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Investor Presentation November 2020 – Plains All American Pipeline, L.P.

Plains All American Pipeline, L.P. · Nov 1, 2020 · 61 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 1
    Investor Presentation November 2020
  2. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 2
    Table of Contents Value Proposition & Key Messages Business Overview Industry Observations & Plains Focus Areas 2020 YTD Results & 2021 Outlook Sustainability Key Takeaways Appendix PAA PAGP 3
  3. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 3
    Value Proposition & Key Messages
  4. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 4
    Midstream Sector: Attractive Relative Value Proposition Relative Valuation 2014 2020 YTD (EV / NTM EBITDA) Midstream valuations have decreased relative to other asset classes, while balance sheet health, governance, financial…
  5. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 5
    An Investment in Plains Offers: Significant value-investment opportunity, attractive yield and meaningful capacity for price appreciation Investment Grade balance sheet; +FCF trajectory further enhancing financial flexibility…
  6. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 6
    Key Messages 2021: expect meaningful positive Free Cash Flow after distributions Preliminary estimate: 300mm, or 900+mm including targeted asset sales of 600+mm Focused on continued portfolio optimization, de-leveraging & returning…
  7. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 7
    Business Overview
  8. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 8
    Plains: Critical Infrastructure, Integrated Model Full-service: supply aggregation, quality segregation, flow assurance, access to multiple markets 6 mmb/d 1 mmb/d 130 mb/d 60 bcf Pipeline Tariff Crude Purchase NGL Sales Nat. Gas…
  9. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 9
    Fee-Based Cash Flow Generated From Operating Critical Infrastructure Strategically located assets, Significantly contracted, Long-term partnerships, Customer alignment Transportation Segment Reporting Segments Crude & NGL pipelines,…
  10. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 10
    Strong Portfolio of Long-Haul Pipelines, Substantially Backed by Long-Term 3rd Party Contractual Commitments Combination of supply-push and demand-pull pipelines Integrated w/ Plains hub terminals at Cushing, Midland, Patoka and St.…
  11. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 11
    Term Supply & Committed Acreage Position: Enhances Long-Term Volume Security on Plains Systems; Highly Strategic for Optimization & Rationalization Opportunities Permian 1st Purchased Lease Supply Permian Acreage Dedications (3Q20…
  12. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 12
    Leading Demand-Hub Positioning Enables Pipeline & Commercial Opportunities, Reinforces Downstream Customer Relationships (Examples: Cushing & St. James terminals) Inbound Outbound (direct connections underlined) Cushing Inbound…
  13. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 13
    Industry Observations & Plains Focus Areas
  14. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 14
    Global Demand Recovery a question of when, not if World needs energy resources. Despite global lockdowns, world still consumed 80 mmb/d in 2Q20. Pre-COVID Global Consumption by Product (100mmb/d) Global Demand Recovery Scenarios…
  15. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 15
    North American Energy: The Responsibly Produced Option TOP 10 LIQUIDS PRODUCING NATIONS MMB/D AT YE2019 UN SDG RANK (LOWER IS FAVORABLE) USA 20.8 CANADA 20 RUSSIA 11.5 USA 35 CHINA 39 SAUDI ARABIA 11.5 CANADA 5.6 RUSSIA 55…
  16. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 16
    U.S. Short-Cycle Shale Key for Global Demand Recovery Global Supply / Demand Balance mmb/d 2020 avg. global-demand down 10 mmb/d World Production World Consumption 110 Historical OPEC Spare Capacity Inventory builds (1+ billion…
  17. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 17
    Plains: Focused on What We Can Control / Influence Plains Focus Areas & Key Initiatives: Operating Excellence Financial Discipline Employee health & well-being Maximizing FCF & Financial flexibility Operating safely, reliably &…
  18. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 18
    2020 YTD Results & 2021 Outlook
  19. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 19
    Solid Execution of Key Initiatives Advancing safe, reliable and responsible operations 2020 YTD: 50% improvement in Safety & Environmental performance metrics vs. 2017 Positive FCF inflection: maximizing FCF, reducing leverage,…
  20. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 20
    2020 YTD Results Highlight Value of Integrated Business Model Most recent guidance in-line w/ initial Feb 2020(G) furnished pre-COVID Business has performed well despite 2020 Adj. EBITDA Guidance Progression ( billions) challenging…
  21. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 21
    3Q20 Fee-Based Results / Implied 4Q20 3Q Transportation Segment Results Segment Fee-based Segments Ahead of expectations Adj. EBITDA Q/Q: 25mm benefit of 2Q MVC deficiency, ( millions) 652 increased throughput, and cost reductions…
  22. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 22
    2020 / 2021 Outlook Recap 2020(Nov-G) increase driven by 3Q20 results & (000s, except per-unit results) reflects expectations through balance of 2020 2020 2020 Adj. EBITDA (Aug-G) (Nov-G) 2021(PG) Adj. EBITDA: +/- 2.2 B…
  23. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 23
    Financial Focus Areas Achieve and maintain mid-BBB / Baa credit ratings Maximize annual Free Cash Flow after distributions Reduce leverage over time to within targeted range of 3.0x 3.5x (Long-term Debt / LTM Adj. EBITDA; S&L…
  24. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 24
    Anticipate Meaningful 2021 FCF After Distributions Focused on maximizing annual Free Cash Flow after distributions 00 millions Adj. EBTIDA vs. FCF (after distributions) 00 3,237 2021 FCF after distributions: +/- 300mm 00 2,684…
  25. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 25
    FCF Inflection Supported by Completion of Strategic Projects ( billions) Continue to challenge all investment capital (high-return must do / no regrets) 2021 Investment Capital: 50%: W2W & Diamond / Capline 20%-25%: Wellhead & CDP…
  26. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 26
    Capitalization & Liquidity / Other Updates S&P / Fitch: BBB-, Stable Moodys: Ba1, Positive Repaid 600mm Feb-2021 Sr. Notes in Nov-2020 via par call option Credit Stats & Liquidity 12/31/19 9/30/20 Target Pro-Forma Committed…
  27. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 27
    Announced 500mm Common Equity Repurchase Program Additional method of returning capital to investors through a balanced approach Allocate up to 75 MM in 2020; allocate up to 25% 2021 FCF after distributions (allocation within this…
  28. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 28
    Allocation of FCF After Distributions (Directional Illustration) 2021: plan to allocate up to 25% of FCF after distributions Illustrative 2021 Free Cash Flow ( millions) Directional Allocation (Blended Approach) HigherPAA RA…
  29. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 29
    Sustainability For full sustainability presentation and disclosures, please visit https://www.plainsallamerican.com/sustainability.
  30. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 30
    Our Sustainability Commitment Plains strives to promote sustainability through transparent business practices and safe and responsible use of resources. We believe that continuous improvement of our environmental, social and…
  31. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 31
    Continuous Improvement of our Sustainability Efforts Our priority remains ensuring safe, reliable and sustainable operations. We have: Established executive oversight and a VP-level working group responsible for implementation, with…
  32. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 32
    The Building Blocks of Our Sustainability Program VALUES FOCUS AREAS OVERSIGHT ADMINISTRATION Environment Board of Directors Implementation Safety & Environmental Stewardship - Operational Safety - Environmental Strategy - Ensure…
  33. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 33
    Health, Safety & Environmental 2020 YTD: 50 % improvement in TRIR & Federally Reportable Releases vs. 2017. Total Recordable Injury Rate (TRIR) Federally Reportable Releases -- Lost Workday Cases down 75% -- -- Released volumes down…
  34. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 34
    Plains Governance Closely Aligned with C-Corps Focused on continuous improvement in all aspects of Sustainability 1 for 1 Economic & Voting Rights Public Election of Independent Directors on a staggered 3-yr rolling PAA GP HOLDINGS…
  35. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 35
    Multiple Enhancements to Executive Compensation Have further aligned with investors Have engaged independent compensation consultant and have proactively sought investor feedback Examples of recent enhancements: 2018: Converted…
  36. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 36
    Key Takeaways
  37. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 37
    Key Takeaways Plains is well positioned to manage through current environment Strong conviction in the long-term durability of our business Critical asset base, prominent and highly integrated Permian franchise The Permian (and…
  38. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 38
    APPENDIX
  39. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 39
    Investor FAQ: What Are the Potential Implications / Risks Associated With a Change in Administration in 2021 Potential Ban of Fracking on Federal Leases Most of the producers served by Plains Permian Basin assets believe they have the…
  40. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 40
    Overview of Accounting Treatment for MVC Deficiencies (further detailed within quarterly SEC filings) Minimum Volume Commitments (MVCs) relate to agreements between pipeline companies and shippers whereby pipeline companies reserve…
  41. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 41
    Free Cash Flow GAAP CFFO to Non-GAAP FCF 2016 2017 2018 1Q19 2Q19 3Q19 4Q19 2019 1Q20 2Q20 3Q20 2020 YTD LTM Net Cash Provided by Op. Activities (GAAP) 733 2,499 2,608 1,033 431 314 726 2,504 890 84 282 1,256 1,982 Net Cash Used in…
  42. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 42
    2019 Annual Revenue Credit Profile Top 100 Customers Credit Quality by Rating Credit Profile by Revenue of Top 100 Customers 85% Investment Grade or Secured Top 100 Customers 3% 13% 12% 90% of 2019 Consolidated Revenue Top 5…
  43. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 43
    Business Overview
  44. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 44
    Crude Oil Supply Aggregation & Sales Plays a key role in delivering value chain solutions for customers and partners Crude Oil Lease Gathering Activity (directional illustration) Value for Producers: Value For Refiners Creates…
  45. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 45
    NGL Supply Aggregation & Sale Plays a key role in delivering value chain solutions for customers and partners NGL Sales Activity (directional illustration) Purchase Produce / Process Store Transport Sell Storage Truck Spec Products…
  46. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 46
    Optimizing Pipeline & Terminal Systems Through Supply Aggregation & Market Access (Directional Illustration) Supply Aggregation -- Serving supply-push and demand-pull customers -- Supply Hub Market Access Demand Hub -- Flow…
  47. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 47
    Quality Segregation Capability Differentiates System Directional Illustration Condensate WTL WTI WTS Common Stream --ability to segregate at the lease is critical-- PAA PAGP 48
  48. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 48
    Quality Segregation Capability Differentiates System Directional Illustration Dedicated Gathering Dedicated Terminalling Condensate WTL WTI WTS Cond. WTL WTI WTS Batch Segregation --ability to segregate at the lease is…
  49. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 49
    Market Hub Terminals: Strategic / Cornerstone Assets Enable regional connectivity & support fee-based opportunities Basin Sunrise Sunrise Cushing Midland OK TX(1) St. James Patoka LA IL Inbound Pipelines PAA PAGP 50…
  50. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 50
    Plains Cushing Terminal Unmatched connectivity, flexibility & operational capabilities (mmbbls) Largest, most interconnected facility in Cushing Cushing Hub Estimated Shell Capacity 30.0 25 25.0 Multi-grade segregation, receipts…
  51. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 51
    Plains St. James Terminal Unmatched connectivity, flexibility & operational capabilities Leading hub terminal position at key USGC hub Large-scale multi-grade handling Multiple dock options Optionality for purity NGL products Key…
  52. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 52
    Executing NGL Strategy to Reinforce & Optimize Core Canadian Asset Positioning & Market Access MONTNEY / GRANDE PRAIRIE Advanced multiple key initiatives, including: Positioning assets / contracts to increase predictability of…
  53. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 53
    Asset Exchange Advances Portfolio Optimization Strategy Executed Definitive Agreement w/ Inter Pipeline (TSX: IPL) for Asset Exchange A win-win exchange that advances Plains portfolio optimization strategy Further streamlines Plains…
  54. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 54
    Strategic Projects Recap of selected projects either recently completed or currently under development
  55. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 55
    FCF Inflection Benefitted by Completion of Strategic Projects & Continued Portfolio Optimization Capital Investment Asset Sales (1) Completing multi-year capital program 3.6 B in cumulative divestitures (2016 2020 YTD)…
  56. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 56
    Permian to USGC: Cactus II Completed 3Q19 Project Overview Midland Plains Ownership: 65% Wink Orla Capacity: 670 mb/d Crane Highly contracted, long-term MVCs McCamey Multi-grade segregation and batching Origins: Orla, Wink,…
  57. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 57
    Permian to USGC: Wink to Webster Project sanctioned and progress advancing Status Midland-to-Webster partial in-service early 2021 MVCs ramping from 4Q21 through 2023 Deferring portion of investment to align w/ MVC Midland ramp…
  58. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 58
    Brownfield Projects: Upstream of Cushing Optimizing existing system capacity through strong alignment with industry partners Saddlehorn Expansion Saddlehorn Patoka 100 mb/d expansion (fully committed) White Cliffs Sold 10%…
  59. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 59
    Brownfield Projects: Downstream of Cushing Diamond in-service targeted 4Q 2021 and Capline in-service targeted 1Q22 Patoka Diamond Expansion / Extension 200 mb/d expansion & modest extension (contractually supported) Cushing…
  60. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 60
    Brownfield Projects: Downstream of Cushing Optimizing existing system capacity through strong alignment with industry partners Red River Expansion & JV Cushing 85 mb/d expansion Sold 33% interest to Delek Wichita Falls (increased…
  61. Investor Presentation November 2020 – Plains All American Pipeline, L.P. – slide 61
    Investor Presentation November 2020

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