Midstream refers to the energy industry segment involving transportation, storage, and processing of crude oil, natural gas, and refined products between production (upstream) and end-user sales (downstream). Midstream operations include pipelines, storage terminals, processing plants, and transportation infrastructure. These assets provide essential links in energy supply chains.

Midstream companies typically operate under fee-based models, earning revenue from transportation and processing services rather than commodity price exposure. These businesses often provide stable cash flows and dividend yields, making them attractive to income-focused investors. Understanding midstream operations helps assess energy infrastructure investments and supply chain dynamics.

Real-world example: A midstream company operates natural gas pipelines earning $0.50 per MMBtu transportation fees, providing stable revenue regardless of natural gas price volatility while serving as essential infrastructure connecting producers to end-users.