed with the SEC on February 26, 2021.

The Partnership’s assets include assets owned and ownership interests accounted for by us under the equity method of accounting, through our 98.0% partnership interest in WES Operating, as of September 30, 2021 (see Note 7—Equity Investments in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q). We also own and control the entire non-economic general partner interest in WES Operating GP, and our general partner is owned by Occidental.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

We have made in this Form 10-Q, and may make in other public filings, press releases, and statements by management, forward-looking statements concerning our operations, economic performance, and financial condition. These forward-looking statements include statements preceded by, followed by, or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “estimates,” “projects,” “target,” “goal,” “plans,” “objective,” “should,” or similar expressions or variations on such expressions. These statements discuss future expectations, contain projections of results of operations or financial condition, or include other “forward-looking” information.

Although we and our general partner believe that the expectations reflected in our forward-looking statements are reasonable, neither we nor our general partner can provide any assurance that such expectations will prove correct. These forward-looking statements involve risks and uncertainties. Important factors that could cause actual results to differ materially from expectations include, but are not limited to, the following:

•our ability to pay distributions to our unitholders;

•our assumptions about the energy market;

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

•our operating results;

•competitive conditions;

•technology;

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

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

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

•weather and natural disasters;

•inflation;

•the availability of goods and services;

•general economic conditions, internationally, domestically, or in the jurisdictions in which we are doing business;

38

•federal, state, and local laws and state-approved voter ballot initiatives, including those laws or ballot initiatives that limit producers’ hydraulic-fracturing activities or other oil and natural-gas development or operations;

•environmental liabilities;

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

•changes in the financial or operational condition of Occidental;

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

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

•our commitments to capital projects;

•our ability to access liquidity under the RCF;

•our ability to repay debt;

•the impact from disruptions caused by winter storm Uri or the blizzard in the state of Colorado or resolution of litigation or other disputes;

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

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

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

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

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

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

•the economic uncertainty from the worldwide outbreak of the coronavirus (“COVID-19”); and

•other factors discussed below, in “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates” included in the 2020 Form 10-K, in our quarterly reports on Form 10-Q, and in our other public filings and press releases.

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

39

EXECUTIVE SUMMARY

We are a midstream energy company organized as a publicly traded partnership, engaged in the business of gathering, compressing, treating, processing, and transporting natural gas; gathering, stabilizing, and transporting condensate, NGLs, and crude oil; and gathering and disposing of produced water. In our capacity as a natural-gas processor, we also buy and sell natural gas, NGLs, and condensate on behalf of ourselves and as an agent for our customers under certain contracts. To provide superior midstream service, we focus on ensuring the reliability and performance of our systems, creating sustainable cost efficiencies, enhancing our safety culture, and protecting the environment. We own or have investments in assets located in Texas, New Mexico, the Rocky Mountains (Colorado, Utah, and Wyoming), and North-central Pennsylvania. As of September 30, 2021, our assets and investments consisted of the following:

	Wholly Owned and Operated	Operated Interests	Non-Operated Interests	Equity Interests
Gathering systems (1)	17	2	3	1
Treating facilities	36	3	—	—
Natural-gas processing plants/trains	24	3	—	5
NGLs pipelines	2	—	—	5
Natural-gas pipelines	5	—	—	1
Crude-oil pipelines	3	1	—	4

_________________________________________________________________________________________

(1)Includes the DBM water systems.

Significant financial and operational events during the nine months ended September 30, 2021, included the following:

•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.

•WES Operating purchased and retired $500.0 million of certain of its senior notes via a tender offer.

•We repurchased 5,586,419 common units for an aggregate purchase price of $104.4 million.

•Our third-quarter 2021 per-unit distribution of $0.32300 increased $0.004 from the second-quarter 2021 per-unit distribution of $0.31900.

•Natural-gas throughput attributable to WES totaled 4,081 MMcf/d and 4,132 MMcf/d for the three and nine months ended September 30, 2021, respectively, representing a 4% decrease and 6% decrease compared to the three months ended June 30, 2021, and nine months ended September 30, 2020, respectively.

•Crude-oil and NGLs throughput attributable to WES totaled 641 MBbls/d and 645 MBbls/d for the three and nine months ended September 30, 2021, respectively, representing a 7% decrease and 11% decrease compared to the three months ended June 30, 2021, and nine months ended September 30, 2020, respectively.

•Produced-water throughput attributable to WES totaled 735 MBbls/d and 673 MBbls/d for the three and nine months ended September 30, 2021, respectively, representing a 7% increase and 5% decrease compared to the three months ended June 30, 2021, and nine months ended September 30, 2020, respectively.

•Gross margin was $541.6 million and $1.5 billion for the three and nine months ended September 30, 2021, respectively, representing an 8% increase and 5% decrease compared to the three months ended June 30, 2021, and nine months ended September 30, 2020, respectively. See Key Performance Metrics within this Item 2.

40

•Adjusted gross margin for natural-gas assets (as defined under the caption Key Performance Metrics within this Item 2) averaged $1.31 per Mcf and $1.24 per Mcf for the three and nine months ended September 30, 2021, respectively, representing an 8% increase compared to the three months ended June 30, 2021, and nine months ended September 30, 2020.

•Adjusted gross margin for crude-oil and NGLs assets (as defined under the caption Key Performance Metrics within this Item 2) averaged $2.52 per Bbl and $2.46 per Bbl for the three and nine months ended September 30, 2021, respectively, representing a 5% increase and 2% decrease compared to the three months ended June 30, 2021, and nine months ended September 30, 2020, respectively.

•Adjusted gross margin for produced-water assets (as defined under the caption Key Performance Metrics within this Item 2) averaged $0.94 per Bbl and $0.93 per Bbl for the three and nine months ended September 30, 2021, respectively, representing a 2% increase and 5% decrease compared to the three months ended June 30, 2021, and nine months ended September 30, 2020, respectively.

The following table provides additional information on throughput for the periods presented below:

	Three Months Ended				Nine Months Ended
	September 30, 2021	June 30, 2021	Inc/ (Dec)		September 30, 2021	September 30, 2020	Inc/ (Dec)
Throughput for natural-gas assets (MMcf/d)
Delaware Basin	1,274	1,244	2	%	1,217	1,330	(8)	%
DJ Basin	1,368	1,413	(3)	%	1,375	1,342	2	%
Equity investments	443	457	(3)	%	447	451	(1)	%
Other	1,152	1,310	(12)	%	1,248	1,416	(12)	%
Total throughput for natural-gas assets	4,237	4,424	(4)	%	4,287	4,539	(6)	%
Throughput for crude-oil and NGLs assets (MBbls/d)
Delaware Basin	185	184	1	%	177	192	(8)	%
DJ Basin	87	98	(11)	%	89	109	(18)	%
Equity investments	350	386	(9)	%	358	395	(9)	%
Other	32	33	(3)	%	34	42	(19)	%
Total throughput for crude-oil and NGLs assets	654	701	(7)	%	658	738	(11)	%
Throughput for produced-water assets (MBbls/d)
Delaware Basin	750	702	7	%	687	726	(5)	%
Total throughput for produced-water assets	750	702	7	%	687	726	(5)	%

Weather-related impacts. In February 2021, the U.S. experienced winter storm Uri, bringing extreme cold temperatures, ice, and snow to the central U.S., including Texas, and in March 2021, Colorado experienced a historic blizzard. Winter storm Uri adversely affected our volumes for approximately ten days and the blizzard in Colorado likewise disrupted our assets in that state. We estimate the impact of these weather events to have reduced net income and Adjusted EBITDA (as defined under the caption Key Performance Metrics within this Item 2) for the nine months ended September 30, 2021, by approximately $30 million due to lower volumes, the impact of commodity-prices, and higher operating expenses related to utilities. The estimated impact of the adverse winter weather on our operations and financial results may change and those changes may be material. Any additional inclement weather in the future, or other adverse conditions, including resolution of litigation and other legal disputes and the COVID-19 pandemic and resulting mitigation factors, may have an adverse impact on our operations and financial results.

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COVID-19. During 2020, the global outbreak of COVID-19 caused a sharp decline in the worldwide demand for oil, natural gas, and NGLs, which contributed significantly to commodity-price declines and oversupplied commodities markets. These market dynamics have had an adverse impact on producers that provide throughput into our systems, and we have experienced decreased throughput at many of our locations.

Additionally, many of our employees have been and may continue to be subject to pandemic-related work-from-home requirements, which require us to take additional actions to ensure that the number of personnel accessing our network remotely does not lead to excessive cyber-security risk levels. Similarly, we are working continually to ensure operational changes that we have made to promote the health and safety of our personnel during this pandemic do not unduly disrupt intracompany communications and key business processes. We consider our risk-mitigation efforts adequate; however, the ultimate impact of the ongoing pandemic is unpredictable, with direct and indirect impacts to our business.

WES continues to monitor the COVID-19 situation closely, and as state and federal governments issue additional guidance, we will update our own policies in response to ensure the safety and health of our workforce and communities. The federal government has provided guidance to states on how to safely return personnel to the workplace, which we are following as our workforce returns to WES locations. All WES facilities, including field locations, have been conducting enhanced routine cleaning and disinfecting of common areas and frequently touched surfaces using CDC- and EPA-approved products. Our return-to-work protocols include daily required application-based health self-assessments that must be completed prior to accessing WES work locations.

Commodity purchase and sale agreements. Effective April 1, 2020, changes to marketing-contract terms with AESC terminated AESC’s prior status as an agent of the Partnership for third-party sales and established AESC as a customer of the Partnership. Accordingly, we no longer recognize service revenues and/or product sales revenues and the equivalent cost of product expense for the marketing services performed by AESC. Year-over-year variances for the nine months ended September 30, 2021, include the following impacts related to this change (i) decrease of $45.9 million in Service revenues – fee based, (ii) decrease of $21.2 million in Product sales, and (iii) decrease of $67.1 million in Cost of product expense. These changes had no impact to Operating income (loss), Net income (loss), the balance sheets, cash flows, or any non-GAAP metric used to evaluate our operations (see Key Performance Metrics within this Item 2). See Note 6—Related-Party Transactions in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

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OUTLOOK

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

Impact of crude-oil, natural-gas, and NGLs prices. Crude-oil, natural-gas, and NGLs prices can fluctuate significantly, and have done so over time. Commodity-price fluctuations affect the level of our customers’ activities and our customers’ allocations of capital within their own asset portfolios. During the first quarter of 2020, oil and natural-gas prices decreased significantly, driven by the expectation of increased supply and sharp declines in demand resulting from the worldwide macroeconomic downturn that followed the global outbreak of COVID-19. For example, NYMEX West Texas Intermediate crude-oil daily settlement prices ranged from a high of $63.27 per barrel in January 2020 to a low below $20.00 per barrel in April 2020. Although commodity prices have rebounded to pre-pandemic levels, the extent and duration of the recent commodity-price volatility cannot be predicted, and potential impacts to our business include the following:

•We have exposure to increased credit risk to the extent any of our customers, including Occidental, is in financial distress. See Liquidity and Capital Resources—Credit risk within this Item 2 for additional information.

•An extended period of diminished earnings may restrict our ability to fully access our RCF, which contains various customary covenants, certain events of default, and a maximum consolidated leverage ratio based on Adjusted EBITDA (as defined in the covenant) related to the trailing twelve-month period. Further, any future waivers or amendments to the RCF also may trigger pricing increases for available credit. See Liquidity and Capital Resources—Debt and credit facilities within this Item 2 for additional information.

•As of September 30, 2021, it is reasonably possible that future commodity-price declines, prolonged depression of commodity prices, changes to producers’ drilling plans in response to lower prices, and potential producer bankruptcies could result in future long-lived asset impairments.

To the extent producers continue with development plans in our areas of operation, we will continue to connect new wells or production facilities to our systems to maintain throughput on our systems and mitigate the impact of production declines. However, our success in connecting additional wells or production facilities is dependent on the activity levels of our customers. Additionally, we will continue to evaluate the crude-oil, NGLs, and natural-gas price environments and adjust our capital spending plans to reflect our customers’ anticipated activity levels, while maintaining appropriate liquidity and financial flexibility.

ACQUISITIONS AND DIVESTITURES

Fort Union and Bison facilities. In October 2020, we (i) sold our 14.81% interest in Fort Union, which was accounted for under the equity method of accounting, and (ii) 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. We 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. See Note 3—Acquisitions and Divestitures in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q for further information.

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RESULTS OF OPERATIONS

OPERATING RESULTS

In November 2020, the SEC issued a final rule to modernize and simplify Management’s Discussion and Analysis and certain financial disclosure requirements in SEC Regulation S-K. As permitted by this final rule, the analysis herein reflects the optional approach to discuss results of operations on a sequential-quarter basis, which we believe will provide information that is most useful to investors in assessing our quarterly results of operations going forward. In addition, as required by the final rule, we have continued to include a comparison of the current year-to-date period to the prior year-to-date period.

For purposes of the following discussion, any increases or decreases “for the three months ended September 30, 2021” refer to the comparison of the three months ended September 30, 2021, to the three months ended June 30, 2021; and any increases or decreases “for the nine months ended September 30, 2021” refer to the comparison of the nine months ended September 30, 2021, to the nine months ended September 30, 2020.

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

	Three Months Ended				Nine Months Ended
thousands	September 30, 2021		June 30, 2021		September 30, 2021		September 30, 2020
Total revenues and other (1)	$	763,840	$	719,131	$	2,157,945	$	2,125,112
Equity income, net – related parties	48,506		58,666		159,337		176,788
Total operating expenses (1)	428,716		444,074		1,307,010		1,792,290
Gain (loss) on divestiture and other, net	(364)		1,225		278		(3,651)
Operating income (loss)	383,266		334,948		1,010,550		505,959
Interest income – Anadarko note receivable	—		—		—		11,736
Interest expense	(93,257)		(95,290)		(287,040)		(278,811)
Gain (loss) on early extinguishment of debt	(24,655)		—		(24,944)		10,372
Other income (expense), net	110		84		(1,013)		612
Income (loss) before income taxes	265,464		239,742		697,553		249,868
Income tax expense (benefit)	1,826		1,465		4,403		3,792
Net income (loss)	263,638		238,277		693,150		246,076
Net income (loss) attributable to noncontrolling interests	7,913		7,018		20,375		(17,045)
Net income (loss) attributable to Western Midstream Partners, LP (2)	$	255,725	$	231,259	$	672,775	$	263,121
Key performance metrics (3)
Adjusted gross margin	$	705,407	$	677,236	$	1,997,267	$	2,069,801
Adjusted EBITDA	531,580		491,126		1,465,816		1,546,386
Free cash flow	320,031		379,776		913,629		762,364

_________________________________________________________________________________________

(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 I, Item 1 of this Form 10-Q.

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

(3)Adjusted gross margin, Adjusted EBITDA, and Free cash flow are defined under the caption Key Performance Metrics within this Item 2. For reconciliations of these non-GAAP financial measures to their most directly comparable financial measures calculated and presented in accordance with GAAP, see Key Performance Metrics—Reconciliation of non-GAAP financial measures within this Item 2.

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Throughput

	Three Months Ended				Nine Months Ended
	September 30, 2021	June 30, 2021	Inc/ (Dec)		September 30, 2021	September 30, 2020	Inc/ (Dec)
Throughput for natural-gas assets (MMcf/d)
Gathering, treating, and transportation	378	534	(29)	%	477	551	(13)	%
Processing	3,416	3,433	—	%	3,363	3,537	(5)	%
Equity investments (1)	443	457	(3)	%	447	451	(1)	%
Total throughput	4,237	4,424	(4)	%	4,287	4,539	(6)	%
Throughput attributable to noncontrolling interests (2)	156	159	(2)	%	155	162	(4)	%
Total throughput attributable to WES for natural-gas assets	4,081	4,265	(4)	%	4,132	4,377	(6)	%
Throughput for crude-oil and NGLs assets (MBbls/d)
Gathering, treating, and transportation	304	315	(3)	%	300	343	(13)	%
Equity investments (3)	350	386	(9)	%	358	395	(9)	%
Total throughput	654	701	(7)	%	658	738	(11)	%
Throughput attributable to noncontrolling interests (2)	13	14	(7)	%	13	15	(13)	%
Total throughput attributable to WES for crude-oil and NGLs assets	641	687	(7)	%	645	723	(11)	%
Throughput for produced-water assets (MBbls/d)
Gathering and disposal	750	702	7	%	687	726	(5)	%
Throughput attributable to noncontrolling interests (2)	15	14	7	%	14	15	(7)	%
Total throughput attributable to WES for produced-water assets	735	688	7	%	673	711	(5)	%

_________________________________________________________________________________________

(1)Represents the 14.81% share of average Fort Union throughput (until divested in October 2020), 22% share of average Rendezvous throughput, 50% share of average Mi Vida and Ranch Westex throughput, and 30% share of average Red Bluff Express throughput.

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

(3)Represents the 10% share of average White Cliffs throughput; 25% share of average Mont Belvieu JV throughput; 20% share of average TEG, TEP, Whitethorn, and Saddlehorn throughput; 33.33% share of average FRP throughput; and 15% share of average Panola and Cactus II throughput.

Natural-gas assets

Gathering, treating, and transportation throughput decreased by 156 MMcf/d for the three months ended September 30, 2021, primarily due to (i) decreased volumes at the Bison treating facility, which was sold to a third party during the second quarter of 2021 and (ii) production declines in areas around the Marcellus Interest and Springfield gas-gathering systems.

Gathering, treating, and transportation throughput decreased by 74 MMcf/d for the nine months ended September 30, 2021, primarily due to (i) decreased volumes at the Bison treating facility, which was sold to a third party during the second quarter of 2021 and (ii) production declines and the impact of winter storm Uri at the Springfield gas-gathering system. These decreases were offset partially by increased production in areas around the Marcellus Interest systems.

Processing throughput decreased by 17 MMcf/d for the three months ended September 30, 2021, primarily due to decreased production in areas around the DJ Basin complex, partially offset by increased production in areas around the West Texas complex.

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Processing throughput decreased by 174 MMcf/d for the nine months ended September 30, 2021, primarily due to (i) lower production and the impact of winter storm Uri at the West Texas complex, (ii) the Granger straddle plant being held idle beginning in the third quarter of 2020, and (iii) lower volumes at the Granger complex due to production declines in the area. These decreases were offset partially by higher volumes at the DJ Basin complex primarily due to an additional third-party connection to Latham Train II beginning January 1, 2021.

Equity-investment throughput decreased by 14 MMcf/d for the three months ended September 30, 2021, primarily due to decreased volumes at the Mi Vida and Ranch Westex plants and the Rendezvous system.

Equity-investment throughput decreased by 4 MMcf/d for the nine months ended September 30, 2021, primarily due to (i) decreased volumes at the Rendezvous system due to production declines in the area and (ii) decreased volumes at the Fort Union system, which was sold to a third party during the fourth quarter of 2020. These decreases were offset partially by increased volumes on Red Bluff Express resulting from increased pipeline commitments.

Crude-oil and NGLs assets

Gathering, treating, and transportation throughput decreased by 11 MBbls/d for the three months ended September 30, 2021, primarily due to decreased production in areas around the DJ Basin oil system.

Gathering, treating, and transportation throughput decreased by 43 MBbls/d for the nine months ended September 30, 2021, primarily due to (i) lower volumes at the DJ Basin oil system resulting from production declines in the area and (ii) lower volumes at the DBM oil system due to lower production and the impact of winter storm Uri.

Equity-investment throughput decreased by 36 MBbls/d for the three months ended September 30, 2021, primarily due to decreased volumes on the Whitethorn pipeline and TEP, partially offset by increased volumes on the Cactus II pipeline resulting from an incentive rate implemented in the second quarter of 2021.

Equity-investment throughput decreased by 37 MBbls/d for the nine months ended September 30, 2021, primarily due to decreased volumes on the Whitethorn pipeline, partially offset by increased volumes on the Saddlehorn pipeline.

Produced-water assets

Gathering and disposal throughput increased by 48 MBbls/d for the three months ended September 30, 2021, due to increased volumes at the DBM water systems resulting from higher production in the area.

Gathering and disposal throughput decreased by 39 MBbls/d for the nine months ended September 30, 2021, due to decreased volumes at the DBM water systems resulting from lower production and the impact of winter storm Uri.

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Service Revenues

	Three Months Ended						Nine Months Ended
thousands except percentages	September 30, 2021		June 30, 2021		Inc/ (Dec)		September 30, 2021		September 30, 2020		Inc/ (Dec)
Service revenues – fee based	$	650,482	$	618,985	5	%	$	1,841,742	$	1,980,546	(7)	%
Service revenues – product based	28,812		27,803		4	%	88,267		35,237		150	%
Total service revenues	$	679,294	$	646,788	5	%	$	1,930,009	$	2,015,783	(4)	%

Service revenues – fee based

Service revenues – fee based increased by $31.5 million for the three months ended September 30, 2021, primarily due to increases of (i) $18.9 million due to revenue recorded in the third quarter of 2021 that was previously constrained (see Note 2—Revenue from Contracts with Customers in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q) and (ii) $14.2 million at the West Texas complex resulting from increased throughput.

Service revenues – fee based decreased by $138.8 million for the nine months ended September 30, 2021, primarily due to decreases of (i) $45.9 million, resulting from a change in accounting for the marketing contracts with AESC effective April 1, 2020 (see Executive Summary—Commodity purchase and sale agreements within this Item 2), (ii) $37.9 million at the DBM oil system due to decreased throughput, including the impact of winter storm Uri, and lower lease revenue under the operating and maintenance agreement with Occidental, (iii) $23.8 million at the DBM water systems resulting from decreased throughput, including the impact of winter storm Uri, and a lower average fee resulting from a cost-of-service rate redetermination effective January 1, 2021, (iv) $20.9 million at the DJ Basin complex due to decreased throughput on certain fee-based contracts, (v) $12.1 million at the Bison treating facility due to the expiration of a minimum-volume commitment contract in the fourth quarter of 2020, decreased throughput, and the sale of the facility to a third party during the second quarter of 2021, and (vi) $9.6 million at the West Texas complex from decreased throughput, including the impact of winter storm Uri. These decreases were offset partially by an increase of $18.9 million due to revenue recorded in the third quarter of 2021 that was previously constrained (see Note 2—Revenue from Contracts with Customers in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q).

Service revenues – product based

Service revenues – product based increased by $1.0 million for the three months ended September 30, 2021, primarily due to increased pricing across several systems, partially offset by a decrease of $4.7 million at the West Texas complex primarily due to a decrease in electricity-related fees charged to customers.

Service revenues – product based increased by $53.0 million for the nine months ended September 30, 2021, primarily due to increases of (i) $15.6 million at the DJ Basin complex due to increased third-party volumes and average prices, (ii) $15.1 million at the West Texas complex due to an increase in electricity-related fees charged to customers during winter storm Uri, and (iii) $6.5 million at the Granger complex, $6.3 million at the Hilight system, and $4.7 million at the Chipeta complex due to increased prices.

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Product Sales

	Three Months Ended						Nine Months Ended
thousands except percentages and per-unit amounts	September 30, 2021		June 30, 2021		Inc/ (Dec)		September 30, 2021		September 30, 2020		Inc/ (Dec)
Natural-gas sales	$	32,151	$	14,195	126	%	$	67,765	$	23,934	183	%
NGLs sales	52,147		58,061		(10)	%	159,594		84,557		89	%
Total Product sales	$	84,298	$	72,256	17	%	$	227,359	$	108,491	110	%
Per-unit gross average sales price:
Natural gas (per Mcf)	$	4.10	$	2.65	55	%	$	4.20	$	1.32	NM
NGLs (per Bbl)	36.96		27.16		36	%	30.81		12.25		152	%

_________________________________________________________________________________________

NM—Not meaningful

Natural-gas sales

Natural-gas sales increased by $18.0 million for the three months ended September 30, 2021, primarily due to increases of (i) $13.1 million at the West Texas complex attributable to an increase in average prices and volumes sold and (ii) $2.3 million at the DJ Basin complex and $2.1 million at the MGR assets attributable to an increase in average prices.

Natural-gas sales increased by $43.8 million for the nine months ended September 30, 2021, primarily due to increases of (i) $37.2 million at the West Texas complex and $7.4 million at the MGR assets attributable to increases in average prices and (ii) $1.8 million resulting from a change in accounting for the marketing contracts with AESC effective April 1, 2020 (see Executive Summary—Commodity purchase and sale agreements within this Item 2). These increases were offset partially by decreases of $4.9 million at the DJ Basin complex and $4.3 million at the Granger complex attributable to decreases in volumes sold, partially offset by increases in average prices.

NGLs sales

NGLs sales decreased by $5.9 million for the three months ended September 30, 2021, primarily due to a decrease of $8.7 million at the West Texas complex attributable to net changes in contract mix. This decrease was partially offset by an increase of $2.2 million at the Chipeta complex attributable to an increase in average prices and volumes sold.

NGLs sales increased by $75.0 million for the nine months ended September 30, 2021, primarily due to increases of (i) $65.4 million at the West Texas complex attributable to an increase in average prices, partially offset by decreased volumes sold and (ii) $15.9 million at the Chipeta complex and $8.7 million at the Granger complex attributable to increases in average prices. These increases were offset partially by a decrease of $23.0 million resulting from a change in accounting for the marketing contracts with AESC effective April 1, 2020 (see Executive Summary—Commodity purchase and sale agreements within this Item 2).

Equity Income, Net – Related Parties

	Three Months Ended						Nine Months Ended
thousands except percentages	September 30, 2021		June 30, 2021		Inc/ (Dec)		September 30, 2021		September 30, 2020		Inc/ (Dec)
Equity income, net – related parties	$	48,506	$	58,666	(17)	%	$	159,337	$	176,788	(10)	%

Equity income, net – related parties decreased by $10.2 million for the three months ended September 30, 2021, primarily due to decreases of $5.9 million at Cactus II and $4.1 million at Mont Belvieu JV resulting from electricity credits received in the second quarter of 2021 related to winter storm Uri.

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Equity income, net – related parties decreased by $17.5 million for the nine months ended September 30, 2021, primarily due to decreases of (i) $24.1 million at Whitethorn LLC related to commercial activities and lower volumes and (ii) $4.8 million and $4.2 million at Cactus II and White Cliffs, respectively, due to lower volumes. These decreases were offset partially by increases of (i) $6.4 million and $5.1 million at Saddlehorn and Red Bluff Express, respectively, due to higher volumes and (ii) $4.4 million at Mont Belvieu JV from a load-reduction electricity credit received in the second quarter of 2021 related to winter storm Uri.

Cost of Product and Operation and Maintenance Expenses

	Three Months Ended						Nine Months Ended
thousands except percentages	September 30, 2021		June 30, 2021		Inc/ (Dec)		September 30, 2021		September 30, 2020		Inc/ (Dec)
Residue purchases	$	32,123	$	23,019	40	%	$	113,046	$	43,998	157	%
NGLs purchases	51,440		42,305		22	%	124,664		111,809		11	%
Other	(331)		12,720		(103)	%	12,535		(2,196)		NM
Cost of product	83,232		78,044		7	%	250,245		153,611		63	%
Operation and maintenance	140,838		153,028		(8)	%	434,198		436,670		(1)	%
Total Cost of product and Operation and maintenance expenses	$	224,070	$	231,072	(3)	%	$	684,443	$	590,281	16	%

Residue purchases

Residue purchases increased by $9.1 million for the three months ended September 30, 2021, primarily due to increases of (i) $4.0 million at the West Texas complex attributable to an increase in average prices and volumes purchased and (ii) $2.2 million at the MGR assets attributable to an increase in average prices.

Residue purchases increased by $69.0 million for the nine months ended September 30, 2021, primarily due to increases of $45.4 million at the West Texas complex, $7.7 million at the Chipeta complex, $6.6 million at the MGR assets, $5.4 million at the Granger complex, and $5.3 million at the Hilight system attributable to increases in average prices. These increases were offset partially by a decrease of $5.2 million resulting from a change in accounting for the marketing contracts with AESC effective April 1, 2020 (see Executive Summary—Commodity purchase and sale agreements within this Item 2).

NGLs purchases

NGLs purchases increased by $9.1 million for the three months ended September 30, 2021, primarily due to increases of (i) $5.5 million at the DJ Basin complex attributable to an increase in average prices and (ii) $2.2 million at the Chipeta complex attributable to an increase in average prices and volumes purchased.

NGLs purchases increased by $12.9 million for the nine months ended September 30, 2021, primarily due to increases of $31.5 million at the West Texas complex, $24.7 million at the DJ Basin complex, $9.4 million at the Chipeta complex, and $5.8 million at the Granger complex attributable to increases in average prices. These increases were offset partially by a decrease of $61.1 million resulting from a change in accounting for the marketing contracts with AESC effective April 1, 2020 (see Executive Summary—Commodity purchase and sale agreements within this Item 2).

Other items

Other items decreased by $13.1 million for the three months ended September 30, 2021, primarily due to decreases of $8.1 million at the West Texas complex and $3.1 million at the DJ Basin complex, primarily attributable to changes in imbalance positions.

Other items increased by $14.7 million for the nine months ended September 30, 2021, primarily due to an increase of $31.2 million at the West Texas complex, partially offset by a decrease of $16.7 million at the DJ Basin complex, both primarily attributable to changes in imbalance positions.

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Operation and maintenance expense

Operation and maintenance expense decreased by $12.2 million for the three months ended September 30, 2021, primarily due to decreases of (i) $5.9 million at the West Texas complex attributable to reduced utilities expense and surface maintenance and plant repairs and (ii) $4.8 million at the DJ Basin complex due to an environmental liability of $4.1 million recorded in the second quarter of 2021.

Operation and maintenance expense decreased by $2.5 million for the nine months ended September 30, 2021, primarily due to decreases of (i) $7.5 million at the West Texas complex, primarily attributable to reduced salaries and wages, surface maintenance and plant repairs, and safety expense; partially offset by increased utilities expense primarily resulting from the impact of winter storm Uri, (ii) $5.8 million at the DJ Basin complex attributable to reduced surface maintenance and plant repairs, and (iii) $3.8 million at the DBM water systems attributable to lower disposal fees resulting from reduced volumes and lower surface-use fees, partially offset by increased utilities expense and surface maintenance and plant repairs, including the impact of winter storm Uri. These decreases were offset partially by an increase of $10.2 million at the DBM oil system, primarily attributable to increases in field-related expenses, chemicals and treating services, and utilities expense primarily resulting from the impact of winter storm Uri.

Other Operating Expenses

	Three Months Ended						Nine Months Ended
thousands except percentages	September 30, 2021		June 30, 2021		Inc/ (Dec)		September 30, 2021		September 30, 2020		Inc/ (Dec)
General and administrative	$	50,409	$	44,448	13	%	$	139,973	$	118,466	18	%
Property and other taxes	13,641		17,967		(24)	%	45,992		57,263		(20)	%
Depreciation and amortization	139,002		137,849		1	%	407,404		384,688		6	%
Long-lived asset and other impairments	1,594		12,738		(87)	%	29,198		200,575		(85)	%
Goodwill impairment	—		—		—	%	—		441,017		(100)	%
Total other operating expenses	$	204,646	$	213,002	(4)	%	$	622,567	$	1,202,009	(48)	%

General and administrative expenses

General and administrative expenses increased by $6.0 million for the three months ended September 30, 2021, primarily due to increases of (i) $4.4 million in personnel costs and (ii) $2.0 million in contract and consulting costs.

General and administrative expenses increased by $21.5 million for the nine months ended September 30, 2021, primarily due to increases of (i) $16.2 million in personnel costs primarily related to increased bonus-related contributions under our employee savings plan and equity-based compensation expense, and (ii) $6.3 million in contract and consulting costs primarily related to information technology services and fees.

Property and other taxes

Property and other taxes decreased by $4.3 million for the three months ended September 30, 2021, primarily due to ad valorem tax decreases at the West Texas complex and DBM oil system due to favorable differences between actual and estimated tax payments related to the 2021 fiscal year.

Property and other taxes decreased by $11.3 million for the nine months ended September 30, 2021, primarily due to ad valorem tax decreases at the West Texas complex due to favorable differences between actual and estimated tax payments related to the 2020 fiscal year.

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Depreciation and amortization expense

Depreciation and amortization expense increased by $22.7 million for the nine months ended September 30, 2021, primarily due to increases of (i) $16.9 million at the DJ Basin complex, primarily as a result of a change in estimate for asset retirement obligations for the Third Creek gathering system in the comparative prior period, (ii) $7.1 million related to depreciation for capitalized information technology implementation costs related to the stand-up of WES as an independent organization, (iii) $6.3 million at the West Texas complex resulting from capital projects being placed into service, and (iv) $3.8 million at the Springfield system due to an acceleration of depreciation expense for revised service life assumptions. These increases were offset partially by decreases of (i) $13.4 million due to the sale of the Bison treating facility and (ii) $3.3 million at a transportation asset in Southwest Wyoming, primarily as a result of downward asset retirement obligation revisions made in the first quarter of 2021.

Long-lived asset and other impairment expense

Long-lived asset and other impairment expense for the three months ended June 30, 2021, was primarily due to an $11.6 million other-than-temporary impairment of our investment in Ranch Westex.

Long-lived asset and other impairment expense for the three months ended March 31, 2021, was primarily due to $13.5 million of impairments at the DJ Basin complex due to cancellation of projects.

Long-lived asset and other impairment expense for the nine months ended September 30, 2020, was primarily due to (i) $150.2 million of impairments for assets located in Wyoming and Utah, (ii) impairments of $14.8 million primarily at the DJ Basin complex, DBM water systems, and West Texas complex due to cancellation of projects, and (iii) impairments of rights-of-way for $6.2 million at the DJ Basin complex.

For further information on Long-lived asset and other impairment expense, see Note 8—Property, Plant, and Equipment in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

Goodwill impairment expense

During the three months ended March 31, 2020, an interim goodwill impairment test was performed due to significant unit-price declines triggered by the combined impacts from the global outbreak of COVID-19 and the oil-market disruption. As a result of the interim impairment test, a goodwill impairment of $441.0 million was recognized for the gathering and processing reporting unit. For additional information, see Note 9—Goodwill in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

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Interest Income – Anadarko Note Receivable and Interest Expense

	Three Months Ended						Nine Months Ended
thousands except percentages	September 30, 2021		June 30, 2021		Inc/ (Dec)		September 30, 2021		September 30, 2020		Inc/ (Dec)
Interest income – Anadarko note receivable	$	—	$	—	—	%	$	—	$	11,736	(100)	%
Third parties
Long-term and short-term debt	$	(90,913)	$	(92,487)	(2)	%	$	(279,122)	$	(273,620)	2	%
Finance lease liabilities	(218)		(292)		(25)	%	(808)		(1,162)		(30)	%
Commitment fees and amortization of debt-related costs	(3,147)		(3,179)		(1)	%	(9,664)		(10,052)		(4)	%
Capitalized interest	1,021		668		53	%	2,554		6,066		(58)	%
Related parties
Finance lease liabilities	—		—		—	%	—		(43)		(100)	%
Interest expense	$	(93,257)	$	(95,290)	(2)	%	$	(287,040)	$	(278,811)	3	%

Interest income

Interest income - Anadarko note receivable decreased by $11.7 million for the nine months ended September 30, 2021, due to the exchange of the Anadarko note receivable under the Unit Redemption Agreement in September 2020. See Note 6—Related-Party Transactions in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

Interest expense

Interest expense decreased by $2.0 million for the three months ended September 30, 2021, primarily due to lower outstanding balances as a result of the purchase and retirement of portions of certain of the senior notes.

Interest expense increased by $8.2 million for the nine months ended September 30, 2021, primarily due to (i) $27.4 million of additional interest incurred from higher effective interest rates resulting from credit-rating downgrades on the 3.100% Senior Notes due 2025, 4.050% Senior Notes due 2030, and 5.250% Senior Notes due 2050 and (ii) a decrease of $3.5 million in capitalized interest due to decreased capital expenditures. These increases were offset partially by decreases of (i) $18.4 million due to lower outstanding balances on the 5.375% Senior Notes due 2021 that were called on March 1, 2021 and the purchase and retirement of portions of certain of the senior notes during the third quarter of 2021 and (ii) $3.9 million due to lower outstanding borrowings under the RCF in 2021. See Liquidity and Capital Resources—Debt and credit facilities within this Item 2.

Income Tax Expense (Benefit)

	Three Months Ended								Nine Months Ended
thousands except percentages	September 30, 2021			June 30, 2021			Inc/ (Dec)		September 30, 2021			September 30, 2020			Inc/ (Dec)
Income (loss) before income taxes	$	265,464		$	239,742		11	%	$	697,553		$	249,868		179	%
Income tax expense (benefit)	1,826			1,465			25	%	4,403			3,792			16	%
Effective tax rate	1		%	1		%			1		%	2		%

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 all periods presented, the variance from the federal statutory rate primarily was due to our Texas margin tax liability.

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KEY PERFORMANCE METRICS

	Three Months Ended						Nine Months Ended
thousands except percentages and per-unit amounts	September 30, 2021		June 30, 2021		Inc/ (Dec)		September 30, 2021		September 30, 2020		Inc/ (Dec)
Adjusted gross margin for natural-gas assets	$	492,708	$	469,409	5	%	$	1,394,506	$	1,384,632	1	%
Adjusted gross margin for crude-oil and NGLs assets	148,939		150,317		(1)	%	432,401		494,481		(13)	%
Adjusted gross margin for produced-water assets	63,760		57,510		11	%	170,360		190,688		(11)	%
Adjusted gross margin	705,407		677,236		4	%	1,997,267		2,069,801		(4)	%
Per-Mcf Adjusted gross margin for natural-gas assets (1)	1.31		1.21		8	%	1.24		1.15		8	%
Per-Bbl Adjusted gross margin for crude-oil and NGLs assets (2)	2.52		2.40		5	%	2.46		2.50		(2)	%
Per-Bbl Adjusted gross margin for produced-water assets (3)	0.94		0.92		2	%	0.93		0.98		(5)	%
Adjusted EBITDA	531,580		491,126		8	%	1,465,816		1,546,386		(5)	%
Free cash flow	320,031		379,776		(16)	%	913,629		762,364		20	%

_________________________________________________________________________________________

(1)Average for period. Calculated as Adjusted gross margin for natural-gas assets, divided by total throughput (MMcf/d) attributable to WES for natural-gas assets.

(2)Average for period. Calculated as Adjusted gross margin for crude-oil and NGLs assets, divided by total throughput (MBbls/d) attributable to WES for crude-oil and NGLs assets.

(3)Average for period. Calculated as Adjusted gross margin for produced-water assets, divided by total throughput (MBbls/d) attributable to WES for produced-water assets.

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

To facilitate investor and industry analyst comparisons between us and our peers, we also disclose per-Mcf Adjusted gross margin for natural-gas assets, per-Bbl Adjusted gross margin for crude-oil and NGLs assets, and per-Bbl Adjusted gross margin for produced-water assets.

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Adjusted gross margin increased by $28.2 million for the three months ended September 30, 2021, primarily due to (i) increased throughput at the West Texas complex and DBM water systems and (ii) revenue recorded in the third quarter of 2021 that was previously constrained (see Note 2—Revenue from Contracts with Customers in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q). These increases were offset partially by (i) a decrease in distributions from Mont Belvieu JV and (ii) decreased throughput at the DJ Basin complex.

Adjusted gross margin decreased by $72.5 million for the nine months ended September 30, 2021, primarily due to (i) decreased throughput and lower lease revenue under the operating and maintenance agreement with Occidental at the DBM oil system, (ii) a decrease in distributions from Whitethorn LLC, (iii) decreased throughput and a lower average fee resulting from a cost-of-service rate redetermination effective January 1, 2021, at the DBM water systems, (iv) decreased throughput on certain fee-based contracts at the DJ Basin complex, and (v) the expiration of a minimum-volume commitment contract in the fourth quarter of 2020 and decreased throughput at the Bison treating facility, which was sold to a third party during the second quarter of 2021. These decreases were offset partially by (i) revenue recorded in the third quarter of 2021 that was previously constrained, (ii) higher average commodity prices at the MGR assets, and (iii) an increase in distributions from Red Bluff Express and Saddlehorn.

Per-Mcf Adjusted gross margin for natural-gas assets increased by $0.10 for the three months ended September 30, 2021, primarily due to (i) revenue recorded in the third quarter of 2021 that was previously constrained at the Springfield gas-gathering system and (ii) increased throughput at the West Texas complex, which has a higher-than-average per-Mcf margin as compared to our other natural-gas assets. These increases were offset partially by decreased throughput at the DJ Basin complex, which has a higher-than-average per-Mcf margin as compared to our other natural-gas assets.

Per-Mcf Adjusted gross margin for natural-gas assets increased by $0.09 for the nine months ended September 30, 2021, primarily due to (i) a higher cost-of-service rate effective January 1, 2021, at the West Texas complex and (ii) revenue recorded in the third quarter of 2021 that was previously constrained at the Springfield gas-gathering system. These increases were offset partially by decreased throughput on certain fee-based contracts at the DJ Basin complex, which has a higher-than-average per-Mcf margin as compared to our other natural-gas assets.

Per-Bbl Adjusted gross margin for crude-oil and NGLs assets increased by $0.12 for the three months ended September 30, 2021, primarily due to (i) revenue recorded in the third quarter of 2021 that was previously constrained and (ii) decreased volumes on the Whitethorn pipeline, which has a lower-than-average per-Bbl margin as compared to our other crude-oil and NGLs assets. These increases were offset partially by (i) lower lease revenue under the operating and maintenance agreement with Occidental at the DBM oil system and (ii) a decrease in distributions from Mont Belvieu JV.

Per-Bbl Adjusted gross margin for crude-oil and NGLs assets decreased by $0.04 for the nine months ended September 30, 2021, primarily due to (i) decreased throughput and lower lease revenue under the operating and maintenance agreement with Occidental at the DBM oil system, which has a higher-than-average per-Bbl margin as compared to our other crude-oil and NGLs assets and (ii) a decrease in distributions from FRP and Cactus II. These decreases were offset partially by (i) a higher cost-of-service rate effective January 1, 2021, at the DJ Basin oil system and (ii) revenue recorded in the third quarter of 2021 that was previously constrained.

Per-Bbl Adjusted gross margin for produced-water assets increased by $0.02 for the three months ended September 30, 2021, primarily due to increased throughput on volumes with higher-than-average per-Bbl margins.

Per-Bbl Adjusted gross margin for produced-water assets decreased by $0.05 for the nine months ended September 30, 2021, primarily due to a lower average fee resulting from a cost-of-service rate redetermination effective January 1, 2021.

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Adjusted EBITDA. We define Adjusted EBITDA attributable to Western Midstream Partners, LP (“Adjusted EBITDA”) as net income (loss), plus (i) distributions from equity investments, (ii) non-cash equity-based compensation expense, (iii) interest expense, (iv) income tax expense, (v) depreciation and amortization, (vi) impairments, and (vii) other expense (including lower of cost or market inventory adjustments recorded in cost of product), less (i) gain (loss) on divestiture and other, net, (ii) gain (loss) on early extinguishment of debt, (iii) income from equity investments, (iv) interest income, (v) income tax benefit, (vi) other income, and (vii) the noncontrolling interest owners’ proportionate share of revenues and expenses. We believe the presentation of Adjusted EBITDA provides information useful to investors in assessing our financial condition and results of operations and that Adjusted EBITDA is a widely accepted financial indicator of a company’s ability to incur and service debt, fund capital expenditures, and make distributions. Adjusted EBITDA is a supplemental financial measure that management and external users of our consolidated financial statements, such as industry analysts, investors, commercial banks, and rating agencies, use, among other measures, to assess the following:

•our operating performance as compared to other publicly traded partnerships in the midstream industry, without regard to financing methods, capital structure, or historical cost basis;

•the ability of our assets to generate cash flow to make distributions; and

•the viability of acquisitions and capital expenditures and the returns on investment of various investment opportunities.

Adjusted EBITDA increased by $40.5 million for the three months ended September 30, 2021, primarily due to (i) a $44.7 million increase in total revenues and other, (ii) a $12.2 million decrease in operation and maintenance expenses, and (iii) a $4.3 million decrease in property taxes. These amounts were offset partially by (i) an $8.2 million decrease in distributions from equity investments, (ii) a $6.1 million increase in general and administrative expenses excluding non-cash equity-based compensation expense, and (iii) a $5.2 million increase in cost of product (net of lower of cost or market inventory adjustments).

Adjusted EBITDA decreased by $80.6 million for the nine months ended September 30, 2021, primarily due to (i) a $96.8 million increase in cost of product (net of lower of cost or market inventory adjustments), (ii) a $17.2 million increase in general and administrative expenses excluding non-cash equity-based compensation expense, and (iii) a $14.7 million decrease in distributions from equity investments. These amounts were offset partially by (i) a $32.8 million increase in total revenues and other and (ii) an $11.3 million decrease in property taxes. The above-described variances in cost of product and total revenues and other include the impacts resulting from a change in accounting for the marketing contracts with AESC effective April 1, 2020, which had no net impact on Adjusted EBITDA (see Executive Summary—Commodity purchase and sale agreements within this Item 2).

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

Free cash flow decreased by $59.7 million for the three months ended September 30, 2021, primarily due to a decrease of $60.8 million in net cash provided by operating activities, partially offset by a decrease of $3.2 million in contributions to equity investments.

Free cash flow increased by $151.3 million for the nine months ended September 30, 2021, primarily due to (i) a decrease of $154.5 million in capital expenditures, (ii) a decrease of $15.3 million in contributions to equity investments, and (iii) an $8.3 million increase in distributions from equity investments in excess of cumulative earnings. These amounts were offset partially by a decrease of $26.9 million in net cash provided by operating activities.

See Capital Expenditures and Historical Cash Flow within this Item 2 for further information.

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Reconciliation of non-GAAP financial measures. Adjusted gross margin, Adjusted EBITDA, and Free cash flow are not defined in GAAP. The GAAP measure used by us that is most directly comparable to Adjusted gross margin is gross margin. Net income (loss) and net cash provided by operating activities are the GAAP measures used by us that are most directly comparable to Adjusted EBITDA. The GAAP measure used by us that is most directly comparable to Free cash flow is net cash provided by operating activities. Our non-GAAP financial measures of Adjusted gross margin, Adjusted EBITDA, and Free cash flow should not be considered as alternatives to the GAAP measures of gross margin, net income (loss), net cash provided by operating activities, or any other measure of financial performance presented in accordance with GAAP. Adjusted gross margin, Adjusted EBITDA, and Free cash flow have important limitations as analytical tools because they exclude some, but not all, items that affect gross margin, net income (loss), and net cash provided by operating activities. Adjusted gross margin, Adjusted EBITDA, and Free cash flow should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Our definitions of Adjusted gross margin, Adjusted EBITDA, and Free cash flow may not be comparable to similarly titled measures of other companies in our industry, thereby diminishing their utility as comparative measures.

Management compensates for the limitations of Adjusted gross margin, Adjusted EBITDA, and Free cash flow as analytical tools by reviewing the comparable GAAP measures, understanding the differences between Adjusted gross margin, Adjusted EBITDA, and Free cash flow compared to (as applicable) gross margin, net income (loss), and net cash provided by operating activities, and incorporating this knowledge into its decision-making processes. We believe that investors benefit from having access to the same financial measures that our management considers in evaluating our operating results.

The following tables present (i) a reconciliation of the GAAP financial measure of gross margin to the non-GAAP financial measure of Adjusted gross margin, (ii) a reconciliation of the GAAP financial measures of net income (loss) and net cash provided by operating activities to the non-GAAP financial measure of Adjusted EBITDA, and (iii) a reconciliation of the GAAP financial measure of net cash provided by operating activities to the non-GAAP financial measure of Free cash flow:

	Three Months Ended				Nine Months Ended
thousands	September 30, 2021		June 30, 2021		September 30, 2021		September 30, 2020
Reconciliation of Gross margin to Adjusted gross margin
Total revenues and other	$	763,840	$	719,131	$	2,157,945	$	2,125,112
Less:
Cost of product	83,232		78,044		250,245		153,611
Depreciation and amortization	139,002		137,849		407,404		384,688
Gross margin	541,606		503,238		1,500,296		1,586,813
Add:
Distributions from equity investments	62,711		70,947		194,847		209,566
Depreciation and amortization	139,002		137,849		407,404		384,688
Less:
Reimbursed electricity-related charges recorded as revenues	19,725		17,585		54,622		61,100
Adjusted gross margin attributable to noncontrolling interests (1)	18,187		17,213		50,658		50,166
Adjusted gross margin	$	705,407	$	677,236	$	1,997,267	$	2,069,801
Adjusted gross margin for natural-gas assets	$	492,708	$	469,409	$	1,394,506	$	1,384,632
Adjusted gross margin for crude-oil and NGLs assets	148,939		150,317		432,401		494,481
Adjusted gross margin for produced-water assets	63,760		57,510		170,360		190,688

_________________________________________________________________________________________

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

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	Three Months Ended				Nine Months Ended
thousands	September 30, 2021		June 30, 2021		September 30, 2021		September 30, 2020
Reconciliation of Net income (loss) to Adjusted EBITDA
Net income (loss)	$	263,638	$	238,277	$	693,150	$	246,076
Add:
Distributions from equity investments	62,711		70,947		194,847		209,566
Non-cash equity-based compensation expense	6,979		7,121		20,834		16,527
Interest expense	93,257		95,290		287,040		278,811
Income tax expense	1,826		1,465		4,403		8,072
Depreciation and amortization	139,002		137,849		407,404		384,688
Impairments (1)	1,594		12,738		29,198		641,592
Other expense	4		30		1,252		1,953
Less:
Gain (loss) on divestiture and other, net	(364)		1,225		278		(3,651)
Gain (loss) on early extinguishment of debt	(24,655)		—		(24,944)		10,372
Equity income, net – related parties	48,506		58,666		159,337		176,788
Interest income – Anadarko note receivable	—		—		—		11,736
Other income	109		84		193		2,373
Income tax benefit	—		—		—		4,280
Adjusted EBITDA attributable to noncontrolling interests (2)	13,835		12,616		37,448		39,001
Adjusted EBITDA	$	531,580	$	491,126	$	1,465,816	$	1,546,386
Reconciliation of Net cash provided by operating activities to Adjusted EBITDA
Net cash provided by operating activities	$	391,333	$	452,111	$	1,104,994	$	1,131,893
Interest (income) expense, net	93,257		95,290		287,040		267,075
Accretion and amortization of long-term obligations, net	(1,871)		(1,914)		(5,873)		(6,482)
Current income tax expense (benefit)	824		749		2,128		1,399
Other (income) expense, net	(110)		(84)		1,013		(612)
Cash paid to settle interest-rate swaps	—		—		—		19,181
Distributions from equity investments in excess of cumulative earnings – related parties	8,702		9,232		30,075		21,750
Changes in assets and liabilities:
Accounts receivable, net	61,609		38,982		130,773		192,338
Accounts and imbalance payables and accrued liabilities, net	(17,204)		(55,758)		(56,495)		(37,814)
Other items, net	8,875		(34,866)		9,609		(3,341)
Adjusted EBITDA attributable to noncontrolling interests (2)	(13,835)		(12,616)		(37,448)		(39,001)
Adjusted EBITDA	$	531,580	$	491,126	$	1,465,816	$	1,546,386
Cash flow information
Net cash provided by operating activities	$	391,333	$	452,111	$	1,104,994	$	1,131,893
Net cash used in investing activities	(80,883)		(59,932)		(187,287)		(426,670)
Net cash provided by (used in) financing activities	(516,161)		(142,982)		(1,262,767)		(667,140)

_________________________________________________________________________________________

(1)Includes goodwill impairment for the nine months ended September 30, 2020. See Note 9—Goodwill in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

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

57

	Three Months Ended				Nine Months Ended
thousands	September 30, 2021		June 30, 2021		September 30, 2021		September 30, 2020
Reconciliation of Net cash provided by operating activities to Free cash flow
Net cash provided by operating activities	$	391,333	$	452,111	$	1,104,994	$	1,131,893
Less:
Capital expenditures	79,829		78,145		217,757		372,262
Contributions to equity investments – related parties	175		3,422		3,683		19,017
Add:
Distributions from equity investments in excess of cumulative earnings – related parties	8,702		9,232		30,075		21,750
Free cash flow	$	320,031	$	379,776	$	913,629	$	762,364
Cash flow information
Net cash provided by operating activities	$	391,333	$	452,111	$	1,104,994	$	1,131,893
Net cash used in investing activities	(80,883)		(59,932)		(187,287)		(426,670)
Net cash provided by (used in) financing activities	(516,161)		(142,982)		(1,262,767)		(667,140)

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LIQUIDITY AND CAPITAL RESOURCES

Our primary cash uses include quarterly distributions, debt service, customary operating expenses, and capital expenditures. Our sources of liquidity as of September 30, 2021, included cash and cash equivalents, cash flows generated from operations, available borrowing capacity under the RCF, and potential issuances of additional equity or debt securities. We believe that cash flows generated from these sources will be sufficient to satisfy our short-term working capital requirements and long-term capital-expenditure and debt service requirements. The amount of future distributions to unitholders will depend on our results of operations, financial condition, capital requirements, and other factors, and will be determined by the Board of Directors on a quarterly basis. We may rely on external financing sources, including equity and debt issuances, to fund capital expenditures and future acquisitions. However, we also may use operating cash flows to fund capital expenditures or acquisitions, which could result in borrowings under the RCF to pay distributions or to fund other short-term working capital requirements.

Under our partnership agreement, we distribute all of our available cash (beyond proper reserves as defined in our partnership agreement) within 55 days following each quarter’s end. Our cash flow and resulting ability to make cash distributions are dependent on our ability to generate cash flow from operations. Generally, our available cash is our cash on hand at the end of a quarter after the payment of our expenses and the establishment of cash reserves and cash on hand resulting from working capital borrowings made after the end of the quarter. The general partner establishes cash reserves to provide for the proper conduct of our business, including (i) reserves to fund future capital expenditures, (ii) to comply with applicable laws, debt instruments, or other agreements, or (iii) to provide funds for unitholder distributions for any one or more of the next four quarters. We have made cash distributions to our unitholders each quarter since our initial public offering in 2012. The Board of Directors declared a cash distribution to unitholders for the third quarter of 2021 of $0.32300 per unit, or $134.9 million in the aggregate. The cash distribution is payable on November 12, 2021, to our unitholders of record at the close of business on November 1, 2021.

In November 2020, we announced a buyback program of up to $250.0 million of our common units through December 31, 2021. The common units may be purchased from time to time in the open market at prevailing market prices or in privately negotiated transactions. The timing and amount of purchases under the program will be determined based on ongoing assessments of capital needs, our financial performance, the market price of the common units, and other factors, including organic growth and acquisition opportunities and general market conditions. The program does not obligate us to purchase any specific dollar amount or number of units and may be suspended or discontinued at any time. During the nine months ended September 30, 2021, we repurchased 5,586,419 common units on the open market for an aggregate purchase price of $104.4 million. We canceled the units immediately upon receipt. As of September 30, 2021, we had an authorized amount of $113.1 million remaining under the Purchase Program.

Management continuously monitors our leverage position and coordinates our capital expenditures and quarterly distributions with expected cash inflows and projected debt service requirements. We will continue to evaluate funding alternatives, including additional borrowings and the issuance of debt or equity securities, to secure funds as needed or to refinance maturing debt balances with longer-term debt issuances. Our ability to generate cash flows is subject to a number of factors, some of which are beyond our control. Read Risk Factors under Part II, Item 1A of this Form 10-Q.

Working capital. Working capital is an indication of liquidity and potential needs for short-term funding. Working capital requirements are driven by changes in accounts receivable and accounts payable and other factors such as credit extended to, and the timing of collections from, our customers, and the level and timing of our spending for acquisitions, maintenance, and other capital activities. As of September 30, 2021, we had a $550.6 million working capital deficit, which we define as the amount by which current liabilities exceed current assets. Our working capital deficit was primarily due to (i) the 4.000% Senior Notes due 2022 of $502.1 million and (ii) $220.0 million of outstanding borrowings under the RCF being classified as short-term debt on the consolidated balance sheet as of September 30, 2021. As of September 30, 2021, there was $1.8 billion available for borrowing under the RCF. See Note 10—Selected Components of Working Capital and Note 11—Debt and Interest Expense in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

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Capital expenditures. Our business is capital intensive, requiring significant investment to maintain and improve existing facilities or to develop new midstream infrastructure. Capital expenditures includes maintenance capital expenditures, which include those expenditures required to maintain existing operating capacity and service capability of our assets, such as to replace system components and equipment that have been subject to significant use over time, become obsolete, or reached the end of their useful lives, to remain in compliance with regulatory or legal requirements, or to complete additional well connections to maintain existing system throughput and related cash flows; and expansion capital expenditures, which include expenditures to construct new midstream infrastructure and expenditures incurred to extend the useful lives of our assets, reduce costs, increase revenues, or increase system throughput or capacity from current levels, including well connections that increase existing system throughput.

Capital expenditures in the consolidated statements of cash flows reflect capital expenditures on a cash basis, when payments are made. Capital incurred is presented on an accrual basis. Capital expenditures as presented in the consolidated statements of cash flows and capital incurred were as follows:

	Nine Months Ended  September 30,
thousands	2021		2020
Capital expenditures (1)	$	217,757	$	372,262
Capital incurred (1)	224,080		251,315

_________________________________________________________________________________________

(1)For the nine months ended September 30, 2021 and 2020, included $2.6 million and $6.1 million, respectively, of capitalized interest.

Capital expenditures decreased by $154.5 million for the nine months ended September 30, 2021, primarily due to decreases of (i) $66.8 million at the West Texas complex primarily attributable to decreases in facility expansion and pipeline projects, (ii) $41.0 million at the DJ Basin complex primarily related to the completion of Latham Train II that commenced operations in the first quarter of 2020, and decreases in pipeline, well connection, and compression projects, (iii) $19.5 million at the DBM oil system primarily related to the completion of the Loving ROTF Trains III and IV that commenced operations during the first and third quarters of 2020, respectively, and decreases in pipeline and well connection projects, and (iv) $11.0 million at the DBM water systems primarily due to reduced construction of additional water-disposal facilities and gathering projects.

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Historical cash flow. The following table and discussion present a summary of our net cash flows provided by (used in) operating, investing, and financing activities:

	Nine Months Ended  September 30,
thousands	2021		2020
Net cash provided by (used in):
Operating activities	$	1,104,994	$	1,131,893
Investing activities	(187,287)		(426,670)
Financing activities	(1,262,767)		(667,140)
Net increase (decrease) in cash and cash equivalents	$	(345,060)	$	38,083

Operating activities. Net cash provided by operating activities decreased for the nine months ended September 30, 2021, primarily due to (i) lower cash operating income, (ii) lower distributions from equity investments, (iii) lower interest income, and (iv) higher interest expense. These decreases were offset partially by (i) the impact of changes in assets and liabilities and (ii) cash paid during the nine months ended September 30, 2020, to settle interest-rate swaps. Refer to Operating Results within this Item 2 for a discussion of our results of operations as compared to the prior period.

Investing activities. Net cash used in investing activities for the nine months ended September 30, 2021, included the following:

•$217.8 million of capital expenditures, primarily related to construction, expansion, and asset-integrity projects at the West Texas complex, DBM water systems, DJ Basin complex, and DBM oil system;

•$3.7 million of capital contributions primarily paid to Cactus II;

•$2.0 million of purchases from related parties;

•$30.1 million of distributions received from equity investments in excess of cumulative earnings; and

•$8.0 million related to the sale of the Bison treating facility.

Net cash used in investing activities for the nine months ended September 30, 2020, included the following:

•$372.3 million of capital expenditures, primarily related to construction and expansion at the West Texas and DJ Basin complexes, DBM water systems, and DBM oil system;

•$57.1 million of increases to materials and supplies inventory;

•$19.0 million of capital contributions primarily paid to Cactus II and FRP for construction activities; and

•$21.8 million of distributions received from equity investments in excess of cumulative earnings.

Financing activities. Net cash used in financing activities for the nine months ended September 30, 2021, included the following:

•$521.9 million to purchase and retire portions of certain of WES Operating’s senior notes via a tender offer;

•$431.1 million to redeem the total principal amount outstanding of WES Operating’s 5.375% Senior Notes due 2021;

•$398.9 million of distributions paid to WES unitholders;

•$180.0 million of repayments of outstanding borrowings under the RCF;

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•$104.4 million of unit repurchases;

•$11.8 million of decreases in outstanding checks due mostly to ad valorem tax payments made at the end of 2020;

•$9.9 million of distributions paid to the noncontrolling interest owner of WES Operating;

•$5.3 million of finance lease payments;

•$2.7 million of distributions paid to the noncontrolling interest owner of Chipeta;

•$400.0 million of borrowings under the RCF, which were used for general partnership purposes and to purchase and retire portions of certain of WES Operating’s senior notes via a tender offer; and

•$6.7 million of contributions from related parties.

Net cash used in financing activities for the nine months ended September 30, 2020, included the following:

•$3.0 billion of repayments of outstanding borrowings under the Term loan facility;

•$600.0 million of repayments of outstanding borrowings under the RCF;

•$563.6 million of distributions paid to WES unitholders;

•$180.4 million to purchase and retire portions of WES Operating’s 5.375% Senior Notes due 2021, 4.000% Senior Notes due 2022, and Floating-Rate Senior Notes via open-market repurchases;

•$12.2 million of finance lease payments;

•$11.5 million of distributions paid to the noncontrolling interest owner of WES Operating;

•$3.9 million of distributions paid to the noncontrolling interest owner of Chipeta;

•$3.5 billion of net proceeds from the Fixed-Rate Senior Notes and Floating-Rate Senior Notes issued in January 2020, which were used to repay the $3.0 billion outstanding borrowings under the Term loan facility, repay outstanding amounts under the RCF, and for general partnership purposes;

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

•$20.0 million of a one-time cash contribution from Occidental received in January 2020, pursuant to the Services Agreement, for anticipated transition costs required to establish stand-alone human resources and information technology functions.

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Debt and credit facilities. As of September 30, 2021, the carrying value of outstanding debt was $7.1 billion. See Note 11—Debt and Interest Expense in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

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 and the Floating-Rate Senior Notes due 2023. 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 4.542%, 5.424%, and 6.629%, respectively, at September 30, 2021. The interest rate on the Floating-Rate Senior Notes was 2.23% at September 30, 2021. The effective interest rate of these notes is subject to adjustment from time to time due to a change in credit rating. In August 2021, Standard and Poor’s (“S&P”) upgraded WES Operating’s long-term debt from “BB” to “BB+.” As a result of the S&P upgrade, annualized borrowing costs will decrease by $7.9 million.

During the third quarter of 2021, WES Operating purchased and retired $500.0 million of certain of its senior notes via a tender offer. For the three months ended September 30, 2021, losses of $24.7 million were recognized for the early retirement of these notes. 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 September 30, 2021, the 4.000% Senior Notes due 2022 were classified as short-term debt on the consolidated balance sheet. At September 30, 2021, WES Operating was in compliance with all covenants under the relevant governing indentures.

We may, from time to time, seek to retire, rearrange, or amend some or all of our outstanding debt or debt agreements through cash purchases, exchanges, open-market repurchases, privately negotiated transactions, tender offers, or otherwise. Such transactions, if any, will depend on prevailing market conditions, our liquidity position and requirements, contractual restrictions, and other factors. The amounts involved may be material.

Revolving credit facility. WES Operating’s $2.0 billion senior unsecured revolving credit facility is expandable to a maximum of $2.5 billion, and matures in February 2025 for each extending lender. The non-extending lender’s commitments mature in February 2024 and represent $100.0 million out of $2.0 billion of total commitments from all lenders.

As of September 30, 2021, there were $220.0 million of outstanding borrowings and $5.1 million of outstanding letters of credit, resulting in $1.8 billion of available borrowing capacity under the RCF. At September 30, 2021, the interest rate on any outstanding RCF borrowings was 1.58% and the facility-fee rate was 0.25%.

The RCF contains certain covenants that limit, among other things, WES Operating’s ability, and that of certain of its subsidiaries, to incur additional indebtedness, grant certain liens, merge, consolidate, or allow any material change in the character of its business, enter into certain related-party transactions and use proceeds other than for partnership purposes. The RCF also contains various customary covenants, certain events of default, and a maximum consolidated leverage ratio as of the end of each fiscal quarter (which is defined as the ratio of consolidated indebtedness as of the last day of a fiscal quarter to Consolidated EBITDA for the most-recent four-consecutive fiscal quarters ending on such day) of 5.0 to 1.0, or a consolidated leverage ratio of 5.5 to 1.0 with respect to quarters ending in the 270-day period immediately following certain acquisitions. As a result of certain covenants contained in the RCF, our capacity to borrow under the RCF may be limited. At September 30, 2021, WES Operating was in compliance with all covenants under the RCF. Any outstanding RCF borrowings are classified as short-term debt on the consolidated balance sheet due to management’s intent to repay within the next twelve months.

Finance lease liabilities. During the first quarter of 2020, WES entered into finance leases with third parties for equipment and vehicles extending through 2029. Certain equipment leases were amended during the third quarter of 2021 requiring reassessment of lease classification. As a result, these leases are now classified as operating leases resulting in a reduction of $19.6 million in Net property, plant, and equipment and $20.3 million in Short-term and Long-term debt. The operating leases resulted in additions of $4.8 million in Other assets, $3.1 million in Accrued liabilities, and $2.4 million in Other liabilities, on the consolidated balance sheet. As of September 30, 2021, we have future lease payments of $1.3 million for the remainder of 2021 and a total of $5.4 million in years thereafter.

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Credit risk. We bear credit risk through exposure to non-payment or non-performance by our counterparties, including Occidental, financial institutions, customers, and other parties. Generally, non-payment or non-performance results from a customer’s inability to satisfy payables to us for services rendered, minimum-volume-commitment deficiency payments owed, or volumes owed pursuant to gas-imbalance agreements. We examine and monitor the creditworthiness of customers and may establish credit limits for customers. A substantial portion of our throughput is sourced from producers, including Occidental, that recently received credit-rating downgrades. We are subject to the risk of non-payment or late payment by producers for gathering, processing, transportation, and disposal fees. Additionally, we continue to evaluate counterparty credit risk and, in certain circumstances, are exercising our rights to request adequate assurance.

We expect our exposure to the concentrated risk of non-payment or non-performance to continue for as long as our commercial relationships with Occidental generate a significant portion of our revenues. While Occidental is our contracting counterparty, gathering and processing arrangements with affiliates of Occidental on most of our systems include not just Occidental-produced volumes, but also, in some instances, the volumes of other working-interest owners of Occidental who rely on our facilities and infrastructure to bring their volumes to market. We also are party to agreements with Occidental under which Occidental is required to indemnify us for certain environmental claims, losses arising from rights-of-way claims, failures to obtain required consents or governmental permits, and income taxes with respect to the assets previously acquired from Anadarko. See Note 6—Related-Party Transactions in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

Our ability to make cash distributions to our unitholders may be adversely impacted if Occidental becomes unable to perform under the terms of gathering, processing, transportation, and disposal agreements; the contribution agreements; or the Services Agreement.

ITEMS AFFECTING THE COMPARABILITY OF FINANCIAL RESULTS WITH WES OPERATING

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

Reconciliation of net income (loss). The differences between net income (loss) attributable to WES and WES Operating are reconciled as follows:

	Three Months Ended				Nine Months Ended
thousands	September 30, 2021		June 30, 2021		September 30, 2021		September 30, 2020
Net income (loss) attributable to WES	$	255,725	$	231,259	$	672,775	$	263,121
Limited partner interests in WES Operating not held by WES (1)	5,214		4,754		13,779		5,426
General and administrative expenses (2)	(280)		1,600		2,206		2,683
Other income (expense), net	(4)		(2)		(9)		(6)
Income taxes	3		—		3		—
Net income (loss) attributable to WES Operating	$	260,658	$	237,611	$	688,754	$	271,224

_________________________________________________________________________________________

(1)Represents the portion of net income (loss) allocated to the limited partner interests in WES Operating not held by WES. A subsidiary of Occidental held a 2.0% limited partner interest in WES Operating for all periods presented.

(2)Represents general and administrative expenses incurred by WES separate from, and in addition to, those incurred by WES Operating.

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Reconciliation of net cash provided by (used in) operating and financing activities. The differences between net cash provided by (used in) operating and financing activities for WES and WES Operating are reconciled as follows:

	Nine Months Ended  September 30,
thousands	2021		2020
WES net cash provided by operating activities	$	1,104,994	$	1,131,893
General and administrative expenses (1)	2,206		2,683
Non-cash equity-based compensation expense	7,040		(5,372)
Changes in working capital	(10,045)		4,774
Other income (expense), net	(9)		(6)
Income taxes	3		—
WES Operating net cash provided by operating activities	$	1,104,189	$	1,133,972
WES net cash provided by (used in) financing activities	$	(1,262,767)	$	(667,140)
Distributions to WES unitholders (2)	398,896		563,579
Distributions to WES from WES Operating (3)	(486,621)		(565,577)
Increase (decrease) in outstanding checks	58		316
Unit repurchases	104,366		—
Other	3,492		—
WES Operating net cash provided by (used in) financing activities	$	(1,242,576)	$	(668,822)

_________________________________________________________________________________________

(1)Represents general and administrative expenses incurred by WES separate from, and in addition to, those incurred by WES Operating.

(2)Represents distributions to WES common unitholders paid under WES’s partnership agreement. See Note 4—Partnership Distributions and Note 5—Equity and Partners’ Capital in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

(3)Difference attributable to elimination in consolidation of WES Operating’s distributions on partnership interests owned by WES. See Note 4—Partnership Distributions and Note 5—Equity and Partners’ Capital in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

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

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

CRITICAL ACCOUNTING ESTIMATES

The preparation of consolidated financial statements in accordance with GAAP requires management to make informed judgments and estimates that affect the amounts of assets and liabilities as of the date of the financial statements and the amounts of revenues and expenses recognized during the periods reported. There have been no significant changes to our critical accounting estimates from those disclosed in our annual report on Form 10-K for the fiscal year ended December 31, 2020.

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Item 3.  Quantitative and Qualitative Disclosures About Market Risk

Commodity-price risk. Certain of our processing services are provided under percent-of-proceeds and keep-whole agreements. Under percent-of-proceeds agreements, we receive a specified percentage of the net proceeds from the sale of residue and/or NGLs. Under keep-whole agreements, we keep 100% of the NGLs produced, and the processed natural gas, or value of the natural gas, is returned to the producer, and because some of the gas is used and removed during processing, we compensate the producer for the amount of gas used and removed in processing by supplying additional gas or by paying an agreed-upon value for the gas used.

For the nine months ended September 30, 2021, 92% of our wellhead natural-gas volume (excluding equity investments) and 100% of our crude-oil and produced-water throughput (excluding equity investments) were serviced under fee-based contracts. A 10% increase or decrease in commodity prices would not have a material impact on our operating income (loss), financial condition, or cash flows for the next twelve months, excluding the effect of the below-described imbalances.

We bear a limited degree of commodity-price risk with respect to settlement of natural-gas imbalances that arise from differences in gas volumes received into our systems and gas volumes delivered by us to customers, and for instances where actual liquids recovery or fuel usage varies from contractually stipulated amounts. Natural-gas volumes owed to or by us that are subject to monthly cash settlement are valued according to the terms of the contract as of the balance sheet dates and generally reflect market-index prices. Other natural-gas volumes owed to or by us are valued at our weighted-average cost of natural gas as of the balance sheet dates and are settled in-kind. Our exposure to the impact of changes in commodity prices on outstanding imbalances depends on the settlement timing of the imbalances. See Outlook under Part I, Item 2 and Risk Factors under Part II, Item 1A of this Form 10-Q.

Interest-rate risk. The Federal Open Market Committee decreased its target range for the federal funds rate twice in 2020 and as of September 30, 2021, there have been no changes to the target range in 2021. Any future increases in the federal funds rate likely will result in an increase in short-term financing costs. As of September 30, 2021, we had (i) $220.0 million outstanding borrowings under the RCF that bear interest at a rate based on LIBOR or an alternative base rate at WES Operating’s option, and (ii) the Floating-Rate Senior Notes that bear interest at a rate based on LIBOR. While a 10% change in the applicable benchmark interest rate would not materially impact interest expense on our outstanding borrowings, it would impact the fair value of the senior notes at September 30, 2021.

Additional variable-rate debt may be issued in the future, either under the RCF or other financing sources, including commercial bank borrowings or debt issuances.

Item 4.  Controls and Procedures

Evaluation of Disclosure Controls and Procedures. The Chief Executive Officer and Chief Financial Officer of WES’s general partner and WES Operating GP (for purposes of this Item 4, “Management”) performed an evaluation of WES’s and WES Operating’s disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. WES’s and WES Operating’s disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports that are filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC, and to ensure that the information required to be disclosed in the reports that are filed or submitted under the Exchange Act is accumulated and communicated to management, including the principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Based on this evaluation, Management concluded that WES’s and WES Operating’s disclosure controls and procedures were effective as of September 30, 2021.

Changes in Internal Control Over Financial Reporting. There were no changes in WES’s or WES Operating’s internal control over financial reporting during the quarter ended September 30, 2021, that have materially affected, or are reasonably likely to materially affect, WES’s or WES Operating’s internal control over financial reporting.

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PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings

On July 1, 2020, the U.S. Department of Justice, on behalf of the U.S. Environmental Protection Agency (the “EPA”), and the State of Colorado commenced an enforcement action in the United States District Court for the District of Colorado against Kerr-McGee Gathering LLC (“KMG”), a wholly owned subsidiary of WES, for alleged non-compliance with the leak detection and repair requirements of the federal Clean Air Act (“LDAR requirements”) at its Fort Lupton facility in the DJ Basin complex. KMG previously had been in negotiations with the EPA and the State of Colorado to resolve the alleged non-compliance at the Fort Lupton facility. Per the complaint, plaintiffs pray for injunctive relief, remedial action, and civil penalties. Management cannot reasonably estimate the outcome of this action at this time.

On August 12, 2019, Sanchez Energy Corporation and certain of its affiliated companies (collectively, “Sanchez”) filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas. While Sanchez holds a working interest in the acreage dedicated to our Springfield system, Sanchez also was the upstream operator for substantially all of the natural gas, crude oil, and NGLs that the Springfield system gathers and that WES processes in the Eagle Ford Shale Play. On April 29, 2020, we received notice that Sanchez filed a motion to reject a number of midstream and downstream agreements with commercial counterparties, including Sanchez’s Springfield gathering agreements and agreements obligating Sanchez to deliver the gas volumes gathered by the Springfield system to our Brasada processing plant. We objected to Sanchez’s rejection and instituted an adversary proceeding regarding such rejection. On May 6, 2021, the Bankruptcy Court issued an opinion determining, among other things, that Sanchez’s Springfield gathering agreements were rejected, but that such agreements contain covenants running with the land that survive rejection, thus preserving the acreage dedication to our Springfield system. We intend to continue defending our contractual rights in the bankruptcy proceeding and any other appropriate venue.

On May 15, 2020, Gavilan Resources LLC (“Gavilan”), an entity that owns a 25% working interest in the acreage where the Springfield gathering system and Brasada processing plant are located, also filed for Chapter 11 bankruptcy protection. As a part of this bankruptcy, Mesquite Energy, Inc. (the successor to Sanchez) (“Mesquite”) purchased Gavilan’s assets at auction. Gavilan did not assume and assign its agreements with Springfield as part of its asset sale. Instead, the assets sold to Mesquite remain subject to any covenants, servitudes, or similar agreements that could be equitable servitudes or covenants running with the land, pending a further order of the bankruptcy court.

The parties to the Sanchez and Gavilan proceedings discussed above are currently working toward a comprehensive legal and commercial settlement of the matters in dispute. Nevertheless, we cannot make any assurances regarding the ultimate outcome of these negotiations or the Sanchez and Gavilan proceedings themselves, and any resulting impact on WES due to the uncertainties associated with the ongoing process.

On October 29, 2020, WGR Operating, LP (“WGR”), on behalf of itself and derivatively on behalf of Mont Belvieu JV, filed suit against Enterprise Products Operating, LLC (“Enterprise”) and Mont Belvieu JV (as a nominal defendant) in the District Court of Harris County, Texas. Our lawsuit seeks a declaratory judgment regarding proper revenue allocation as set forth in the Operating Agreement between Mont Belvieu JV (of which WGR is a 25% owner) and Enterprise (the “Operating Agreement”) related to fractionation trains at the Mont Belvieu complex in Chambers County, Texas. Specifically, the Operating Agreement sets forth a revenue allocation structure, whereby revenue would be allocated to the various fracs at the Mont Belvieu complex in sequential order, with Fracs VII and VIII (which are owned by Mont Belvieu JV) following Fracs I through VI, but preceding any “Later Frac Facilities.” Subsequent to the construction of Fracs VII and VIII, Enterprise built Fracs IX, X, and XI, which it wholly owns, and has signaled its intention to treat such subsequent fracs as outside the Mont Belvieu revenue allocation. We do not believe Enterprise’s attempt to bypass the agreed-to revenue allocation is proper under the parties’ agreements and now seek judicial determination. We currently sue only for declaratory judgment to avoid potential future damages. We cannot make any assurances regarding the ultimate outcome of this proceeding and its resulting impact on WGR or WES.

Except as discussed above, we are not a party to any legal, regulatory, or administrative proceedings other than proceedings arising in the ordinary course of business. Management believes that there are no such proceedings for which a final disposition could have a material adverse effect on results of operations, cash flows, or financial condition, or for which disclosure is otherwise required by Item 103 of Regulation S-K.

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Item 1A.  Risk Factors

Security holders and potential investors in our securities should carefully consider the risk factors included below and those set forth under Part I, Item 1A in our Form 10-K for the year ended December 31, 2020, together with all of the other information included in this document, and in our other public filings, press releases, and public discussions with management. Additionally, for a full discussion of the risks associated with Occidental’s business, see Item 1A under Part I in Occidental’s Form 10-K for the year ended December 31, 2020, Occidental’s quarterly reports on Form 10-Q and Occidental’s other public filings, press releases, and public discussions with Occidental management. We have identified the below risk factors as important factors that could cause our actual results to differ materially from those contained in any written or oral forward-looking statements made by us or on our behalf.

Because we are dependent on Occidental as our largest customer and the owner of our general partner, any development that materially and adversely affects Occidental’s operations, financial condition, or market reputation could have a material and adverse impact on us. Material adverse changes at Occidental could restrict our access to capital, make it more expensive to access the capital markets, or increase the costs of our borrowings.

We are dependent on Occidental as our largest customer and the owner of our general partner, and we expect to derive significant revenue from Occidental for the foreseeable future. As a result, any event, whether in our area of operations or otherwise, that adversely affects Occidental’s production, financial condition, leverage, market reputation, liquidity, results of operations, or cash flows may adversely affect our revenues and cash available for distribution. Accordingly, we are indirectly subject to the business risks of Occidental, including, but not limited to, the volatility of oil and natural-gas prices, the availability of capital on favorable terms to fund Occidental’s exploration and development activities, the political and economic uncertainties associated with Occidental’s foreign operations, transportation-capacity constraints, and shareholder activism.

Further, we are subject to the risk of non-payment or non-performance by Occidental, including with respect to our gathering and transportation agreements. For example, we are currently involved in a dispute with Occidental regarding the calculation of the cost-of-service rate under a gathering contract related to our DJ Basin oil system. If such dispute is resolved in a manner adverse to us, such resolution could have a negative impact on our financial condition and results of operations, including a reduction in rates and a non-cash charge to earnings. In addition, we cannot predict the extent to which Occidental’s business would be impacted if conditions in the energy industry were to deteriorate further, nor can we estimate the impact such conditions would have on Occidental’s ability to perform under our gathering and transportation agreements with Occidental. Accordingly, any material non-payment or non-performance by Occidental could reduce our ability to make distributions to our unitholders.

Any material limitations to our ability to access capital as a result of adverse changes at Occidental could limit our ability to obtain future financing on favorable terms, or at all, or could result in increased financing costs in the future. Similarly, material adverse changes at Occidental could adversely impact our unit price, thereby limiting our ability to raise capital through equity issuances or debt financing, or adversely affect our ability to engage in or expand or pursue our business activities, and also prevent us from engaging in certain transactions that might otherwise be considered beneficial to us.

See Occidental’s reports filed under the Securities and Exchange Act of 1934, as amended, with the SEC (which are not, and shall not be deemed to be, incorporated by reference herein), for a full discussion of the risks associated with Occidental’s business.

The tax treatment of publicly traded partnerships or an investment in our common units could be subject to potential legislative, judicial, or administrative changes and differing interpretations, possibly on a retroactive basis.

The current U.S. federal income tax treatment of publicly traded partnerships, including us, or an investment in our common units may be modified by administrative, legislative, or judicial interpretation at any time. From time to time, members of Congress propose and consider substantive changes to the existing U.S. federal income tax laws that would affect publicly traded partnerships. On April 21, 2021, Senator Wyden introduced the Clean Energy for America Act, which would eliminate the exception upon which we rely for our treatment as a publicly traded partnership for U.S. federal income tax purposes.

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Any modification to the U.S. federal income tax laws and interpretations thereof may or may not be retroactively applied and could make it more difficult or impossible to meet the exception for certain publicly traded partnerships to be treated as partnerships for U.S. federal income tax purposes or increase the amount of taxes payable by unitholders in publicly traded partnerships. You are urged to consult with your own tax advisor with respect to the status of regulatory or administrative developments and proposals and their potential effect on your investment in our common units.

Our profitability may be negatively impacted by inflation in the cost of labor, materials, and services.

Although inflation in the United States has been relatively low in recent years, the U.S. economy could experience a significant inflationary effect from, among other things, supply chain disruptions caused by, or governmental stimulus or fiscal policies adopted in response to, the COVID-19 crisis. While we cannot predict any future trends in the rate of inflation, the global COVID-19 pandemic has brought unprecedented uncertainty to the near-term economic outlook. A significant increase in inflation would raise our costs for labor, materials and services, and to the extent we are unable to recover higher costs through our commercial agreements, would negatively impact our profitability and cash flows available for distribution to unitholders.

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

The following table sets forth information with respect to repurchases made by WES of its common units in the open market under the Purchase Program during the third quarter of 2021:

Period	Total number of units purchased	Average price paid per unit		Total number of units purchased as part of publicly announced plans or programs (1)	Approximate dollar value of units that may yet be purchased under the plans or programs (1)
July 1-31, 2021	—	$	—	—	201,224,786
August 1-31, 2021	1,608,154	19.21		1,608,154	170,339,655
September 1-30, 2021	2,862,457	20.00		2,862,457	113,099,523
Total	4,470,611	19.71		4,470,611

______________________________________________________________________________________

(1)In November 2020, WES announced the Purchase Program, pursuant to which we may purchase up to $250.0 million in aggregate value of our common units through December 31, 2021. See Note 5—Equity and Partners’ Capital in the Notes to Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q for additional details.

69

Item 6.  Exhibits

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

Exhibit Index

Exhibit Number			Description
#	2.	1	Contribution Agreement and Agreement and Plan of Merger, dated as of November 7, 2018, by and among Anadarko Petroleum Corporation, Anadarko E&P Onshore LLC, APC Midstream Holdings, LLC, Western Gas Equity Partners, LP, Western Gas Equity Holdings, LLC, Western Gas Partners, LP, Western Gas Holdings, LLC, Clarity Merger Sub, LLC, WGR Asset Holding Company LLC, WGR Operating, LP, Kerr-McGee Gathering LLC, Kerr-McGee Worldwide Corporation and Delaware Basin Midstream, LLC (incorporated by reference to Exhibit 2.1 to Western Gas Equity Partners, LP’s Current Report on Form 8-K filed on November 8, 2018, File No. 001-35753).
	3.	1	Certificate of Limited Partnership of Western Gas Equity Partners, LP (incorporated by reference to Exhibit 3.1 to the Registration Statement on Form S-1 of Western Gas Equity Partners, LP filed on November 5, 2012, File No. 333-184763).
	3.	2	Certificate of Amendment to Certificate of Limited Partnership of Western Gas Equity Partners, LP, effective as of February 28, 2019 (incorporated by reference to Exhibit 3.1 to Western Midstream Partners, LP’s Current Report on Form 8-K filed on February 28, 2019, File No. 001-35753).
	3.	3	Second Amended and Restated Agreement of Limited Partnership of Western Midstream Partners, LP, dated as of December 31, 2019 (incorporated by reference to Exhibit 3.1 to Western Midstream Partners, LP’s Current Report on Form 8-K filed on January 6, 2020, File No. 001-35753).
	3.	4	Certificate of Formation of Western Gas Equity Holdings, LLC (incorporated by reference to Exhibit 3.3 to Western Gas Equity Partners, LP’s Registration Statement on Form S-1 filed on November 5, 2012, File No. 333-184763).
	3.	5	Certificate of Amendment to Certificate of Formation of Western Gas Equity Holdings, LLC, effective as of February 28, 2019 (incorporated by reference to Exhibit 3.2 to Western Midstream Partners, LP’s Current Report on Form 8-K filed on February 28, 2019, File No. 001-35753).
	3.	6	Second Amended and Restated Limited Liability Company Agreement of Western Midstream Holdings, LLC, dated as of February 28, 2019 (incorporated by reference to Exhibit 3.7 to Western Midstream Partners, LP’s Current Report on Form 8-K filed on February 28, 2019, File No. 001-35753).
	3.	7	Amendment No. 1 to Second Amended and Restated Limited Liability Company Agreement of Western Midstream Holdings, LLC, dated February 28, 2019 (incorporated by reference to Exhibit 3.1 to Western Midstream Partners, LP’s Current Report on Form 8-K filed on March 26, 2019, File No. 001-35753).
	3.	8	Certificate of Limited Partnership of Western Gas Partners, LP (incorporated by reference to Exhibit 3.1 to Western Gas Partners, LP’s Registration Statement on Form S-1 filed on October 15, 2007, File No. 333-146700).
	3.	9	Third Amended and Restated Agreement of Limited Partnership of Western Midstream Operating, LP, dated as of February 28, 2019 (incorporated by reference to Exhibit 3.5 to Western Midstream Partners, LP’s Current Report on Form 8-K filed on February 28, 2019, File No. 001-35753).
	3.	10	Certificate of Formation of Western Gas Holdings, LLC (incorporated by reference to Exhibit 3.3 to Western Gas Partners, LP’s Registration Statement on Form S-1 filed on October 15, 2007, File No. 333-146700).
	3.	11	Certificate of Amendment to Certificate of Formation of Western Gas Holdings, LLC, effective as of February 28, 2019 (incorporated by reference to Exhibit 3.4 to Western Midstream Partners, LP’s Current Report on Form 8-K filed on February 28, 2019, File No. 001-35753).
	3.	12	Third Amended and Restated Limited Liability Company Agreement of Western Midstream Operating GP, LLC, dated as of February 28, 2019 (incorporated by reference to Exhibit 3.8 to Western Midstream Partners, LP’s Current Report on Form 8-K filed on February 28, 2019, File No. 001-35753).
	3.	13	Certificate of Merger of Clarity Merger Sub, LLC with and into Western Gas Partners, LP, effective as of February 28, 2019 (incorporated by reference to Exhibit 3.3 to Western Midstream Partners, LP’s Current Report on Form 8-K filed on February 28, 2019, File No. 001-35753).

70

Exhibit Number			Description
	4.	1	Specimen Unit Certificate for the Common Units (incorporated by reference to Exhibit 4.1 to Western Gas Partners, LP’s Quarterly Report on Form 10-Q filed on June 13, 2008, File No. 001-34046).
	4.	2	Indenture, dated as of May 18, 2011, among Western Gas Partners, LP, as Issuer, the Subsidiary Guarantors named therein, as Guarantors, and Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 4.1 to Western Gas Partners, LP’s Current Report on Form 8-K filed on May 18, 2011, File No. 001-34046).
	4.	3	First Supplemental Indenture, dated as of May 18, 2011, among Western Gas Partners, LP, as Issuer, the Subsidiary Guarantors named therein, as Guarantors, and Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 4.2 to Western Gas Partners, LP’s Current Report on Form 8-K filed on May 18, 2011, File No. 001-34046).
	4.	4	Form of 5.375% Senior Notes due 2021 (incorporated by reference to Exhibit 4.3, which is included as Exhibit A to Exhibit 4.2, to Western Gas Partners, LP’s Current Report on Form 8-K filed on May 18, 2011, File No. 001-34046).
	4.	5	Fourth Supplemental Indenture, dated as of June 28, 2012, among Western Gas Partners, LP, as Issuer, and Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 4.1 to Western Gas Partners, LP’s Current Report on Form 8-K filed on June 28, 2012, File No. 001-34046).
	4.	6	Form of 4.000% Senior Notes due 2022 (incorporated by reference to Exhibit 4.2, which is included as Exhibit A to Exhibit 4.1, to Western Gas Partners, LP’s Current Report on Form 8-K filed on June 28, 2012, File No. 001-34046).
	4.	7	Sixth Supplemental Indenture, dated as of March 20, 2014, among Western Gas Partners, LP, as Issuer, and Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 4.2 to Western Gas Partners, LP’s Current Report on Form 8-K filed on March 20, 2014, File No. 001-34046).
	4.	8	Form of 5.450% Senior Notes due 2044 (incorporated by reference to Exhibit 4.4, which is included as Exhibit A to Exhibit 4.2, to Western Gas Partners, LP’s Current Report on Form 8-K filed on March 20, 2014, File No. 001-34046).
	4.	9	Seventh Supplemental Indenture, dated as of June 4, 2015, among Western Gas Partners, LP, as Issuer, and Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 4.1 to Western Gas Partners, LP’s Current Report on Form 8-K filed on June 4, 2015, File No. 001-34046).
	4.	10	Form of 3.950% Senior Notes due 2025 (incorporated by reference to Exhibit 4.2, which is included as Exhibit A to Exhibit 4.1, to Western Gas Partners, LP’s Current Report on Form 8-K filed on June 4, 2015, File No. 001-34046).
	4.	11	Eighth Supplemental Indenture, dated as of July 12, 2016, among Western Gas Partners, LP, as Issuer, and Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 4.1 to Western Gas Partners, LP’s Current Report on Form 8-K filed on July 12, 2016, File No. 001-34046).
	4.	12	Form of 4.650% Senior Notes due 2026 (incorporated by reference to Exhibit 4.2, which is included as Exhibit A to Exhibit 4.1, to Western Gas Partners, LP’s Current Report on Form 8-K filed on July 12, 2016, File No. 001-34046).
	4.	13	Ninth Supplemental Indenture, dated as of March 2, 2018, among Western Gas Partners, LP, as Issuer, and Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 4.1 to Western Gas Partners, LP’s Current Report on Form 8-K filed on March 2, 2018, File No. 001-34046).
	4.	14	Form of 4.500% Senior Notes due 2028 (incorporated by reference to Exhibit 4.2, which is included as Exhibit A-1 to Exhibit 4.1, to Western Gas Partners, LP’s Current Report on Form 8-K filed on March 2, 2018, File No. 001-34046).
	4.	15	Form of 5.300% Senior Notes due 2048 (incorporated by reference to Exhibit 4.3, which is included as Exhibit A-2 to Exhibit 4.1, to Western Gas Partners, LP’s Current Report on Form 8-K filed on March 2, 2018, File No. 001-34046).
	4.	16	Tenth Supplemental Indenture, dated as of August 9, 2018, by and between Western Gas Partners, LP, as Issuer, and Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 4.1 to Western Gas Partners, LP’s Current Report on Form 8-K filed on August 9, 2018, File No. 001-34046).
	4.	17	Form of 4.750% Senior Notes due 2028 (incorporated by reference to Exhibit 4.2, which is included as Exhibit A-1 to Exhibit 4.1, to Western Gas Partners, LP’s Current Report on Form 8-K filed on August 9, 2018, File No. 001-34046).
	4.	18	Form of 5.500% Senior Notes due 2048 (incorporated by reference to Exhibit 4.3, which is included as Exhibit A-2 to Exhibit 4.1, to Western Gas Partners, LP’s Current Report on Form 8-K filed on August 9, 2018, File No. 001-34046).

71

Exhibit Number			Description
	4.	19	Eleventh Supplemental Indenture, dated as of January 13, 2020, by and between Western Midstream Operating, LP, as Issuer, and Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 4.1 to Western Midstream Operating, LP’s Current Report on Form 8-K filed on January 13, 2020, File No. 001-34046).
	4.	20	Form of Floating Rate Senior Notes due 2023 (incorporated by reference to Exhibit 4.2, which is included as Exhibit A-1 to Exhibit 4.1 to Western Midstream Operating, LP’s Current Report on Form 8-K filed on January 13, 2020, File No. 001-34046).
	4.	21	Form of 3.100% Senior Notes due 2025 (incorporated by reference to Exhibit 4.3, which is included as Exhibit A-2 to Exhibit 4.1 to Western Midstream Operating, LP’s Current Report on Form 8-K filed on January 13, 2020, File No. 001-34046).
	4.	22	Form of 4.050% Senior Notes due 2030 (incorporated by reference to Exhibit 4.4, which is included as Exhibit A-3 to Exhibit 4.1 to Western Midstream Operating, LP’s Current Report on Form 8-K filed on January 13, 2020, File No. 001-34046).
	4.	23	Form of 5.250% Senior Notes due 2050 (incorporated by reference to Exhibit 4.5, which is included as Exhibit A-4 to Exhibit 4.1 to Western Midstream Operating, LP’s Current Report on Form 8-K filed on January 13, 2020, File No. 001-34046).
*	31.	1	Certification of Chief Executive Officer and Chief Financial Officer, pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Western Midstream Partners, LP.
*	31.	2	Certification of Chief Executive Officer and Chief Financial Officer, pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Western Midstream Operating, LP.
**	32.	1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - Western Midstream Partners, LP.
**	32.	2	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - Western Midstream Operating, LP.
*	101.	INS	XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
*	101.	SCH	Inline XBRL Schema Document
*	101.	CAL	Inline XBRL Calculation Linkbase Document
*	101.	DEF	Inline XBRL Definition Linkbase Document
*	101.	LAB	Inline XBRL Label Linkbase Document
*	101.	PRE	Inline XBRL Presentation Linkbase Document
*	104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

______________________________________________________________________________________

# Pursuant to Item 601(b)(2) of Regulation S-K, the registrant agrees to furnish supplementally a copy of any omitted schedule to the Securities and Exchange Commission upon request.

72

SIGNATURES

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

	WESTERN MIDSTREAM PARTNERS, LP
November 9, 2021
	/s/ Michael P. Ure
	Michael P. Ure President, Chief Executive Officer and Chief Financial Officer Western Midstream Holdings, LLC (as general partner of Western Midstream Partners, LP)
	WESTERN MIDSTREAM OPERATING, LP
November 9, 2021
	/s/ Michael P. Ure
	Michael P. Ure President, Chief Executive Officer and Chief Financial Officer Western Midstream Operating GP, LLC (as general partner of Western Midstream Operating, LP)

73

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND

CHIEF FINANCIAL OFFICER

PURSUANT TO RULE 13A-14(A) AND RULE 15D-14(A)

OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

I, Michael P. Ure, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Western Midstream Partners, LP (the “registrant”);

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusion about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 9, 2021

/s/ Michael P. Ure

Michael P. Ure

President, Chief Executive Officer and Chief Financial Officer

Western Midstream Holdings, LLC

(as general partner of Western Midstream Partners, LP)

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND

CHIEF FINANCIAL OFFICER

PURSUANT TO RULE 13A-14(A) AND RULE 15D-14(A)

OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

I, Michael P. Ure, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Western Midstream Operating, LP (the “registrant”);

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusion about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 9, 2021

/s/ Michael P. Ure

Michael P. Ure

President, Chief Executive Officer and Chief Financial Officer

Western Midstream Operating GP, LLC

(as general partner of Western Midstream Operating, LP)

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, I, Michael P. Ure, President, Chief Executive Officer and Chief Financial Officer of Western Midstream Holdings, LLC, the general partner of Western Midstream Partners, LP (the “Partnership”), certify to the best of my knowledge that:

(1)the Quarterly Report on Form 10-Q of the Partnership for the period ending September 30, 2021, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

November 9, 2021	/s/ Michael P. Ure
	Michael P. Ure President, Chief Executive Officer and Chief Financial Officer Western Midstream Holdings, LLC (as general partner of Western Midstream Partners, LP)

The foregoing certification is being furnished as an exhibit to the Report pursuant to Item 601(b)(32) of Regulation S-K and Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code) and, accordingly, is not being filed as part of the Report for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not incorporated by reference into any filing of the Partnership, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, I, Michael P. Ure, President, Chief Executive Officer and Chief Financial Officer of Western Midstream Operating GP, LLC, the general partner of Western Midstream Operating, LP (the “Partnership”), certify to the best of my knowledge that:

(1)the Quarterly Report on Form 10-Q of the Partnership for the period ending September 30, 2021, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

November 9, 2021	/s/ Michael P. Ure
	Michael P. Ure President, Chief Executive Officer and Chief Financial Officer Western Midstream Operating GP, LLC (as general partner of Western Midstream Operating, LP)

The foregoing certification is being furnished as an exhibit to the Report pursuant to Item 601(b)(32) of Regulation S-K and Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code) and, accordingly, is not being filed as part of the Report for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not incorporated by reference into any filing of the Partnership, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

XML

Cover Page - shares	9 Months Ended
	Sep. 30, 2021	Nov. 04, 2021
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2021
Document Transition Report	false
Entity Registrant Name	WESTERN MIDSTREAM PARTNERS, LP
Entity File Number	001-35753
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	46-0967367
Entity Address, Address Line One	9950 Woodloch Forest Drive, Suite 2800
Entity Address, City or Town	The Woodlands,
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77380
City Area Code	(346)
Local Phone Number	786-5000
Title of 12(b) Security	Common units
Trading Symbol	WES
Security Exchange Name	NYSE
Entity Common Units Outstanding		408,390,278
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Central Index Key	0001423902
Amendment Flag	false
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31
WES Operating [Member]
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2021
Document Transition Report	false
Entity Registrant Name	WESTERN MIDSTREAM OPERATING, LP
Entity File Number	001-34046
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	26-1075808
Entity Address, Address Line One	9950 Woodloch Forest Drive, Suite 2800
Entity Address, City or Town	The Woodlands,
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77380
City Area Code	(346)
Local Phone Number	786-5000
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Central Index Key	0001414475
Amendment Flag	false
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31

XML

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Revenues and other
Revenues and other	[1]	$ 763,840	$ 679,044	$ 2,157,945	$ 2,125,112
Equity income, net – related parties		48,506	61,026	159,337	176,788
Operating expenses
Cost of product		83,232	31,739	250,245	153,611
Operation and maintenance		140,838	132,293	434,198	436,670
General and administrative		50,409	41,578	139,973	118,466
Property and other taxes		13,641	19,392	45,992	57,263
Depreciation and amortization		139,002	132,564	407,404	384,688
Long-lived asset and other impairments		1,594	34,640	29,198	200,575
Goodwill impairment		0	0	0	441,017
Total operating expenses	[2]	428,716	392,206	1,307,010	1,792,290
Gain (loss) on divestiture and other, net		(364)	(768)	278	(3,651)
Operating income (loss)		383,266	347,096	1,010,550	505,959
Interest income – Anadarko note receivable		0	3,286	0	11,736
Interest expense		(93,257)	(95,571)	(287,040)	(278,811)
Gain (loss) on early extinguishment of debt		(24,655)	1,632	(24,944)	10,372
Other income (expense), net		110	720	(1,013)	612
Income (loss) before income taxes		265,464	257,163	697,553	249,868
Income tax expense (benefit)		1,826	3,028	4,403	3,792
Net income (loss)		263,638	254,135	693,150	246,076
Net income (loss) attributable to noncontrolling interests		7,913	7,524	20,375	(17,045)
Net income (loss) attributable to Western Midstream Partners, LP		255,725	246,611	672,775	263,121
Limited partners' interest in net income (loss):
Net income (loss) attributable to Western Midstream Partners, LP		255,725	246,611	672,775	263,121
General partner interest in net (income) loss		(5,527)	(5,132)	(14,484)	(5,462)
Limited partners' interest in net income (loss)	[3]	$ 250,198	$ 241,479	$ 658,291	$ 257,659
Net income (loss) per common unit - basic	[3]	$ 0.61	$ 0.55	$ 1.60	$ 0.58
Net income (loss) per common unit - diluted	[3]	$ 0.61	$ 0.55	$ 1.59	$ 0.58
Weighted-average common units outstanding - basic	[3]	411,909	438,857	412,690	442,255
Weighted-average common units outstanding - diluted	[3]	412,714	438,926	413,150	442,275
Service Revenues - Fee Based [Member]
Revenues and other
Revenues and other		$ 650,482	$ 636,522	$ 1,841,742	$ 1,980,546
Service Revenues - Product Based [Member]
Revenues and other
Revenues and other		28,812	12,316	88,267	35,237
Product Sales [Member]
Revenues and other
Revenues and other		84,298	30,106	227,359	108,491
Other [Member]
Revenues and other
Revenues and other		$ 248	$ 100	$ 577	$ 838

[1] Total revenues and other includes related-party amounts of $431.7 million and $1.2 billion for the three and nine months ended September 30, 2021, respectively, and $455.6 million and $1.4 billion for the three and nine months ended September 30, 2020, respectively. See Note 6.

[2] Total operating expenses includes related-party amounts of $22.7 million and $91.5 million for the three and nine months ended September 30, 2021, respectively, and $10.4 million and $161.5 million for the three and nine months ended September 30, 2020, respectively. See Note 6.

[3] See Note 5.

XML

Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Total revenues and other	[1]	$ 763,840	$ 679,044	$ 2,157,945	$ 2,125,112
Total operating expenses	[2]	428,716	392,206	1,307,010	1,792,290
Related Parties [Member]
Total revenues and other		431,681	455,641	1,225,375	1,411,468
Total operating expenses		$ 22,689	$ 10,393	$ 91,505	$ 161,469

[1] Total revenues and other includes related-party amounts of $431.7 million and $1.2 billion for the three and nine months ended September 30, 2021, respectively, and $455.6 million and $1.4 billion for the three and nine months ended September 30, 2020, respectively. See Note 6.

[2] Total operating expenses includes related-party amounts of $22.7 million and $91.5 million for the three and nine months ended September 30, 2021, respectively, and $10.4 million and $161.5 million for the three and nine months ended September 30, 2020, respectively. See Note 6.

XML

Consolidated Balance Sheets - USD ($) $ in Thousands		Sep. 30, 2021	Dec. 31, 2020
Current assets
Cash and cash equivalents		$ 99,862	$ 444,922
Accounts receivable, net		583,652	452,880
Other current assets		73,196	45,262
Total current assets		756,710	943,064
Property, plant, and equipment
Cost		12,732,926	12,641,745
Less accumulated depreciation		4,208,845	3,931,800
Net property, plant, and equipment		8,524,081	8,709,945
Goodwill		4,783	4,783
Other intangible assets		752,659	776,409
Equity investments		1,181,181	1,224,813
Other assets	[1]	199,964	171,013
Total assets	[2]	11,419,378	11,830,027
Current liabilities
Accounts and imbalance payables		341,220	210,691
Short-term debt		726,429	438,870
Accrued ad valorem taxes		49,065	41,427
Accrued liabilities		190,628	269,947
Total current liabilities		1,307,342	960,935
Long-term liabilities
Long-term debt		6,399,874	7,415,832
Deferred income taxes		24,470	22,195
Asset retirement obligations		271,022	260,283
Other liabilities		320,224	275,570
Total long-term liabilities		7,015,590	7,973,880
Total liabilities	[3]	8,322,932	8,934,815
Equity and partners' capital
Common units (408,610,916 and 413,839,863 units issued and outstanding at September 30, 2021, and December 31, 2020, respectively)		2,965,944	2,778,339
General partner units (9,060,641 units issued and outstanding at September 30, 2021, and December 31, 2020)		(11,286)	(17,208)
Total partners' capital		2,954,658	2,761,131
Noncontrolling interests		141,788	134,081
Total equity and partners' capital		3,096,446	2,895,212
Total liabilities, equity, and partners' capital		$ 11,419,378	$ 11,830,027
Common units issued		408,610,916	413,839,863
Common units outstanding		408,610,916	413,839,863
General partner units issued		9,060,641	9,060,641
General partner units outstanding		9,060,641	9,060,641

[1] Other assets includes $11.2 million and $4.2 million of NGLs line-fill inventory as of September 30, 2021, and December 31, 2020, respectively. Other assets also includes $63.1 million and $71.9 million of materials and supplies inventory as of September 30, 2021, and December 31, 2020, respectively.

[2] Total assets includes related-party amounts of $1.6 billion as of September 30, 2021, and December 31, 2020, which includes related-party Accounts receivable, net of $289.4 million and $291.3 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

[3] Total liabilities includes related-party amounts of $250.7 million and $164.7 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

XML

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands		Sep. 30, 2021	Dec. 31, 2020
Materials and supplies inventory		$ 63,100	$ 71,900
Total assets	[1]	11,419,378	11,830,027
Accounts receivable, net		583,652	452,880
Total liabilities	[2]	8,322,932	8,934,815
Related Parties [Member]
Total assets		1,576,164	1,572,526
Accounts receivable, net		289,402	291,253
Total liabilities		250,735	164,655
Natural-Gas Liquids [Member]
NGLs line-fill inventory		$ 11,200	$ 4,200

[1] Total assets includes related-party amounts of $1.6 billion as of September 30, 2021, and December 31, 2020, which includes related-party Accounts receivable, net of $289.4 million and $291.3 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

[2] Total liabilities includes related-party amounts of $250.7 million and $164.7 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

XML

Consolidated Statements of Equity and Partners' Capital - USD ($) $ in Thousands		Total	Occidental [Member]	Chipeta [Member]	WES Operating [Member]	Common Units [Member]	Common Units [Member] Occidental [Member]	General Partner [Member]	Noncontrolling Interests [Member]	Noncontrolling Interests [Member] Chipeta [Member]	Noncontrolling Interests [Member] WES Operating [Member]
Balance at Dec. 31, 2019		$ 3,345,293				$ 3,209,947		$ (14,224)	$ 149,570
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		(289,400)				(251,396)		(5,131)	(32,873)
Distributions to noncontrolling interest owners				$ (1,738)	$ (5,807)					$ (1,738)	$ (5,807)
Distributions to Partnership unitholders		(281,786)				(276,151)		(5,635)
Acquisitions from related parties		0				(3,987)			3,987
Contributions of equity-based compensation from related parties			$ 4,105				$ 4,105
Equity-based compensation expense		1,129				1,129
Net contributions from (distributions to) related parties	[1]	20,489				489			20,000
Balance at Mar. 31, 2020		2,792,285				2,684,136		(24,990)	133,139
Balance at Dec. 31, 2019		3,345,293				3,209,947		(14,224)	149,570
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		246,076
Balance at Sep. 30, 2020		2,790,456				2,674,682		(20,032)	135,806
Balance at Mar. 31, 2020		2,792,285				2,684,136		(24,990)	133,139
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		281,341				267,576		5,461	8,304
Distributions to noncontrolling interest owners				(1,037)	(2,869)					(1,037)	(2,869)
Distributions to Partnership unitholders		(140,893)				(138,075)		(2,818)
Contributions of equity-based compensation from related parties			3,562				3,562
Equity-based compensation expense		2,115				2,115
Net contributions from (distributions to) related parties		1,343				1,343
Other		(330)				(330)
Balance at Jun. 30, 2020		2,935,517				2,820,327		(22,347)	137,537
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		254,135				241,479		5,132	7,524
Distributions to noncontrolling interest owners				(1,148)	(2,869)					(1,148)	(2,869)
Distributions to Partnership unitholders		(140,900)				(138,083)		(2,817)
Unit exchange with Occidental	[2]				(261,878)	(256,640)					(5,238)
Contributions of equity-based compensation from related parties			3,488				3,488
Equity-based compensation expense		2,128				2,128
Net contributions from (distributions to) related parties		842				842
Other		1,141				1,141
Balance at Sep. 30, 2020		2,790,456				2,674,682		(20,032)	135,806
Balance at Dec. 31, 2020		2,895,212				2,778,339		(17,208)	134,081
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		191,235				181,798		3,993	5,444
Distributions to noncontrolling interest owners				(276)	(2,551)					(276)	(2,551)
Distributions to Partnership unitholders		(131,265)				(128,447)		(2,818)
Unit repurchases	[3]	(16,241)				(16,241)
Contributions of equity-based compensation from related parties			3,210				3,210
Equity-based compensation expense		3,524				3,524
Net contributions from (distributions to) related parties		1,627				1,627
Other		(2,355)				(2,355)
Balance at Mar. 31, 2021		2,942,120				2,821,455		(16,033)	136,698
Balance at Dec. 31, 2020		2,895,212				2,778,339		(17,208)	134,081
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		693,150
Balance at Sep. 30, 2021		3,096,446				2,965,944		(11,286)	141,788
Balance at Mar. 31, 2021		2,942,120				2,821,455		(16,033)	136,698
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		238,277				226,295		4,964	7,018
Distributions to noncontrolling interest owners				(1,245)	(2,741)					(1,245)	(2,741)
Distributions to Partnership unitholders		(132,969)				(130,115)		(2,854)
Contributions of equity-based compensation from related parties			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 Jun. 30, 2021		3,052,873				2,927,066		(13,923)	139,730
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		263,638				250,198		5,527	7,913
Distributions to noncontrolling interest owners				$ (1,213)	$ (4,642)					$ (1,213)	$ (4,642)
Distributions to Partnership unitholders		(134,662)				(131,772)		(2,890)
Unit repurchases	[3]	(88,125)				(88,125)
Contributions of equity-based compensation from related parties			$ 2,311				$ 2,311
Equity-based compensation expense		4,668				4,668
Net contributions from (distributions to) related parties		2,165				2,165
Other		(567)				(567)
Balance at Sep. 30, 2021		$ 3,096,446				$ 2,965,944		$ (11,286)	$ 141,788

[1] See Services Agreement within Note 6.

[2] See Note 6.

[3] See Note 5.

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020
Cash flows from operating activities
Net income (loss)		$ 693,150	$ 246,076
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		407,404	384,688
Long-lived asset and other impairments		29,198	200,575
Goodwill impairment		0	441,017
Non-cash equity-based compensation expense		20,834	16,527
Deferred income taxes		2,275	2,393
Accretion and amortization of long-term obligations, net		5,873	6,482
Equity income, net – related parties		(159,337)	(176,788)
Distributions from equity-investment earnings – related parties		164,772	187,816
(Gain) loss on divestiture and other, net		(278)	3,651
(Gain) loss on early extinguishment of debt		24,944	(10,372)
Cash paid to settle interest-rate swaps		0	(19,181)
Other		46	192
Changes in assets and liabilities:
(Increase) decrease in accounts receivable, net		(130,773)	(192,338)
Increase (decrease) in accounts and imbalance payables and accrued liabilities, net		56,495	37,814
Change in other items, net		(9,609)	3,341
Net cash provided by operating activities		1,104,994	1,131,893
Cash flows from investing activities
Capital expenditures		(217,757)	(372,262)
Contributions to equity investments – related parties		(3,683)	(19,017)
Distributions from equity investments in excess of cumulative earnings – related parties		30,075	21,750
Proceeds from the sale of assets to third parties		8,002	0
(Increase) decrease in materials and supplies inventory and other		(1,924)	(57,141)
Net cash used in investing activities		(187,287)	(426,670)
Cash flows from financing activities
Borrowings, net of debt issuance costs		400,000	3,681,173
Repayments of debt		(1,132,966)	(3,780,390)
Increase (decrease) in outstanding checks		(11,757)	691
Distributions to Partnership unitholders	[1]	(398,896)	(563,579)
Net contributions from (distributions to) related parties		6,673	22,674
Finance lease payments	[2]	(5,295)	(12,241)
Unit repurchases		(104,366)	0
Other		(3,492)	0
Net cash provided by (used in) financing activities		(1,262,767)	(667,140)
Net increase (decrease) in cash and cash equivalents		(345,060)	38,083
Cash and cash equivalents at beginning of period		444,922	99,962
Cash and cash equivalents at end of period		99,862	138,045
Supplemental disclosures
Non-cash unit exchange with Occidental	[1]	0	(261,878)
Interest paid, net of capitalized interest		348,904	307,713
Income taxes paid (reimbursements received)		932	(384)
Accrued capital expenditures		29,085	20,275
Chipeta [Member]
Cash flows from financing activities
Distributions to Chipeta noncontrolling interest owner		(2,734)	(3,923)
WES Operating [Member]
Cash flows from financing activities
Distributions to noncontrolling interest owner of WES Operating		(9,934)	(11,545)
Related Parties [Member]
Cash flows from investing activities
Purchases from related parties		(2,000)	0
Cash flows from financing activities
Distributions to Partnership unitholders		(195,205)	(301,219)
Finance lease payments		0	(6,382)
Related Parties [Member] | WES Operating [Member]
Cash flows from financing activities
Distributions to Partnership unitholders		$ (9,934)	$ (11,545)

[1] See Note 6.

[2] For the nine months ended September 30, 2020, includes related-party payments of $6.4 million.

XML

Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020
Finance lease payments	[1]	$ 5,295	$ 12,241
Related Parties [Member]
Finance lease payments		$ 0	$ 6,382

[1] For the nine months ended September 30, 2020, includes related-party payments of $6.4 million.

XML

Consolidated Statements of Operations - WES Operating - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Revenues and other
Revenues and other	[1]	$ 763,840	$ 679,044	$ 2,157,945	$ 2,125,112
Equity income, net – related parties		48,506	61,026	159,337	176,788
Operating expenses
Cost of product		83,232	31,739	250,245	153,611
Operation and maintenance		140,838	132,293	434,198	436,670
General and administrative		50,409	41,578	139,973	118,466
Property and other taxes		13,641	19,392	45,992	57,263
Depreciation and amortization		139,002	132,564	407,404	384,688
Long-lived asset and other impairments		1,594	34,640	29,198	200,575
Goodwill impairment		0	0	0	441,017
Total operating expenses	[2]	428,716	392,206	1,307,010	1,792,290
Gain (loss) on divestiture and other, net		(364)	(768)	278	(3,651)
Operating income (loss)		383,266	347,096	1,010,550	505,959
Interest income – Anadarko note receivable		0	3,286	0	11,736
Interest expense		(93,257)	(95,571)	(287,040)	(278,811)
Gain (loss) on early extinguishment of debt		(24,655)	1,632	(24,944)	10,372
Other income (expense), net		110	720	(1,013)	612
Income (loss) before income taxes		265,464	257,163	697,553	249,868
Income tax expense (benefit)		1,826	3,028	4,403	3,792
Net income (loss)		263,638	254,135	693,150	246,076
Net income (loss) attributable to noncontrolling interest		7,913	7,524	20,375	(17,045)
Net income (loss) attributable to Western Midstream Operating, LP		255,725	246,611	672,775	263,121
Service Revenues - Fee Based [Member]
Revenues and other
Revenues and other		650,482	636,522	1,841,742	1,980,546
Service Revenues - Product Based [Member]
Revenues and other
Revenues and other		28,812	12,316	88,267	35,237
Product Sales [Member]
Revenues and other
Revenues and other		84,298	30,106	227,359	108,491
Other [Member]
Revenues and other
Revenues and other		248	100	577	838
WES Operating [Member]
Revenues and other
Revenues and other	[3]	763,840	679,044	2,157,945	2,125,112
Equity income, net – related parties		48,506	61,026	159,337	176,788
Operating expenses
Cost of product		83,232	31,739	250,245	153,611
Operation and maintenance		140,838	132,293	434,198	436,670
General and administrative		50,689	41,483	137,767	115,783
Property and other taxes		13,641	19,392	45,992	57,263
Depreciation and amortization		139,002	132,564	407,404	384,688
Long-lived asset and other impairments		1,594	34,640	29,198	200,575
Goodwill impairment		0	0	0	441,017
Total operating expenses	[4]	428,996	392,111	1,304,804	1,789,607
Gain (loss) on divestiture and other, net		(364)	(768)	278	(3,651)
Operating income (loss)		382,986	347,191	1,012,756	508,642
Interest income – Anadarko note receivable		0	3,286	0	11,736
Interest expense		(93,257)	(95,571)	(287,040)	(278,811)
Gain (loss) on early extinguishment of debt		(24,655)	1,632	(24,944)	10,372
Other income (expense), net		106	718	(1,022)	606
Income (loss) before income taxes		265,180	257,256	699,750	252,545
Income tax expense (benefit)		1,823	3,028	4,400	3,792
Net income (loss)		263,357	254,228	695,350	248,753
Net income (loss) attributable to noncontrolling interest		2,699	2,488	6,596	(22,471)
Net income (loss) attributable to Western Midstream Operating, LP		260,658	251,740	688,754	271,224
WES Operating [Member] | Service Revenues - Fee Based [Member]
Revenues and other
Revenues and other		650,482	636,522	1,841,742	1,980,546
WES Operating [Member] | Service Revenues - Product Based [Member]
Revenues and other
Revenues and other		28,812	12,316	88,267	35,237
WES Operating [Member] | Product Sales [Member]
Revenues and other
Revenues and other		84,298	30,106	227,359	108,491
WES Operating [Member] | Other [Member]
Revenues and other
Revenues and other		$ 248	$ 100	$ 577	$ 838

[1] Total revenues and other includes related-party amounts of $431.7 million and $1.2 billion for the three and nine months ended September 30, 2021, respectively, and $455.6 million and $1.4 billion for the three and nine months ended September 30, 2020, respectively. See Note 6.

[2] Total operating expenses includes related-party amounts of $22.7 million and $91.5 million for the three and nine months ended September 30, 2021, respectively, and $10.4 million and $161.5 million for the three and nine months ended September 30, 2020, respectively. See Note 6.

[3] Total revenues and other includes related-party amounts of $431.7 million and $1.2 billion for the three and nine months ended September 30, 2021, respectively, and $455.6 million and $1.4 billion for the three and nine months ended September 30, 2020, respectively. See Note 6.

[4] Total operating expenses includes related-party amounts of $23.7 million and $93.6 million for the three and nine months ended September 30, 2021, respectively, and $11.1 million and $162.2 million for the three and nine months ended September 30, 2020, respectively. See Note 6.

XML

Consolidated Statements of Operations - WES Operating (Parenthetical) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Total revenues and other	[1]	$ 763,840	$ 679,044	$ 2,157,945	$ 2,125,112
Total operating expenses	[2]	428,716	392,206	1,307,010	1,792,290
Related Parties [Member]
Total revenues and other		431,681	455,641	1,225,375	1,411,468
Total operating expenses		22,689	10,393	91,505	161,469
WES Operating [Member]
Total revenues and other	[3]	763,840	679,044	2,157,945	2,125,112
Total operating expenses	[4]	428,996	392,111	1,304,804	1,789,607
WES Operating [Member] | Related Parties [Member]
Total revenues and other		431,700	455,600	1,200,000	1,400,000
Total operating expenses		$ 23,700	$ 11,100	$ 93,600	$ 162,200

[1] Total revenues and other includes related-party amounts of $431.7 million and $1.2 billion for the three and nine months ended September 30, 2021, respectively, and $455.6 million and $1.4 billion for the three and nine months ended September 30, 2020, respectively. See Note 6.

[2] Total operating expenses includes related-party amounts of $22.7 million and $91.5 million for the three and nine months ended September 30, 2021, respectively, and $10.4 million and $161.5 million for the three and nine months ended September 30, 2020, respectively. See Note 6.

[3] Total revenues and other includes related-party amounts of $431.7 million and $1.2 billion for the three and nine months ended September 30, 2021, respectively, and $455.6 million and $1.4 billion for the three and nine months ended September 30, 2020, respectively. See Note 6.

[4] Total operating expenses includes related-party amounts of $23.7 million and $93.6 million for the three and nine months ended September 30, 2021, respectively, and $11.1 million and $162.2 million for the three and nine months ended September 30, 2020, respectively. See Note 6.

XML

Consolidated Balance Sheets - WES Operating - USD ($) $ in Thousands		Sep. 30, 2021	Dec. 31, 2020
Current assets
Cash and cash equivalents		$ 99,862	$ 444,922
Accounts receivable, net		583,652	452,880
Other current assets		73,196	45,262
Total current assets		756,710	943,064
Property, plant, and equipment
Cost		12,732,926	12,641,745
Less accumulated depreciation		4,208,845	3,931,800
Net property, plant, and equipment		8,524,081	8,709,945
Goodwill		4,783	4,783
Other intangible assets		752,659	776,409
Equity investments		1,181,181	1,224,813
Other assets	[1]	199,964	171,013
Total assets	[2]	11,419,378	11,830,027
Current liabilities
Accounts and imbalance payables		341,220	210,691
Short-term debt		726,429	438,870
Accrued ad valorem taxes		49,065	41,427
Accrued liabilities		190,628	269,947
Total current liabilities		1,307,342	960,935
Long-term liabilities
Long-term debt		6,399,874	7,415,832
Deferred income taxes		24,470	22,195
Asset retirement obligations		271,022	260,283
Other liabilities		320,224	275,570
Total long-term liabilities		7,015,590	7,973,880
Total liabilities	[3]	8,322,932	8,934,815
Equity and partners' capital
Common units (318,675,578 units issued and outstanding at September 30, 2021, and December 31, 2020)		2,965,944	2,778,339
Total partners' capital		2,954,658	2,761,131
Noncontrolling interest		141,788	134,081
Total equity and partners' capital		3,096,446	2,895,212
Total liabilities, equity, and partners' capital		$ 11,419,378	$ 11,830,027
Common units issued		408,610,916	413,839,863
Common units outstanding		408,610,916	413,839,863
WES Operating [Member]
Current assets
Cash and cash equivalents		$ 92,863	$ 418,537
Accounts receivable, net		583,652	407,549
Other current assets		70,907	43,244
Total current assets		747,422	869,330
Property, plant, and equipment
Cost		12,732,926	12,641,745
Less accumulated depreciation		4,208,845	3,931,800
Net property, plant, and equipment		8,524,081	8,709,945
Goodwill		4,783	4,783
Other intangible assets		752,659	776,409
Equity investments		1,181,181	1,224,813
Other assets	[4]	199,964	171,013
Total assets	[5]	11,410,090	11,756,293
Current liabilities
Accounts and imbalance payables		382,406	210,532
Short-term debt		726,429	438,870
Accrued ad valorem taxes		49,065	41,427
Accrued liabilities		145,241	230,833
Total current liabilities		1,303,141	921,662
Long-term liabilities
Long-term debt		6,399,874	7,415,832
Deferred income taxes		24,470	22,195
Asset retirement obligations		271,022	260,283
Other liabilities		320,224	275,570
Total long-term liabilities		7,015,590	7,973,880
Total liabilities	[6]	8,318,731	8,895,542
Equity and partners' capital
Common units (318,675,578 units issued and outstanding at September 30, 2021, and December 31, 2020)		3,057,945	2,831,199
Total partners' capital		3,057,945	2,831,199
Noncontrolling interest		33,414	29,552
Total equity and partners' capital		3,091,359	2,860,751
Total liabilities, equity, and partners' capital		$ 11,410,090	$ 11,756,293
Common units issued		318,675,578	318,675,578
Common units outstanding		318,675,578	318,675,578

[1] Other assets includes $11.2 million and $4.2 million of NGLs line-fill inventory as of September 30, 2021, and December 31, 2020, respectively. Other assets also includes $63.1 million and $71.9 million of materials and supplies inventory as of September 30, 2021, and December 31, 2020, respectively.

[2] Total assets includes related-party amounts of $1.6 billion as of September 30, 2021, and December 31, 2020, which includes related-party Accounts receivable, net of $289.4 million and $291.3 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

[3] Total liabilities includes related-party amounts of $250.7 million and $164.7 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

[4] Other assets includes $11.2 million and $4.2 million of NGLs line-fill inventory as of September 30, 2021, and December 31, 2020, respectively. Other assets also includes $63.1 million and $71.9 million of materials and supplies inventory as of September 30, 2021, and December 31, 2020, respectively.

[5] Total assets includes related-party amounts of $1.6 billion and $1.5 billion as of September 30, 2021, and December 31, 2020, respectively, which includes related-party Accounts receivable, net of $289.4 million and $246.1 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

[6] Total liabilities includes related-party amounts of $291.6 million and $164.3 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

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Consolidated Balance Sheets - WES Operating (Parenthetical) - USD ($) $ in Thousands		Sep. 30, 2021	Dec. 31, 2020
Materials and supplies inventory		$ 63,100	$ 71,900
Total assets	[1]	11,419,378	11,830,027
Accounts receivable, net		583,652	452,880
Total liabilities	[2]	8,322,932	8,934,815
Related Parties [Member]
Total assets		1,576,164	1,572,526
Accounts receivable, net		289,402	291,253
Total liabilities		250,735	164,655
Natural-Gas Liquids [Member]
NGLs line-fill inventory		11,200	4,200
WES Operating [Member]
Materials and supplies inventory		63,100	71,900
Total assets	[3]	11,410,090	11,756,293
Accounts receivable, net		583,652	407,549
Total liabilities	[4]	8,318,731	8,895,542
WES Operating [Member] | Related Parties [Member]
Total assets		1,600,000	1,500,000
Accounts receivable, net		289,402	246,083
Total liabilities		291,600	164,300
WES Operating [Member] | Natural-Gas Liquids [Member]
NGLs line-fill inventory		$ 11,200	$ 4,200

[1] Total assets includes related-party amounts of $1.6 billion as of September 30, 2021, and December 31, 2020, which includes related-party Accounts receivable, net of $289.4 million and $291.3 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

[2] Total liabilities includes related-party amounts of $250.7 million and $164.7 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

[3] Total assets includes related-party amounts of $1.6 billion and $1.5 billion as of September 30, 2021, and December 31, 2020, respectively, which includes related-party Accounts receivable, net of $289.4 million and $246.1 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

[4] Total liabilities includes related-party amounts of $291.6 million and $164.3 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

XML

Consolidated Statements of Equity and Partners' Capital - WES Operating - USD ($) $ in Thousands		Total		Occidental [Member]	Chipeta [Member]	Common Units [Member]		Common Units [Member] Occidental [Member]	Noncontrolling Interest [Member]		Noncontrolling Interest [Member] Chipeta [Member]	WES Operating [Member]		WES Operating [Member] Occidental [Member]	WES Operating [Member] WES [Member]	WES Operating [Member] Chipeta [Member]	WES Operating [Member] Common Units [Member]		WES Operating [Member] Common Units [Member] Occidental [Member]	WES Operating [Member] Common Units [Member] WES [Member]	WES Operating [Member] Noncontrolling Interest [Member]	WES Operating [Member] Noncontrolling Interest [Member] Chipeta [Member]
Balance at Dec. 31, 2019		$ 3,345,293				$ 3,209,947			$ 149,570			$ 3,341,819					$ 3,286,620				$ 55,199
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		(289,400)				(251,396)			(32,873)			(287,995)					(260,330)				(27,665)
Distributions to noncontrolling interest owners					$ (1,738)						$ (1,738)					$ (1,738)						$ (1,738)
Distributions to WES Operating unitholders		(281,786)				(276,151)						(290,314)					(290,314)
Acquisitions from related parties		0				(3,987)			3,987			0					(3,987)				3,987
Contributions of equity-based compensation from related parties				$ 4,105				$ 4,105						$ 4,105					$ 4,105
Net contributions from (distributions to) related parties		20,489	[1]			489	[1]		20,000	[1]		20,489	[2]				20,489	[2]
Balance at Mar. 31, 2020		2,792,285				2,684,136			133,139			2,786,366					2,756,583				29,783
Balance at Dec. 31, 2019		3,345,293				3,209,947			149,570			3,341,819					3,286,620				55,199
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		246,076										248,753
Balance at Sep. 30, 2020		2,790,456				2,674,682			135,806			2,783,023					2,750,231				32,792
Balance at Mar. 31, 2020		2,792,285				2,684,136			133,139			2,786,366					2,756,583				29,783
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		281,341				267,576			8,304			282,520					279,814				2,706
Distributions to noncontrolling interest owners					(1,037)						(1,037)					(1,037)						(1,037)
Distributions to WES Operating unitholders		(140,893)				(138,075)						(143,404)					(143,404)
Contributions of equity-based compensation from related parties				3,562				3,562						3,562					3,562
Net contributions from (distributions to) related parties		1,343				1,343						1,343					1,343
Other		(330)				(330)
Balance at Jun. 30, 2020		2,935,517				2,820,327			137,537			2,929,350					2,897,898				31,452
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		254,135				241,479			7,524			254,228					251,740				2,488
Distributions to noncontrolling interest owners					(1,148)						(1,148)					(1,148)						(1,148)
Distributions to WES Operating unitholders		(140,900)				(138,083)						(143,404)					(143,404)
Contributions of equity-based compensation from related parties				3,488				3,488						3,488					3,488
Unit exchange with Occidental	[3]					(256,640)						(261,878)					(261,878)
Net contributions from (distributions to) related parties		842				842						842					842
Other		1,141				1,141						1,545					1,545
Balance at Sep. 30, 2020		2,790,456				2,674,682			135,806			2,783,023					2,750,231				32,792
Balance at Dec. 31, 2020		2,895,212				2,778,339			134,081			2,860,751					2,831,199				29,552
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		191,235				181,798			5,444			192,118					190,485				1,633
Distributions to noncontrolling interest owners					(276)						(276)					(276)						(276)
Distributions to WES Operating unitholders		(131,265)				(128,447)						(127,470)					(127,470)
Contributions of equity-based compensation from related parties				3,210				3,210						3,210	$ 10,826				3,210	$ 10,826
Net contributions from (distributions to) related parties		1,627				1,627						1,627					1,627
Other		(2,355)				(2,355)
Balance at Mar. 31, 2021		2,942,120				2,821,455			136,698			2,940,786					2,909,877				30,909
Balance at Dec. 31, 2020		2,895,212				2,778,339			134,081			2,860,751					2,831,199				29,552
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		693,150										695,350
Balance at Sep. 30, 2021		3,096,446				2,965,944			141,788			3,091,359					3,057,945				33,414
Balance at Mar. 31, 2021		2,942,120				2,821,455			136,698			2,940,786					2,909,877				30,909
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		238,277				226,295			7,018			239,875					237,611				2,264
Distributions to noncontrolling interest owners					(1,245)						(1,245)					(1,245)						(1,245)
Distributions to WES Operating unitholders		(132,969)				(130,115)						(137,030)					(137,030)
Contributions of equity-based compensation from related parties				2,375				2,375						2,375	4,613				2,375	4,613
Net contributions from (distributions to) related parties		2,881				2,881						2,881					2,881
Other		(571)				(571)
Balance at Jun. 30, 2021		3,052,873				2,927,066			139,730			3,052,255					3,020,327				31,928
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income (loss)		263,638				250,198			7,913			263,357					260,658				2,699
Distributions to noncontrolling interest owners					$ (1,213)						$ (1,213)					$ (1,213)						$ (1,213)
Distributions to WES Operating unitholders		(134,662)				(131,772)						(232,055)					(232,055)
Contributions of equity-based compensation from related parties				$ 2,311				$ 2,311						$ 2,311	$ 4,539				$ 2,311	$ 4,539
Net contributions from (distributions to) related parties		2,165				2,165						2,165					2,165
Other		(567)				(567)
Balance at Sep. 30, 2021		$ 3,096,446				$ 2,965,944			$ 141,788			$ 3,091,359					$ 3,057,945				$ 33,414

[1] See Services Agreement within Note 6.

[2] See Services Agreement within Note 6.

[3] See Note 6.

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Consolidated Statements of Cash Flows - WES Operating - USD ($) $ in Thousands		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020
Cash flows from operating activities
Net income (loss)		$ 693,150	$ 246,076
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		407,404	384,688
Long-lived asset and other impairments		29,198	200,575
Goodwill impairment		0	441,017
Non-cash equity-based compensation expense		20,834	16,527
Deferred income taxes		2,275	2,393
Accretion and amortization of long-term obligations, net		5,873	6,482
Equity income, net – related parties		(159,337)	(176,788)
Distributions from equity-investment earnings – related parties		164,772	187,816
(Gain) loss on divestiture and other, net		(278)	3,651
(Gain) loss on early extinguishment of debt		24,944	(10,372)
Cash paid to settle interest-rate swaps		0	(19,181)
Other		46	192
Changes in assets and liabilities:
(Increase) decrease in accounts receivable, net		(130,773)	(192,338)
Increase (decrease) in accounts and imbalance payables and accrued liabilities, net		56,495	37,814
Change in other items, net		(9,609)	3,341
Net cash provided by operating activities		1,104,994	1,131,893
Cash flows from investing activities
Capital expenditures		(217,757)	(372,262)
Contributions to equity investments – related parties		(3,683)	(19,017)
Distributions from equity investments in excess of cumulative earnings – related parties		30,075	21,750
Proceeds from the sale of assets to third parties		8,002	0
(Increase) decrease in materials and supplies inventory and other		(1,924)	(57,141)
Net cash used in investing activities		(187,287)	(426,670)
Cash flows from financing activities
Borrowings, net of debt issuance costs		400,000	3,681,173
Repayments of debt		(1,132,966)	(3,780,390)
Increase (decrease) in outstanding checks		(11,757)	691
Distributions to WES Operating unitholders	[1]	(398,896)	(563,579)
Net contributions from (distributions to) related parties		6,673	22,674
Finance lease payments	[2]	(5,295)	(12,241)
Net cash provided by (used in) financing activities		(1,262,767)	(667,140)
Net increase (decrease) in cash and cash equivalents		(345,060)	38,083
Cash and cash equivalents at beginning of period		444,922	99,962
Cash and cash equivalents at end of period		99,862	138,045
Supplemental disclosures
Non-cash unit exchange with Occidental	[1]	0	(261,878)
Interest paid, net of capitalized interest		348,904	307,713
Income taxes paid (reimbursements received)		932	(384)
Accrued capital expenditures		29,085	20,275
Chipeta [Member]
Cash flows from financing activities
Distributions to Chipeta noncontrolling interest owner		(2,734)	(3,923)
Related Parties [Member]
Cash flows from investing activities
Purchases from related parties		(2,000)	0
Cash flows from financing activities
Distributions to WES Operating unitholders		(195,205)	(301,219)
Finance lease payments		0	(6,382)
WES Operating [Member]
Cash flows from operating activities
Net income (loss)		695,350	248,753
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		407,404	384,688
Long-lived asset and other impairments		29,198	200,575
Goodwill impairment		0	441,017
Non-cash equity-based compensation expense		27,874	11,155
Deferred income taxes		2,275	2,393
Accretion and amortization of long-term obligations, net		5,873	6,482
Equity income, net – related parties		(159,337)	(176,788)
Distributions from equity-investment earnings – related parties		164,772	187,816
(Gain) loss on divestiture and other, net		(278)	3,651
(Gain) loss on early extinguishment of debt		24,944	(10,372)
Cash paid to settle interest-rate swaps		0	(19,181)
Other		46	192
Changes in assets and liabilities:
(Increase) decrease in accounts receivable, net		(176,104)	(155,008)
Increase (decrease) in accounts and imbalance payables and accrued liabilities, net		91,508	4,836
Change in other items, net		(9,336)	3,763
Net cash provided by operating activities		1,104,189	1,133,972
Cash flows from investing activities
Capital expenditures		(217,757)	(372,262)
Contributions to equity investments – related parties		(3,683)	(19,017)
Distributions from equity investments in excess of cumulative earnings – related parties		30,075	21,750
Proceeds from the sale of assets to third parties		8,002	0
(Increase) decrease in materials and supplies inventory and other		(1,924)	(57,141)
Net cash used in investing activities		(187,287)	(426,670)
Cash flows from financing activities
Borrowings, net of debt issuance costs		400,000	3,681,173
Repayments of debt		(1,132,966)	(3,780,390)
Increase (decrease) in outstanding checks		(11,699)	1,007
Distributions to WES Operating unitholders	[1]	(496,555)	(577,122)
Net contributions from (distributions to) related parties		6,673	22,674
Finance lease payments	[2]	(5,295)	(12,241)
Net cash provided by (used in) financing activities		(1,242,576)	(668,822)
Net increase (decrease) in cash and cash equivalents		(325,674)	38,480
Cash and cash equivalents at beginning of period		418,537	98,122
Cash and cash equivalents at end of period		92,863	136,602
Supplemental disclosures
Non-cash unit exchange with Occidental	[1]	0	(261,878)
Interest paid, net of capitalized interest		348,904	307,713
Income taxes paid (reimbursements received)		932	(384)
Accrued capital expenditures		29,085	20,275
WES Operating [Member] | Chipeta [Member]
Cash flows from financing activities
Distributions to Chipeta noncontrolling interest owner		(2,734)	(3,923)
WES Operating [Member] | Related Parties [Member]
Cash flows from investing activities
Purchases from related parties		(2,000)	0
Cash flows from financing activities
Distributions to WES Operating unitholders		$ (496,555)	(577,122)
Finance lease payments			$ (6,400)

[1] See Note 6.

[2] For the nine months ended September 30, 2020, includes related-party payments of $6.4 million.

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Consolidated Statements of Cash Flows - WES Operating (Parenthetical) - USD ($) $ in Thousands		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020
Finance lease payments	[1]	$ 5,295	$ 12,241
WES Operating [Member]
Finance lease payments	[1]	5,295	12,241
Related Parties [Member]
Finance lease payments		$ 0	6,382
Related Parties [Member] | WES Operating [Member]
Finance lease payments			$ 6,400

[1] For the nine months ended September 30, 2020, includes related-party payments of $6.4 million.

XML

Description of Business and Basis of Presentation

9 Months Ended

Sep. 30, 2021

Accounting Policies [Abstract]

Description of Business and Basis of Presentation

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

General. Western Midstream Partners, LP is a Delaware master limited partnership formed in September 2012. Western Midstream Operating, LP (together with its subsidiaries, “WES Operating”) is a Delaware limited partnership formed in 2007 to acquire, own, develop, and operate midstream assets. Western Midstream Partners, LP owns, directly and indirectly, a 98.0% limited partner interest in WES Operating, and directly owns all of the outstanding equity interests of Western Midstream Operating GP, LLC, which holds the entire non-economic general partner interest in WES Operating.

For purposes of these consolidated financial statements, the “Partnership” refers to Western Midstream Partners, LP in its individual capacity or to Western Midstream Partners, LP and its subsidiaries, including Western Midstream Operating GP, LLC and WES Operating, as the context requires. “WES Operating GP” refers to Western Midstream Operating GP, LLC, individually as the general partner of WES Operating. The Partnership’s general partner, Western Midstream Holdings, LLC (the “general partner”), is a wholly owned subsidiary of Occidental Petroleum Corporation. “Occidental” refers to Occidental Petroleum Corporation, as the context requires, and its subsidiaries, excluding the general partner. “Anadarko” refers to Anadarko Petroleum Corporation and its subsidiaries, excluding Western Midstream Holdings, LLC. Anadarko became a wholly owned subsidiary of Occidental as a result of Occidental’s acquisition by merger of Anadarko on August 8, 2019. “Related parties” refers to Occidental (see Note 6), the Partnership’s investments accounted for under the equity method of accounting (see Note 7), and the Partnership and WES Operating for transactions that eliminate upon consolidation (see Note 6).

The Partnership is engaged in the business of gathering, compressing, treating, processing, and transporting natural gas; gathering, stabilizing, and transporting condensate, natural-gas liquids (“NGLs”), and crude oil; and gathering and disposing of produced water. In its capacity as a natural-gas processor, the Partnership also buys and sells natural gas, NGLs, and condensate on behalf of itself and as an agent for its customers under certain contracts. As of September 30, 2021, the Partnership’s assets and investments consisted of the following:

	Wholly Owned and Operated	Operated Interests	Non-Operated Interests	Equity Interests
Gathering systems (1)	17	2	3	1
Treating facilities	36	3	—	—
Natural-gas processing plants/trains	24	3	—	5
NGLs pipelines	2	—	—	5
Natural-gas pipelines	5	—	—	1
Crude-oil pipelines	3	1	—	4

_________________________________________________________________________________________

(1)Includes the DBM water systems.

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

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Basis of presentation. The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and include the accounts of the Partnership and entities in which it holds a controlling financial interest, including WES Operating, WES Operating GP, proportionately consolidated interests, and equity investments (see table below). All significant intercompany transactions have been eliminated.

The following table outlines the ownership interests and the accounting method of consolidation used in the consolidated financial statements for entities not wholly owned:

	Percentage Interest
Full consolidation
Chipeta (1)	75.00	%
Proportionate consolidation (2)
Springfield system	50.10	%
Marcellus Interest systems	33.75	%
Equity investments (3)
Mi Vida JV LLC (“Mi Vida”)	50.00	%
Ranch Westex JV LLC (“Ranch Westex”)	50.00	%
Front Range Pipeline LLC (“FRP”)	33.33	%
Red Bluff Express Pipeline, LLC (“Red Bluff Express”)	30.00	%
Enterprise EF78 LLC (“Mont Belvieu JV”)	25.00	%
Rendezvous Gas Services, LLC (“Rendezvous”)	22.00	%
Texas Express Pipeline LLC (“TEP”)	20.00	%
Texas Express Gathering LLC (“TEG”)	20.00	%
Whitethorn Pipeline Company LLC (“Whitethorn LLC”)	20.00	%
Saddlehorn Pipeline Company, LLC (“Saddlehorn”)	20.00	%
Cactus II Pipeline LLC (“Cactus II”)	15.00	%
Panola Pipeline Company, LLC (“Panola”)	15.00	%
White Cliffs Pipeline, LLC (“White Cliffs”)	10.00	%

_________________________________________________________________________________________

(1)The 25% third-party interest in Chipeta Processing LLC (“Chipeta”) is reflected within noncontrolling interests in the consolidated financial statements. See Noncontrolling interests below.

(2)The Partnership proportionately consolidates its associated share of the assets, liabilities, revenues, and expenses attributable to these assets.

(3)Investments in non-controlled entities over which the Partnership exercises significant influence are accounted for under the equity method of accounting. “Equity-investment throughput” refers to the Partnership’s share of average throughput for these investments.

Certain information and note disclosures commonly included in annual financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, the accompanying consolidated financial statements and notes should be read in conjunction with the Partnership’s 2020 Form 10-K, as filed with the SEC on February 26, 2021. Management believes that the disclosures made are adequate to make the information not misleading.

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

The consolidated financial results of WES Operating are included in the Partnership’s consolidated financial statements. Throughout these notes to consolidated financial statements, and to the extent material, any differences between the consolidated financial results of the Partnership and WES Operating are discussed separately. The Partnership’s consolidated financial statements differ from those of WES Operating primarily as a result of (i) the presentation of noncontrolling interest ownership (see Noncontrolling interests below), (ii) the elimination of WES Operating GP’s investment in WES Operating with WES Operating GP’s underlying capital account, (iii) the general and administrative expenses incurred by the Partnership, which are separate from, and in addition to, those incurred by WES Operating, (iv) the inclusion of the impact of Partnership equity balances and Partnership distributions, and (v) transactions between the Partnership and WES Operating that eliminate upon consolidation.

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 September 30, 2021 (see Note 7). The Partnership also owns and controls the entire non-economic general partner interest in WES Operating GP, and the Partnership’s general partner is owned by Occidental.

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

Noncontrolling interests. The Partnership’s noncontrolling interests in the consolidated financial statements consist of (i) the 25% third-party interest in Chipeta and (ii) the 2.0% Occidental subsidiary-owned limited partner interest in WES Operating. WES Operating’s noncontrolling interest in the consolidated financial statements consists of the 25% third-party interest in Chipeta. See Note 5.

Segments. The Partnership’s operations continue to be organized into a single operating segment, the assets of which gather, compress, treat, process, and transport natural gas; gather, stabilize, and transport condensate, NGLs, and crude oil; and gather and dispose of produced water in the United States.

Equity-based compensation. During the nine months ended September 30, 2021, the Partnership issued 357,472 common units under its long-term incentive plans. Compensation expense was $4.7 million and $12.9 million for the three and nine months ended September 30, 2021, respectively, and $2.1 million and $5.4 million for the three and nine months ended September 30, 2020, respectively.

On March 22, 2021, the Board of Directors approved the Western Midstream Partners, LP 2021 Long-Term Incentive Plan (the “2021 LTIP”). Subject to the capitalization adjustment provisions included in the 2021 LTIP, the total aggregate number of common units that may be delivered with respect to awards under the 2021 LTIP is 9,500,000 (the “2021 LTIP Limit”). Common units withheld from an award or surrendered by a participant to satisfy tax withholding obligations or to satisfy the payment of any exercise price with respect to an award will not be considered to be common units delivered under the 2021 LTIP for purposes of the 2021 LTIP Limit. If any award is forfeited, cancelled, exercised, settled in cash, or otherwise terminates or expires without the actual delivery of common units, the common units subject to such award will again be available for awards under the 2021 LTIP. The 2021 LTIP provides for the grant of unit options, unit appreciation rights, restricted units, phantom units, other unit-based awards, cash awards, and a unit award or a substitute award to employees and directors of the Partnership and its general partner. Affiliates of Occidental who held a majority of the Partnership’s outstanding common units as of March 22, 2021, approved the 2021 LTIP via written consent. On April 7, 2021, the Partnership mailed an information statement on Schedule 14C to its unitholders of record as of March 22, 2021. The 2021 LTIP became effective on April 27, 2021.

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Defined-contribution plan. Beginning in the first quarter of 2020, employees of the Partnership are eligible to participate in the Western Midstream Savings Plan, a defined-contribution benefit plan maintained by the Partnership. All regular employees may participate in the plan by making elective contributions that are matched by the Partnership, subject to certain limitations. The Partnership also makes other contributions based on plan guidelines. The Partnership recognized expense related to the plan of $5.3 million and $18.3 million for the three and nine months ended September 30, 2021, respectively, and $3.8 million and $8.2 million for the three and nine months ended September 30, 2020, respectively.

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Revenue from Contracts with Customers

9 Months Ended

Sep. 30, 2021

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

2. REVENUE FROM CONTRACTS WITH CUSTOMERS

The following table summarizes revenue from contracts with customers:

	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
Revenue from customers
Service revenues – fee based	$	605,967	$	582,725	$	1,707,987	$	1,806,097
Service revenues – product based	28,812		12,316		88,267		35,237
Product sales	84,298		30,106		227,359		108,491
Total revenue from customers	719,077		625,147		2,023,613		1,949,825
Revenue from other than customers
Lease revenue (1)	44,515		53,797		133,755		174,449
Other	248		100		577		838
Total revenues and other	$	763,840	$	679,044	$	2,157,945	$	2,125,112

_________________________________________________________________________________________

(1)Includes fixed- and variable-lease revenue from an operating and maintenance agreement entered into with Occidental. See Operating leases within Note 6.

Certain of the Partnership’s midstream services contracts have minimum-volume commitment demand fees and fees that require periodic rate redeterminations based on the related facility cost-of-service rate provisions. During the year ended December 31, 2020, and the six months ended June 30, 2021, the Partnership constrained revenue on certain cost-of-service agreements based on the status of commercial negotiations relating to a legal dispute with one of the contract counterparties. During the three months ended September 30, 2021, the Partnership determined it was no longer necessary to constrain revenue under these cost-of-service agreements. The Partnership updated its estimate of variable consideration and a cumulative catch-up revenue adjustment of $18.9 million was recorded to Service revenues – fee based. Future revenue reversals could occur to the extent the outcome of the legal proceedings and commercial negotiations differ from our current assumptions.

2. REVENUE FROM CONTRACTS WITH CUSTOMERS

Contract balances. Receivables from customers, which are included in Accounts receivable, net on the consolidated balance sheets were $572.8 million and $428.2 million as of September 30, 2021, and December 31, 2020, respectively.

Contract assets primarily relate to (i) revenue accrued but not yet billed under cost-of-service contracts with fixed and variable fees and (ii) accrued deficiency fees the Partnership expects to charge customers once the related performance periods are completed. The following table summarizes activity related to contract assets from contracts with customers:

thousands
Contract assets balance at December 31, 2020	$	56,344
Amounts transferred to Accounts receivable, net that were included in the contract assets balance at the beginning of the period (1)	(3,858)
Additional estimated revenues recognized (2)	17,472
Contract assets balance at September 30, 2021	$	69,958
Contract assets at September 30, 2021
Other current assets	$	23,766
Other assets	46,192
Total contract assets from contracts with customers	$	69,958

_________________________________________________________________________________________

(1)Includes $(3.9) million for the three months ended September 30, 2021.

(2)Includes $8.9 million for the three months ended September 30, 2021.

Contract liabilities primarily relate to (i) aid-in-construction payments received from customers that must be recognized over the expected period of customer benefit, (ii) fixed and variable fees under cost-of-service contracts that are received from customers for which revenue recognition is deferred, and (iii) fees that are charged to customers for only a portion of the contract term and must be recognized as revenues over the expected period of customer benefit. The following table summarizes activity related to contract liabilities from contracts with customers:

thousands
Contract liabilities balance at December 31, 2020	$	266,937
Cash received or receivable, excluding revenues recognized during the period (1)	60,786
Revenues recognized that were included in the contract liability balance at the beginning of the period (2)	(13,553)
Cumulative catch-up adjustment for change in estimated consideration (3)	(17,209)
Contract liabilities balance at September 30, 2021	$	296,961
Contract liabilities at September 30, 2021
Accrued liabilities	$	22,854
Other liabilities	274,107
Total contract liabilities from contracts with customers	$	296,961

_________________________________________________________________________________________

(1)Includes $26.7 million for the three months ended September 30, 2021.

(2)Includes $(5.5) million for the three months ended September 30, 2021, $(1.7) million of which is related to the cumulative catch-up revenue adjustment recognized for the nine months ended September 30, 2021.

(3)Includes $(17.2) million for the three months ended September 30, 2021.

2. REVENUE FROM CONTRACTS WITH CUSTOMERS

Transaction price allocated to remaining performance obligations. Revenues expected to be recognized from certain performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2021, 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. Therefore, the following table represents only a portion of expected future revenues from existing contracts as most future revenues from customers are dependent on future variable customer volumes and, in some cases, variable commodity prices for those volumes.

thousands
Remainder of 2021	$	211,353
2022	1,057,409
2023	1,002,351
2024	973,300
2025	890,903
Thereafter	2,719,380
Total	$	6,854,696

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Acquisitions and Divestitures

9 Months Ended

Sep. 30, 2021

Property, Plant and Equipment [Abstract]

Acquisitions and Divestitures

3. ACQUISITIONS AND DIVESTITURES

Fort Union and Bison facilities. In October 2020, the Partnership (i) sold its 14.81% interest in Fort Union Gas Gathering, LLC (“Fort Union”), which was accounted for under the equity method of accounting, and (ii) entered into an option agreement to sell the Bison treating facility, located in Northeast Wyoming, to a third party. The Partnership received combined proceeds of $27.0 million, resulting in a net gain on sale of $21.0 million related to the Fort Union interest that was recorded in the fourth quarter of 2020 as Gain (loss) on divestiture and other, net in the consolidated statements of operations.

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.

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Partnership Distributions

9 Months Ended

Sep. 30, 2021

Distributions Made to Members or Limited Partners [Abstract]

Partnership Distributions

4. PARTNERSHIP DISTRIBUTIONS

Partnership distributions. Under its partnership agreement, the Partnership distributes all of its available cash (beyond proper reserves as defined in its partnership agreement) to unitholders of record on the applicable record date within 55 days following each quarter’s end. The Board of Directors of the general partner (the “Board of Directors”) declared the following cash distributions to the Partnership’s unitholders for the periods presented:

thousands except per-unit amounts Quarters Ended	Total Quarterly Per-unit Distribution		Total Quarterly Cash Distribution		Distribution Date
2020
March 31	$	0.31100	$	140,893	May 2020
June 30	0.31100		140,900		August 2020
September 30	0.31100		132,255		November 2020
December 31	0.31100		131,265		February 2021
2021
March 31	$	0.31500	$	132,969	May 2021
June 30	0.31900		134,662		August 2021
September 30 (1)	0.32300		134,862		November 2021

_________________________________________________________________________________________

(1)The Board of Directors declared a cash distribution to the Partnership’s unitholders for the third quarter of 2021 of $0.32300 per unit, or $134.9 million in aggregate. The cash distribution is payable on November 12, 2021, to unitholders of record at the close of business on November 1, 2021, including the general partner units.

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

WES Operating partnership distributions. WES Operating makes quarterly cash distributions to the Partnership and WGR Asset Holding Company LLC (“WGRAH”), a subsidiary of Occidental, in proportion to their share of limited partner interests in WES Operating. See Note 5. WES Operating made the following cash distributions to its limited partners for the periods presented:

thousands Quarters Ended	Total Quarterly Cash Distribution
2020
March 31	$	143,404
June 30	143,404
September 30	143,404
December 31	127,470
2021
March 31	$	137,030
June 30	140,217
September 30	140,217

4. PARTNERSHIP DISTRIBUTIONS

In addition to the distributions above, during the quarter ended September 30, 2021, WES Operating made a distribution of $91.8 million to the Partnership and WGRAH. The Partnership used its portion of the distribution to repurchase common units on the open market. See Note 5.

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Equity and Partners' Capital

9 Months Ended

Sep. 30, 2021

Partners' Capital Notes [Abstract]

Equity and Partners' Capital

5. EQUITY AND PARTNERS’ CAPITAL

Holdings of Partnership equity. The Partnership’s common units are listed on the New York Stock Exchange under the ticker symbol “WES.” As of September 30, 2021, Occidental held 202,781,578 common units, representing a 48.5% 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 205,829,338 common units, representing a 49.3% limited partner interest in the Partnership.

In March 2021, an affiliate of Occidental sold 11,500,000 of the Partnership’s common units it held to the public through an underwritten offering, including 1,500,000 common units pursuant to the full exercise of the underwriters’ over-allotment option. The Partnership did not receive any proceeds from the public offering.

On September 11, 2020, the Partnership assigned its 98% interest in the 30-year $260.0 million note established in May 2008 between WES Operating and Anadarko (the “Anadarko note receivable”) to Anadarko, which Anadarko canceled and retired immediately upon receipt, in exchange for which Occidental caused certain of its subsidiaries to transfer an aggregate of 27,855,398 common units representing limited partner interests in the Partnership to the Partnership. The units were canceled by the Partnership immediately upon receipt. See Note 6.

Partnership equity repurchases. In November 2020, the Board of Directors authorized the Partnership to buy back up to $250.0 million of the Partnership’s common units through December 31, 2021 (the “Purchase Program”). The common units may be purchased from time to time in the open market at prevailing market prices or in privately negotiated transactions. During the nine months ended September 30, 2021, the Partnership repurchased 5,586,419 common units on the open market for an aggregate purchase price of $104.4 million. The units were canceled by the Partnership immediately upon receipt. As of September 30, 2021, the Partnership had an authorized amount of $113.1 million remaining under the Purchase Program.

Holdings of WES Operating equity. As of September 30, 2021, (i) the Partnership, directly and indirectly through its ownership of WES Operating GP, owned a 98.0% limited partner interest and the entire non-economic general partner interest in WES Operating and (ii) Occidental, through its ownership of WGRAH, owned a 2.0% limited partner interest in WES Operating, which is reflected as a noncontrolling interest within the consolidated financial statements of the Partnership (see Note 1).

Partnership’s net income (loss) per common unit. The common and general partner unitholders’ allocation of net income (loss) attributable to the Partnership was equal to their cash distributions plus their respective allocations of undistributed earnings or losses in accordance with their weighted-average ownership percentage during each period using the two-class method.

The Partnership’s basic net income (loss) per common unit is calculated by dividing the limited partners’ interest in net income (loss) by the weighted-average number of common units outstanding during the period. Diluted net income (loss) per common unit includes the effect of outstanding units issued under the Partnership’s long-term incentive plans.

5. EQUITY AND PARTNERS’ CAPITAL

The following table provides a reconciliation between basic and diluted net income (loss) per common unit:

	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands except per-unit amounts	2021		2020		2021		2020
Net income (loss)
Limited partners’ interest in net income (loss)	$	250,198	$	241,479	$	658,291	$	257,659
Weighted-average common units outstanding
Basic	411,909		438,857		412,690		442,255
Dilutive effect of non-vested phantom units	805		69		460		20
Diluted	412,714		438,926		413,150		442,275
Excluded due to anti-dilutive effect	4		1,084		700		1,271
Net income (loss) per common unit
Basic	$	0.61	$	0.55	$	1.60	$	0.58
Diluted	$	0.61	$	0.55	$	1.59	$	0.58

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

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Related-Party Transactions

9 Months Ended

Sep. 30, 2021

Related Party Fees and Other Arrangements, Limited Liability Company (LLC) or Limited Partnership (LP) [Abstract]

Related-Party Transactions

6. RELATED-PARTY TRANSACTIONS

Summary of related-party transactions. The following tables summarize material related-party transactions included in the Partnership’s consolidated financial statements:

Consolidated statements of operations
	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
Revenues and other
Service revenues – fee based	$	418,520	$	436,405	$	1,188,679	$	1,344,326
Service revenues – product based	1,499		2,544		9,662		6,690
Product sales	11,662		16,692		27,034		60,452
Total revenues and other	431,681		455,641		1,225,375		1,411,468
Equity income, net – related parties (1)	48,506		61,026		159,337		176,788
Operating expenses
Cost of product	17,384		1,483		53,968		85,353
Operation and maintenance	3,497		1,303		24,534		35,660
General and administrative (2)	1,808		7,607		13,003		40,456
Total operating expenses	22,689		10,393		91,505		161,469
Interest income – Anadarko note receivable	—		3,286		—		11,736

_________________________________________________________________________________________

(1)See Note 7.

(2)Includes (i) amounts charged by Occidental pursuant to the shared services agreement (see Services Agreement within this Note 6) and (ii) equity-based compensation expense allocated to the Partnership by Occidental, which is not reimbursed to Occidental and is reflected as a contribution to partners’ capital in the consolidated statements of equity and partners’ capital (see Incentive Plans within this Note 6).

Consolidated balance sheets
thousands	September 30, 2021		December 31, 2020
Assets
Accounts receivable, net	$	289,402	$	291,253
Other current assets	29,021		5,493
Equity investments (1)	1,181,181		1,224,813
Other assets	76,560		50,967
Total assets	1,576,164		1,572,526
Liabilities
Accounts and imbalance payables	42,384		6,664
Accrued liabilities	19,232		19,195
Other liabilities	189,119		138,796
Total liabilities	250,735		164,655

_________________________________________________________________________________________

(1)See Note 7.

6. RELATED-PARTY TRANSACTIONS

Consolidated statements of cash flows
	Nine Months Ended  September 30,
thousands	2021		2020
Distributions from equity-investment earnings – related parties	$	164,772	$	187,816
Purchases from related parties	(2,000)		—
Contributions to equity investments – related parties	(3,683)		(19,017)
Distributions from equity investments in excess of cumulative earnings – related parties	30,075		21,750
Distributions to Partnership unitholders (1)	(195,205)		(301,219)
Distributions to WES Operating unitholders (2)	(9,934)		(11,545)
Net contributions from (distributions to) related parties	6,673		22,674
Finance lease payments	—		(6,382)

_________________________________________________________________________________________

(1)Represents distributions paid to Occidental pursuant to the partnership agreement of the Partnership (see Note 4 and Note 5).

(2)Represents distributions paid to a certain subsidiary of Occidental pursuant to WES Operating’s partnership agreement (see Note 4 and Note 5).

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:

Consolidated statements of operations
	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
General and administrative (1)	$	2,775	$	8,314	$	15,061	$	41,220

_________________________________________________________________________________________

(1)Includes (i) amounts charged by Occidental pursuant to the shared services agreement (see Services Agreement within this Note 6), (ii) equity-based compensation expense allocated to WES Operating by Occidental, which is not reimbursed to Occidental and is reflected as a contribution to partners’ capital in the consolidated statements of equity and partners’ capital (see Incentive Plans within this Note 6), and (iii) an intercompany service fee between the Partnership and WES Operating.

Consolidated balance sheets
thousands	September 30, 2021		December 31, 2020
Accounts receivable, net	$	289,402	$	246,083
Accounts and imbalance payables (1)	83,576		6,664

_________________________________________________________________________________________

(1)As of September 30, 2021, includes balances related to transactions between the Partnership and WES Operating.

Consolidated statements of cash flows
	Nine Months Ended  September 30,
thousands	2021		2020
Distributions to WES Operating unitholders (1)	$	(496,555)	$	(577,122)

_________________________________________________________________________________________

(1)Represents distributions paid to the Partnership and a certain subsidiary of Occidental pursuant to WES Operating’s partnership agreement. Includes a distribution made from WES Operating to the Partnership during the quarter ended September 30, 2021, that was used by the Partnership to repurchase common units on the open market. See Note 4 and Note 5.

6. RELATED-PARTY TRANSACTIONS

Related-party revenues. Related-party revenues include (i) amounts earned by the Partnership from services provided to Occidental and from the sale of natural gas, condensate, and NGLs to Occidental and (ii) income from the Partnership’s investments accounted for under the equity method of accounting (see Note 7).

Gathering and processing agreements. The Partnership has significant gathering and processing arrangements with affiliates of Occidental on most of its systems. While Occidental is the contracting counterparty of the Partnership, these arrangements with Occidental include not just Occidental-produced volumes, but also, in some instances, the volumes of other working-interest owners of Occidental who rely on the Partnership’s facilities and infrastructure to bring their volumes to market. Natural-gas throughput (excluding equity-investment throughput) attributable to production owned or controlled by Occidental was 38% and 36% for the three and nine months ended September 30, 2021, respectively, and 41% and 42% for the three and nine months ended September 30, 2020, 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 nine months ended September 30, 2021, respectively, and 87% and 88% for the three and nine months ended September 30, 2020, respectively. Produced-water throughput attributable to production owned or controlled by Occidental was 89% and 87% for the three and nine months ended September 30, 2021, respectively, and 87% and 88% for the three and nine months ended September 30, 2020, 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.

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. (“Mesquite”) that allows Mesquite to process gas under such agreement. For this reason, Anadarko continues to be liable under the Brasada gas processing agreement through 2034 to the extent Mesquite does not perform. For all periods presented, Mesquite has performed Anadarko’s obligations under the Brasada gas processing agreement pursuant to its agency arrangement with Anadarko.

Further, in connection with the sale of its Uinta Basin assets in 2020, Kerr McGee Oil & Gas Onshore LP, a subsidiary of Occidental, retained the deficiency payment obligations under a gas processing agreement at the Chipeta plant. This contingent payment obligation extends through the earlier of October 1, 2022, or the termination of the processing agreement.

Commodity purchase and sale agreements. Through December 31, 2020, the Partnership purchased and sold a significant amount of natural gas and NGLs from and to Anadarko Energy Services Company (“AESC”), a marketing affiliate of Occidental. Prior to April 1, 2020, AESC acted as an agent on behalf of either the Partnership or the Partnership’s customers for third-party sales. Where AESC sold natural gas and NGLs on the Partnership’s customers’ behalf, the Partnership recognized associated service revenues and cost of product expense for the marketing services performed by AESC. When product sales were on the Partnership’s behalf, the Partnership recognized product sales revenues based on Occidental’s sales price to the third party and recorded the associated cost of product expense associated with the marketing activities provided by AESC. Effective April 1, 2020, changes to marketing-contract terms with AESC terminated AESC’s prior status as an agent of the Partnership for third-party sales and established AESC as a customer of the Partnership. Accordingly, the Partnership no longer recognizes service revenues and/or product sales revenues and the equivalent cost of product expense for the marketing services performed by AESC. This change has no impact to Operating income (loss), Net income (loss), the balance sheets, cash flows, or any non-GAAP metric used to evaluate the Partnership’s operations (see Key Performance Metrics under Part I, Item 2 of this Form 10-Q).

6. RELATED-PARTY TRANSACTIONS

Marketing Transition Services Agreement. Effective December 31, 2019, certain subsidiaries of Anadarko entered into a transition services agreement (the “Marketing Transition Services Agreement”) to provide marketing-related services to certain of the Partnership’s subsidiaries through December 31, 2020, subject to the option to extend such services for an additional six-month period. The Marketing Transition Services Agreement was terminated on December 31, 2020. While the Partnership still has some marketing agreements with affiliates of Occidental, the Partnership began marketing and selling substantially all of its natural gas and NGLs directly to third parties beginning on January 1, 2021.

Operating leases. 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.

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 provides operational and maintenance services with respect to a crude-oil gathering system and associated treating facilities owned by the Partnership through December 31, 2021. The agreement and underlying contracts include (i) fixed consideration, which is measured as the minimum-volume commitment for both gathering and treating, and (ii) variable consideration, which consists of all volumes above the minimum-volume commitment. Subsequent to the initial two-year term, the agreement provides for automatic one-year extensions, unless either party exercises its option to terminate the lease with advance notice. In April 2021, the Partnership exercised its option to terminate the operating and maintenance agreement with Occidental effective December 31, 2021. For the three and nine months ended September 30, 2021, the Partnership recognized fixed-lease revenue of $43.9 million and $131.9 million, respectively, and variable-lease revenue of $0.6 million and $1.9 million, respectively, related to these agreements. For the three and nine months ended September 30, 2020, the Partnership recognized fixed-lease revenue of $44.0 million and $131.8 million, respectively, and variable-lease revenue of $9.8 million and $42.6 million, respectively, related to these agreements, with such amounts included in Service revenues – fee based in the consolidated statements of operations.

Related-party expenses. Operation and maintenance expense includes amounts accrued for or paid to related parties for field-related costs provided by related parties at certain of the Partnership’s assets. A portion of general and administrative expense is paid by Occidental, which results in related-party transactions pursuant to the reimbursement provisions of the Partnership’s and WES Operating’s agreements with Occidental. Cost of product expense includes amounts related to certain continuing marketing arrangements with affiliates of Occidental, related-party imbalances, and transactions with affiliates accounted for under the equity method of accounting. See Commodity purchase and sale agreements and Marketing Transition Services Agreement in the sections above. Related-party expenses do not bear a direct relationship to related-party revenues, and third-party expenses do not bear a direct relationship to third-party revenues.

Services Agreement. General and administrative expense includes costs incurred pursuant to the agreement dated as of December 31, 2019, by and among Occidental, Anadarko, and WES Operating GP, under which Occidental has performed certain centralized corporate functions for the Partnership and WES Operating (“Services Agreement”).

Pursuant to the Services Agreement, which was amended and restated on December 31, 2019, specified employees of Occidental were seconded to WES Operating GP to provide, under the direction, supervision, and control of the general partner, (i) operating and routine maintenance service and (ii) corporate, administrative, and other services, with respect to the assets owned and operated by the Partnership. Occidental was reimbursed for the services provided by the seconded employees. In January 2020, pursuant to the Services Agreement, Occidental made a one-time cash contribution of $20.0 million to WES Operating for anticipated transition costs required to establish stand-alone human resources and information technology functions. In late March 2020, seconded employees’ employment was transferred to the Partnership. Occidental continues to provide certain limited administrative and operational services to the Partnership, with most services expected to be fully transitioned to the Partnership by December 31, 2021.

6. RELATED-PARTY TRANSACTIONS

Incentive Plans. 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 allocated expense related to the Incentive Plans of $2.3 million and $7.9 million for the three and nine months ended September 30, 2021, respectively, and $3.5 million and $11.2 million for the three and nine months ended September 30, 2020, respectively. These amounts are reflected as contributions to partners’ capital in the consolidated statements of equity and partners’ capital.

Construction reimbursement agreements and Purchases from related parties. From time to time, the Partnership enters into construction reimbursement agreements with Occidental providing that the Partnership will manage the construction of certain midstream infrastructure for Occidental in the Partnership’s areas of operation. Such arrangements generally provide for a reimbursement of costs incurred by the Partnership on a cost or cost-plus basis.

Additionally, from time to time, in support of the Partnership’s business, the Partnership purchases equipment, inventory, and other miscellaneous assets, from Occidental or its affiliates. These amounts are included in Purchases from related parties in the consolidated statements of cash flows.

Related-party commercial agreement. During the first quarter of 2021, an affiliate of Occidental and certain wholly owned subsidiaries of the Partnership entered into a Commercial Understanding Agreement (“CUA”). Under the CUA, certain West Texas surface-use and salt-water disposal agreements were amended to reduce usage fees owed by the Partnership in exchange for the forgiveness of certain deficiency fees owed by Occidental and other unrelated contractual amendments. The present value of the reduced usage fees under the CUA was $30.0 million at the time the agreement was executed.

Anadarko note receivable. In May 2008, WES Operating loaned $260.0 million to Anadarko in exchange for a 30-year note that bore interest at a fixed annual rate and was classified as interest income in the consolidated statements of operations. On September 11, 2020, the Partnership and Occidental entered into a Unit Redemption Agreement, pursuant to which WES Operating transferred the note receivable to Anadarko, which Anadarko immediately canceled and retired upon receipt.

Customer concentration. Occidental was the only customer from which revenues exceeded 10% of consolidated revenues for all periods presented in the consolidated statements of operations.

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Equity Investments

9 Months Ended

Sep. 30, 2021

Equity Method Investments and Joint Ventures [Abstract]

Equity Investments

7. EQUITY INVESTMENTS

The following table presents the financial statement impact of the Partnership’s equity investments for the nine months ended September 30, 2021:

thousands	Balance at December 31, 2020		Other-than-temporary impairment expense (1)		Equity income, net		Contributions		Distributions		Distributions in excess of cumulative earnings (2)		Balance at September 30, 2021
White Cliffs	$	45,623	$	—	$	701	$	—	$	(266)	$	(4,583)	$	41,475
Rendezvous	28,198		—		(1,560)		—		(884)		(2,058)		23,696
Mont Belvieu JV	98,874		—		25,066		—		(25,095)		(2,193)		96,652
TEG	16,661		—		3,390		—		(3,409)		(299)		16,343
TEP	195,189		—		27,572		—		(27,623)		(4,491)		190,647
FRP	199,881		—		28,351		—		(28,482)		(4,004)		195,746
Whitethorn LLC	156,729		—		6,380		347		(5,736)		(4,018)		153,702
Cactus II	173,921		—		14,290		3,336		(14,415)		(3,926)		173,206
Saddlehorn	111,717		—		26,045		—		(26,157)		—		111,605
Panola	20,867		—		1,629		—		(1,628)		(555)		20,313
Mi Vida	55,031		—		7,445		—		(7,334)		(2,245)		52,897
Ranch Westex	18,898		(11,805)		9,267		—		(12,517)		(1,624)		2,219
Red Bluff Express	103,224		—		10,761		—		(11,226)		(79)		102,680
Total	$	1,224,813	$	(11,805)	$	159,337	$	3,683	$	(164,772)	$	(30,075)	$	1,181,181

_________________________________________________________________________________________

(1)Recorded in Long-lived asset and other impairments in the consolidated statements of operations.

(2)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.

The investment balance in Ranch Westex at September 30, 2021, was $37.1 million less than the Partnership’s underlying equity in Ranch Westex’s net assets. During the nine months ended September 30, 2021, the Partnership recognized an impairment loss of $11.8 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.

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Property, Plant, and Equipment

9 Months Ended

Sep. 30, 2021

Property, Plant and Equipment [Abstract]

Property, Plant, and Equipment

8. PROPERTY, PLANT, AND EQUIPMENT

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

thousands	Estimated Useful Life	September 30, 2021		December 31, 2020
Land	N/A	$	10,955	$	9,696
Gathering systems – pipelines	30 years	5,343,971		5,231,212
Gathering systems – compressors	15 years	2,111,639		2,096,905
Processing complexes and treating facilities	25 years	3,367,933		3,424,368
Transportation pipeline and equipment	6 to 45 years	168,384		168,205
Produced-water disposal systems	20 years	879,916		831,719
Assets under construction	N/A	123,115		176,834
Other	3 to 40 years	727,013		702,806
Total property, plant, and equipment		12,732,926		12,641,745
Less accumulated depreciation		4,208,845		3,931,800
Net property, plant, and equipment		$	8,524,081	$	8,709,945

The cost of property classified as “Assets under construction” is excluded from capitalized costs being depreciated. These amounts represent property that is not yet placed into productive service as of the respective balance sheet date.

Long-lived asset and other impairments. During the nine months ended September 30, 2021, the Partnership recognized impairments of $29.2 million, primarily attributable to (i) $14.1 million of impairments at the DJ Basin complex due to cancellation of projects and (ii) an $11.8 million other-than-temporary impairment of the Partnership’s investment in Ranch Westex (see Note 7).

During the nine months ended September 30, 2020, the Partnership recognized impairments of $200.6 million, primarily due to $150.2 million of impairments for assets located in Wyoming and Utah. These assets were impaired to estimated fair values of $112.2 million. The Partnership assesses whether events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The fair value of assets with impairment triggers were measured using the income approach and Level-3 fair value inputs. The income approach was based on the Partnership’s projected future earnings before interest, taxes, depreciation, and amortization (“EBITDA”) and free cash flows, which requires significant assumptions including, among others, future throughput volumes based on current expectations of producer activity and operating costs. These impairments were primarily triggered by reductions in estimated future cash flows resulting from lower forecasted producer throughput and lower commodity prices. The remaining impairments of $21.0 million were primarily at the DJ Basin complex and DBM water systems due to cancellation of projects and impairments of rights-of-way. Long-lived asset and other impairments on the consolidated statements of operations also includes a $29.4 million other-than-temporary impairment for the nine months ended September 30, 2020, of the Partnership’s investment in Ranch Westex.

8. PROPERTY, PLANT, AND EQUIPMENT

Potential future long-lived asset impairments. As of September 30, 2021, it is reasonably possible that future commodity-price declines, prolonged depression of commodity prices, changes to producers’ drilling plans in response to lower prices, and potential producer bankruptcies could result in future long-lived asset impairments. For example, on April 29, 2020, the Partnership received notice that Sanchez, in its bankruptcy, was seeking to reject a number of midstream and downstream agreements with commercial counterparties, including Sanchez’s Springfield gathering agreements and agreements obligating Sanchez to deliver the gas volumes gathered by the Springfield system to our Brasada processing plant. On May 6, 2021, the Bankruptcy Court issued an opinion determining, among other things, that Sanchez’s Springfield gathering agreements were rejected, but that such agreements contain covenants running with the land that survive rejection, thus preserving the acreage dedication to the Partnership’s Springfield system. Depending on the ultimate outcome of the Partnership’s continuing efforts to defend its contractual rights in the bankruptcy proceeding, as well as the Partnership’s ongoing commercial discussions, the Partnership’s South Texas assets could be impaired.

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Goodwill

9 Months Ended

Sep. 30, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

9. GOODWILL

Goodwill is recorded when the purchase price of a business acquired exceeds the fair market value of the tangible and separately measurable intangible net assets. Goodwill also includes the allocated historic carrying value of midstream goodwill attributed to the Partnership’s assets previously acquired from Anadarko. The Partnership’s goodwill has been allocated to two reporting units: (i) gathering and processing and (ii) transportation.

The Partnership evaluates goodwill for impairment at the reporting-unit level on an annual basis, as of October 1, or more often as facts and circumstances warrant. An initial qualitative assessment is performed to determine the likelihood of whether goodwill is impaired and if deemed necessary based on this assessment, a quantitative assessment is then performed. If the quantitative assessment indicates that the carrying value of the reporting unit, including goodwill, exceeds its fair value, a goodwill impairment is recorded for the amount by which the reporting unit’s carrying value exceeds its fair value.

During the three months ended March 31, 2020, the Partnership performed an interim goodwill impairment test due to a significant decline in the trading price of the Partnership’s common units, triggered by the combined impacts from the global outbreak of COVID-19 and the oil-market disruption resulting from significantly lower global demand and corresponding oversupply of crude oil. The Partnership primarily used the market approach and Level-3 inputs to estimate the fair value of its two reporting units. The market approach was based on multiples of EBITDA and the Partnership’s projected future EBITDA. The EBITDA multiples were based on current and historic multiples for comparable midstream companies of similar size and business profit to the Partnership. The EBITDA projections require significant assumptions including, among others, future throughput volumes based on current expectations of producer activity and operating costs. The reasonableness of the market approach was tested against an income approach that was based on a discounted cash-flow analysis. Key assumptions in this analysis include the use of an appropriate discount rate, terminal-year multiples, and estimated future cash flows, including estimates of throughput, capital expenditures, operating, and general and administrative costs. The Partnership also reviewed the reasonableness of the total fair value of both reporting units to the market capitalization as of March 31, 2020, and the reasonableness of an implied acquisition premium. Impairment determinations involve significant assumptions and judgments, and differing assumptions regarding any of these inputs could have a significant effect on the valuations. As a result of the interim impairment test, the Partnership recognized a goodwill impairment of $441.0 million during the first quarter of 2020, which reduced the carrying value of goodwill for the gathering and processing reporting unit to zero. Goodwill allocated to the transportation reporting unit of $4.8 million as of March 31, 2020, was not impaired. Recurring goodwill impairment assessments have indicated no further impairment.

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Selected Components of Working Capital

9 Months Ended

Sep. 30, 2021

Selected Components Of Working Capital [Abstract]

Selected Components of Working Capital

10. SELECTED COMPONENTS OF WORKING CAPITAL

A summary of accounts receivable, net is as follows:

	The Partnership				WES Operating
thousands	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
Trade receivables, net	$	583,646	$	452,718	$	583,646	$	407,547
Other receivables, net	6		162		6		2
Total accounts receivable, net	$	583,652	$	452,880	$	583,652	$	407,549

A summary of other current assets is as follows:

	The Partnership				WES Operating
thousands	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
NGLs inventory	$	4,002	$	882	$	4,002	$	882
Imbalance receivables	14,958		12,976		14,958		12,976
Prepaid insurance	14,425		8,131		12,136		6,113
Contract assets	23,766		5,338		23,766		5,338
Other	16,045		17,935		16,045		17,935
Total other current assets	$	73,196	$	45,262	$	70,907	$	43,244

A summary of accrued liabilities is as follows:

	The Partnership				WES Operating
thousands	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
Accrued interest expense	$	69,570	$	137,307	$	69,570	$	137,307
Short-term asset retirement obligations	14,365		20,215		14,365		20,215
Short-term remediation and reclamation obligations	6,101		2,950		6,101		2,950
Income taxes payable	4,593		3,399		4,593		3,399
Contract liabilities	22,854		31,477		22,854		31,477
Other	73,145		74,599		27,758		35,485
Total accrued liabilities	$	190,628	$	269,947	$	145,241	$	230,833

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Debt and Interest Expense

9 Months Ended

Sep. 30, 2021

Debt Instruments [Abstract]

Debt and Interest Expense

11. DEBT AND INTEREST EXPENSE

WES Operating is the borrower for all outstanding debt and is expected to be the borrower for all future debt issuances. The following table presents the outstanding debt:

	September 30, 2021						December 31, 2020
thousands	Principal		Carrying Value		Fair Value (1)		Principal		Carrying Value		Fair Value (1)
Short-term debt
4.000% Senior Notes due 2022	$	502,246	$	502,086	$	510,243	$	—	$	—	$	—
5.375% Senior Notes due 2021	—		—		—		431,081		430,606		436,241
RCF	220,000		220,000		220,000		—		—		—
Finance lease liabilities	4,343		4,343		4,343		8,264		8,264		8,264
Total short-term debt	$	726,589	$	726,429	$	734,586	$	439,345	$	438,870	$	444,505
Long-term debt
4.000% Senior Notes due 2022	$	—	$	—	$	—	$	580,917	$	580,555	$	597,568
Floating-Rate Senior Notes due 2023	213,138		212,521		212,773		239,978		238,879		235,066
3.100% Senior Notes due 2025	732,106		727,794		774,328		1,000,000		992,900		1,028,614
3.950% Senior Notes due 2025	399,163		395,708		421,970		500,000		494,866		512,807
4.650% Senior Notes due 2026	474,242		471,500		513,758		500,000		496,708		524,880
4.500% Senior Notes due 2028	400,000		396,010		433,214		400,000		395,617		415,454
4.750% Senior Notes due 2028	400,000		396,840		437,005		400,000		396,555		418,786
4.050% Senior Notes due 2030	1,200,000		1,190,102		1,324,159		1,200,000		1,189,407		1,342,996
5.450% Senior Notes due 2044	600,000		593,699		691,067		600,000		593,598		607,234
5.300% Senior Notes due 2048	700,000		687,210		807,613		700,000		687,048		694,172
5.500% Senior Notes due 2048	350,000		342,629		409,945		350,000		342,543		343,928
5.250% Senior Notes due 2050	1,000,000		983,659		1,176,283		1,000,000		983,512		1,100,375
Finance lease liabilities	2,202		2,202		2,202		23,644		23,644		23,644
Total long-term debt	$	6,470,851	$	6,399,874	$	7,204,317	$	7,494,539	$	7,415,832	$	7,845,524

_________________________________________________________________________________________

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

11. DEBT AND INTEREST EXPENSE

Debt activity. The following table presents the debt activity for the nine months ended September 30, 2021:

thousands	Carrying Value
Balance at December 31, 2020	$	7,854,702
RCF borrowings	400,000
Repayments of RCF borrowings	(180,000)
Repayment of 5.375% Senior Notes due 2021	(431,081)
Repayment of 4.000% Senior Notes due 2022	(78,671)
Repayment of Floating-Rate Senior Notes due 2023	(26,840)
Repayment of 3.100% Senior Notes due 2025	(267,894)
Repayment of 3.950% Senior Notes due 2025	(100,837)
Repayment of 4.650% Senior Notes due 2026	(25,758)
Finance lease liabilities	(25,364)
Other	8,046
Balance at September 30, 2021	$	7,126,303

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 4.542%, 5.424%, and 6.629%, respectively, at September 30, 2021, and were 4.291%, 5.173%, and 6.375%, respectively, at September 30, 2020. The interest rate on the Floating-Rate Senior Notes was 2.23% and 2.12% at September 30, 2021 and 2020, 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 third quarter of 2021, WES Operating purchased and retired $500.0 million of certain of its senior notes via a tender offer (see Debt activity above). For the three months ended September 30, 2021, losses of $24.7 million were recognized for the early retirement of these notes. 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 September 30, 2021, the 4.000% Senior Notes due 2022 were classified as short-term debt on the consolidated balance sheet. At September 30, 2021, 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. The non-extending lender’s commitments mature in February 2024 and represent $100.0 million out of $2.0 billion of total commitments from all lenders.

As of September 30, 2021, there were $220.0 million of outstanding borrowings and $5.1 million of outstanding letters of credit, resulting in $1.8 billion of available borrowing capacity under the RCF. As of September 30, 2021 and 2020, the interest rate on any outstanding RCF borrowings was 1.58% and 1.65%, respectively. The facility-fee rate was 0.25% at September 30, 2021 and 2020. At September 30, 2021, WES Operating was in compliance with all covenants under the RCF. Any outstanding RCF borrowings are classified as short-term debt on the consolidated balance sheet due to management’s intent to repay within the next twelve months.

Term loan facility. In January 2020, WES Operating repaid the outstanding borrowings with proceeds from the issuance of the Fixed-Rate Senior Notes and Floating-Rate Senior Notes and terminated its $3.0 billion senior unsecured credit facility (“Term loan facility”), see WES Operating Senior Notes above. During the first quarter of 2020, a loss of $2.3 million was recognized for the early termination of the Term loan facility.

11. DEBT AND INTEREST EXPENSE

Finance lease liabilities. The Partnership subleased equipment from Occidental via finance leases through April 2020. During the first quarter of 2020, the Partnership entered into finance leases with third parties for equipment and vehicles extending through 2029. Certain equipment leases were amended during the third quarter of 2021 requiring reassessment of lease classification. As a result, these leases are now classified as operating leases resulting in a reduction of $19.6 million in Net property, plant, and equipment and $20.3 million in Short-term and Long-term debt. The operating leases resulted in additions of $4.8 million in Other assets, $3.1 million in Accrued liabilities, and $2.4 million in Other liabilities, on the consolidated balance sheet. The Partnership has future payments for its finance leases of $6.7 million as of September 30, 2021.

Interest expense. The following table summarizes the amounts included in interest expense:

	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
Third parties
Long-term and short-term debt	$	(90,913)	$	(94,201)	$	(279,122)	$	(273,620)
Finance lease liabilities	(218)		(369)		(808)		(1,162)
Commitment fees and amortization of debt-related costs	(3,147)		(3,463)		(9,664)		(10,052)
Capitalized interest	1,021		2,462		2,554		6,066
Total interest expense – third parties	(93,257)		(95,571)		(287,040)		(278,768)
Related parties
Finance lease liabilities	—		—		—		(43)
Total interest expense – related parties	—		—		—		(43)
Interest expense	$	(93,257)	$	(95,571)	$	(287,040)	$	(278,811)

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2021

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

12. COMMITMENTS AND CONTINGENCIES

Environmental obligations. The Partnership is subject to various environmental-remediation obligations arising from federal, state, and local regulations regarding air and water quality, hazardous and solid waste disposal, and other environmental matters. As of September 30, 2021, and December 31, 2020, the consolidated balance sheets included $12.0 million and $8.2 million, respectively, of liabilities for remediation and reclamation obligations. The current portion of these amounts is included in Accrued liabilities, and the long-term portion of these amounts is included in Other liabilities. The majority of payments related to these obligations are expected to be made over the next five years.

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

Other commitments. The Partnership has payment obligations, or commitments, that include, among other things, a revolving credit facility, other third-party long-term debt, obligations related to the Partnership’s capital spending programs, pipeline 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 twelve months, primarily relate to construction, expansion, and asset-integrity projects at the West Texas complex, DBM water systems, DJ Basin complex, and DBM oil system.

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Description of Business and Basis of Presentation (Policies)

9 Months Ended

Sep. 30, 2021

Accounting Policies [Abstract]

Consolidation policy

Basis of presentation. The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and include the accounts of the Partnership and entities in which it holds a controlling financial interest, including WES Operating, WES Operating GP, proportionately consolidated interests, and equity investments (see table below). All significant intercompany transactions have been eliminated.

The following table outlines the ownership interests and the accounting method of consolidation used in the consolidated financial statements for entities not wholly owned:

	Percentage Interest
Full consolidation
Chipeta (1)	75.00	%
Proportionate consolidation (2)
Springfield system	50.10	%
Marcellus Interest systems	33.75	%
Equity investments (3)
Mi Vida JV LLC (“Mi Vida”)	50.00	%
Ranch Westex JV LLC (“Ranch Westex”)	50.00	%
Front Range Pipeline LLC (“FRP”)	33.33	%
Red Bluff Express Pipeline, LLC (“Red Bluff Express”)	30.00	%
Enterprise EF78 LLC (“Mont Belvieu JV”)	25.00	%
Rendezvous Gas Services, LLC (“Rendezvous”)	22.00	%
Texas Express Pipeline LLC (“TEP”)	20.00	%
Texas Express Gathering LLC (“TEG”)	20.00	%
Whitethorn Pipeline Company LLC (“Whitethorn LLC”)	20.00	%
Saddlehorn Pipeline Company, LLC (“Saddlehorn”)	20.00	%
Cactus II Pipeline LLC (“Cactus II”)	15.00	%
Panola Pipeline Company, LLC (“Panola”)	15.00	%
White Cliffs Pipeline, LLC (“White Cliffs”)	10.00	%

_________________________________________________________________________________________

(1)The 25% third-party interest in Chipeta Processing LLC (“Chipeta”) is reflected within noncontrolling interests in the consolidated financial statements. See Noncontrolling interests below.

(2)The Partnership proportionately consolidates its associated share of the assets, liabilities, revenues, and expenses attributable to these assets.

(3)Investments in non-controlled entities over which the Partnership exercises significant influence are accounted for under the equity method of accounting. “Equity-investment throughput” refers to the Partnership’s share of average throughput for these investments.

Certain information and note disclosures commonly included in annual financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, the accompanying consolidated financial statements and notes should be read in conjunction with the Partnership’s 2020 Form 10-K, as filed with the SEC on February 26, 2021. Management believes that the disclosures made are adequate to make the information not misleading.

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

The consolidated financial results of WES Operating are included in the Partnership’s consolidated financial statements. Throughout these notes to consolidated financial statements, and to the extent material, any differences between the consolidated financial results of the Partnership and WES Operating are discussed separately. The Partnership’s consolidated financial statements differ from those of WES Operating primarily as a result of (i) the presentation of noncontrolling interest ownership (see Noncontrolling interests below), (ii) the elimination of WES Operating GP’s investment in WES Operating with WES Operating GP’s underlying capital account, (iii) the general and administrative expenses incurred by the Partnership, which are separate from, and in addition to, those incurred by WES Operating, (iv) the inclusion of the impact of Partnership equity balances and Partnership distributions, and (v) transactions between the Partnership and WES Operating that eliminate upon consolidation.

Noncontrolling interests. The Partnership’s noncontrolling interests in the consolidated financial statements consist of (i) the 25% third-party interest in Chipeta and (ii) the 2.0% Occidental subsidiary-owned limited partner interest in WES Operating. WES Operating’s noncontrolling interest in the consolidated financial statements consists of the 25% third-party interest in Chipeta. See Note 5.

Use of estimates policy

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

Segments policy

Segments. The Partnership’s operations continue to be organized into a single operating segment, the assets of which gather, compress, treat, process, and transport natural gas; gather, stabilize, and transport condensate, NGLs, and crude oil; and gather and dispose of produced water in the United States.

Net income (loss) per common unit policy

Partnership’s net income (loss) per common unit. The common and general partner unitholders’ allocation of net income (loss) attributable to the Partnership was equal to their cash distributions plus their respective allocations of undistributed earnings or losses in accordance with their weighted-average ownership percentage during each period using the two-class method.

The Partnership’s basic net income (loss) per common unit is calculated by dividing the limited partners’ interest in net income (loss) by the weighted-average number of common units outstanding during the period. Diluted net income (loss) per common unit includes the effect of outstanding units issued under the Partnership’s long-term incentive plans.

5. EQUITY AND PARTNERS’ CAPITAL

The following table provides a reconciliation between basic and diluted net income (loss) per common unit:

	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands except per-unit amounts	2021		2020		2021		2020
Net income (loss)
Limited partners’ interest in net income (loss)	$	250,198	$	241,479	$	658,291	$	257,659
Weighted-average common units outstanding
Basic	411,909		438,857		412,690		442,255
Dilutive effect of non-vested phantom units	805		69		460		20
Diluted	412,714		438,926		413,150		442,275
Excluded due to anti-dilutive effect	4		1,084		700		1,271
Net income (loss) per common unit
Basic	$	0.61	$	0.55	$	1.60	$	0.58
Diluted	$	0.61	$	0.55	$	1.59	$	0.58

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

Goodwill policy

Goodwill is recorded when the purchase price of a business acquired exceeds the fair market value of the tangible and separately measurable intangible net assets. Goodwill also includes the allocated historic carrying value of midstream goodwill attributed to the Partnership’s assets previously acquired from Anadarko. The Partnership’s goodwill has been allocated to two reporting units: (i) gathering and processing and (ii) transportation.

The Partnership evaluates goodwill for impairment at the reporting-unit level on an annual basis, as of October 1, or more often as facts and circumstances warrant. An initial qualitative assessment is performed to determine the likelihood of whether goodwill is impaired and if deemed necessary based on this assessment, a quantitative assessment is then performed. If the quantitative assessment indicates that the carrying value of the reporting unit, including goodwill, exceeds its fair value, a goodwill impairment is recorded for the amount by which the reporting unit’s carrying value exceeds its fair value.

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Description of Business and Basis of Presentation (Tables)

9 Months Ended

Sep. 30, 2021

Accounting Policies [Abstract]

Assets and Investments Table

As of September 30, 2021, the Partnership’s assets and investments consisted of the following:

	Wholly Owned and Operated	Operated Interests	Non-Operated Interests	Equity Interests
Gathering systems (1)	17	2	3	1
Treating facilities	36	3	—	—
Natural-gas processing plants/trains	24	3	—	5
NGLs pipelines	2	—	—	5
Natural-gas pipelines	5	—	—	1
Crude-oil pipelines	3	1	—	4

_________________________________________________________________________________________

(1)Includes the DBM water systems.

Ownership Interests and Method of Consolidation Table

The following table outlines the ownership interests and the accounting method of consolidation used in the consolidated financial statements for entities not wholly owned:

	Percentage Interest
Full consolidation
Chipeta (1)	75.00	%
Proportionate consolidation (2)
Springfield system	50.10	%
Marcellus Interest systems	33.75	%
Equity investments (3)
Mi Vida JV LLC (“Mi Vida”)	50.00	%
Ranch Westex JV LLC (“Ranch Westex”)	50.00	%
Front Range Pipeline LLC (“FRP”)	33.33	%
Red Bluff Express Pipeline, LLC (“Red Bluff Express”)	30.00	%
Enterprise EF78 LLC (“Mont Belvieu JV”)	25.00	%
Rendezvous Gas Services, LLC (“Rendezvous”)	22.00	%
Texas Express Pipeline LLC (“TEP”)	20.00	%
Texas Express Gathering LLC (“TEG”)	20.00	%
Whitethorn Pipeline Company LLC (“Whitethorn LLC”)	20.00	%
Saddlehorn Pipeline Company, LLC (“Saddlehorn”)	20.00	%
Cactus II Pipeline LLC (“Cactus II”)	15.00	%
Panola Pipeline Company, LLC (“Panola”)	15.00	%
White Cliffs Pipeline, LLC (“White Cliffs”)	10.00	%

_________________________________________________________________________________________

(1)The 25% third-party interest in Chipeta Processing LLC (“Chipeta”) is reflected within noncontrolling interests in the consolidated financial statements. See Noncontrolling interests below.

(2)The Partnership proportionately consolidates its associated share of the assets, liabilities, revenues, and expenses attributable to these assets.

(3)Investments in non-controlled entities over which the Partnership exercises significant influence are accounted for under the equity method of accounting. “Equity-investment throughput” refers to the Partnership’s share of average throughput for these investments.

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Revenue from Contracts with Customers (Tables)

9 Months Ended

Sep. 30, 2021

Revenue from Contract with Customer [Abstract]

Summary of Revenue from Contracts with Customers Table

The following table summarizes revenue from contracts with customers:

	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
Revenue from customers
Service revenues – fee based	$	605,967	$	582,725	$	1,707,987	$	1,806,097
Service revenues – product based	28,812		12,316		88,267		35,237
Product sales	84,298		30,106		227,359		108,491
Total revenue from customers	719,077		625,147		2,023,613		1,949,825
Revenue from other than customers
Lease revenue (1)	44,515		53,797		133,755		174,449
Other	248		100		577		838
Total revenues and other	$	763,840	$	679,044	$	2,157,945	$	2,125,112

_________________________________________________________________________________________

(1)Includes fixed- and variable-lease revenue from an operating and maintenance agreement entered into with Occidental. See Operating leases within Note 6.

Contract Balances Tables

The following table summarizes activity related to contract assets from contracts with customers:

thousands
Contract assets balance at December 31, 2020	$	56,344
Amounts transferred to Accounts receivable, net that were included in the contract assets balance at the beginning of the period (1)	(3,858)
Additional estimated revenues recognized (2)	17,472
Contract assets balance at September 30, 2021	$	69,958
Contract assets at September 30, 2021
Other current assets	$	23,766
Other assets	46,192
Total contract assets from contracts with customers	$	69,958

_________________________________________________________________________________________

(1)Includes $(3.9) million for the three months ended September 30, 2021.

(2)Includes $8.9 million for the three months ended September 30, 2021.

The following table summarizes activity related to contract liabilities from contracts with customers:

thousands
Contract liabilities balance at December 31, 2020	$	266,937
Cash received or receivable, excluding revenues recognized during the period (1)	60,786
Revenues recognized that were included in the contract liability balance at the beginning of the period (2)	(13,553)
Cumulative catch-up adjustment for change in estimated consideration (3)	(17,209)
Contract liabilities balance at September 30, 2021	$	296,961
Contract liabilities at September 30, 2021
Accrued liabilities	$	22,854
Other liabilities	274,107
Total contract liabilities from contracts with customers	$	296,961

_________________________________________________________________________________________

(1)Includes $26.7 million for the three months ended September 30, 2021.

(2)Includes $(5.5) million for the three months ended September 30, 2021, $(1.7) million of which is related to the cumulative catch-up revenue adjustment recognized for the nine months ended September 30, 2021.

(3)Includes $(17.2) million for the three months ended September 30, 2021.

Expected Revenue Recognition from Satisfaction of Performance Obligations Table

Therefore, the following table represents only a portion of expected future revenues from existing contracts as most future revenues from customers are dependent on future variable customer volumes and, in some cases, variable commodity prices for those volumes.

thousands
Remainder of 2021	$	211,353
2022	1,057,409
2023	1,002,351
2024	973,300
2025	890,903
Thereafter	2,719,380
Total	$	6,854,696

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Partnership Distributions (Tables)

9 Months Ended

Sep. 30, 2021

Distributions Made to Members or Limited Partners [Abstract]

Cash Distributions Tables

The Board of Directors of the general partner (the “Board of Directors”) declared the following cash distributions to the Partnership’s unitholders for the periods presented:

thousands except per-unit amounts Quarters Ended	Total Quarterly Per-unit Distribution		Total Quarterly Cash Distribution		Distribution Date
2020
March 31	$	0.31100	$	140,893	May 2020
June 30	0.31100		140,900		August 2020
September 30	0.31100		132,255		November 2020
December 31	0.31100		131,265		February 2021
2021
March 31	$	0.31500	$	132,969	May 2021
June 30	0.31900		134,662		August 2021
September 30 (1)	0.32300		134,862		November 2021

_________________________________________________________________________________________

(1)The Board of Directors declared a cash distribution to the Partnership’s unitholders for the third quarter of 2021 of $0.32300 per unit, or $134.9 million in aggregate. The cash distribution is payable on November 12, 2021, to unitholders of record at the close of business on November 1, 2021, including the general partner units.

WES Operating made the following cash distributions to its limited partners for the periods presented:

thousands Quarters Ended	Total Quarterly Cash Distribution
2020
March 31	$	143,404
June 30	143,404
September 30	143,404
December 31	127,470
2021
March 31	$	137,030
June 30	140,217
September 30	140,217

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Equity and Partners' Capital (Tables)

9 Months Ended

Sep. 30, 2021

Partners' Capital Notes [Abstract]

Calculation of Net Income (Loss) Per Unit Table

The following table provides a reconciliation between basic and diluted net income (loss) per common unit:

	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands except per-unit amounts	2021		2020		2021		2020
Net income (loss)
Limited partners’ interest in net income (loss)	$	250,198	$	241,479	$	658,291	$	257,659
Weighted-average common units outstanding
Basic	411,909		438,857		412,690		442,255
Dilutive effect of non-vested phantom units	805		69		460		20
Diluted	412,714		438,926		413,150		442,275
Excluded due to anti-dilutive effect	4		1,084		700		1,271
Net income (loss) per common unit
Basic	$	0.61	$	0.55	$	1.60	$	0.58
Diluted	$	0.61	$	0.55	$	1.59	$	0.58

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Related-Party Transactions (Tables)

9 Months Ended

Sep. 30, 2021

Related Party Transaction [Line Items]

Related-Party Transactions Tables

The following tables summarize material related-party transactions included in the Partnership’s consolidated financial statements:

Consolidated statements of operations
	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
Revenues and other
Service revenues – fee based	$	418,520	$	436,405	$	1,188,679	$	1,344,326
Service revenues – product based	1,499		2,544		9,662		6,690
Product sales	11,662		16,692		27,034		60,452
Total revenues and other	431,681		455,641		1,225,375		1,411,468
Equity income, net – related parties (1)	48,506		61,026		159,337		176,788
Operating expenses
Cost of product	17,384		1,483		53,968		85,353
Operation and maintenance	3,497		1,303		24,534		35,660
General and administrative (2)	1,808		7,607		13,003		40,456
Total operating expenses	22,689		10,393		91,505		161,469
Interest income – Anadarko note receivable	—		3,286		—		11,736

_________________________________________________________________________________________

(1)See Note 7.

(2)Includes (i) amounts charged by Occidental pursuant to the shared services agreement (see Services Agreement within this Note 6) and (ii) equity-based compensation expense allocated to the Partnership by Occidental, which is not reimbursed to Occidental and is reflected as a contribution to partners’ capital in the consolidated statements of equity and partners’ capital (see Incentive Plans within this Note 6).

Consolidated balance sheets
thousands	September 30, 2021		December 31, 2020
Assets
Accounts receivable, net	$	289,402	$	291,253
Other current assets	29,021		5,493
Equity investments (1)	1,181,181		1,224,813
Other assets	76,560		50,967
Total assets	1,576,164		1,572,526
Liabilities
Accounts and imbalance payables	42,384		6,664
Accrued liabilities	19,232		19,195
Other liabilities	189,119		138,796
Total liabilities	250,735		164,655

_________________________________________________________________________________________

(1)See Note 7.

6. RELATED-PARTY TRANSACTIONS

Consolidated statements of cash flows
	Nine Months Ended  September 30,
thousands	2021		2020
Distributions from equity-investment earnings – related parties	$	164,772	$	187,816
Purchases from related parties	(2,000)		—
Contributions to equity investments – related parties	(3,683)		(19,017)
Distributions from equity investments in excess of cumulative earnings – related parties	30,075		21,750
Distributions to Partnership unitholders (1)	(195,205)		(301,219)
Distributions to WES Operating unitholders (2)	(9,934)		(11,545)
Net contributions from (distributions to) related parties	6,673		22,674
Finance lease payments	—		(6,382)

_________________________________________________________________________________________

(1)Represents distributions paid to Occidental pursuant to the partnership agreement of the Partnership (see Note 4 and Note 5).

(2)Represents distributions paid to a certain subsidiary of Occidental pursuant to WES Operating’s partnership agreement (see Note 4 and Note 5).

WES Operating [Member]

Related Party Transaction [Line Items]

Related-Party Transactions Tables

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:

Consolidated statements of operations
	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
General and administrative (1)	$	2,775	$	8,314	$	15,061	$	41,220

_________________________________________________________________________________________

(1)Includes (i) amounts charged by Occidental pursuant to the shared services agreement (see Services Agreement within this Note 6), (ii) equity-based compensation expense allocated to WES Operating by Occidental, which is not reimbursed to Occidental and is reflected as a contribution to partners’ capital in the consolidated statements of equity and partners’ capital (see Incentive Plans within this Note 6), and (iii) an intercompany service fee between the Partnership and WES Operating.

Consolidated balance sheets
thousands	September 30, 2021		December 31, 2020
Accounts receivable, net	$	289,402	$	246,083
Accounts and imbalance payables (1)	83,576		6,664

_________________________________________________________________________________________

(1)As of September 30, 2021, includes balances related to transactions between the Partnership and WES Operating.

Consolidated statements of cash flows
	Nine Months Ended  September 30,
thousands	2021		2020
Distributions to WES Operating unitholders (1)	$	(496,555)	$	(577,122)

_________________________________________________________________________________________

(1)Represents distributions paid to the Partnership and a certain subsidiary of Occidental pursuant to WES Operating’s partnership agreement. Includes a distribution made from WES Operating to the Partnership during the quarter ended September 30, 2021, that was used by the Partnership to repurchase common units on the open market. See Note 4 and Note 5.

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Equity Investments (Tables)

9 Months Ended

Sep. 30, 2021

Equity Method Investments and Joint Ventures [Abstract]

Equity Investments Table

The following table presents the financial statement impact of the Partnership’s equity investments for the nine months ended September 30, 2021:

thousands	Balance at December 31, 2020		Other-than-temporary impairment expense (1)		Equity income, net		Contributions		Distributions		Distributions in excess of cumulative earnings (2)		Balance at September 30, 2021
White Cliffs	$	45,623	$	—	$	701	$	—	$	(266)	$	(4,583)	$	41,475
Rendezvous	28,198		—		(1,560)		—		(884)		(2,058)		23,696
Mont Belvieu JV	98,874		—		25,066		—		(25,095)		(2,193)		96,652
TEG	16,661		—		3,390		—		(3,409)		(299)		16,343
TEP	195,189		—		27,572		—		(27,623)		(4,491)		190,647
FRP	199,881		—		28,351		—		(28,482)		(4,004)		195,746
Whitethorn LLC	156,729		—		6,380		347		(5,736)		(4,018)		153,702
Cactus II	173,921		—		14,290		3,336		(14,415)		(3,926)		173,206
Saddlehorn	111,717		—		26,045		—		(26,157)		—		111,605
Panola	20,867		—		1,629		—		(1,628)		(555)		20,313
Mi Vida	55,031		—		7,445		—		(7,334)		(2,245)		52,897
Ranch Westex	18,898		(11,805)		9,267		—		(12,517)		(1,624)		2,219
Red Bluff Express	103,224		—		10,761		—		(11,226)		(79)		102,680
Total	$	1,224,813	$	(11,805)	$	159,337	$	3,683	$	(164,772)	$	(30,075)	$	1,181,181

_________________________________________________________________________________________

(1)Recorded in Long-lived asset and other impairments in the consolidated statements of operations.

(2)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.

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Property, Plant, and Equipment (Tables)

9 Months Ended

Sep. 30, 2021

Property, Plant and Equipment [Abstract]

Property, Plant, and Equipment Table

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

thousands	Estimated Useful Life	September 30, 2021		December 31, 2020
Land	N/A	$	10,955	$	9,696
Gathering systems – pipelines	30 years	5,343,971		5,231,212
Gathering systems – compressors	15 years	2,111,639		2,096,905
Processing complexes and treating facilities	25 years	3,367,933		3,424,368
Transportation pipeline and equipment	6 to 45 years	168,384		168,205
Produced-water disposal systems	20 years	879,916		831,719
Assets under construction	N/A	123,115		176,834
Other	3 to 40 years	727,013		702,806
Total property, plant, and equipment		12,732,926		12,641,745
Less accumulated depreciation		4,208,845		3,931,800
Net property, plant, and equipment		$	8,524,081	$	8,709,945

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Selected Components of Working Capital (Tables)

9 Months Ended

Sep. 30, 2021

Selected Components Of Working Capital [Abstract]

Accounts Receivable, Net Table

A summary of accounts receivable, net is as follows:

	The Partnership				WES Operating
thousands	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
Trade receivables, net	$	583,646	$	452,718	$	583,646	$	407,547
Other receivables, net	6		162		6		2
Total accounts receivable, net	$	583,652	$	452,880	$	583,652	$	407,549

Other Current Assets Table

A summary of other current assets is as follows:

	The Partnership				WES Operating
thousands	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
NGLs inventory	$	4,002	$	882	$	4,002	$	882
Imbalance receivables	14,958		12,976		14,958		12,976
Prepaid insurance	14,425		8,131		12,136		6,113
Contract assets	23,766		5,338		23,766		5,338
Other	16,045		17,935		16,045		17,935
Total other current assets	$	73,196	$	45,262	$	70,907	$	43,244

Accrued Liabilities Table

A summary of accrued liabilities is as follows:

	The Partnership				WES Operating
thousands	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
Accrued interest expense	$	69,570	$	137,307	$	69,570	$	137,307
Short-term asset retirement obligations	14,365		20,215		14,365		20,215
Short-term remediation and reclamation obligations	6,101		2,950		6,101		2,950
Income taxes payable	4,593		3,399		4,593		3,399
Contract liabilities	22,854		31,477		22,854		31,477
Other	73,145		74,599		27,758		35,485
Total accrued liabilities	$	190,628	$	269,947	$	145,241	$	230,833

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Debt and Interest Expense (Tables)

9 Months Ended

Sep. 30, 2021

Debt Instruments [Abstract]

Debt Outstanding and Debt Activity Tables

The following table presents the outstanding debt:

	September 30, 2021						December 31, 2020
thousands	Principal		Carrying Value		Fair Value (1)		Principal		Carrying Value		Fair Value (1)
Short-term debt
4.000% Senior Notes due 2022	$	502,246	$	502,086	$	510,243	$	—	$	—	$	—
5.375% Senior Notes due 2021	—		—		—		431,081		430,606		436,241
RCF	220,000		220,000		220,000		—		—		—
Finance lease liabilities	4,343		4,343		4,343		8,264		8,264		8,264
Total short-term debt	$	726,589	$	726,429	$	734,586	$	439,345	$	438,870	$	444,505
Long-term debt
4.000% Senior Notes due 2022	$	—	$	—	$	—	$	580,917	$	580,555	$	597,568
Floating-Rate Senior Notes due 2023	213,138		212,521		212,773		239,978		238,879		235,066
3.100% Senior Notes due 2025	732,106		727,794		774,328		1,000,000		992,900		1,028,614
3.950% Senior Notes due 2025	399,163		395,708		421,970		500,000		494,866		512,807
4.650% Senior Notes due 2026	474,242		471,500		513,758		500,000		496,708		524,880
4.500% Senior Notes due 2028	400,000		396,010		433,214		400,000		395,617		415,454
4.750% Senior Notes due 2028	400,000		396,840		437,005		400,000		396,555		418,786
4.050% Senior Notes due 2030	1,200,000		1,190,102		1,324,159		1,200,000		1,189,407		1,342,996
5.450% Senior Notes due 2044	600,000		593,699		691,067		600,000		593,598		607,234
5.300% Senior Notes due 2048	700,000		687,210		807,613		700,000		687,048		694,172
5.500% Senior Notes due 2048	350,000		342,629		409,945		350,000		342,543		343,928
5.250% Senior Notes due 2050	1,000,000		983,659		1,176,283		1,000,000		983,512		1,100,375
Finance lease liabilities	2,202		2,202		2,202		23,644		23,644		23,644
Total long-term debt	$	6,470,851	$	6,399,874	$	7,204,317	$	7,494,539	$	7,415,832	$	7,845,524

_________________________________________________________________________________________

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

11. DEBT AND INTEREST EXPENSE

Debt activity. The following table presents the debt activity for the nine months ended September 30, 2021:

thousands	Carrying Value
Balance at December 31, 2020	$	7,854,702
RCF borrowings	400,000
Repayments of RCF borrowings	(180,000)
Repayment of 5.375% Senior Notes due 2021	(431,081)
Repayment of 4.000% Senior Notes due 2022	(78,671)
Repayment of Floating-Rate Senior Notes due 2023	(26,840)
Repayment of 3.100% Senior Notes due 2025	(267,894)
Repayment of 3.950% Senior Notes due 2025	(100,837)
Repayment of 4.650% Senior Notes due 2026	(25,758)
Finance lease liabilities	(25,364)
Other	8,046
Balance at September 30, 2021	$	7,126,303

Interest Expense Table

The following table summarizes the amounts included in interest expense:

	Three Months Ended  September 30,				Nine Months Ended  September 30,
thousands	2021		2020		2021		2020
Third parties
Long-term and short-term debt	$	(90,913)	$	(94,201)	$	(279,122)	$	(273,620)
Finance lease liabilities	(218)		(369)		(808)		(1,162)
Commitment fees and amortization of debt-related costs	(3,147)		(3,463)		(9,664)		(10,052)
Capitalized interest	1,021		2,462		2,554		6,066
Total interest expense – third parties	(93,257)		(95,571)		(287,040)		(278,768)
Related parties
Finance lease liabilities	—		—		—		(43)
Total interest expense – related parties	—		—		—		(43)
Interest expense	$	(93,257)	$	(95,571)	$	(287,040)	$	(278,811)

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Description of Business and Basis of Presentation - Assets and Investments Table (Details)	Sep. 30, 2021 unit
Wholly Owned and Operated [Member] | Gathering Systems [Member]
Assets [Line Items]
Assets, number of units	17
Wholly Owned and Operated [Member] | Treating Facilities [Member]
Assets [Line Items]
Assets, number of units	36
Wholly Owned and Operated [Member] | Natural-Gas Processing Plants/Trains [Member]
Assets [Line Items]
Assets, number of units	24
Wholly Owned and Operated [Member] | Natural-Gas Liquids Pipelines [Member]
Assets [Line Items]
Assets, number of units	2
Wholly Owned and Operated [Member] | Natural-Gas Pipelines [Member]
Assets [Line Items]
Assets, number of units	5
Wholly Owned and Operated [Member] | Crude-Oil Pipelines [Member]
Assets [Line Items]
Assets, number of units	3
Operated Interests [Member] | Gathering Systems [Member]
Assets [Line Items]
Assets, number of units	2
Operated Interests [Member] | Treating Facilities [Member]
Assets [Line Items]
Assets, number of units	3
Operated Interests [Member] | Natural-Gas Processing Plants/Trains [Member]
Assets [Line Items]
Assets, number of units	3
Operated Interests [Member] | Crude-Oil Pipelines [Member]
Assets [Line Items]
Assets, number of units	1
Non-Operated Interests [Member] | Gathering Systems [Member]
Assets [Line Items]
Assets, number of units	3
Equity Interests [Member] | Gathering Systems [Member]
Assets [Line Items]
Assets, number of units	1
Equity Interests [Member] | Natural-Gas Processing Plants/Trains [Member]
Assets [Line Items]
Assets, number of units	5
Equity Interests [Member] | Natural-Gas Liquids Pipelines [Member]
Assets [Line Items]
Assets, number of units	5
Equity Interests [Member] | Natural-Gas Pipelines [Member]
Assets [Line Items]
Assets, number of units	1
Equity Interests [Member] | Crude-Oil Pipelines [Member]
Assets [Line Items]
Assets, number of units	4

XML

Description of Business and Basis of Presentation - Ownership Interests and Method of Consolidation Table (Details)	9 Months Ended
	Sep. 30, 2021
Chipeta [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Ownership interest by noncontrolling interest owner	25.00%
Full Consolidation [Member] | Chipeta [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Percentage ownership interest	75.00%
Proportionate Consolidation [Member] | Springfield System [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Percentage ownership interest	50.10%
Proportionate Consolidation [Member] | Marcellus Interest Systems [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Percentage ownership interest	33.75%
Equity Investments [Member] | Mi Vida [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	50.00%
Equity Investments [Member] | Ranch Westex [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	50.00%
Equity Investments [Member] | Front Range Pipeline [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	33.33%
Equity Investments [Member] | Red Bluff Express [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	30.00%
Equity Investments [Member] | Mont Belvieu JV [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	25.00%
Equity Investments [Member] | Rendezvous [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	22.00%
Equity Investments [Member] | Texas Express Pipeline [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	20.00%
Equity Investments [Member] | Texas Express Gathering [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	20.00%
Equity Investments [Member] | Whitethorn LLC [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	20.00%
Equity Investments [Member] | Saddlehorn [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	20.00%
Equity Investments [Member] | Cactus II [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	15.00%
Equity Investments [Member] | Panola [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	15.00%
Equity Investments [Member] | White Cliffs [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Equity-investment ownership percentage	10.00%

XML

Description of Business and Basis of Presentation - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Mar. 22, 2021
Defined-contribution plan expense	$ 5.3	$ 3.8	$ 18.3	$ 8.2
Long-Term Incentive Plans [Member]
Common units issued under the WES LTIP, number of units			357,472
Equity-based compensation expense	$ 4.7	$ 2.1	$ 12.9	$ 5.4
Western Midstream Partners, LP 2021 Long-Term Incentive Plan [Member]
Units authorized under LTIP					9,500,000
WES Operating [Member]
Ownership interest by noncontrolling interest owner	2.00%		2.00%
Chipeta [Member]
Ownership interest by noncontrolling interest owner	25.00%		25.00%
WES [Member] | WES Operating [Member]
Ownership interest			98.00%

XML

Revenue from Contracts with Customers - Revenue From Contracts With Customers Table (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Disaggregation of Revenue [Line Items]
Revenue from customers		$ 719,077	$ 625,147	$ 2,023,613	$ 1,949,825
Revenue from other than customers, other		248	100	577	838
Total revenues and other	[1]	763,840	679,044	2,157,945	2,125,112
Service Revenues - Fee Based [Member]
Disaggregation of Revenue [Line Items]
Revenue from customers		605,967	582,725	1,707,987	1,806,097
Total revenues and other		650,482	636,522	1,841,742	1,980,546
Service Revenues - Product Based [Member]
Disaggregation of Revenue [Line Items]
Revenue from customers		28,812	12,316	88,267	35,237
Total revenues and other		28,812	12,316	88,267	35,237
Product Sales [Member]
Disaggregation of Revenue [Line Items]
Revenue from customers		84,298	30,106	227,359	108,491
Total revenues and other		84,298	30,106	227,359	108,491
Lease Revenue [Member]
Disaggregation of Revenue [Line Items]
Revenue from other than customers		$ 44,515	$ 53,797	$ 133,755	$ 174,449

[1] Total revenues and other includes related-party amounts of $431.7 million and $1.2 billion for the three and nine months ended September 30, 2021, respectively, and $455.6 million and $1.4 billion for the three and nine months ended September 30, 2020, respectively. See Note 6.

XML

Revenue from Contracts with Customers - Contract Assets Table (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2021	Dec. 31, 2020
Change in Contracts with Customer, Asset [Roll Forward]
Contract assets balance at beginning of year		$ 56,344
Amounts transferred to Accounts receivable, net that were included in the contract assets balance at the beginning of the period	$ (3,900)	(3,858)
Additional estimated revenues recognized	8,900	17,472
Contract assets balance at end of period	69,958	69,958
Contract Assets [Abstract]
Other current assets	23,766	23,766	$ 5,338
Other assets	46,192	46,192
Total contract assets from contracts with customers	$ 69,958	$ 69,958	$ 56,344

XML

Revenue from Contracts with Customers - Contract Liabilities Table (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2021	Dec. 31, 2020
Change in Contracts with Customer, Liability [Roll Forward]
Contract liabilities balance at begining of year		$ 266,937
Cash received or receivable, excluding revenues recognized during the period	$ 26,700	60,786
Revenues recognized that were included in the contract liability balance at the beginning of the period	(5,500)	(13,553)
Cumulative catch-up adjustment for change in estimate consideration	(17,200)	(17,209)
Contract liabilities balance at end of period	296,961	296,961
Contract Liabilities [Abstract]
Accrued liabilities	22,854	22,854	$ 31,477
Other liabilities	274,107	274,107
Total contract liabilities from contracts with customers	296,961	$ 296,961	$ 266,937
Revenues recognized that were included in the contract liability balance at the beginning of the period, related to a cumulative catch-up.	$ (1,700)

XML

Revenue from Contracts with Customers - Expected Revenues Table (Details) $ in Thousands	Sep. 30, 2021 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligation expected to be satisfied	$ 6,854,696
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligation expected to be satisfied	$ 211,353
Performance obligation expected to be satisfied, expected timing	3 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligation expected to be satisfied	$ 1,057,409
Performance obligation expected to be satisfied, expected timing	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligation expected to be satisfied	$ 1,002,351
Performance obligation expected to be satisfied, expected timing	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligation expected to be satisfied	$ 973,300
Performance obligation expected to be satisfied, expected timing	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligation expected to be satisfied	$ 890,903
Performance obligation expected to be satisfied, expected timing	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligation expected to be satisfied	$ 2,719,380
Performance obligation expected to be satisfied, expected timing

XML

Revenue from Contracts with Customers - Additional Information (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2021	Dec. 31, 2020
Revenue from Contracts with Customer [Line Items]
Accounts receivable, net	$ 583,652	$ 452,880
Customers [Member]
Revenue from Contracts with Customer [Line Items]
Accounts receivable, net	572,800	$ 428,200
Service Revenues - Fee Based [Member]
Revenue from Contracts with Customer [Line Items]
Cumulative catch-up revenue adjustment	$ 18,900

XML

Acquisitions and Divestitures - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jun. 30, 2021	Dec. 31, 2020	Sep. 30, 2021	Oct. 09, 2020
Fort Union [Member]
Property, Plant and Equipment [Line Items]
Equity-investment ownership percentage				14.81%
Net gain on sale of assets		$ 21.0
Fort Union and Bison Treating Facility [Member]
Property, Plant and Equipment [Line Items]
Proceeds from sale of assets		27.0
Bison [Member]
Property, Plant and Equipment [Line Items]
Proceeds from sale of assets	$ 1.0	$ 7.0	$ 8.0
Net gain on sale of assets			$ 5.4

XML

Partnership Distributions - Cash Distributions Tables (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020
Distribution Made to Limited Partner [Line Items]
Total quarterly per-unit distribution	$ 0.32300	$ 0.31900	$ 0.31500	$ 0.31100	$ 0.31100	$ 0.31100	$ 0.31100
Total quarterly cash distribution	$ 134,862	$ 134,662	$ 132,969	$ 131,265	$ 132,255	$ 140,900	$ 140,893
WES Operating [Member]
Distribution Made to Limited Partner [Line Items]
Total quarterly cash distribution	$ 140,217	$ 140,217	$ 137,030	$ 127,470	$ 143,404	$ 143,404	$ 143,404

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Partnership Distributions - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2021
WES [Member]
Distribution Made to Limited Partner [Line Items]
Partnership agreement day requirement of distribution of available cash		55 days
WES Operating [Member]
Distribution Made to Limited Partner [Line Items]
Additional quarterly cash distribution	$ 91.8

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Equity and Partners' Capital - Calculation of Net Income (Loss) Per Unit Table (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Equity [Abstract]
Limited partners' interest in net income (loss)	[1]	$ 250,198	$ 241,479	$ 658,291	$ 257,659
Weighted-average common units outstanding
Basic	[1]	411,909	438,857	412,690	442,255
Dilutive effect of non-vested phantom units		805	69	460	20
Diluted	[1]	412,714	438,926	413,150	442,275
Excluded due to anti-dilutive effect		4	1,084	700	1,271
Net income (loss) per common unit
Basic	[1]	$ 0.61	$ 0.55	$ 1.60	$ 0.58
Diluted	[1]	$ 0.61	$ 0.55	$ 1.59	$ 0.58

[1] See Note 5.

XML

Equity and Partners' Capital - Additional Information (Details) - USD ($)		1 Months Ended	9 Months Ended
	Sep. 11, 2020	Mar. 31, 2021	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020	Nov. 30, 2020	May 31, 2008
Schedule of Investments [Line Items]
Common units outstanding			408,610,916		413,839,863
General partner units outstanding			9,060,641		9,060,641
Unit repurchases, authorized amount						$ 250,000,000
Unit repurchases, number of units			5,586,419
Unit repurchases, amount			$ 104,366,000	$ 0
Unit repurchases, remaining authorized amount			$ 113,100,000
Related Parties [Member]
Schedule of Investments [Line Items]
Anadarko note receivable							$ 260,000,000
Anadarko [Member]
Schedule of Investments [Line Items]
Anadarko note receivable - percentage interest transferred	98.00%
Anadarko note receivable	$ 260,000,000
WES [Member] | Public [Member]
Schedule of Investments [Line Items]
Common units outstanding			205,829,338
Limited partner's interest			49.30%
WES [Member] | WES [Member] | Related Parties [Member] | Limited Partner [Member]
Schedule of Investments [Line Items]
Units redeemed from a related party	27,855,398
WES [Member] | WES Operating [Member]
Schedule of Investments [Line Items]
Limited partner's interest			98.00%
Occidental [Member] | Limited Partner [Member]
Schedule of Investments [Line Items]
Units sold by a related party		11,500,000
Units sold by a related party, over-allotment		1,500,000
Occidental [Member] | WES [Member]
Schedule of Investments [Line Items]
Common units outstanding			202,781,578
Limited partner's interest			48.50%
General partner units outstanding			9,060,641
General partner's interest			2.20%
Occidental [Member] | WES Operating [Member]
Schedule of Investments [Line Items]
Limited partner's interest			2.00%
WES Operating [Member]
Schedule of Investments [Line Items]
Common units outstanding			318,675,578		318,675,578

XML

Related-Party Transactions - Summary of WES Related-Party Transactions Tables (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Consolidated statements of operations [Abstract]
Revenues and other	[1]	$ 763,840	$ 679,044	$ 2,157,945	$ 2,125,112
Equity income, net – related parties		48,506	61,026	159,337	176,788
Cost of product		83,232	31,739	250,245	153,611
Operation and maintenance		140,838	132,293	434,198	436,670
General and administrative		50,409	41,578	139,973	118,466
Operating expenses	[2]	428,716	392,206	1,307,010	1,792,290
Interest income – Anadarko note receivable		0	3,286	0	11,736
Consolidated balance sheets [Abstract]
Accounts receivable, net		583,652		583,652		$ 452,880
Other current assets		73,196		73,196		45,262
Equity investments		1,181,181		1,181,181		1,224,813
Other assets	[3]	199,964		199,964		171,013
Total assets	[4]	11,419,378		11,419,378		11,830,027
Accounts and imbalance payables		341,220		341,220		210,691
Accrued liabilities		190,628		190,628		269,947
Other liabilities		320,224		320,224		275,570
Total liabilities	[5]	8,322,932		8,322,932		8,934,815
Consolidated statements of cash flows [Abstract]
Distributions from equity-investment earnings – related parties				164,772	187,816
Contributions to equity investments – related parties				(3,683)	(19,017)
Distributions from equity investments in excess of cumulative earnings – related parties				30,075	21,750
Distributions to Partnership unitholders	[6]			(398,896)	(563,579)
Net contributions from (distributions to) related parties				6,673	22,674
Finance lease payments	[7]			(5,295)	(12,241)
Service Revenues - Fee Based [Member]
Consolidated statements of operations [Abstract]
Revenues and other		650,482	636,522	1,841,742	1,980,546
Service Revenues - Product Based [Member]
Consolidated statements of operations [Abstract]
Revenues and other		28,812	12,316	88,267	35,237
Product Sales [Member]
Consolidated statements of operations [Abstract]
Revenues and other		84,298	30,106	227,359	108,491
Related Parties [Member]
Consolidated statements of operations [Abstract]
Revenues and other		431,681	455,641	1,225,375	1,411,468
Cost of product		17,384	1,483	53,968	85,353
Operation and maintenance		3,497	1,303	24,534	35,660
General and administrative		1,808	7,607	13,003	40,456
Operating expenses		22,689	10,393	91,505	161,469
Consolidated balance sheets [Abstract]
Accounts receivable, net		289,402		289,402		291,253
Other current assets		29,021		29,021		5,493
Other assets		76,560		76,560		50,967
Total assets		1,576,164		1,576,164		1,572,526
Accounts and imbalance payables		42,384		42,384		6,664
Accrued liabilities		19,232		19,232		19,195
Other liabilities		189,119		189,119		138,796
Total liabilities		250,735		250,735		$ 164,655
Consolidated statements of cash flows [Abstract]
Purchases from related parties				(2,000)	0
Distributions to Partnership unitholders				(195,205)	(301,219)
Finance lease payments				0	(6,382)
Related Parties [Member] | WES Operating [Member]
Consolidated statements of cash flows [Abstract]
Distributions to Partnership unitholders				(9,934)	(11,545)
Related Parties [Member] | Service Revenues - Fee Based [Member]
Consolidated statements of operations [Abstract]
Revenues and other		418,520	436,405	1,188,679	1,344,326
Related Parties [Member] | Service Revenues - Product Based [Member]
Consolidated statements of operations [Abstract]
Revenues and other		1,499	2,544	9,662	6,690
Related Parties [Member] | Product Sales [Member]
Consolidated statements of operations [Abstract]
Revenues and other		$ 11,662	$ 16,692	$ 27,034	$ 60,452

[1] Total revenues and other includes related-party amounts of $431.7 million and $1.2 billion for the three and nine months ended September 30, 2021, respectively, and $455.6 million and $1.4 billion for the three and nine months ended September 30, 2020, respectively. See Note 6.

[2] Total operating expenses includes related-party amounts of $22.7 million and $91.5 million for the three and nine months ended September 30, 2021, respectively, and $10.4 million and $161.5 million for the three and nine months ended September 30, 2020, respectively. See Note 6.

[3] Other assets includes $11.2 million and $4.2 million of NGLs line-fill inventory as of September 30, 2021, and December 31, 2020, respectively. Other assets also includes $63.1 million and $71.9 million of materials and supplies inventory as of September 30, 2021, and December 31, 2020, respectively.

[4] Total assets includes related-party amounts of $1.6 billion as of September 30, 2021, and December 31, 2020, which includes related-party Accounts receivable, net of $289.4 million and $291.3 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

[5] Total liabilities includes related-party amounts of $250.7 million and $164.7 million as of September 30, 2021, and December 31, 2020, respectively. See Note 6.

[6] See Note 6.

[7] For the nine months ended September 30, 2020, includes related-party payments of $6.4 million.

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Related-Party Transactions - Summary of WES Operating Related-Party Transactions Tables (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Consolidated statements of operations [Abstract]
General and administrative		$ 50,409	$ 41,578	$ 139,973	$ 118,466
Consolidated balance sheets [Abstract]
Accounts receivable, net		583,652		583,652		$ 452,880
Accounts and imbalance payables		341,220		341,220		210,691
Consolidated statements of cash flows [Abstract]
Distributions to WES Operating unitholders	[1]			(398,896)	(563,579)
Related Parties [Member]
Consolidated statements of operations [Abstract]
General and administrative		1,808	7,607	13,003	40,456
Consolidated balance sheets [Abstract]
Accounts receivable, net		289,402		289,402		291,253
Accounts and imbalance payables		42,384		42,384		6,664
Consolidated statements of cash flows [Abstract]
Distributions to WES Operating unitholders				(195,205)	(301,219)
WES Operating [Member]
Consolidated statements of operations [Abstract]
General and administrative		50,689	41,483	137,767	115,783
Consolidated balance sheets [Abstract]
Accounts receivable, net		583,652		583,652		407,549
Accounts and imbalance payables		382,406		382,406		210,532
Consolidated statements of cash flows [Abstract]
Distributions to WES Operating unitholders	[1]			(496,555)	(577,122)
WES Operating [Member] | Related Parties [Member]
Consolidated statements of operations [Abstract]
General and administrative		2,775	$ 8,314	15,061	41,220
Consolidated balance sheets [Abstract]
Accounts receivable, net		289,402		289,402		246,083
Accounts and imbalance payables		$ 83,576		83,576		$ 6,664
Consolidated statements of cash flows [Abstract]
Distributions to WES Operating unitholders				$ (496,555)	$ (577,122)

[1] See Note 6.

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Related-Party Transactions - Additional Information (Details) - USD ($)	3 Months Ended				9 Months Ended
	Sep. 30, 2021	Mar. 31, 2021	Sep. 30, 2020	Mar. 31, 2020	Sep. 30, 2021	Sep. 30, 2020	May 31, 2008
Related Party Transaction [Line Items]
Right-of-use asset recognized	$ 4,800,000				$ 4,800,000
WES Operating [Member]
Related Party Transaction [Line Items]
Cash contribution from related party				$ 20,000,000
Occidental [Member]
Related Party Transaction [Line Items]
Right-of-use asset recognized		$ 30,000,000
Present value of reduced usage fees		$ 30,000,000
Occidental [Member] | Incentive Plans [Member]
Related Party Transaction [Line Items]
Allocated equity-based compensation expense	2,300,000		$ 3,500,000		7,900,000	$ 11,200,000
Related Parties [Member]
Related Party Transaction [Line Items]
Operating lease, fixed-lease revenue	43,900,000		44,000,000		131,900,000	131,800,000
Operating lease, variable lease revenue	$ 600,000		$ 9,800,000		$ 1,900,000	$ 42,600,000
Anadarko note receivable							$ 260,000,000
Natural Gas [Member]
Related Party Transaction [Line Items]
Related-party throughput percentage	38.00%		41.00%		36.00%	42.00%
Crude Oil and NGLs Member]
Related Party Transaction [Line Items]
Related-party throughput percentage	88.00%		87.00%		89.00%	88.00%
Produced water [Member]
Related Party Transaction [Line Items]
Related-party throughput percentage	89.00%		87.00%		87.00%	88.00%

XML

Equity Investments - Equity Investments Table (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			$ 1,224,813
Other-than-temporary impairment expense			(11,805)
Equity income, net	$ 48,506	$ 61,026	159,337	$ 176,788
Contributions			3,683	19,017
Distributions			(164,772)	(187,816)
Distributions in excess of cumulative earnings			(30,075)	(21,750)
Balance at end of period	1,181,181		1,181,181
White Cliffs [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			45,623
Other-than-temporary impairment expense			0
Equity income, net			701
Contributions			0
Distributions			(266)
Distributions in excess of cumulative earnings			(4,583)
Balance at end of period	41,475		41,475
Rendezvous [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			28,198
Other-than-temporary impairment expense			0
Equity income, net			(1,560)
Contributions			0
Distributions			(884)
Distributions in excess of cumulative earnings			(2,058)
Balance at end of period	23,696		23,696
Mont Belvieu JV [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			98,874
Other-than-temporary impairment expense			0
Equity income, net			25,066
Contributions			0
Distributions			(25,095)
Distributions in excess of cumulative earnings			(2,193)
Balance at end of period	96,652		96,652
Texas Express Gathering [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			16,661
Other-than-temporary impairment expense			0
Equity income, net			3,390
Contributions			0
Distributions			(3,409)
Distributions in excess of cumulative earnings			(299)
Balance at end of period	16,343		16,343
Texas Express Pipeline [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			195,189
Other-than-temporary impairment expense			0
Equity income, net			27,572
Contributions			0
Distributions			(27,623)
Distributions in excess of cumulative earnings			(4,491)
Balance at end of period	190,647		190,647
Front Range Pipeline [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			199,881
Other-than-temporary impairment expense			0
Equity income, net			28,351
Contributions			0
Distributions			(28,482)
Distributions in excess of cumulative earnings			(4,004)
Balance at end of period	195,746		195,746
Whitethorn LLC [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			156,729
Other-than-temporary impairment expense			0
Equity income, net			6,380
Contributions			347
Distributions			(5,736)
Distributions in excess of cumulative earnings			(4,018)
Balance at end of period	153,702		153,702
Cactus II [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			173,921
Other-than-temporary impairment expense			0
Equity income, net			14,290
Contributions			3,336
Distributions			(14,415)
Distributions in excess of cumulative earnings			(3,926)
Balance at end of period	173,206		173,206
Saddlehorn [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			111,717
Other-than-temporary impairment expense			0
Equity income, net			26,045
Contributions			0
Distributions			(26,157)
Distributions in excess of cumulative earnings			0
Balance at end of period	111,605		111,605
Panola [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			20,867
Other-than-temporary impairment expense			0
Equity income, net			1,629
Contributions			0
Distributions			(1,628)
Distributions in excess of cumulative earnings			(555)
Balance at end of period	20,313		20,313
Mi Vida [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			55,031
Other-than-temporary impairment expense			0
Equity income, net			7,445
Contributions			0
Distributions			(7,334)
Distributions in excess of cumulative earnings			(2,245)
Balance at end of period	52,897		52,897
Ranch Westex [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year	2,900		18,898
Other-than-temporary impairment expense			(11,805)	$ (29,400)
Equity income, net			9,267
Contributions			0
Distributions			(12,517)
Distributions in excess of cumulative earnings			(1,624)
Balance at end of period	2,219		2,219
Red Bluff Express [Member]
Schedule of Equity Method Investments [Line Items]
Balance at beginning of year			103,224
Other-than-temporary impairment expense			0
Equity income, net			10,761
Contributions			0
Distributions			(11,226)
Distributions in excess of cumulative earnings			(79)
Balance at end of period	$ 102,680		$ 102,680

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Equity Investments - Additional Information (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Jun. 30, 2021	Dec. 31, 2020
Schedule of Equity Method Investments [Line Items]
Other-than-temporary impairment expense	$ 11,805
Equity-investment balance	1,181,181			$ 1,224,813
Ranch Westex [Member]
Schedule of Equity Method Investments [Line Items]
Equity investment difference between carrying and underlying value	(37,100)
Other-than-temporary impairment expense	11,805	$ 29,400
Equity-investment balance	$ 2,219		$ 2,900	$ 18,898

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Property, Plant, and Equipment - Historical Cost Table (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Property, plant, and equipment	$ 12,732,926	$ 12,641,745
Less accumulated depreciation	4,208,845	3,931,800
Net property, plant, and equipment	8,524,081	8,709,945
Land [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment	10,955	9,696
Gathering Systems – Pipelines [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment	$ 5,343,971	5,231,212
Estimated useful life	30 years
Gathering Systems – Compressors [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment	$ 2,111,639	2,096,905
Estimated useful life	15 years
Processing Complexes And Treating Facilities [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment	$ 3,367,933	3,424,368
Estimated useful life	25 years
Transportation Pipeline And Equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment	$ 168,384	168,205
Transportation Pipeline And Equipment [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life	6 years
Transportation Pipeline And Equipment [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life	45 years
Produced-Water Disposal Systems [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment	$ 879,916	831,719
Estimated useful life	20 years
Assets Under Construction [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment	$ 123,115	176,834
Other [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment	$ 727,013	$ 702,806
Other [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life	3 years
Other [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life	40 years

XML

Property, Plant, and Equipment - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Property, Plant and Equipment [Line Items]
Long-lived asset and other impairments	$ 1,594	$ 34,640	$ 29,198	$ 200,575
Other-than-temporary impairment expense			11,805
Ranch Westex [Member]
Property, Plant and Equipment [Line Items]
Other-than-temporary impairment expense			11,805	29,400
DJ Basin Complex [Member]
Property, Plant and Equipment [Line Items]
Long-lived asset and other impairments			$ 14,100
Wyoming and Utah Assets [Member]
Property, Plant and Equipment [Line Items]
Long-lived asset and other impairments				150,200
Wyoming and Utah Assets [Member] | Fair Value, Nonrecurring [Member] | Level-3 Inputs [Member] | Valuation, Income Approach [Member]
Property, Plant and Equipment [Line Items]
Estimated fair value		$ 112,200		112,200
DJ Basin Complex and DBM Water Systems [Member]
Property, Plant and Equipment [Line Items]
Long-lived asset and other impairments				$ 21,000

XML

Goodwill - Additional Information (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2021 USD ($)	Sep. 30, 2020 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2020 USD ($)	Dec. 31, 2020 USD ($)
Finite-Lived Intangible Assets [Line Items]
Number of reporting units			2
Goodwill impairment	$ 0	$ 0	$ 0	$ 441,017,000
Goodwill	$ 4,783,000		$ 4,783,000		$ 4,783,000
Gathering and Processing Reporting Unit [Member]
Finite-Lived Intangible Assets [Line Items]
Goodwill		0		0
Transportation Reporting Unit [Member]
Finite-Lived Intangible Assets [Line Items]
Goodwill		$ 4,800,000		$ 4,800,000

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Selected Components of Working Capital - Accounts Receivable, Net Table (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Trade receivables, net	$ 583,646	$ 452,718
Other receivables, net	6	162
Total accounts receivable, net	583,652	452,880
WES Operating [Member]
Trade receivables, net	583,646	407,547
Other receivables, net	6	2
Total accounts receivable, net	$ 583,652	$ 407,549

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Selected Components of Working Capital - Other Current Assets Table (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
NGLs inventory	$ 4,002	$ 882
Imbalance receivables	14,958	12,976
Prepaid insurance	14,425	8,131
Contract assets	23,766	5,338
Other	16,045	17,935
Total other current assets	73,196	45,262
WES Operating [Member]
NGLs inventory	4,002	882
Imbalance receivables	14,958	12,976
Prepaid insurance	12,136	6,113
Contract assets	23,766	5,338
Other	16,045	17,935
Total other current assets	$ 70,907	$ 43,244

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Selected Components of Working Capital - Accrued Liabilities Table (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Accrued interest expense	$ 69,570	$ 137,307
Short-term asset retirement obligations	14,365	20,215
Short-term remediation and reclamation obligations	6,101	2,950
Income taxes payable	4,593	3,399
Contract liabilities	22,854	31,477
Other	73,145	74,599
Total accrued liabilities	190,628	269,947
WES Operating [Member]
Accrued interest expense	69,570	137,307
Short-term asset retirement obligations	14,365	20,215
Short-term remediation and reclamation obligations	6,101	2,950
Income taxes payable	4,593	3,399
Contract liabilities	22,854	31,477
Other	27,758	35,485
Total accrued liabilities	$ 145,241	$ 230,833

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Debt and Interest Expense - Debt Outstanding Table (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020	Jan. 13, 2020
Debt Instrument [Line Items]
Total short-term debt, principal	$ 726,589	$ 439,345
Total short-term debt, carrying value	726,429	438,870
Long-term debt	6,399,874	7,415,832
Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Short-term debt, fair value	734,586	444,505
Long-Term Debt Obligations [Member]
Debt Instrument [Line Items]
Total long-term debt, principal	6,470,851	7,494,539
Long-term debt	6,399,874	7,415,832
Long-Term Debt Obligations [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	7,204,317	7,845,524
WES Operating [Member]
Debt Instrument [Line Items]
Total short-term debt, carrying value	726,429	438,870
Long-term debt	6,399,874	7,415,832
WES Operating [Member] | RCF [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Principal	220,000	0
Short-term debt, carrying value	220,000	0
WES Operating [Member] | RCF [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Short-term debt, fair value	220,000	0
WES Operating [Member] | Finance Lease Liability, Short Term [Member]
Debt Instrument [Line Items]
Finance leases - short-term debt	4,343	8,264
WES Operating [Member] | Finance Lease Liability, Short Term [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Finance leases - short-term debt	4,343	8,264
WES Operating [Member] | Finance Lease Liability, Long Term [Member]
Debt Instrument [Line Items]
Finance leases - long-term debt	2,202	23,644
WES Operating [Member] | Finance Lease Liability, Long Term [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Finance leases - long-term debt	$ 2,202	23,644
WES Operating [Member] | Senior Notes [Member] | 4.000% Senior Notes due 2022 [Member]
Debt Instrument [Line Items]
Senior note, interest rate	4.00%
Principal	$ 502,246	580,917
Short-term debt, carrying value	502,086
Long-term debt, carrying value		580,555
WES Operating [Member] | Senior Notes [Member] | 4.000% Senior Notes due 2022 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Short-term debt, fair value	$ 510,243
Long-term debt, fair value		597,568
WES Operating [Member] | Senior Notes [Member] | 5.375% Senior Notes due 2021 [Member]
Debt Instrument [Line Items]
Senior note, interest rate	5.375%
Principal	$ 0	431,081
Short-term debt, carrying value	0	430,606
WES Operating [Member] | Senior Notes [Member] | 5.375% Senior Notes due 2021 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Short-term debt, fair value	0	436,241
WES Operating [Member] | Senior Notes [Member] | Floating-Rate Senior Notes due 2023 [Member]
Debt Instrument [Line Items]
Principal	213,138	239,978
Long-term debt, carrying value	212,521	238,879
WES Operating [Member] | Senior Notes [Member] | Floating-Rate Senior Notes due 2023 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	$ 212,773	235,066
WES Operating [Member] | Senior Notes [Member] | 3.100% Senior Notes due 2025 [Member]
Debt Instrument [Line Items]
Senior note, interest rate	3.10%		3.10%
Principal	$ 732,106	1,000,000
Long-term debt, carrying value	727,794	992,900
WES Operating [Member] | Senior Notes [Member] | 3.100% Senior Notes due 2025 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	$ 774,328	1,028,614
WES Operating [Member] | Senior Notes [Member] | 3.950% Senior Notes due 2025 [Member]
Debt Instrument [Line Items]
Senior note, interest rate	3.95%
Principal	$ 399,163	500,000
Long-term debt, carrying value	395,708	494,866
WES Operating [Member] | Senior Notes [Member] | 3.950% Senior Notes due 2025 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	$ 421,970	512,807
WES Operating [Member] | Senior Notes [Member] | 4.650% Senior Notes due 2026 [Member]
Debt Instrument [Line Items]
Senior note, interest rate	4.65%
Principal	$ 474,242	500,000
Long-term debt, carrying value	471,500	496,708
WES Operating [Member] | Senior Notes [Member] | 4.650% Senior Notes due 2026 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	$ 513,758	524,880
WES Operating [Member] | Senior Notes [Member] | 4.500% Senior Notes due 2028 [Member]
Debt Instrument [Line Items]
Senior note, interest rate	4.50%
Principal	$ 400,000	400,000
Long-term debt, carrying value	396,010	395,617
WES Operating [Member] | Senior Notes [Member] | 4.500% Senior Notes due 2028 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	$ 433,214	415,454
WES Operating [Member] | Senior Notes [Member] | 4.750% Senior Notes due 2028 [Member]
Debt Instrument [Line Items]
Senior note, interest rate	4.75%
Principal	$ 400,000	400,000
Long-term debt, carrying value	396,840	396,555
WES Operating [Member] | Senior Notes [Member] | 4.750% Senior Notes due 2028 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	$ 437,005	418,786
WES Operating [Member] | Senior Notes [Member] | 4.050% Senior Notes due 2030 [Member]
Debt Instrument [Line Items]
Senior note, interest rate	4.05%		4.05%
Principal	$ 1,200,000	1,200,000
Long-term debt, carrying value	1,190,102	1,189,407
WES Operating [Member] | Senior Notes [Member] | 4.050% Senior Notes due 2030 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	$ 1,324,159	1,342,996
WES Operating [Member] | Senior Notes [Member] | 5.450% Senior Notes due 2044 [Member]
Debt Instrument [Line Items]
Senior note, interest rate	5.45%
Principal	$ 600,000	600,000
Long-term debt, carrying value	593,699	593,598
WES Operating [Member] | Senior Notes [Member] | 5.450% Senior Notes due 2044 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	$ 691,067	607,234
WES Operating [Member] | Senior Notes [Member] | 5.300% Senior Notes due 2048 [Member]
Debt Instrument [Line Items]
Senior note, interest rate	5.30%
Principal	$ 700,000	700,000
Long-term debt, carrying value	687,210	687,048
WES Operating [Member] | Senior Notes [Member] | 5.300% Senior Notes due 2048 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	$ 807,613	694,172
WES Operating [Member] | Senior Notes [Member] | 5.500% Senior Notes due 2048 [Member]
Debt Instrument [Line Items]
Senior note, interest rate	5.50%
Principal	$ 350,000	350,000
Long-term debt, carrying value	342,629	342,543
WES Operating [Member] | Senior Notes [Member] | 5.500% Senior Notes due 2048 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	$ 409,945	343,928
WES Operating [Member] | Senior Notes [Member] | 5.250% Senior Notes due 2050 [Member]
Debt Instrument [Line Items]
Senior note, interest rate	5.25%		5.25%
Principal	$ 1,000,000	1,000,000
Long-term debt, carrying value	983,659	983,512
WES Operating [Member] | Senior Notes [Member] | 5.250% Senior Notes due 2050 [Member] | Valuation, Market Approach [Member] | Level-2 Inputs [Member]
Debt Instrument [Line Items]
Long-term debt, fair value	$ 1,176,283	$ 1,100,375

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Debt and Interest Expense - Debt Activity Table (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2021	Jan. 13, 2020
Changes in Debt Outstanding [Roll Forward]
Beginning balance		$ 7,854,702
Other		8,046
Ending balance	$ 7,126,303	7,126,303
WES Operating [Member] | Senior Notes [Member]
Changes in Debt Outstanding [Roll Forward]
Repayments of senior notes	$ (500,000)
WES Operating [Member] | RCF [Member] | Revolving Credit Facility [Member]
Changes in Debt Outstanding [Roll Forward]
Facility borrowings		400,000
Repayments of facility borrowings		(180,000)
WES Operating [Member] | 5.375% Senior Notes due 2021 [Member] | Senior Notes [Member]
Changes in Debt Outstanding [Roll Forward]
Repayments of senior notes		$ (431,081)
Senior note, interest rate	5.375%	5.375%
WES Operating [Member] | 4.000% Senior Notes due 2022 [Member] | Senior Notes [Member]
Changes in Debt Outstanding [Roll Forward]
Repayments of senior notes		$ (78,671)
Senior note, interest rate	4.00%	4.00%
WES Operating [Member] | Floating-Rate Senior Notes due 2023 [Member] | Senior Notes [Member]
Changes in Debt Outstanding [Roll Forward]
Repayments of senior notes		$ (26,840)
WES Operating [Member] | 3.100% Senior Notes due 2025 [Member] | Senior Notes [Member]
Changes in Debt Outstanding [Roll Forward]
Repayments of senior notes		$ (267,894)
Senior note, interest rate	3.10%	3.10%	3.10%
WES Operating [Member] | 3.950% Senior Notes due 2025 [Member] | Senior Notes [Member]
Changes in Debt Outstanding [Roll Forward]
Repayments of senior notes		$ (100,837)
Senior note, interest rate	3.95%	3.95%
WES Operating [Member] | 4.650% Senior Notes due 2026 [Member] | Senior Notes [Member]
Changes in Debt Outstanding [Roll Forward]
Repayments of senior notes		$ (25,758)
Senior note, interest rate	4.65%	4.65%
WES Operating [Member] | Finance Lease Liability [Member]
Changes in Debt Outstanding [Roll Forward]
Finance lease liabilities		$ (25,364)

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Debt and Interest Expense - Interest Expense Table (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Debt Instrument [Line Items]
Interest expense	$ (93,257)	$ (95,571)	$ (287,040)	$ (278,811)
Third Parties [Member]
Debt Instrument [Line Items]
Long-term and short-term debt	(90,913)	(94,201)	(279,122)	(273,620)
Finance lease liabilities	(218)	(369)	(808)	(1,162)
Commitment fees and amortization of debt-related costs	(3,147)	(3,463)	(9,664)	(10,052)
Capitalized interest	1,021	2,462	2,554	6,066
Interest expense	(93,257)	(95,571)	(287,040)	(278,768)
Related Parties [Member]
Debt Instrument [Line Items]
Finance lease liabilities	0	0	0	(43)
Interest expense	$ 0	$ 0	$ 0	$ (43)

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Debt and Interest Expense - Additional Information (Details) - USD ($)	3 Months Ended			9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Mar. 31, 2020	Sep. 30, 2021	Sep. 30, 2020	Jan. 13, 2020
Debt Instrument [Line Items]
Gain (loss) on early extinguishment of debt	$ (24,655,000)	$ 1,632,000		$ (24,944,000)	$ 10,372,000
Finance leases - Net property, plant, and equipment	19,600,000			19,600,000
Finance leases - Debt	20,300,000			20,300,000
Operating leases - Other assets	4,800,000			4,800,000
Operating leases - Accrued liabilities	3,100,000			3,100,000
Operating leases - Other liabilities	2,400,000			2,400,000
WES Operating [Member]
Debt Instrument [Line Items]
Gain (loss) on early extinguishment of debt	(24,655,000)	$ 1,632,000		(24,944,000)	$ 10,372,000
WES Operating [Member] | Third Parties [Member]
Debt Instrument [Line Items]
Future lease payments	6,700,000			$ 6,700,000
WES Operating [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Repayments of Debt	500,000,000
Gain (loss) on early extinguishment of debt	$ (24,700,000)
WES Operating [Member] | 3.100% Senior Notes due 2025 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Senior note, interest rate	3.10%			3.10%		3.10%
Senior note, effective interest rate	4.542%	4.291%		4.542%	4.291%
Repayments of Debt				$ 267,894,000
WES Operating [Member] | 4.050% Senior Notes due 2030 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Senior note, interest rate	4.05%			4.05%		4.05%
Senior note, effective interest rate	5.424%	5.173%		5.424%	5.173%
WES Operating [Member] | 5.250% Senior Notes due 2050 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Senior note, interest rate	5.25%			5.25%		5.25%
Senior note, effective interest rate	6.629%	6.375%		6.629%	6.375%
WES Operating [Member] | Floating-Rate Senior Notes due 2023 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Senior note, effective interest rate	2.23%	2.12%		2.23%	2.12%
Repayments of Debt				$ 26,840,000
WES Operating [Member] | 5.375% Senior Notes due 2021 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Senior note, interest rate	5.375%			5.375%
Repayments of Debt				$ 431,081,000
WES Operating [Member] | 4.000% Senior Notes due 2022 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Senior note, interest rate	4.00%			4.00%
Repayments of Debt				$ 78,671,000
WES Operating [Member] | RCF [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Facility, expandable maximum borrowing capacity	$ 2,500,000,000			2,500,000,000
Facility, maximum borrowing capacity	2,000,000,000			2,000,000,000
Facility, outstanding borrowings	220,000,000			220,000,000
Facility, outstanding letters of credit	5,100,000			5,100,000
Facility, available borrowing capacity	$ 1,800,000,000			$ 1,800,000,000
Facility, interest rate at period end	1.58%	1.65%		1.58%	1.65%
Facility, fee rate				0.25%	0.25%
Facility, repayment of borrowings				$ 180,000,000
WES Operating [Member] | RCF [Member] | Revolving Credit Facility [Member] | Non-Extending Lender [Member]
Debt Instrument [Line Items]
Facility, borrowing capacity for non-extending lender	$ 100,000,000			$ 100,000,000
WES Operating [Member] | Term Loan Facility [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Gain (loss) on early extinguishment of debt			$ (2,300,000)
Facility, repayment of borrowings			$ 3,000,000,000

XML

Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions	Sep. 30, 2021	Dec. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
Liability for remediation and reclamation obligations	$ 12.0	$ 8.2