Western Midstream Partners Business Model Canvas

While Occidental (OXY) remained Western Midstream Partners' anchor customer in 2024, contracts with ~30 independent E&P firms supplied ~28% of volumes, diversifying revenue; long – term take – or – pay agreements (typical 5-10 years) provide producers flow assurance for gas and crude. Western Midstream integrates partners' production schedules into its pipeline and storage network, coordinating across 120,000 barrels/day of crude capacity and ~1.4 Bcf/d gas takeaway.

Occidental supplies ~55% of throughput and long – term acreage dedications; independents provide ~28% of volumes under 5-10 year take – or – pay contracts, giving flow assurance across ~120,000 b/d crude and ~1.4 Bcf/d gas capacity.

WM funds 30-50% in JV projects (example: $420M of $1.2B), targets $1.2-1.8B debt facilities, and saved $12-18M via 20% faster permitting in 2024.

Continuous monitoring and regular physical inspections keep Western Midstream's pipeline integrity high, with automated sensors and pigging runs reducing leak incidents; in 2024 the firm reported 99.6% pipeline uptime and zero reportable releases on its major crude lines.

Western Midstream runs ~10,000 miles of gathering lines, ~200 compression stations, gas plants handling ~2.1 Bcf/d and producing ~45 MBbl/d NGLs (2024); water services moved ~100,000 bbl/d, ~40% recycling, ~$75-90M EBITDA (2024); 2025 capex guidance ~$1.9B focused on Permian growth, emissions reduction, and throughput uptime (~99.6% in 2024).

Long-term acreage dedications and contractual rights are core intangible assets for Western Midstream Partners, locking in dedicated service areas and creating a visible backlog of future volumes as producers develop leases over decades; as of FY 2024 Western reported ~2.1 Bcf/d of committed gas throughput capacity under contract, boosting revenue visibility and cutting competitive risk. These dedications enable predictable cash flows and support multi-year financial planning and $1.2-1.5B annual stable EBITDA range guidance.

Western Midstream's core resources-~6,100 miles of pipelines, 160+ processing sites, 2.1 Bcf/d contracted capacity, modern cryogenic plants (85k b/d NGLs), $2.0B revolver, and ~3.0x net debt/EBITDA-deliver stable fee-based cashflows, ~98% uptime, and support $1.12B fee-EBITDA (2024) while preserving BBB/Baa funding costs.

Western Midstream Partners' one-stop midstream suite-gathering, processing, transportation, and water management-cuts producer counterparty counts and saved customers an estimated $45-60 million in logistics costs in 2024 through pooled infrastructure and tariff optimization. Integrated services improved flow-to-market coordination, lifting average throughput utilization to ~92% in 2024 and shortening time-to-market by ~18% versus fragmented providers.

Western Midstream ensures >99.6% uptime and ~15% excess pipeline capacity (2024), handled ~2.1 Bcf/d throughput in 2024, improved realized prices by $1.50-3.00/bbl, delivered ~92% utilization, 68% fee-based coverage of 2024 adj. EBITDA, cut methane intensity 22% vs 2019, and invested $200m+ in emissions/tech (2023-2025).

Western Midstream holds weekly technical coordination meetings with customers, aligning upstream schedules to manage pipeline pressures and inlet volumes-this reduced emergency flaring incidents by 18% in 2024 and supported throughput stability near 98% of nameplate capacity.

Western Midstream secures stable, long-term fee revenue via 10+ year throughput and minimum-volume contracts (≈72% of fee revenue in 2024), backed by dedicated commercial teams, real-time portals, and weekly coordination that kept throughput ~98% of nameplate and reduced disputes ~30% YoY.

Western Midstream Partners uses secure digital portals to share throughput, invoice, and environmental compliance data with producers and partners; in 2024 these portals supported over 95% of customer transactions and reduced invoice dispute rates by 28% year-over-year.

Physical interconnects and secure digital portals delivered ~1.2 Bcf/d throughput in 2024, supporting fee-based revenue and 95%+ self-service transactions; BD teams closed ~$210M new contracts and $180M tender backlog while $1.3B capex and ~$960M midpoint EBITDA funded expansion.

Natural gas marketers and shippers buy gas at the wellhead or plant tailgate and pay Western Midstream for connectivity to interstate hubs; in 2024 Western's gas gathering and processing throughput averaged ~2.3 Bcf/d, ensuring reliable delivery to high-demand markets. These customers value the company's access to hubs like Katy and Waha, which in 2024 supported ~60% of Western's takeaway capacity and helped keep system utilization above 85%.

Core customers are Occidental (≈65% of 2024 NGL/gas volumes; 92% system utilization), independents (~28% of third – party throughput; target 10-15% annual growth), gas marketers (avg 2.3 Bcf/d in 2024; hubs Katy/Waha ≈60% takeaway), refiners/petrochem (US refinery utilization ~90%; Gulf Coast feedstock +3.5% 2024), and produced – water shippers (Permian W/O ≈8:1).

G&A covers corporate overhead-executive pay, legal, accounting, IT-and Western Midstream Partners reported G&A of $112.4 million in 2024, about 3.8% of total revenue, reflecting efforts to keep these costs low to boost distributable cash.

Efficient corporate functions support the company's multi-region operations across the Permian and DJ basins; maintaining G&A near 3-4% of revenue targets preserves cash for distributions and capital projects.

O&M ~$420M (36% adj op exp) + Maint CapEx ~$195M (2024) + Growth CapEx ~$1.6B (2022-24) + G&A $112.4M (3.8% rev) + Interest ~$245M (2024) + Taxes/compliance $120-150M (2023-24); focus on automation, refinancing, and G&A control to protect distributions.

Western Midstream earns revenue by charging tariffs to transport stabilized crude oil and natural gas liquids (NGLs) via its Permian and DJ Basin pipelines to market hubs; in 2024 tariff and transportation fees accounted for roughly 68% of consolidated segment EBITDA, with average throughput utilization near 92% across major systems. Tariffs are a mix of regulated rates and market-competitive tolls per barrel-mile, so sustaining >90% utilization is key to converting fixed-cost pipelines into predictable cash flow.

Fee-based gathering, processing and tariff revenues drove predictable cash flow in 2024-fee contracts generated ~68% of segment EBITDA and about $1.1B of adjusted EBITDA, with processing volumes ~6.5 Bcf/d and pipeline utilization ~92%. Water services added an estimated $45-60M revenue run-rate; commodity sales contributed ~$120M with ~70% of volumes hedged, lowering realized volatility ~40%.