Plains All American Pipeline, L.P. Reports Solid Third-Quarter 2009 Results

http://www.businesswire.com/news/home/20091104006436/en

HOUSTON--(Business Wire)--
Plains All American Pipeline, L.P. (NYSE:PAA) today reported net income of $122
million, or $0.65 per diluted limited partner unit, for the third quarter of
2009 as compared to net income for the third quarter of 2008 of $206 million, or
$1.41 per diluted limited partner unit. The Partnership reported earnings before
interest, taxes, depreciation and amortization ("EBITDA") of $242 million for
the third quarter of 2009, compared with EBITDA of $310 million for the third
quarter of 2008.

The Partnership`s reported results include the impact of items that affect
comparability between reporting periods. These items are excluded from adjusted
results, as further described in the table below. Accordingly, the Partnership`s
third-quarter 2009 adjusted net income, adjusted net income per diluted limited
partner unit and adjusted EBITDA were $114 million, $0.59 and $234 million,
respectively, as compared to third-quarter 2008 adjusted net income, adjusted
net income per diluted limited partner unit and adjusted EBITDA of $119 million,
$0.71 and $223 million, respectively. (See the section of this release entitled
"Non-GAAP Financial Measures" and the attached tables for discussion of EBITDA
and other non-GAAP financial measures, and reconciliations of such measures to
the comparable GAAP measures.)

"Plains All American has been very active and productive in the four months
since the end of the second quarter" said Greg L. Armstrong, Chairman & CEO of
Plains All American. "We delivered operating and financial results at the high
end of guidance, acquired the remaining 50% interest in PAA Natural Gas Storage
(PNGS), raised over $1.2 billion in the capital markets at very attractive rates
and increased our annualized distribution by 6 cents or 1.7% to $3.68 per unit.
We also ended the third quarter with a solid balance sheet and over $1.6 billion
of available committed liquidity, of which approximately $260 million was used
in early October to prepay our 7.125% senior notes."

For the first nine months of 2009, the Partnership reported net income of $469
million, or $2.82 per diluted limited partner unit, as compared to net income
for the first nine months of 2008 of $339 million, or $2.08 per diluted limited
partner unit. The Partnership reported EBITDA of $808 million for the first nine
months of 2009, compared with EBITDA of $639 million for the first nine months
of 2008. Adjusted net income, adjusted net income per diluted limited partner
unit and adjusted EBITDA for the first nine months of 2009 were $406 million,
$2.33 and $745 million, respectively. Adjusted net income, adjusted net income
per diluted limited partner unit and adjusted EBITDA for the first nine months
of 2008 were $352 million, $2.19 and $652 million, respectively.

The following table summarizes selected items that the Partnership believes
impact comparability of financial results between reporting periods (amounts in
millions, except per unit amounts):

Three Months Ended Nine Months Ended
September 30, September 30,
2009 2008 2009 2008
Selected items impacting comparability
Equity compensation charge (1) $ (12 ) $ (3 ) $ (36 ) $ (23 )
Inventory valuation adjustments net of gains and (losses) from related derivative activities (2) - 4 24 4
Gains/(losses) from other derivative activities (2) (3) 11 94 54 3
Gains on acquisition-related foreign currency and linefill hedges - - - 11
Net gain on purchase of remaining 50% interest in PNGS 9 - 9 -
Net gain/(loss) on foreign currency revaluation - (8 ) 12 (8 )
Selected items impacting comparability 8 87 63 (13 )
Less: GP 2% portion of selected items impacting comparability - (2 ) (1 ) -
LP 98% portion of selected items impacting comparability $ 8 $ 85 $ 62 $ (13 )

Impact to basic net income per limited partner unit $ 0.06 $ 0.70 $ 0.49 $ (0.11 )

Impact to diluted net income per limited partner unit $ 0.06 $ 0.70 $ 0.49 $ (0.11 )
______________________________
(1) The equity compensation charge for the three and nine months ended September 30, 2009 and 2008 excludes the portion of the equity compensation expense represented by grants under the LTIP Plans that, pursuant to the terms of the grant, will be settled in cash only and have no impact on diluted units. The portion of the equity compensation expense attributable to the cash portion of the LTIP Plans is approximately $4 million and $1 million for the three months ended September 30, 2009 and 2008,
respectively, and approximately $11 million and $3 million for the nine months ended September 30, 2009 and 2008, respectively.
(2) Gains and losses from derivative activities related to revalued inventory are included in the line item "Inventory valuation adjustments net of gains and (losses) from related derivative activities;" gains and losses from derivative activities not related to revalued inventory are included in the line item "Gains/(losses) from other derivative activities."
(3) Gains and losses from other derivative activities for the nine months ended September 30, 2009 includes losses of approximately $1 million related to interest rate derivatives, which are included in other income/(expense), net, but do not impact segment profit.

The following tables present certain selected financial information by segment
for the third-quarter and first nine months reporting periods (amounts in
millions):

Three Months Ended Three Months Ended
September 30, 2009 September 30, 2008
Transportation Facilities Marketing Transportation Facilities Marketing
Operations Operations Operations Operations Operations Operations
Revenues (1) $ 250 $ 97 $ 4,645 $ 242 $ 69 $ 8,676
Purchases and related costs (1) (15 ) (1 ) (4,534 ) (23 ) - (8,471 )
Field operating costs (excluding equity compensation benefit/charge) (1) (86 ) (32 ) (45 ) (86 ) (27 ) (50 )
Equity compensation benefit/(charge) - operations (2 ) - - 1 - -
Segment G&A expenses (excluding equity compensation charge) (2) (14 ) (7 ) (17 ) (14 ) (5 ) (16 )
Equity compensation charge - general and administrative (6 ) (3 ) (5 ) (2 ) (1 ) (1 )
Equity earnings in unconsolidated entities 2 3 - 1 3 -
Reported segment profit $ 129 $ 57 $ 44 $ 119 $ 39 $ 138

Selected items impacting comparability of segment profit:
Equity compensation charge (3) 6 2 4 1 1 1
Inventory valuation adjustments net of (gains)/losses from related derivative activities (4) - - - - - (4 )
(Gains)/losses from other derivative activities (4) - - (11 ) - - (94 )
Net loss on foreign currency revaluation - - - - - 8
Subtotal 6 2 (7 ) 1 1 (89 )
Segment profit excluding selected items impacting comparability $ 135 $ 59 $ 37 $ 120 $ 40 $ 49

Maintenance capital $ 9 $ 2 $ 1 $ 13 $ 5 $ 1
______________________________

Nine Months Ended Nine Months Ended
September 30, 2009 September 30, 2008
Transportation Facilities Marketing Transportation Facilities Marketing
Operations Operations Operations Operations Operations Operations
Revenues (1) $ 714 $ 259 $ 11,877 $ 680 $ 194 $ 24,594
Purchases and related costs (1) (47 ) (1 ) (11,389 ) (68 ) - (24,211 )
Field operating costs (excluding equity compensation charge) (1) (249 ) (85 ) (139 ) (246 ) (76 ) (135 )
Equity compensation charge - operations (6 ) (1 ) (1 ) (1 ) - -
Segment G&A expenses (excluding equity compensation charge) (2) (45 ) (18 ) (51 ) (42 ) (13 ) (49 )
Equity compensation charge - general and administrative (17 ) (7 ) (15 ) (12 ) (5 ) (9 )
Equity earnings in unconsolidated entities 5 8 - 4 7 -
Reported segment profit $ 355 $ 155 $ 282 $ 315 $ 107 $ 190

Selected items impacting comparability of segment profit:
Equity compensation charge (3) 18 6 12 12 4 7
Inventory valuation adjustments net of (gains)/losses from related derivative activities (4) - - (24 ) - - (4 )
(Gains)/losses from other derivative activities (4) (5) - - (55 ) - - (3 )
Net (gain)/loss on foreign currency revaluation - - (12 ) - - 8
Subtotal 18 6 (79 ) 12 4 8
Segment profit excluding selected items impacting comparability $ 373 $ 161 $ 203 $ 327 $ 111 $ 198

Maintenance capital $ 40 $ 11 $ 5 $ 38 $ 15 $ 3
______________________________
(1) Includes intersegment amounts.
(2) Segment general and administrative expenses (G&A) reflect direct costs attributable to each segment and an allocation of other expenses to the segments based on the business activities that existed at that time. The proportional allocations by segment require judgment by management and will continue to be based on the business activities that exist during each period.
(3) The equity compensation charge for the three and nine months ended September 30, 2009 and 2008 excludes the portion of the equity compensation expense represented by grants under the LTIP Plans that, pursuant to the terms of the grant, will be settled in cash only and have no impact on diluted units. The portion of the equity compensation expense attributable to the cash portion of the LTIP Plans is approximately $4 million and $1 million for the three months ended September 30, 2009 and 2008,
respectively, and approximately $11 million and $3 million for the nine months ended September 30, 2009 and 2008, respectively.
(4) Gains and losses from derivative activities related to revalued inventory are included in the line item "Inventory valuation adjustments net of (gains)/losses from related derivative activities;" gains and losses from derivative activities not related to revalued inventory are included in the line item "Gains/(losses) from other derivative activities."
(5) Gains and losses from other derivative activities for the nine months ended September 30, 2009 includes losses of approximately $1 million related to interest rate derivatives, which are included in other income/(expense), net, but do not impact segment profit.

Adjusted segment profit for the Transportation segment for the third quarter of
2009 increased 13% over corresponding 2008 results primarily due to higher
average pipeline tariffs and increased pipeline loss allowance revenue.

Adjusted segment profit for the Facilities segment for the third quarter of 2009
increased 48% over comparable 2008 results principally due to capacity increases
from recently completed capital projects, recent acquisitions, including the
PNGS acquisition, and higher average lease rates at various facilities.

Adjusted segment profit for the Marketing segment for the third quarter of 2009
decreased 25% from comparable 2008 results. This decrease is due to a number of
factors including declines in margins due to tighter crude oil quality
differentials and lower LPG margins, partially offset by a favorable contango
market and lower operating costs.

The Partnership`s basic weighted average units outstanding for the third quarter
of 2009 totaled 130 million (131 million diluted) as compared to 128 million
(129 million diluted) in last year`s third quarter. At September 30, 2009, the
Partnership had approximately 136.1 million units outstanding, long-term debt of
approximately $4.1 billion ($437 million of which supports hedged inventory) and
an adjusted long-term debt-to-total capitalization ratio of 47%.

The Partnership has declared a quarterly distribution of $0.92 per unit ($3.68
per unit on an annualized basis) payable November 13, 2009 on its outstanding
limited partner units. This distribution represents an increase of 3.1% over the
quarterly distribution paid in November 2008 and an increase of 1.7% from the
August 2009 distribution level.

Prior to its November 5th conference call, the Partnership will furnish a
current report on Form 8-K, which will include material in this press release
and financial and operational guidance for the fourth quarter 2009, and
preliminary 2010 guidance. A copy of the Form 8-K will be available on the
Partnership`s website at www.paalp.com.

Non-GAAP Financial Measures

In this release, the Partnership`s EBITDA disclosure is not presented in
accordance with generally accepted accounting principles and is not intended to
be used in lieu of GAAP presentations of net income or cash flows from operating
activities. EBITDA is presented because we believe it provides additional
information with respect to both the performance of our fundamental business
activities as well as our ability to meet our future debt service, capital
expenditures and working capital requirements. We also believe that debt holders
commonly use EBITDA to analyze Partnership performance. In addition, we present
selected items that impact the comparability of our operating results as
additional information that may be helpful to your understanding of our
financial results. We consider an understanding of these selected items
impacting comparability to be material to our evaluation of our operating
results and prospects. Although we present selected items that we consider in
evaluating our performance, you should also be aware that the items presented do
not represent all items that affect comparability between the periods presented.
Variations in our operating results are also caused by changes in volumes,
prices, exchange rates, mechanical interruptions, acquisitions and numerous
other factors. These types of variations are not separately identified in this
release, but will be discussed, as applicable, in management`s discussion and
analysis of operating results in our Quarterly Report on Form 10-Q.

A reconciliation of net income to EBITDA and EBITDA to cash flows from operating
activities for the periods presented is included in the tables attached to this
release. In addition, the Partnership maintains on its website (www.paalp.com) a
reconciliation of all non-GAAP financial information, such as EBITDA, to the
most comparable GAAP measures. To access the information, investors should click
on the "Investor Relations" link on the Partnership`s home page and then the
"Non-GAAP Reconciliation" link on the Investor Relations page.

Conference Call

The Partnership will host a conference call at 11:00 AM (Eastern) on Thursday,
November 5, 2009 to discuss the following items:

1. The Partnership`s third-quarter 2009 performance;

2. The status of major expansion projects;

3. Capitalization and liquidity;

4. Financial and operating guidance for the fourth quarter 2009 and preliminary
2010 guidance; and

5. The Partnership`s outlook for the future.

Webcast Instructions

To access the Internet webcast, please go to the Partnership`s website at
www.paalp.com, choose "Investor Relations," and then choose "Conference Calls."
Following the live webcast, the call will be archived for a period of sixty (60)
days on the Partnership`s website.

If you are unable to participate in the webcast, please dial 800-230-1059, or,
for international callers, 612-234-9960, at approximately 10:55 AM (Eastern). No
password is required. You may access the slide presentation accompanying the
conference call a few minutes prior to the call under the Conference Call
Summaries portion of the Conference Calls tab of the Investor Relations section
of PAA`s website at www.paalp.com.

Telephonic Replay Instructions

To listen to a telephonic replay of the conference call, please dial
800-475-6701, or, for international callers, 320-365-3844, and replay access
code 116801. The replay will be available beginning Thursday, November 5, 2009,
at approximately 12:00 PM (Central) and continue until 11:59 PM (Central)
Saturday, December 5, 2009.

Plains All American Pipeline, L.P. is a publicly traded master limited
partnership engaged in the transportation, storage, terminalling and marketing
of crude oil, refined products and liquefied petroleum gas and other natural gas
related petroleum products. The Partnership is also engaged in the development
and operation of natural gas storage facilities. The Partnership is
headquartered in Houston, Texas.

Forward Looking Statements

Except for the historical information contained herein, the matters discussed in
this release are forward-looking statements that involve certain risks and
uncertainties that could cause actual results to differ materially from results
anticipated in the forward-looking statements. These risks and uncertainties
include, among other things, failure to implement or capitalize on planned
internal growth projects; maintenance of our credit rating and ability to
receive open credit from our suppliers and trade counterparties; continued
creditworthiness of, and performance by, our counterparties, including financial
institutions and trading companies with which we do business; the success of our
risk management activities; environmental liabilities or events that are not
covered by an indemnity, insurance or existing reserves; abrupt or severe
declines or interruptions in outer continental shelf production located offshore
California and transported on our pipeline systems; shortages or cost increases
of power supplies, materials or labor; the availability of adequate third-party
production volumes for transportation and marketing in the areas in which we
operate and other factors that could cause declines in volumes shipped on our
pipelines by us and third-party shippers, such as declines in production from
existing oil and gas reserves or failure to develop additional oil and gas
reserves; fluctuations in refinery capacity in areas supplied by our mainlines
and other factors affecting demand for various grades of crude oil, refined
products and natural gas and resulting changes in pricing conditions or
transportation throughput requirements; the availability of, and our ability to
consummate, acquisition or combination opportunities; our ability to obtain debt
or equity financing on satisfactory terms to fund additional acquisitions,
expansion projects, working capital requirements and the repayment or
refinancing of indebtedness; the successful integration and future performance
of acquired assets or businesses and the risks associated with operating in
lines of business that are distinct and separate from our historical operations;
unanticipated changes in crude oil market structure, grade differentials and
volatility (or lack thereof); the impact of current and future laws, rulings,
governmental regulations, accounting standards and statements and related
interpretations; the effects of competition; interruptions in service and
fluctuations in tariffs or volumes on third-party pipelines; increased costs or
lack of availability of insurance; fluctuations in the debt and equity markets,
including the price of our units at the time of vesting under our long-term
incentive plans; the currency exchange rate of the Canadian dollar; weather
interference with business operations or project construction; risks related to
the development and operation of natural gas storage facilities; future
developments and circumstances at the time distributions are declared; general
economic, market or business conditions and the amplification of other risks
caused by deteriorated financial markets, capital constraints and pervasive
liquidity concerns; and other factors and uncertainties inherent in the
transportation, storage, terminalling and marketing of crude oil, refined
products and liquefied petroleum gas and other natural gas related petroleum
products discussed in the Partnership`s filings with the Securities and Exchange
Commission.

PLAINS ALL AMERICAN PIPELINE, L.P. AND SUBSIDIARIES
FINANCIAL SUMMARY (unaudited)

CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per unit data)

Three Months Ended Nine Months Ended
September 30, September 30,
2009 2008 2009 2008

REVENUES $ 4,857 $ 8,862 $ 12,442 $ 25,118

COSTS AND EXPENSES
Purchases and related costs 4,417 8,369 11,036 23,929
Field operating costs 163 162 474 458
General and administrative expenses 52 39 153 130
Depreciation and amortization 59 49 173 150
Total costs and expenses 4,691 8,619 11,836 24,667

OPERATING INCOME 166 243 606 451

OTHER INCOME/(EXPENSE)
Equity earnings in unconsolidated entities 5 4 13 11
Interest expense (59 ) (52 ) (165 ) (143 )
Other income/(expense), net 12 14 17 27

INCOME BEFORE TAX 124 209 471 346
Current income tax expense (2 ) (3 ) (5 ) (9 )
Deferred income tax benefit - - 4 2

NET INCOME 122 206 470 339
Less: Net income attributable to the noncontrolling interest - - (1 ) -
NET INCOME ATTRIBUTABLE TO PLAINS $ 122 $ 206 $ 469 $ 339

NET INCOME ATTRIBUTABLE TO PLAINS:

LIMITED PARTNERS $ 88 $ 173 $ 370 $ 256

GENERAL PARTNER $ 34 $ 33 $ 99 $ 83

BASIC NET INCOME PER LIMITED PARTNER UNIT $ 0.65 $ 1.42 $ 2.84 $ 2.10

DILUTED NET INCOME PER LIMITED PARTNER UNIT $ 0.65 $ 1.41 $ 2.82 $ 2.08

BASIC WEIGHTED AVERAGE UNITS OUTSTANDING 130 123 128 120

DILUTED WEIGHTED AVERAGE UNITS OUTSTANDING 131 124 129 121

PLAINS ALL AMERICAN PIPELINE, L.P. AND SUBSIDIARIES
FINANCIAL SUMMARY (unaudited)

OPERATING DATA(1)
Three Months Ended Nine Months Ended
September 30, September 30,
2009 2008 2009 2008

Transportation activities (Average Daily Volumes, thousands of barrels):
Tariff activities
All American 43 44 40 44
Basin 335 375 389 372
Capline 205 216 205 218
Line 63/Line 2000 141 131 136 151
Salt Lake City Area Systems (2) 152 90 132 94
West Texas/New Mexico Area Systems (2) 355 370 375 367
Manito 62 68 62 70
Rainbow 176 191 184 108
Rangeland 51 54 54 58
Refined products 100 108 96 110
Other 1,219 1,234 1,207 1,238
Tariff activities total 2,839 2,881 2,880 2,830
Trucking 80 101 84 96
Transportation activities total 2,919 2,982 2,964 2,926

Facilities activities (Average Monthly Volumes):
Crude oil, refined products and LPG storage 56 55 56 54
(average monthly capacity in millions of barrels)
Natural gas storage 27 14 21 13
(average monthly capacity in billions of cubic feet) (3)
LPG processing 17 17 16 16
(average throughput in thousands of barrels per day)
Facilities activities total 61 58 60 57
(average monthly capacity in millions of barrels) (4)

Marketing activities (Average Daily Volumes, thousands of barrels):
Crude oil lease gathering purchases 602 638 619 663
Refined products sales 32 27 34 24
LPG sales 61 67 88 85
Waterborne foreign crude oil imported 46 77 54 84
Marketing activities total 741 809 795 856
______________________________
(1) Volumes associated with acquisitions represent total volumes for the number of days we actually owned the assets divided by the number of days in the period.
(2) The aggregate of multiple systems in the respective areas.
(3) In September 2009, we acquired the remaining 50% indirect interest in PAA Natural Gas Storage, LLC ("PNGS") from Vulcan Gas Storage LLC, which resulted in our 100% ownership of the natural gas storage business and related operating entities. Therefore, natural gas storage volumes for 2008 and January through August 2009 are netted to our 50% interest in PNGS. September 2009 volumes represent our 100% interest in PNGS.
(4) Facilities total is calculated as the sum of: (i) crude oil, refined products and LPG storage capacity; (ii) natural gas storage capacity divided by 6 to account for the 6:1 mcf of gas to crude oil barrel ratio; and (iii) LPG processing volumes multiplied by the number of days in the period and divided by the number of months in the period.

PLAINS ALL AMERICAN PIPELINE, L.P. AND SUBSIDIARIES
FINANCIAL SUMMARY (unaudited)

CONDENSED CONSOLIDATED BALANCE SHEET DATA
(In millions)
September 30, December 31,
2009 2008
ASSETS
Current assets $ 3,024 $ 2,596
Property and equipment, net 6,197 5,059
Linefill and base gas 479 425
Long-term inventory 129 139
Investment in unconsolidated entities 68 257
Goodwill 1,270 1,210
Other long-term assets, net 326 346

Total assets $ 11,493 $ 10,032

LIABILITIES AND PARTNERS' CAPITAL
Current liabilities $ 2,859 $ 2,960
Long-term debt under credit facilities and other 7 40
Senior notes, net of unamortized net discount 4,135 3,219
Other long-term liabilities and net deferred credits 265 261

Total liabilities 7,266 6,480

Partners' capital excluding noncontrolling interest 4,163 3,552
Noncontrolling interest 64 -

Total partners' capital 4,227 3,552

Total liabilities and partners' capital $ 11,493 $ 10,032

CREDIT RATIOS
(In millions) September 30,
September 30, 2009
2009 Adjustment (1) Adjusted
Short-term debt $ 692 $ 437 $ 1,129
Long-term debt 4,142 (437 ) 3,705
Total debt $ 4,834 $ - $ 4,834

Long-term debt 4,142 (437 ) 3,705
Partners' Capital 4,227 - 4,227
Total book capitalization $ 8,369 $ (437 ) $ 7,932

Total book capitalization including short-term debt $ 9,061 $ - $ 9,061

Long-term debt to total book capitalization 49 % 47 %

Total debt to total book capitalization including short-term debt 53 % 53 %
______________________________
(1) The adjustment represents the portion of the 4.25% senior notes due September 2012 that has been used to fund hedged inventory and would be classified as short-term debt if funded on our credit facilities. These notes were issued in July 2009 and the proceeds are being used to supplement capital available from our hedged inventory facility.

PLAINS ALL AMERICAN PIPELINE, L.P. AND SUBSIDIARIES
FINANCIAL SUMMARY (unaudited)

COMPUTATION OF BASIC AND DILUTED EARNINGS PER LIMITED PARTNER UNIT
(In millions, except per unit data)
Three Months Ended Nine Months Ended
September 30, September 30,
2009 2008 2009 2008
Numerator for basic and diluted earnings per limited partner unit:
Net Income Attributable to Plains $ 122 $ 206 $ 469 $ 339
Less: General partner's incentive distribution paid (1) (32 ) (30 ) (92 ) (78 )
Subtotal 90 176 377 261
Less: General partner 2% ownership (1) (2 ) (3 ) (7 ) (5 )
Net income available to limited partners 88 173 370 256
Adjustment in accordance with application of the two-class method for MLPs (1) (3 ) 2 (8 ) (5 )
Net income available to limited partners in accordance with application of the two-class method for MLPs $ 85 $ 175 $ 362 $ 251

Denominator:
Basic weighted average number of limited partner units outstanding 130 123 128 120
Effect of dilutive securities:
Weighted average LTIP units 1 1 1 1
Diluted weighted average number of limited partner units outstanding 131 124 129 121

Basic net income per limited partner unit $ 0.65 $ 1.42 $ 2.84 $ 2.10

Diluted net income per limited partner unit $ 0.65 $ 1.41 $ 2.82 $ 2.08

(1) We allocate net income to our general partner based on the distribution paid during the current quarter (including the incentive distribution interest in excess of the 2% general partner interest). Guidance issued by the FASB requires that the distribution pertaining to the current period`s net income, which is to be paid in the subsequent quarter, be utilized in the earnings per unit calculation. We reflect the impact of this difference as the "Adjustment in accordance with application of the two-class
method for MLPs."

PLAINS ALL AMERICAN PIPELINE, L.P. AND SUBSIDIARIES
FINANCIAL SUMMARY (unaudited)

FINANCIAL DATA RECONCILIATIONS
(In millions) Three Months Ended Nine Months Ended
September 30, September 30,
2009 2008 2009 2008
Net income attributable to Plains to earnings before interest, taxes, depreciation and amortization ("EBITDA") reconciliation
Net Income Attributable to Plains $ 122 $ 206 $ 469 $ 339
Add: Interest expense 59 52 165 143
Add: Income tax expense 2 3 1 7
Earnings before interest and taxes ("EBIT") 183 261 635 489
Add: Depreciation and amortization 59 49 173 150
EBITDA $ 242 $ 310 $ 808 $ 639

Three Months Ended Nine Months Ended
September 30, September 30,
2009 2008 2009 2008
Cash flow from operating activities reconciliation
EBITDA $ 242 $ 310 $ 808 $ 639
Current income tax expense (2 ) (3 ) (5 ) (9 )
Interest expense (59 ) (52 ) (165 ) (143 )
Net change in assets and liabilities, net of acquisitions (137 ) (587 ) (338 ) (275 )
Other items to reconcile to cash flows from operating activities:
Equity compensation charge 16 3 47 27

Net cash provided by operating activities $ 60 $ (329 ) $ 347 $ 239

Three Months Ended Nine Months Ended
September 30, September 30,
2009 2008 2009 2008
Funds flow from operations ("FFO")
Net Income Attributable to Plains $ 122 $ 206 $ 469 $ 339
Equity earnings in unconsolidated entities, net of distributions (3 ) (3 ) (6 ) (4 )
Depreciation and amortization 59 49 173 150
Deferred income tax benefit - - (4 ) (2 )
FFO 178 252 632 483
Maintenance capital (12 ) (19 ) (56 ) (56 )

FFO after maintenance capital $ 166 $ 233 $ 576 $ 427

PLAINS ALL AMERICAN PIPELINE, L.P. AND SUBSIDIARIES
FINANCIAL SUMMARY (unaudited)

FINANCIAL DATA RECONCILIATIONS(continued)
(In millions, except per unit data)

Three Months Ended Nine Months Ended
September 30, September 30,
2009 2008 2009 2008
Net income attributable to Plains and earnings per limited partner unit excluding selected items
impacting comparability

Net Income Attributable to Plains $ 122 $ 206 $ 469 $ 339
Selected items impacting comparability (8 ) (87 ) (63 ) 13
Adjusted net income $ 114 $ 119 $ 406 $ 352

Net income available to limited partners in accordance with application of the two-class method for MLPs $ 85 $ 175 $ 362 $ 251
Limited partners' 98% of selected items impacting comparability (8 ) (85 ) (62 ) 13
Adjusted limited partners' net income $ 77 $ 90 $ 300 $ 264

Adjusted basic net income per limited partner unit $ 0.59 $ 0.72 $ 2.35 $ 2.21

Adjusted diluted net income per limited partner unit $ 0.59 $ 0.71 $ 2.33 $ 2.19

Basic weighted average units outstanding 130 123 128 120
Diluted weighted average units outstanding 131 124 129 121

Three Months Ended Nine Months Ended
September 30, September 30,
2009 2008 2009 2008
EBITDA excluding selected items impacting comparability
EBITDA $ 242 $ 310 $ 808 $ 639
Selected items impacting comparability (8 ) (87 ) (63 ) 13
Adjusted EBITDA $ 234 $ 223 $ 745 $ 652

Plains All American Pipeline, L.P.
Manager, Investor Relations
Roy I. Lamoreaux, 713-646-4222 or 800-564-3036
or
Senior Vice President, CFO
Al Swanson, 713-646-4455 or 800-564-3036

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