Western Midstream Doubles Down on Basin Water

A near-$1B push reshapes water infrastructure after a landmark acquisition in the Delaware Basin

23 Mar 2026

Western Midstream Partners is committing up to $1bn in 2026 to expand produced water infrastructure in the Delaware Basin, following its $2bn acquisition of Aris Water Solutions late last year.

The investment underscores rising demand for systems to handle, treat and recycle produced water, a by-product of oil and gas extraction that is growing alongside output in the Permian Basin’s most active region. The company is seeking to scale its network across key operating areas where disposal and reuse capacity is under pressure.

The Aris acquisition significantly increased Western Midstream’s footprint. It added about 790 miles of pipeline and lifted combined handling and recycling capacity to more than 3.8mn barrels per day. The company said water throughput rose 40 per cent in 2025, reaching a record level.

A central element of the 2026 programme is the Pathfinder pipeline, a 30-inch system designed to transport more than 800,000 barrels per day of produced water. The line will move volumes from higher-pressure zones to disposal and reuse sites in eastern Loving County, Texas, where capacity remains available.

The project addresses a growing constraint in the basin: limited underground disposal space in core drilling areas. Moving water over longer distances has become increasingly necessary as local capacity tightens.

Western Midstream has also revised commercial terms with two large basin operators. In January, it replaced cost-sharing arrangements with fixed-fee contracts, a shift intended to stabilise earnings and support continued drilling activity tied to its network.

The company reported adjusted earnings before interest, tax, depreciation and amortisation of $2.48bn in 2025. It expects EBITDA of $2.5bn to $2.7bn in 2026, with distributable cash flow of up to $2.05bn. Net leverage is projected to remain close to three times earnings.

The expansion reflects broader changes in shale operations, where water management is becoming a central infrastructure priority alongside oil and gas production.