Q2 2026 Western Midstream Partners LP Earnings Call Transcript
Key Points
- Record adjusted EBITDA of $737 million, up 8% sequentially and 19% year-over-year, driven by record throughput in the Delaware Basin and the Brazos acquisition.
- Raised full-year 2026 guidance for adjusted EBITDA, distributable cash flow, and free cash flow by 10%, 10%, and 20% at the midpoints, respectively.
- Brazos acquisition is accretive to per-unit metrics, protects the balance sheet, and is expected to generate approximately $100 million of adjusted EBITDA in the second half of 2026.
- Secured new long-term gathering and processing agreements in the Powder River Basin, adding approximately 270,000 dedicated acres with over 1,000 drilling locations and minimum volume commitments.
- Strong balance sheet with over $1.8 billion in liquidity and a pro forma net leverage ratio of approximately 3.15 times, supporting organic growth and strategic M&A.
- JIP-2 produced water treatment facility is now in service, delivering roughly 10 times the reclaimed freshwater of JIP-1, advancing the path to a commercial-scale facility.
- Third-quarter per MCF adjusted gross margin for natural gas assets is expected to be slightly lower than the second quarter due to moderated commodity prices.
- Full-year 2026 crude oil and NGLs throughput is expected to decline by low single-digits year-over-year, reflecting ongoing challenges in the DJ Basin.
- Operation and maintenance expense is expected to increase by approximately 20-25% year-over-year in 2026, driven by higher disposal fees, chemicals, and the full run-rate from Brazos.
- Capital expenditure guidance is maintained at $850 million to $1 billion, but the company now expects to be toward the high end due to new expansion opportunities.
- The DJ Basin is expected to see a low single-digit decline in natural gas throughput and a mid-single-digit decline in crude oil and NGLs throughput on average year-over-year.
- Powder River Basin throughput is expected to decline by mid- to high-single-digits on average year-over-year, despite new agreements, as activity ramps up only in the back half.
Good morning. My name is Tina, and I will be your conference operator today. At this time, I would like to welcome everyone to the Western Midstream Partners second-quarter 2026 earnings conference call. (Operator Instructions)
I would now like to turn the conference over to Daniel Jenkins, Director of Investor Relations. Please go ahead.
Thank you. Good morning, and welcome to Western Midstream's second-quarter 2026 conference call.
Today's call, the accompanying slide deck, and last night's press release contain important disclosures regarding forward-looking statements and non-GAAP reconciliations. Please reference Western Midstream's most recent Form 10-K and 10-Q and other public filings for a description of risk factors that could cause actual results to differ materially from any forward-looking statements we discuss today. Relevant reference materials are posted on our website.
With me today are Oscar Brown, our Chief Executive Officer; Danny
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