Over Past 20+ Years, PAA Has Developed One of the Largest and Most Integrated Midstream Systems in North America PAAs Crude Oil Value Chain Legend Plains Current Profile Volumes Handled(1): 5.2 mmb/d Transportation 1.2 mmb/d…
Visibility to Market Balance Driven by robust global demand growth mmbbls OECD Commercial Oil Stocks Inventories Declining 3,200 3,100 Monthly Inventory Historical 5Yr Rolling Avg. Significant acceleration of inventory 3,000 draws…
U.S. is Worlds 1 Liquids Producer (1) Permian Basin: Largest U.S. producing region World Liquids Production: 100 mmb/d as of April 2018 U.S. & Canada = 22 mmb/d Permian Basin as a standalone country would be a Top 10 liquids…
Expect U.S. to Emerge From the Cycle with Stable Production Growth Trajectory & the Incremental Barrel Poised for Export 2014 2016 2016 2017 2018 Forward Industry Lower Cost /Bbl Downturn U.S. Production U.S. Production Growth &…
U.S. Crude Oil Quality Getting Lighter as Shale Production Grows; Domestic Refiners Approaching Limitations mb/d U.S. Crude Oil Production by API U.S. Production Getting Lighter 3,500 Jan15 Feb18 3,000 U.S. shale driving increased…
U.S. Crude Exports Supported by Resource Quality and Expanded U.S. Infrastructure 2017 U.S. crude oil exports averaged 1.1 mmb/d (2017 exit 1.5 mmb/d) PADD 3 exports accounted for 80%, or 900 mb/d Asia demand represented 40% of 2017…
Permian Growth Drives Future U.S. Exports, Delaware Basin (Significant PAA Operating Leverage) Drives Permian Growth (1) Permian Crude Production Outlook (mb/d) Delaware Basin Overview +1,700 6,400 Majority of E&P acquisitions (last 2…
Permian Basin Infrastructure PAAs Franchise 20+ operators (in yellow), PAAs fully integrated crude oil midstream system (in red) COLORADO CITY MIDLAND ORLA WINK 80% of PAAs CRANE Permian acreage dedications are…
Linking The Permian Basin to Global Demand Corpus Christi represents 40% of 2017 U.S.G.C. exports Permian Basin Permian Basin Crude Oil Production (exc. NGL) mmb/d 7,000 YE 2023: 6.4 mmb/d 6,000 YE 2018: 5,000 3.5 mmb/d 4,000…
80% of PAAs Current Growth Capital Program Dedicated to the Permian Basin Permian LongHaul PAA investing 1.6 billion in Permian takeaway & Gathering & IntraBasin expansion projects in 2018/2019 Other (NonPermian) Permian LongHaul…
PAA Has Transitioned Through the Cycle Integrated model drives continued fee-based growth 1. Captured S&L margins 2. Provided visibility for 3. Operating leverage from infrastructure growth CAPEX / increased capture & additional…
Continued Growth is Key, but Preserving Base is Crucial Complementing growth through system optimization Key focus areas to preserve the base business & drive continued growth: System optimization Operational reliability Cost…
Key Takeaways From 2018 Investor Day PAA executing operating and financial initiatives; Positioned for growth Robust global demand growth (U.S. crude demand) Solid Industry Permian Basin key U.S. supply engine Fundamentals Midstream…
U.S. Crude Oil Fundamentals Jeremy Goebel, Senior Group VP Commercial www.plainsallamerican.com NYSE: PAA & PAGP 21
PAA L48 Onshore U.S. Production Growth Outlook Under Various Price Scenarios mb/d YE 2023 18,000 U.S. Oil Production Growth Scenario Illustration 13,000 mb/d 16,000 14,000 70 Case 12,000 YE 2018 8,800mb/d 10,000 60 Case…
Total U.S. Crude Oil Production Growth Permian Basin is leading growth driver Legend YE/YE Production Growth (Total U.S. Crude Oil) STACK mb/d On average, Permian represents 70% of production growth from YE 18 YE 23 DJ 1,500…
The Permian Basin is Transitioning From Delineation to Development Legacy Era Shale Delineation Shale Development 1921 2007 2008 2017 2017 Future Single Vertical Rig Single Horizontal Rig Single Horizontal Rig One Vertical Well One…
Permian Rig Efficiency Continues to Improve Drilling time substantially reduced over past 3 years Significant rig efficiency gains over past 3 years among U.S. shale basins Since 2015, Delaware and Midland Basin drilling time has…
Permian Well Productivity Continues to Improve County comparison of 12month cumulative oil production & current HZ rig count mbbls Delaware Basin Rigs 180 80 160 76 70 140 60 120 50 100 40 40 80 24 25 37 30 60 40 14 14 11…
Permian Activity Ramp Continues Major independents & integrated oil companies continue to increase activity Actual Operator Rig Count 15 top operators responsible for 50% of Operators July 2017 Rig May 2018 Rig Permian Basin HZ rig…
Majors Likely to Drive Next Phase of Growth Announced forecasts reflect worldscale development plans mboe/d Majors have returned to the Permian Publicly Announced Growth in force ExxonMobil, Chevron and Production Forecast(1)…
PAAs Delaware & Midland Basin Production Outlook Unconstrained (dotted line below), Delaware & Midland Basins could grow 1.5mmb/d and 1mmb/d (1.7x & 1.6x), respectively, from YE 2018 to YE 2023 PAAs assets (particularly gathering…
PAA Permian Production Outlook Under Various Price Scenarios mb/d Permian Basin Oil Production Growth Scenario Illustration 10,000 YE 2023 6,400mb/d 9,000 Unconstrained Case (dotted black line) assumes sufficient D&C capacity (labor &…
Potential Challenges to 2018/2019 Production Outlook Key variables to monitor Very tight market Labor Monitoring: quality and availability of labor PAA believes frac capacity could limit completions in 2018 Frac Spreads Monitoring:…
PAA Permian Production Outlook Under Infrastructure Constrained Scenario mb/d 8,000 Permian Basin Oil Production Growth Scenario Illustration YE 2023 6,400mb/d 7,000 Delayed production growth due to Unconstrained Case…
Canadian Crude Oil Fundamentals Luc Mageau, Director M&A / Fundamentals (PMC) www.plainsallamerican.com NYSE: PAA & PAGP 36
Western Canadian Crude Production Outlook Crude oil production to grow 700mb/d from YE 17 to YE 22 Heavy oil represents 65% of growth, driven by nonupgraded oil sands 450mb/d of growth contributed by multiple oil development projects…
Canada Crude Supply vs. Pipeline Capacity Supply growth outpacing pipeline capacity additions mb/d 7,000 mb/d Keystone XL Timing based on 6,000 company disclosures 5,000 PMC Cross Border Pipelines Trans Mountain Expansion Line 3…
Implications of Constrained Canadian Pipeline Takeaway Capacity Pipeline capacity constraints pressuring differentials in the near/medium term Expect increased crudebyrail and pipeline optimization activities as supply exceeds pipeline…
Crude Oil Positioning & Growth Opportunities Harry Pefanis, President & Chief Commercial Officer www.plainsallamerican.com NYSE: PAA & PAGP 41
Overview of PAAs Asset Base Crude oil transportation in all key oil producing basins Regional interconnectivity links supply regions to major market hubs and demand pull pipelines Crude oil terminals at major demand centers…
PAA Canadian Crude Oil Assets Access to Canadian heavy and light oil production PAA/PMC Crude Pipelines PAA/PMC Crude Assets Canadian Crude Oil Assets(1) Third Party Pipelines SK MB Active Pipeline Miles 2,900 miles Pipeline…
PAA Rocky Mountain Assets DJ and Powder River Basin production drives volume growth (1) PRB Crude Production(2) mb/d 900 600 250350 300 110 0 Western Corridor YE 2017 YE 2023 System DJ Crude Production(2) mb/d 900…
PAA MidContinent Assets Volume growth driven by STACK / SCOOP (2) BROOME Midway Pipeline JV Mississippian Lime PL PAA STACK Cushing Kingfisher Dewey Blaine County Hub County County Diamond Pipeline JV STACK JV…
PAAs Cushing Terminal: Unmatched Connectivity, Flexibility & Operational Capabilities Largest, most interconnected facility in Cushing PAA vs. Total Cushing Throughput mmb/d 100% 2,500 Commercial hub that handles multiple…
PAAs Permian System Unmatched Interconnectivity, Capabilities & Access to Multiple Markets COLORADO CITY mb/d Crude Oil Production(1) MIDLAND 7,000 6,1006,800 WINK 6,000 ORLA 5,000 4,000 2,850 3,000 2,000 1,000 0…
South Texas Connecting Permian & Eagle Ford to Multiple Markets Connectivity to all local refiners and large dock facilities mb/d EF Crude Production(3) Lyssy 4,000 1,8002,200 2,000 1,300 0 YE 2017 YE 2023 Cactus I Condensate…
Permian Basin Strategy Expand gathering footprint, primarily in the Delaware Basin Supported by combination of acreage dedications and volume commitments Debottleneck intrabasin system and provide access to takeaway pipes Expanding…
Permian Growth has Filled Existing Pipeline Capacity and is Driving Demand for Additional Projects Mb/d Permian Production vs. Operable Pipeline Takeaway Capacity 7,500 7,000 Nearterm Capacity Constrained Period 6,500 PAA to…
Select PAA Pipeline Debottlenecking Projects Sunrise Expansion: 1Q19 adds 500 mb/d (gross); 220 mb/d (new takeaway, gross ) Wink to Midland: COLORADO June 18 adds 200 mb/d CITY El Mar to Wink: 1Q19 adds 500 mb/d…
PAAs Permian LongHaul System Capacity Including expansions & certain potential expansions (map reflects gross capacity) Potential Sunrise Phase III (24) Wichita Falls to Cushing +500 mb/d Sunrise Expansion Phase I/II (24) Basin…
Crude Oil Q&A Panel (Moderated by Roy Lamoreaux, VP IR & Communications) Sam Brown John Keffer Tyler Rimbey SVP U.S. Pipelines SVP Terminals SVP Commercial (PMC) Other Panel Participants Harry Pefanis, President & Chief…
FAQs on PAAs Crude Oil Positioning Permian: 1. Given tight takeaway capacity, how will PAA achieve its Permian Transportation volumes forecast 2. How do you benefit from your integrated pipeline system 3. What does it take to…
Western Canadian Growth in C3+ Driven by Montney / Grande Prairie Montney / Grande Prairie C3+ Production 900 800 mb/d PMC Forecasts AB SK 700 B.C. Montney Alliance Pipeline 600 MONTNEY / GRANDE PRAIRIE 500 Alberta Montney 400…
Evolution of the Montney at Grande Prairie Well results driving increased supply and activity Grande Prairie Gas, C3+, & Condensate Production* Area Average Well Results Through Time mboe/d mmcf/d mmcf/d 1,000 50 6,000 8…
Western Canada Gas Production Growth & Takeaway Expansions Lead to Increasing Border Flows at Straddle Plants Increasing Alberta gas supply exceeds local demand expected to continue as supply grows WCSB Gas Supply vs. Demand Drives…
NGL Overview & Positioning Harry Pefanis, President & Chief Commercial Officer www.plainsallamerican.com NYSE: PAA & PAGP 60
PAAs NGL Business Overview Efficiently aggregate, process and move NGLs to end markets PMC NGL Assets(1) MONTNEY / 1.1 Extract or purchase NGL mix at GRANDE PRAIRIE Fort Saskatchewan or straddle Fractionation Capacity: 246 mb/d…
PAA NGL Assets Connect Key NAM Supply Areas to Key NAM Demand Centers & Export Locations Equity Supply 3rd Party Supply PMC Storage Assets Fort Sask Fort Sask Fort Sask Alto FORT SASK. Empress Bakken Kerrobert Tirzah Sarnia…
NGL Q&A Panel (Moderated by Roy Lamoreaux, VP IR & Communications) Jason Balasch Tyler Rimbey Luc Mageau President SVP Commercial Director M&A / Fundamentals Other Panel Participants Harry Pefanis, President & Chief Commercial…
FAQs On PAAs NGL Positioning 1. Are NGL assets core to PAA 2. Why are NGL earnings in the S&L segment volatile What changes have you made in relation to the challenges experienced last year 3. What changes have occurred in the NGL…
Social Responsibility Roy Lamoreaux, VP IR & Communications www.plainsallamerican.com NYSE: PAA & PAGP 65
Plains Social Responsibility (ESRM, ESG) Built upon our core values Safety conduct business & operations safely for employees, contractors and environment Striving to minimize environmental footprint and integrating programs and…
Plains Social Responsibility (ESRM, ESG) Focused on continuous improvement & doing the right thing Our Social Responsibility effort is focused on continuous improvement Executive officerlevel leadership We strive to do the right…
Case Study Do the Right Thing Plains responds to a 3rd party pipeline release June 2017 notified of oil in Little Beaver Creek, ND (near our Baker to Marmarth pipe) Actions: (Before confirming who was responsible for the release)…
PAAs Financial Strategy Fund growth capital with at least 55% equity / retained cash flow or asset sales Minimize / eliminate incremental common equity funding to complete current and future routine expansion activities Target a…
Deleveraging Plan Remains on Track (announced August 2017) Combination of debt reduction & growth in feebased Adjusted EBITDA PAA is committed to its financial strategy & targeted metrics PAA Debt & Leverage Ratios Reduced debt…
PAA Also has a Solid Track Record of Maintaining Significant Liquidity mm 5,000 PAA Liquidity 4,500 4,000 3,500 3,000 2,500 2,000 1,500 As of 3/31/18, PAA had 3.2B of 1,000 available liquidity; planning to not renew…
Senior Notes Maturity Profile As of March 31, 2018 Wtd. Avg. Wtd. Avg. Face Value Tenor Rate Senior Notes: 9.0 Billion YE 2010 4.4B 9.5 years 6.0% Average Tenor: 12 years Percentage Fixed: 100% YE 2013 6.7B 11 years 5.2% Weighted…
PAA Historical Performance & 2018 Guidance A consistent focus on growing feebased cash flow 2,500 PAA Segment Adj. EBITDA Feebased growth, net of asset sales, 100 driven by: 2,000 359 60 651 568 665 Permian production growth…
2018 Key Guidance Metrics 12/31/2017 12/31/2018(G) (Y/Y) % (Y/Y) ( in millions except for per unit calcs) Adjusted EBITDA 2,082 2,300 218 10% Implied Distributable Cash Flow 1,312 1,635 323 25% Less: Preferred Distributions (5) (160)…
Financial Considerations for 2019 and Beyond On track to complete deleveraging plan by 1H19 Expect significant feebased Adj. EBITDA growth in 2019 1415% preliminary feebased shadow guidance growth over 2018 300mm YY Adj. EBITDA…
2018 / 2019 Capital Program Greater than 80% Permian focused 2018 CAPEX includes: ( billions) PAA Expansion Capital Summary 1.6 1.4 1.4 Cactus II investment expected to be shared in JV 1.4 structure, to span +/ 18 month timeframe…
Illustrative Calculation For Cost Of Capital As of May 29, 2018 Cost of Equity: currently view DCF / unit as the appropriate metric for calculating cost of equity Cost of Debt: estimated cost of 10year fixed rate senior notes…
PAGPs Assets and Tax Attributes PAGPs sole asset is its indirect ownership of the same number of PAA common units as it has Class A shares outstanding PAGP indirectly owns 157 million PAA units, has 157 million Class A shares…
Finance Closing Thoughts Committed to executing our financial strategy and completing deleveraging plan Growing feebased cash flow driven by capital investments and increased utilization on our existing pipelines Positioned for…
Looking Back On Where We've Been . . . . . . Looking Forward to An Exciting Future 2018 marks PAAs 20th year as a publicly traded MLP (25th year since inception) PAAs enterprise value has increased from 0.8 billion at IPO to 30…
Key Takeaways From 2018 Investor Day PAA executing operating and financial initiatives; Positioned for growth Robust global demand growth (U.S. crude demand) Solid Industry Permian Basin key U.S. supply engine Fundamentals Midstream…
Closing Thoughts PAA is focused on reinforcing investor confidence through prudent management, consistent transparency and staying true to our core values We characterized 2018 as a year of execution Executing our operating and…
2018 Investor Day Houston, TX June 5, 2018 Executing with Positive Momentum Q&A Session www.plainsallamerican.com NYSE: PAA & PAGP 85
Reconciliation to Adjusted EBITDA and Adjusted Net Income Attributable to PAA: 2014 - 2017 (in millions) (1) (2) Selected Items Impacting Comparability (3) 2017 2016 2015 2014 Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3…
Reconciliation to Adjusted EBITDA and Adjusted Net Income Attributable to PAA: 2010 - 2013 (in millions) (1) (2) Selected Items Impacting Comparability 2013 2012 2011 2010 Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4…
Reconciliation to Adjusted EBITDA and Adjusted Net Income Attributable to PAA: 2006 - 2009 (in millions) (1) (2) Selected Items Impacting Comparability 2009 2008 2007 2006 Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 YTD…
Implied DCF Information (in millions, except per unit and ratio data): (1) Implied DCF Reconciliation Twelve Months Ended December 31, 2017 Adjusted EBITDA 2,082 Interest expense, net (2) (483) Maintenance capital (247) Current…
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