Company:Plains All American Pipeline

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Plains All American Pipeline, L.P.
TypePublic company
NASDAQ: PAANASDAQ: PAGP
IndustryPetroleum industry
Founded1981; 43 years ago (1981)
HeadquartersHouston, Texas, United States
Key people
Willie Chiang, Chairman and CEO
ServicesPipeline transport
Oil terminal
RevenueIncrease $57.342 billion (2022)
Increase $1,037 billion (2022)
Total assetsDecrease $23.892 billion (2022)
Total equityIncrease $13.325 billion (2022)
Websitewww.plainsallamerican.com
Footnotes / references
[1]

Plains All American Pipeline, L.P. is a master limited partnership engaged in pipeline transport, marketing, and storage of liquefied petroleum gas and petroleum in the United States and Canada . Plains owns interests in 18,370 miles (29,560 km) of pipelines, storage capacity for about 75 million barrels of crude oil, 28 million barrels of NGLs, 68 billion cubic feet of natural gas, and 5 natural gas processing plants. The company is headquartered in the Allen Center in Downtown Houston, Texas .[1] Plains (NASDAQ: PAA) is a publicly traded Master limited partnership. PAA owns an extensive network of pipeline transportation, terminalling, storage and gathering assets in key crude oil and NGL producing basins and transportation corridors and at major market hubs in the United States and Canada.[2]

History

The company began in 1981 as a small oil and gas exploration and production company called Plains Resources.[3] The company became a public company via an initial public offering in 1998.[1]

Major acquisitions include:[3]

  • 1998 - All American Pipeline System[3]
  • 1999 - Scurlock Oil Company Permian and west Texas pipeline from Chevron Corporation for $35 million[4]
  • 2001 - Midstream operations of Murphy Oil for $155 million[5]
  • 2001 - CANPET Energy Group, a liquified gas marketing company based in Canada, for $42 million[6][7]
  • 2004 - Capline Pipeline System[8]
  • 2004 - Link Energy pipeline system for $273 million[9]
  • 2005 - Assets in Louisiana from Shell Oil Company for $12 million[10]
  • 2006 - Pacific Energy Partners for $2.4 billion[11]
  • 2008 - Rainbow oil pipeline in Northern Alberta[12]
  • 2012 - Canadian NGL business from BP[13]
  • 2017 - Alpha Crude Connector gathering system and pipeline in the Permian Basin for $1.2 billion.[14]
  • 2019- The Cactus II Pipeline System enters service, capable of transporting 670,000 barrels of crude oil per day from Wink, Texas to Corpus Christi.[15]
  • 2021- Plains Oryx Permian Basin, a joint venture between Plains and Oryx Midstream Services, is formed. The combined system includes ~5,500 miles of pipeline, ~6.8 million barrels per day of pipeline capacity, and ~16.9 million barrels operational storage capacity.[16]

Financial performance and credit ratings

The company earned a profit in nine of the ten calendar years from 2013 to 2022. It reported a $2.59 billion loss for calendar year 2020. Management attributed the 2020 loss to the COVID-19 global pandemic, which reduced demand for energy products. In response, the company recorded goodwill impairment losses and non-cash impairment charges of some $3.4 billion in 2020.[17]

Net Income (Loss)[18][19]
Year $ billions
2013 $1.39
2014 $1.39
2015 $0.90
2016 $0.73
2017 $0.86
2018 $2.21
2019 $2.17
2020 ($2.59)
2021 $0.59
2022 $1.03

As of August 2023, Plains All American's senior unsecured debt was rated Baa3 by Moody's Investors Service,[20][21] and BBB− by Fitch Ratings[22] and S&P Global Ratings. All three ratings are generally considered "investment grade."

Carbon footprint

Plains All American Pipeline reported Total CO2e emissions (Direct + Indirect) for the twelve months ending 31 December 2020 at 1,929 Kt (-290 /-13.1% y-o-y).[23]

Plains All American Pipeline's annual Total CO2e Emissions - Location-Based Scope 1 + Scope 2 (in kilotonnes)
Dec 2018 Dec 2019 Dec 2020
2,367[24] 2,219[25] 1,929[23]

Controversies

2010 settlement

In 2010, the company agreed to pay a $3.25 million civil penalty for violating the Clean Water Act and to spend $41 million to upgrade more than 10,000 miles of crude oil pipelines after the United States Environmental Protection Agency pressed charges regarding 10 pipeline spills in Texas, Louisiana, Oklahoma, and Kansas between June 2004 and September 2007 that spilled over 273,000 gallons of crude oil, some of which ended up in rivers, lakes, and oceans.[26]

Little Buffalo oil spill

The 2011 Little Buffalo oil spill was one of the largest land-based oil spills in North America, the largest oil spill in Alberta in 36 years, and the second spill in Alberta within a two-week period. The Rainbow Pipeline system, owned by Plains Midstream Canada, ruptured on April 29, 2011, spilling 28,000 barrels of oil in a fairly isolated stretch of boreal forest in northern Alberta, about four miles from the nearest homes in Little Buffalo, Alberta.[27][28] The local school was closed due to concerns about the effects of fumes.[29] The incident resulted in charges against the company in 2013.[30] In 2013, the Energy Resources Conservation Board of Alberta reprimanded the company for operational failures in connection with the oil spill.[31]

Rangeland Pipeline Incident

Heavy rains in early June 2012 caused a leak on a 46-year-old Plains Midstream Canada pipeline at Jackson Creek, Alberta, a tributary of the Red Deer River, which spilled approximately 1,000-3,000 barrels of light sour crude into the Red Deer River.[32][33] The company was charged in 2014.[34]

Refugio oil spill

On May 19, 2015, a pipeline operated by the company ruptured northwest of Santa Barbara, California.[35] Within 24 hours, oil polluted approximately 9 miles of the Santa Barbara coast. The spill shut down the popular El Capitán State Beach and Campground during Memorial Day weekend, just prior to the beginning of the summer high season. The spill leaked 105,000 US gallons (2,500 bbl), including 20,000 US gallons (480 bbl) that reached the Pacific Ocean.[36][37][38] The United States House Committee on Energy and Commerce opened an investigation into the oil spill on June 25, 2015. Companies are required to report to the National Response Center on the release of hazardous-material "at the earliest practicable moment."; however, the company did not initially report the spill.[36] According to preliminary findings of the federal Pipeline and Hazardous Materials Safety Administration released in June 2015, corrosion had worn a pipeline section to less than an inch thick.[36] By June 2015 the cost of cleanup rose to USD$92 million.[36] Santa Barbara County firefighters were among the first to discover the spill, before being notified by the company, and they "built a rim of rocks to prevent oil from running to the shoreline."[39][40] In March 2020, the company agreed to pay over $60 million in penalties related to the incident.[41]

Byhalia Connection pipeline

In December 2019, the company announced a joint venture with Valero Energy Corp. to build the Byhalia Connection pipeline – a crude oil pipeline system that would run 49 miles from Memphis to Marshall County, Mississippi,[42] and connect two existing crude oil pipelines: the Diamond pipeline and the Capline pipeline.[43] Concerns over the pipeline's route through the Memphis Sand aquifer, as well as the city's predominantly Black neighborhoods, sparked an opposition movement. The struggle to stop the pipeline gained widespread attention, with environmental and social justice advocates like Jane Fonda and Danny Glover lending their support.[44] Former Vice-President Al Gore called the pipeline a “reckless, racist rip-off,”[45] and U.S. Rep. Steve Cohen asked President Joe Biden to consider revoking the project's federal permit.[46] After defending the pipeline and then putting its planned construction on hold in May 2021, the company announced on July 2, 2021 that it was abandoning the project.[47] Community leader Justin J. Pearson called the pipeline’s cancellation an “extraordinary testament to what Memphis and Shelby County can do when citizens build power toward justice.”[48]

References

  1. ↑ 1.0 1.1 1.2 "Plains All American Pipeline, L.P. 2022 Form 10-K Annual Report". U.S. Securities and Exchange Commission. https://www.sec.gov/ix?doc=/Archives/edgar/data/0001070423/000107042323000006/paa-20221231.htm. 
  2. ↑ "About Us". https://www.plains.com/about-us. 
  3. ↑ 3.0 3.1 3.2 "Company History". Plains All American Pipeline, L.P.. https://www.plainsallamerican.com/about-us/company-history. 
  4. ↑ "Plains Scurlock acquires crude oil pipeline". American City Business Journals. July 16, 1999. https://www.bizjournals.com/houston/stories/1999/07/12/daily11.html. 
  5. ↑ "Plains All American acquires midstream operations, extends reach into Canada". American City Business Journals. March 2, 2001. https://www.bizjournals.com/houston/stories/2001/02/26/daily43.html. 
  6. ↑ "Plains All American to buy CANPET Energy Group". American City Business Journals. April 11, 2001. https://www.bizjournals.com/houston/stories/2001/04/09/daily11.html. 
  7. ↑ "Plains All American buys Canadian crude, LPG marketer". Oil & Gas Journal. April 11, 2001. https://www.ogj.com/general-interest/companies/article/17263154/plains-all-american-buys-canadian-crude-lpg-marketer. 
  8. ↑ "Plains acquires rest of Atchafalaya Pipeline". Oil & Gas Journal. December 8, 2003. https://www.ogj.com/general-interest/article/17256458/plains-acquires-rest-of-atchafalaya-pipeline. 
  9. ↑ Perin, Monica (March 31, 2004). "Plains All American to pay $273M for certain Link Energy assets". American City Business Journals. https://www.bizjournals.com/houston/stories/2004/03/29/daily39.html. 
  10. ↑ Hall, Christine (January 12, 2005). "Plains acquires Louisiana assets from Shell". American City Business Journals. https://www.bizjournals.com/houston/stories/2005/01/10/daily21.html. 
  11. ↑ "Plains All American to buy Pacific Energy". Oil & Gas Journal. June 19, 2006. https://www.ogj.com/general-interest/article/17280873/plains-all-american-to-buy-pacific-energy. 
  12. ↑ "Plains All American to buy Canadian Rainbow oil pipeline". Oil & Gas Journal. April 10, 2008. https://www.ogj.com/general-interest/companies/article/17269607/plains-all-american-to-buy-canadian-rainbow-oil-pipeline. 
  13. ↑ "Plains All American Pipeline Completes Acquisition of Canadian NGL Business from BP" (Press release). Business Wire. April 2, 2012. External link in |publisher= (help)
  14. ↑ Mann, Joshua (March 3, 2017). "Houston pipeline company closes $1.2B buy". American City Business Journals. https://www.bizjournals.com/houston/news/2017/03/03/houston-pipeline-company-closes-1-2b-buy.html. 
  15. ↑ "Plains All American". https://www.plains.com/about-us/company-history. 
  16. ↑ "Plains All American". July 27, 2023. https://www.plains.com/about-us/company-history. 
  17. ↑ "Annual Report on Form 10-K for the fiscal year ended December 31, 2020, p.78.". United States Securities and Exchange Commission. https://www.sec.gov/ix?doc=/Archives/edgar/data/0001070423/000107042321000008/paa-20201231.htm#i1a2046661d8342a2817bac7d3c1f1103_85. 
  18. ↑ "Plains All American Pipeline LP Financials". Barron's. https://www.barrons.com/market-data/stocks/paa/financials?mod=searchresults_companyquotes. 
  19. ↑ "Annual Report on Form 10-K for the fiscal year ended December 31, 2017". United States Securities and Exchange Commission. https://www.sec.gov/Archives/edgar/data/1070423/000107042318000006/paa201710-k.htm#sF0331E31FA3551889447D4A517F0C3A1. 
  20. ↑ "Plains All American Pipeline L.P.". https://www.moodys.com/credit-ratings/Plains-All-American-Pipeline-LP-credit-rating-600044385/reports?category=Ratings_and_Assessments_Reports_rc%7CIssuer_Reports_rc%7CIssuer_Data_Reports&type=Rating_Action_rc%7CAnnouncement_rc%7CAnnouncement_of_Periodic_Review_rc,Credit_Opinion_ir_rc,Peer_Snapshot_rc. 
  21. ↑ "Rating Action: Moody's upgrades Plains All American's notes to Baa3". Moodys Investors Service. November 16, 2021. https://www.moodys.com/research/Moodys-upgrades-Plains-All-Americans-notes-to-Baa3--PR_458051. 
  22. ↑ "Plains All American Pipeline L.P. Credit Ratings". https://www.fitchratings.com/entity/plains-all-american-pipeline-lp-96367390. 
  23. ↑ 23.0 23.1 "Plains All American Pipeline's Sustainability Report for 2020Q4". https://paalp.s3.amazonaws.com/plains/media/documents/sustainability/plains-2020-sustainability-report.pdf.  Alt URL
  24. ↑ "Plains All American Pipeline's Sustainability Report for 2020Q4". https://paalp.s3.amazonaws.com/plains/media/documents/sustainability/plains-2020-sustainability-report.pdf.  Alt URL
  25. ↑ "Plains All American Pipeline's Sustainability Report for 2020Q4". https://paalp.s3.amazonaws.com/plains/media/documents/sustainability/plains-2020-sustainability-report.pdf.  Alt URL
  26. ↑ "Plains All American Pipeline Settlement". United States Environmental Protection Agency. August 10, 2010. https://www.epa.gov/enforcement/plains-all-american-pipeline-settlement. 
  27. ↑ Welsch, Edward (May 5, 2011). "Size of Oil Spill in Canada Grows". The Wall Street Journal. https://www.wsj.com/articles/SB10001424052748704322804576303440805617516. 
  28. ↑ Vanderklippe, Nathan (May 4, 2011). "Costs for oil companies pile up after spill". The Globe and Mail. https://www.theglobeandmail.com/report-on-business/costs-for-oil-companies-pile-up-after-spill/article578815/. 
  29. ↑ "Location of oil spill near Little Buffalo, Alta". The Globe and Mail. May 4, 2011. https://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/location-of-oil-spill-near-little-buffalo-alta/article634637/. 
  30. ↑ "2nd largest pipeline spill in Alberta history leads to charges". CBC News. April 26, 2013. https://www.cbc.ca/news/canada/edmonton/2nd-largest-pipeline-spill-in-alberta-history-leads-to-charges-1.1311723. 
  31. ↑ "Plains Midstream reprimanded for 2011 Alberta oil spill". CBC News. February 26, 2013. https://www.cbc.ca/news/canada/calgary/plains-midstream-reprimanded-for-2011-alberta-oil-spill-1.1311724. 
  32. ↑ Weber, Bob (June 14, 2012). "Alberta pressured to include leaks in environmental monitoring plan". Financial Post. https://financialpost.com/commodities/energy/alberta-pressured-to-include-leaks-in-environmental-monitoring-plan. 
  33. ↑ Ewart, Stephen (June 16, 2012). "Calls growing for probe of aging pipeline system: Recent spills highlight ongoing risk". Calgary Herald. https://www.pressreader.com/canada/calgary-herald/20120616/281840050743111. 
  34. ↑ "Plains Midstream charged in Red Deer River pipeline spill". June 2, 2014. https://www.cbc.ca/news/canada/edmonton/plains-midstream-charged-in-red-deer-river-pipeline-spill-1.2662309. 
  35. ↑ Cooper, Lara (May 19, 2015). "Oil Spill Reported on Coast Near Refugio State Beach". Noozhawk. https://www.noozhawk.com/article/oil_spill_reported_on_coast_near_refugio. 
  36. ↑ 36.0 36.1 36.2 36.3 "California Oil Spill Gushed Like Hose 'Without a Nozzle'". Associated Press. Pittsburgh Post-Gazette. June 26, 2015. https://www.post-gazette.com/business/powersource/2015/06/27/California-oil-spill-gushed-like-hose-without-a-nozzle-3/stories/201506270145. 
  37. ↑ Hayden, Tyler (May 20, 2015). "As Refugio Oil Slick Spreads, Spill Estimate Rises". Santa Barbara Independent. https://www.independent.com/2015/05/20/refugio-oil-slick-spreads-spill-estimate-rises/. 
  38. ↑ Frizell, Sam (May 20, 2015). "California Governor Declares State of Emergency After Santa Barbara Oil Spill". Time (magazine). https://time.com/3891739/california-oil-spill-jerry-brown-state-of-emergency/. 
  39. ↑ Brugger, Kelsey (May 28, 2015). "Supes Gently Grill Feds over Refugio Spill Response County Asks for Timeline; Plains Mum on 'Emergency Response Plan'". Santa Barbara Independent. https://www.independent.com/2015/05/28/supes-gently-grill-feds-over-refugio-spill-response/. 
  40. ↑ "Refugio Incident, Santa Barbara County, May 19, 2015". California Department of Fish and Wildlife. https://calspillwatch.wildlife.ca.gov/Spill-Archive/Refugio. 
  41. ↑ "U.S. Pipeline Company to Modify Its National Operations to Implement Safeguards Resulting from Oil Spill" (Press release). United States Environmental Protection Agency. March 13, 2020.
  42. ↑ Macaraeg, Sarah. "What you need to know about the Byhalia Connection pipeline in Memphis" (in en-US). https://www.commercialappeal.com/story/news/2021/03/23/byhalia-pipeline-memphis-what-you-need-know-environmental-justice/4772256001/. 
  43. ↑ "About the Project". https://byhaliaconnection.com/about-project/. 
  44. ↑ Macaraeg, Sarah. "What you need to know about the Byhalia Connection pipeline in Memphis" (in en-US). https://www.commercialappeal.com/story/news/2021/03/23/byhalia-pipeline-memphis-what-you-need-know-environmental-justice/4772256001/. 
  45. ↑ "Black Community in Memphis Defeats Oil Pipeline That Threatened Water Supply" (in en). https://www.democracynow.org/2021/7/6/headlines/black_community_in_memphis_defeats_oil_pipeline_that_threatened_water_supply. 
  46. ↑ Watts, Micaela A.. "Cohen asks Biden to deny Byhalia pipeline permit; Danny Glover, other celebrities voice opposition" (in en-US). https://www.commercialappeal.com/story/news/2021/02/22/celebrities-ask-biden-deny-byhalia-connection-pipeline/4540677001/. 
  47. ↑ "Company drops plans for Byhalia pipeline; Activists rejoice: 'Sometimes the good guys win'" (in en-US). The Commercial Appeal. https://www.commercialappeal.com/story/news/2021/07/02/plains-all-american-abandons-plan-byhalia-connection-oil-pipeline-memphis/7848508002/. 
  48. ↑ "Black Community in Memphis Defeats Oil Pipeline That Threatened Water Supply" (in en). https://www.democracynow.org/2021/7/6/headlines/black_community_in_memphis_defeats_oil_pipeline_that_threatened_water_supply. 

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