Capital Expenditures
Our operations can be capital intensive, requiring investments to expand, upgrade, maintain or enhance existing operations and to meet environmental and operational regulations.
The following table sets forth a summary of capital expenditures and reconciles capital expenditures on an accrual basis to additions to property, plant and equipment on a cash basis:
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Six Months Ended June 30, |
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2026 |
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2025 |
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(in millions) |
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Total capital expenditures |
$ |
41.0 |
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$ |
120.1 |
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(Increase) decrease in accrued capital expenditures |
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10.4 |
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0.6 |
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(Increase) decrease in capital expenditures included
in accounts payable - affiliate |
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0.5 |
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(11.8 |
) |
Additions to property, plant and equipment |
$ |
51.9 |
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|
$ |
108.9 |
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Capital expenditures in 2026 primarily relate to ongoing gathering system well connects to service Chevron and third-party customers, with the remainder attributable to completion of the compression and gathering pipeline buildout. Capital expenditures in 2025 were attributable to our multi-year expansion of compression capacity and focused on construction of two new compressor stations and associated pipeline infrastructure.
Cautionary Note Regarding Forward-looking Statements
This Quarterly Report on Form 10-Q, including information incorporated by reference herein, contains “forward-looking statements.” Words such as “anticipate,” “estimate,” “expect,” “forecast,” “guidance,” “drive,” “could,” “may,” “should,” “would,” “enable,” “believe,” “intend,” “focus,” “potential,” “project,” “plan,” “trend,” “predict,” “will,” “target,” “opportunity” and similar expressions, and variations or negatives of these words, are intended to identify forward-looking statements, but not all forward-looking statements include such words.
Forward-looking statements relating to the Company’s operations, assets, and strategy are based on management’s current expectations, assessments, estimates, projections and assumptions about the industry. These statements are not guarantees of future performance and are subject to numerous risks, uncertainties and other factors, many of which are beyond the Company’s control and difficult to predict. Therefore, actual outcomes and results may differ materially from our current projections or expectations of future results expressed or forecasted by these forward-looking statements. Among the important factors that could cause actual results to differ materially from those in our forward-looking statements are:
•the ability of Chevron and other parties to satisfy their obligations to us, including Chevron’s ability to meet its drilling and development plans on a timely basis or at all, its ability to deliver its nominated volumes to us, and the operation of joint ventures that we may not control;
•our ability to generate sufficient cash flow to pay current and expected levels of distributions;
•reductions in the volumes of crude oil, natural gas, NGLs and produced water we gather, process, terminal or store;
•the actual volumes we gather, process, terminal or store for Chevron in excess of our MVCs and relative to Chevron’s nominations;
•fluctuations in the prices and demand for crude oil, natural gas and NGLs;
•changes in global economic conditions and the effects of a global economic downturn or inflation on our business and the businesses of our suppliers, customers, business partners and lenders;
•our ability to comply with government regulations or make capital expenditures required to maintain compliance, including our ability to obtain or maintain permits necessary for capital projects in a timely manner, if at all, or the revocation or modification of existing permits;
•our ability to successfully identify, evaluate and timely execute our capital projects, investment opportunities and growth strategies, whether through organic growth or acquisitions;
•costs or liabilities associated with federal, state and local laws, regulations and governmental actions applicable to our business, including legislation and regulatory initiatives relating to environmental protection and health and safety, such as spills, releases, pipeline integrity and measures to limit greenhouse gas emissions and climate change;
•our ability to comply with the terms of our credit facility, indebtedness and other financing arrangements, which, if accelerated, we may not be able to repay;
•reduced demand for our midstream services, including the impact of weather or the availability of competing third-party midstream gathering, processing and transportation operations;
•potential disruption or interruption of our business due to natural and human causes beyond our control, such as accidents, severe weather events, labor disputes, political crises, information technology failures, constraints or disruptions and cyber-attacks;
•any limitations on our ability to access debt or capital markets on terms that we deem acceptable, including as a result of changes in credit ratings, weakness in the oil and gas industry or negative outcomes within commodity and financial markets;
•liability resulting from litigation;
•risks and uncertainties associated with Hess’ integration with Chevron following the completion of the merger, including the failure of Chevron to realize anticipated synergies of the merger in the expected timeframe, operational challenges, the diversion of management’s attention from ongoing business concerns, or unforeseen expenses associated with the merger; and
•other factors described in Item 1A — Risk Factors in our 2025 Annual Report and any additional risks described in our other filings with the Securities and Exchange Commission.
Other unpredictable or unknown factors not discussed in this report could also cause actual results to differ materially from those in our forward-looking statements. Caution should be taken not to place undue reliance on any such forward-looking statements since such statements speak only as of the date of this report. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events or otherwise.