v3.26.1
Related Party Transactions
 6 Months Ended
Jun. 30, 2026
Related Party Transactions [Abstract]  
Related Party Transactions Related Party Transactions
Related party transactions between the Partnership, OpCo and Westlake are primarily based on agreements such as the Ethylene Sales Agreement, the Feedstock Supply Agreement, the Services and Secondment Agreement, Site Lease Agreements, the Omnibus Agreement, the Investment Management Agreement, the Exchange Agreement, the OpCo Partnership Agreement, the OpCo Revolver and the MLP Revolver. These agreements, discussed in detail in the Partnership's 2025 consolidated financial statements included in the 2025 Form 10-K filed on March 4, 2026, reflect the pervasive effect of the relationship with Westlake on the Partnership's operations and its consolidated financial statements. Pursuant to these agreements, the Partnership and OpCo regularly enter into transactions with Westlake. See below for descriptions and details of significant related party transactions.
Sales to Related Parties
OpCo sells ethylene to Westlake under the Ethylene Sales Agreement. Additionally, the Partnership and OpCo from time to time provide other services or products for which it charges Westlake a fee.
OpCo sells a significant portion of its ethylene production to Westlake. Sales to related parties were as follows:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Net sales—Westlake$238,030 $269,076 $501,121 $459,857 
As of June 30, 2026, OpCo's production resulted in expected "excess quantities" of ethylene produced based on annual estimated production. Pursuant to the terms of the Ethylene Sales Agreement, the excess quantities produced by the Partnership were sold to Westlake at prices that excluded certain fixed costs of production. The fixed cost of production associated with the estimated excess quantities for the six months ended June 30, 2026 was approximately $2,100.
Cost of Sales from Related Parties
Charges for goods and services purchased by the Partnership and OpCo from Westlake and included in cost of sales relate primarily to feedstock purchased under the Feedstock Supply Agreement and services provided under the Services and Secondment Agreement.
A significant portion of the Partnership's inputs included in cost of sales are supplied by Westlake. Charges from related parties for significant inputs included in cost of sales were as follows:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Feedstock purchased from Westlake and included in cost of sales$86,595 $90,567 $183,656 $176,066 
Other charges from Westlake and included in cost of sales34,748 33,729 72,953 65,206 
Services from Related Parties Included in Selling, General and Administrative Expenses
Charges for services purchased by the Partnership from Westlake and included in selling, general and administrative expenses primarily relate to services Westlake performs on behalf of the Partnership under the Omnibus Agreement, including the Partnership's finance, legal, information technology, human resources, communication, ethics and compliance and other administrative functions.
Charges from related parties included within selling, general and administrative expenses were as follows:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Services received from Westlake and included in selling, general and administrative expenses$6,618 $5,276 $13,037 $11,707 
Goods and Services from Related Parties Capitalized as Assets
Charges for goods and services purchased by the Partnership and OpCo from Westlake, which were capitalized as assets, relate primarily to the services of Westlake employees under the Services and Secondment Agreement.
Charges from related parties for goods and services capitalized as assets were as follows:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Goods and services purchased from Westlake and capitalized as assets$533 $1,053 $1,074 $6,481 
Receivable under the Investment Management Agreement
On August 1, 2017, the Partnership, OpCo and Westlake executed an investment management agreement (the "Investment Management Agreement") that authorized Westlake to invest the Partnership's and OpCo's excess cash with Westlake for durations of up to a maximum of nine months. Per the terms of the Investment Management Agreement, the Partnership earns a market return plus five basis points and Westlake provides daily availability of the invested cash to meet any liquidity needs of the Partnership or OpCo. Accrued interest of $405 and $206 was included in the receivable under the Investment Management Agreement balance at June 30, 2026 and December 31, 2025, respectively. Total interest earned related to the Investment Management Agreement was $405 and $752 for the three months ended June 30, 2026 and 2025, respectively, and $674 and $2,109 for the six months ended June 30, 2026 and 2025, respectively.
The Partnership's receivable under the Investment Management Agreement was as follows:
June 30,
2026		December 31,
2025
Receivable under the Investment Management Agreement$43,577 $23,378 
Accounts Receivable from Related Parties
The Partnership's accounts receivable from Westlake result primarily from ethylene sales to Westlake and any Buyer Deficiency Fee and Shortfall recognized under the Ethylene Sales Agreement.
As of December 31, 2025, OpCo had an annual production deficiency under the Ethylene Sales Agreement for the full year 2025 primarily due to the Petro 1 turnaround extending into April 2025, which was later than the planned completion in March 2025. The Buyer Deficiency Fee is measured periodically based upon the lower of the actual production deficiency at period end or the estimated annual production deficiency based upon OpCo's annual anticipated production. These periodic estimates are updated at the end of the year based on actual annual production. The Buyer Deficiency Fee is classified as a component of net sales—Westlake. The total Buyer Deficiency Fee recognized by the Partnership during the twelve months ended December 31, 2025 was $5,835. The Buyer Deficiency Fee recognized in 2025 was received by the Partnership in January 2026.
The Partnership's accounts receivable from Westlake were as follows:
June 30,
2026		December 31,
2025
Accounts receivable—Westlake$39,464 $63,571 
Accounts Payable to Related Parties
The Partnership's accounts payable to Westlake result primarily from feedstock purchases under the Feedstock Supply Agreement and services provided under the Services and Secondment Agreement and the Omnibus Agreement.
The Partnership's accounts payable to Westlake were as follows:
June 30,
2026		December 31,
2025
Accounts payable—Westlake$15,630 $19,132 
Related Party Leases
OpCo is obligated to Westlake under various long-term and short-term noncancelable operating leases, primarily related to rail cars and land. Operating lease rentals paid to Westlake for such leases were $481 and $440 for the three months ended June 30, 2026 and 2025, respectively, and $918 and $778 for the six months ended June 30, 2026 and 2025 respectively, and are reflected in other charges from Westlake that are included in cost of sales.
OpCo has two site lease agreements with Westlake, each of which has a term of 50 years. Pursuant to the site lease agreements, OpCo pays Westlake one dollar per site per year.
Debt Payable to Related Parties
See Note 9 for a description of related party debt payable balances.
Interest on related party debt payable balances, net of capitalized interest, for the three months ended June 30, 2026 and 2025 was $5,119 and $5,907, respectively. Interest on related party debt payable balances, net of capitalized interest, for the six months ended June 30, 2026 and 2025 was $10,204 and $11,444, respectively. Interest on related party debt payable is presented as interest expense—Westlake in the consolidated statements of operations. At June 30, 2026 and December 31, 2025, accrued interest on related party debt was $5,119 and $5,508, respectively, and is reflected as a component of accrued and other liabilities in the consolidated balance sheets.
Debt payable to related parties was as follows:
June 30,
2026		December 31,
2025
Long-term debt payable to Westlake$399,674 $399,674 
Major Customer and Concentration of Credit Risk
During the three months ended June 30, 2026 and 2025, Westlake accounted for approximately 80.1% and 90.6%, respectively, of the Partnership's net sales. During the six months ended June 30, 2026 and 2025, Westlake accounted for approximately 83.1% and 86.0%, respectively, of the Partnership's net sales.