paa plains all america pipeline jun 2009 presentation

8/14/2019 PAA Plains All America Pipeline Jun 2009 Presentation

1/180

PAA: Tested. Delivered. Posi

2009 Analyst Meeting

New York, NYJune 10, 2009


2/180


3/180

2009 Analyst Meeting Agenda

Approximate

Timing Presenter

12:00pm - 1:00pm Registration / Lunch

1:00pm - 1:10pm Opening Remarks Roy Lamoreaux

1:10pm - 1:30pm PAA History, Business Model & Positioning for Greg Armstrong

Current Market Environment

1:30pm - 1:50pm Overview of PAA Business Activities & Impact on PAA During Harry Pefanis

an Extended Period of Economic Weakness

1:50pm - 2:00pm Q&A Session

2:00pm - 2:20pm Commercial Activities John von Berg

2:20pm - 2:40pm US Capital Projects Mark Gorman


2:50pm - 3:10pm Break

3:10pm - 3:30pm Plains Midstream Canada Dave Duckett

3:30pm - 3:50pm PAA Natural Gas Storage Dean Liollio


4:00pm - 4:20pm Financial Overview Al Swanson

Charles Kingswell-Smith

4:20pm - 4:35pm PAA Strategic Positioning Pat Diamond

4:35pm - 4:45pm Closing Remarks Greg Armstrong


5:00pm - 6:00pm Cocktail Reception

Act iv ity / Presentat ion


4/180

333 Clay St., Ste. 1600 Houston, TX 77002

Investor Contact Information

Al SwansonSr. VP and CFODirect: 713-646-4455FAX: 713-646-4564

Email: [email protected]

Pat DiamondVice PresidentDirect: 713-646-4487FAX: 713-646-4572Email: [email protected]

Roy LamoreauxMgr., Investor Relations &Equity Capital MarketsDirect: 713-646-4222FAX: 713-646-4572Email: [email protected]

Charles Kingswell-SmithVice President & TreasurerDirect: 713-993-5318FAX: 713-646-4313

Email: [email protected]


5/180

Plains All American Pipeline, L.P.

Management Bios

Greg L. Armstrong

Chairman and CEO

Greg L. Armstronghas served as Chairman of the Board and Chief Executive Officer since

our formation in 1998. He has also served as a director of our general partner or former

general partner since our formation. In addition, he was President, Chief Executive Officer

and director of Plains Resources Inc. from 1992 to May 2001. He previously served Plains

Resources as: President and Chief Operating Officer from October to December 1992;

Executive Vice President and Chief Financial Officer from June to October 1992; Senior

Vice President and Chief Financial Officer from 1991 to 1992; Vice President and Chief

Financial Officer from 1984 to 1991; Corporate Secretary from 1981 to 1988; and Treas-

urer from 1984 to 1987. Mr. Armstrong is also a director of National Oilwell Varco, Inc.,

and PAA/Vulcan.

Harry N. Pefanis

President and COO

Harry N. Pefanishas served as President and Chief Operating Officer since our formation

in 1998. He was also a director of our former general partner. In addition, he was Execu-

tive Vice President Midstream of Plains Resources from May 1998 to May 2001. He

previously served Plains Resources as: Senior Vice President from February 1996 until

May 1998; Vice President Products Marketing from 1988 to February 1996; Manager of

Products Marketing from 1987 to 1988; and Special Assistant for Corporate Planning from1983 to 1987. Mr. Pefanis was also President of several former midstream subsidiaries of

Plains Resources until our formation. Mr. Pefanis is also a director of PAA/Vulcan and Set-

toon Towing.

W. Dave DuckettPresident - Plains Midstream Canada

W. David Ducketthas served as President of Plains Midstream Canada, formerly known as

PMC (Nova Scotia) Company, since June 2003, and Executive Vice President of PMC(Nova Scotia) Company from July 2001 to June 2003. Mr. Duckett was with CANPET En-

ergy Group Inc. from 1985 to 2001, where he served in various capacities, including most

recently as President, Chief Executive Officer and Chairman of the Board.


6/180


Management Bios

Mark J. GormanSr. Vice President - Operations & Business Development

Mark J. Gorman has served as Senior Vice PresidentOperations and Business

Development since August 2008. He previously served as Vice President from November

2006 until August 2008. Prior to joining Plains, he worked in various capacities at Genesis

Energy including: Director, Executive Vice President and COO and President and CEO from

1996 through August 2006. From 1992 to 1996, he served as a President for Howell Crude

Oil Company. Mr. Gorman began his career with Marathon Oil Company, spending 13 years

in various disciplines. Mr. Gorman is also a director of Settoon Towing, Butte and Frontier.

Al Swanson

Sr. Vice President and CFO

Al Swanson has served as Senior Vice President and Chief Financial Officer since Novem-

ber 2008. He previously served as Senior Vice PresidentFinance from August 2008 until

November 2008 and as Senior Vice PresidentFinance and Treasurer from August 2007

until August 2008. He served as Vice President Finance and Treasurer from August

2005 to August 2007, as Vice President and Treasurer from February 2004 to August

2005 and as Treasurer from May 2001 to February 2004. In addition, he held finance

related positions at Plains Resources including Treasurer from February 2001 to May 2001

and Director of Treasury from November 2000 to February 2001. Prior to joining Plains

Resources, he served as Treasurer of Santa Fe Snyder Corporation from 1999 to October

2000 and in various capacities at Snyder Oil Corporation including Director of Corporate

Finance from 1998, Controller SOCO Offshore, Inc. from 1997, and Accounting Man-

ager from 1992. Mr. Swanson began his career with Apache Corporation in 1986 serving

in internal audit and accounting.

John P. vonBerg

Sr. Vice President Commercial Activities

John P. vonBerg has served as Senior Vice PresidentCommercial Activities since August

2008. Previously he served as Vice PresidentCommercial Activities from August 2007

until August 2008 and as Vice PresidentTrading from May 2003 until August 2007. Heserved as Director of these activities from January 2002 until May 2003. Prior to joining

us in January 2002, he served in various roles at Genesis Energy including Director, Vice

Chairman, President and CEO from 1996 through 2001, and from 1993 to 1996 he served

as a Vice President and a Crude Oil Manager for Phibro Energy USA. Mr. vonBerg began

his career with Marathon Oil Company, spending 13 years in various disciplines.


7/180


Management Bios

A. Patrick DiamondVice President

A. Patrick (Pat) Diamond has served as Vice President since August 2007. He previously

served as Director Strategic Planning from July 2005 to August 2007 and as Manager

Special Projects for Plains All American from May 2001 to July 2005 and for Plains Re-

sources from August 1999 to May 2001. Prior to joining the Plains organization, Mr. Dia-

mond was an investment banker in the Global Energy Group of Salomon Smith Barney

from 1994 to 1999 where he was involved in all facets of the energy sector, with particu-

lar emphasis on the area of Master Limited Partnerships (MLPs). Mr. Diamond is a summa

cum laude graduate of Babson College, holding a BS degree in finance and quantitative

studies. He is a member of the Board of Directors of the National Association of Publicly

Traded Partnerships, a trade association representing publicly traded limited partnerships.

Charles Kingswell-Smith

Vice President and Treasurer

Charles (Chuck) Kingswell-Smith joined PAA in 2008 from GE Energy Finance. Mr.

Kingswell-Smith has over 25 years of experience in the energy banking business princi-

pally with JPMorgan Chase. At PAA, Chuck is responsible for coordination of our banking

transactions and lending arrangements, customer credit functions, financial planning at-

tivities, insurance risk management and foreign exchange and interest rate managementactivities.

Roy I. Lamoreaux

Manager, Investor Relations and Equity Capital Markets

Roy I. Lamoreauxhas served as Manager of Investor Relations and Equity Capital Markets

since November 2006. He worked previously at Anadarko Petroleum Corporation in ac-quisitions and divestitures and asset operations groups. Roy received a BBA in Energy

Management from the University of Oklahoma and holds an MBAE from the Acton School

of Business.


8/180

PAA Natural Gas Storage, LLC

Management Bios

Richard S. Tomaski, II

Vice President - PAA Natural Gas Storage LLC

Richard S. Tomaski, II has served as Vice President, PAA Natural Gas Storage, LLC

(formerly known as Energy Center Investments) since 2005. From 2003 to 2005, he served

as Vice President Bluewater Gas Storage Marketing and Development (Bluewater).

From 2002 to 2003, Mr. Tomaski served Bluewater as Vice President Natural Gas Trading

Mid-Continent. From 2000 to 2002, Mr. Tomaski served in several positions with Enron

Corp. and Enron North America. Mr. Tomaski received a B.B.A in Accounting and Finance

from Texas A&M University.

Daniel Noack

VP Operations - PAA Natural Gas Storage LLC

Daniel Noack has served as Vice President, Operations for PAA Natural Gas Storage, LLC

since July 2008. Prior to joining Plains Mr. Noack served as Storage Manager for Energy

Transfer Partners and as a Storage Consultant with El Paso Field Services (Gulfterra)

where he supported the strategic development and daily management of the company's

eight storage assets and twenty-six salt dome cavern wells. Mr. Noack has over 16 years

of experience in the natural gas storage field and is experienced in all aspects of under-

ground salt dome hydrocarbon storage including identifying, permitting, developing, con-

structing, optimizing, and operating.

Dean Liollio

President - PAA Natural Gas Storage, LLC

Dean Liollio has served as President of PAA Natural Gas Storage, LLC since March of

2009. Mr. Liollio has 25 years of experience in the natural gas business, most recently

serving as President and CEO of EnergySouth, Inc., a NASDAQ listed company prior to its

acquisition by Sempra Energy in October 2008. Prior to joining EnergySouth, Mr. Liollio

served with Centerpoint Energy and its subsidiaries for approximately 23 years in various

positions of increasing responsibility including Division President and COO, Southern Gas

Operations.


9/180

Opening Remarks

Roy LamoreauxManager, IR & ECM


10/180

2

Forward-Looking Statements &Non-GAAP Financial Measures Disclo

This presentation contains forward-looking statementparticular, statements about the plans, strategies and prospAmerican Pipeline, L.P. (the Partnership or PAA). Thesstatements are based on the Partnerships current assumptiand projections about future events.

Although the Partnership believes that the expectations rforward-looking statements are reasonable, the Partnersassurance that these expectations will prove to be correct orother benefits anticipated in the forward-looking statementsImportant factors, some of which may be beyond the Partthat could cause actual results to differ materially froexpectations are disclosed in the Partnerships most recentKs filed with the Securities and Exchange Commission.

This presentation also contains non-GAAP financial meEBITDA. For a presentation of the most directly comparable

and a reconciliation of the two as well as additional detail ritems impacting comparability, please see the reconciliationthe last tab in your presentation materials or you can viswww.paalp.com. Click on the Investor Relations section followed by the Non-GAAP Reconciliations link.


11/180

3

Orientation

Information Package Agenda

Investor Contact Info

Presenter Bios

Presentations

Non-GAAP Reconciliations

Q&A

We will hold several Q&A sessions thrthe meeting

PAA personnel will be stationed in audmicrophones for Q&A

Index cards to capture questions are aprovided on each table


12/180

4

Meeting Agenda

Commercial Activities

Overview of PAA Business Activities & Impact on PAADuring an Extended Period of Economic Weakness

Closing Remarks

PAA Strategic Positioning

ChaFinancial Growth Strategy & Risk Management; Guidance,Segment Performance and Distribution Coverage

PAA Natural Gas Storage

Plains Midstream Canada

US Capital Projects

PAA History, Business Model & Positioning for CurrentMarket Environment

Opening Remarks

Topic

Q&A Sessions


13/180

5

Plains All American Profile 2009(NYSE: PAA)

Total Assets (03/31/09) $9.4 B

Book Equity (03/31/09)A $3.7 B

Book Cap. (03/31/09)A $7.1 B

Enterprise ValueAB $9.3 B

Equity Market Cap. B $5.8 B

Fortune 500 Rank 79 Unitholders ~90,000

Current Yield* ($3.62 annualized) ~8.1%

Aggregate Size/Yield

Assets(2)

:Pipelines (activeStorage LPG Railcars

Truck Fleet

Barge Fleet (Sett

Crude, Product LPG Volumes:

Operational footDomestic Canada

Employees

Operation

A Based on balance sheet data as of 3/31/09 pro-forma for Aprildebt offeringB Based on 06/01/09 closing unit price; excludes value of GP.

(1) EBITDA and Net Income are the midpoint of PAAs public guidance furnished via 8-K on Mayselected items impacting comparability.

(2) Includes owned or leased assets as of 12/31/08

2009 Adjusted EBITDA $977 MM

2009 Adjusted Net Income $517 MM

Public Guidance Midpoint (1)


14/180

PAA Assets Well Positioned to Meet the Dynamof North American Energy Markets


15/180

7

PAA Quick Progress UpdateSince Last Analyst Meeting in April 2008

2008 was solid year of performance 14% Adjusted EBITDA growth over 2007 (in line/slightly a

acquisition adjusted Plan) Achieved 2008 goals (with a notable cost overrun on SLC Completed and integrated Rainbow and two other LPG-re PAA business model was stress tested and validated, wit

Meltdown of high-profile competitor Multiple Gulf Coast hurricanes Turmoil in economic and financial markets Significant volatility in commodity markets

PAA is cautiously optimistic on 2009 despite macroecoenvironment 2009 Adjusted EBITDA forecasted to increase 10% over 2 Annualized distribution per unit increased in May 2009 to

4.6% from 2008 analyst meeting level)

PAA is well positioned financially Excellent credit metrics

Solid capital structure with significant liquidity

Able to execute business plan and capital program while significant liquidity, even in a challenging economic and environment


16/180

8

2009 Goals & Performance

Raised equity and dof $557 million; Liq$1.8 billion (pro fordeal)

Prudently manage our capital resourcesand preserve our strong capitalizationand liquidity

Completed two acqcombined price of ~

Pursue an average of $200 million to$300 million of strategic and accretiveacquisitions

Capital program geincreased to $350 m

additional costs asbringing RangelandSLC online and shiexpenditures due to

Successfully execute our 2009 capitalprogram, and set the stage for

continued growth in 2010

1Q09 Adjusted EBITmidpoint guidance 2009 guidance midmillion

Deliver baseline operating and financialperformance in line with guidance

PerformanceGoal


17/180

9

2009 PAA Analyst Meeting Th

Despite being tested by volatility in the cofinancial markets and a variety of other chalbusiness model, financial growth strateg

management practices have delivered stronresults and have positioned PAA to nav

challenging environment, execute its busin

capitalize on potential opportunit

PAA: Tested. Delivered. Pos


18/180

10

Building Blocks from Previous Meetin

PAA represents a predominantly fee-baseinvestment in essential North American einfrastructure.

PAAs assets are strategically located, op

flexible and positioned to benefit from voestablished industry trends.

PAAs management team has significant depth and is knowledgeable, highly motiv

results oriented.

(Above points confirmed by participant f


19/180

11

Todays Focus Items

PAA is well positioned strategically and financially relatchallenging global economy and financial markets. PAA game plan in current, challenging and uncertain envi Outlook and impact on fundamental business (volumes, m

current market conditions continue for extended period of Strong liquidity and capitalization has implications for PAA

defense

PAAs proven business model has continued to deliver and financial results during challenging and volatile ma Composition and durability of Marketing segment cash flo

PAA Natural Gas Storage (50% owned JV) is successfulbusiness plan and is positioned for future growth and ex

PAA is well-positioned to act opportunistically upon acqother investment opportunities that may be available dumarket conditions.

PAA represents an attractive investment opportunity cosubstantial current yield with a solid foundation for cont


20/180

Page Intentionally Left B


21/180

PAA History, Business MoPositioning For Current Envir

Greg Armstrong

Chairman & CEO


22/180

14

81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 0 1 2 3

Sep

UpsMid

Sep

Up& M

28+-Year History Of the Plains Orga

(1981-2009YTD)

1981Plains

ResourcesIPO PLX

Upstream E&P Entity

1988Formation of

Plains Marketingas a Sub of PLX

Midstream Transportation Entity

IPO ofPlains All

AmericanPAA

Di

ove

1 2


23/180

15

1988 1998:Plains Resources (PLX) forms marketingsub to market its gasShifted focus exclusively to crude oiland built Cushing Terminal (initial2MMbls)Began acquiring & building W. TX truckstationsExpanded senior management team

Positioned in lower tier of top 20gatherers & marketersExpanded business & integrated G&Mand T&SEnded 1997 with total assets of $150 MMAcqd AAPL (All American Pipe Line)Completed IPO of PAA

1999 - 2001:Acqd Scurlock Permian & ChevronW.Tx pipeline

Completed Cushing Phases I & IIexpansions (to 4.2 MMbbls)

Trading loss event

Repaired Balance Sheet

Announced plans to enter Canadianmarket

Ended 2000 with total assets of$900 million

Mgmt led buyout of 56% GP(Separated from PLX)

Expanded into Canada

2002- 2009YTDCompleted 43 aCompleted CusIncreased foreigLTM average ofImplemented ~$projects from 20Entered into naproducts busineInitiated St. JamConsummated

$332 mill$2.5 billio$687 mill

Targeted 2009 imillionEnded 1Q09 wit

PAA History and Growth (1988-2009)

$252

$169$130

$110$108$87$34

$408

$511

$77

1988-1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 200

Adjusted EBITDA Growth ($MM)

Note: Adjusted EBITDA excludes the impact of selected items impacting comparability. See website for reconciliation of (www.paalp.com) to comparable Non-GAAP measures. 2009G based on guidance furnished in Form 8-K on May 6,

Less than $10MMper year

Formative PeriodRefinement Period

Execut

1

2


24/180

16

PAAs Proven Business Model

Qualitative

Understand the markets Fundamental supply/demand Volatility, seasonality, cyclica Performance in different econ Recent, pending and possible

market dynamics (regulatory, changes, etc.)

Build or acquire logistics assetmarket fundamentals

Optimize performance of such interconnectivity and combinatarrangements and counter-cyccommercial activities..thusto exert strong influence over o Capitalize on low risk market o Increase utilization of pipeline Positioned to benefit from vol

+

+

+

=

Assets

Capital

Knowledge

Execution Skills

Value AddedServices

Sustainable, increasingprofits & distributions

Formulaic

=


25/180

17

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

1

9

8

3

1

9

8

4

1

9

8

5

1

9

8

6

1

9

8

7

1

9

8

8

1

9

8

9

1

9

9

0

1

9

9

1

1

9

9

2

1

9

9

3

1

9

9

4

1

9

9

5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

198

3

198

4

198

5

198

6

198

7

198

8

198

9

199

0

199

1

199

2

199

3

199

4

199

5

U.S. Imports of Re(Millions of Barrels per Day)

U.S. Natural Gas S(Billions of Cubic Feet per D

Domestic

Seasonal shifts in regionaldemand:

Alternating needs of refineries tostore/blend

Complex transportation logistics Shortage of diluent for Canadian heavy oil

Inefficiency caused by multiple supplysources and numerous regional supply

and demand imbalances

LPG

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

198

3

198

4

198

5

198

6

198

7

198

8

198

9

199

0

199

1

199

2

199

3

199

4

199

5

199

6

199

7

199

8

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

PAA Business Model Complements Establis& Demand Trends on a U.S. and Regional Ba

Source: Energy Information Administration (through year end 2008)

Refinery Inputs: 14.7 MMbbls

U.S. Crude Oil Supply & Demand(Millions of Barrels per Day)

Production: 5.0 MMbbls

Domestic Supply Shortfall9.7 MMbbls


26/180

18

PADD II (Midwest): Highly Populated + RegioImbalance + Land-Locked = Maximum Ineffic

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

1984

1985

1986

1987

1988

1 9 8 9

Source: E

PADD II

(Millions

Gulf ofMexico

ForeignImports

V

IV II

I

III

Mid-Continent (Sun)

OXY

PAA (Basin)

PAA (3)

Seaway

BP

W. Tulsa

COP (2)

Osage

Ozark

SUN

PAA (Red River)

Semgroup

PAA Cushing to Broome

Keystone

COPSemgroup (Whitecliffs)

OXY

SpearheadCPS


27/180

19

Supply/Demand Dynamics, Geopolitical Instability & Capital InHave Contributed To Increased Volatility of Energy Prices

Source: Bloomberg Financial (06/01/09)

NYMEX Crude Oil Prices

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

1990

1991

1992

1993

1994

1995

1996

1997

$

perGallon

Highest High

NY Harbor 87 Promp

$0.00

$2.00

$4.00

$6.00$8.00

$10.00

$12.00

$14.00

$16.00

1991

1992

1993

1994

1995

1996

1997

1 9 9 8

$

perM

cf

Highest High

NYMEX Natu

$0.00

$0.30

$0.60

$0.90

$1.20

$1.50

$1.80

$2.10

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

$

perG

allon

Highest High Lowest Low Avg. Close

NYMEX Propane Prices

$0

$15

$30

$45

$60

$75

$90

$105

$120

$135

$150

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

$perBarrel

Highest High Lowest Low Avg. Close


28/180

20

Crude Oil Grade Differentials to WTI HavMore Volatile Over Time

-$13.00

-$10.00

-$7.00

-$4.00

-$1.00

$2.00$5.00

$8.00

Jan-95

Jul-95

Jan-96

Jul-96

Jan-97

Jul-97

Jan-98

Jul-98

Jan-99

Jul-99

Jan-00

Jul-00

Jan-01

Jul-01

Jan-02

Jul-02

Jan-03

Jul-03

Jan-04

Jul-04

Jan-05

Jul-05

Jan-06

J l 0 6

MIDLAND WTI LLS HLS WTS EIC BONITO

Domestic

-$45.00

-$40.00

-$35.00

-$30.00

-$25.00

-$20.00

-$15.00

-$10.00

-$5.00

$0.00

$5.00

$10.00

May-02

Aug-02

Nov-02

Feb-03

May-03

Aug-03

Nov-03

Feb-04

May-04

Aug-04

Nov-04

Feb-05

May-05

Aug-05

Nov-05

Feb-06

May-06

Aug-06

Nov-06

Feb-07

May-07

Aug-07

Nov-07

Par @ Edmonton 825, 0.5% Ave 4 (I,Sun,Shl,Pex) Sweet @ Edmonton Ave 4 (I, Condensate @ Edmt. Enbridge Adj. Ave 3 (A,I,K) Hard. Light @ Hardisty Ave 4 MSO @ Edmonton (IOL, SUN) Koch AB @ Edmonton Ave 4 Manyberries @ Border (Cenex) LSB @ Cromer Ave 4 (I,Sun, Midale @ Cromer Ave 4 (F,I,Sun,Shl) Bow @ Hardisty Ave 4 (F,I,Ce LLB @ Hardisty (Koch, IOL) Fosterton @ Regina Ave 3 (N

Canadian


29/180

21

($10.00)

($8.00)

($6.00)

($4.00)

($2.00)

$0.00

$2.00

$4.00

$6.00

1/2/1995

1/2/1996

1/2/1997

1/2/1998

1/2/1999

1/2/2000

1/2/2001

1/2/2002

1/2/2003

1/2/2004

1/2/2005

$perBarrel

Increased Volatility In Crude Oil Market SPrompt Month Spread

Contango

Backwardation

Source: Platts Note: Does not include 9/22/08 data point on which the backwardated spread widened to ove


30/180

22

PAA Business Model Well Suited ForIncreasingly Volatile Market Environm

PAAs assets and business model should producein nearly all types of market environments as PAAflow is underpinned by

Significant percentage of fee-based cash flow (~70%Transportation and Facilities segments

Counter-cyclically balanced and relatively predictab

flow generated by our Marketing segment, which inequivalent cash flow

Merchant activities provide upside opportunities (during favorable market conditions and can potennegative impacts of certain industry events

Contango storage opportunities Various additional market-related opportunities

Provides opportunities to mitigate impacts of potendeclines, refinery or pipeline outages, weather or ot


31/180

23

Baseline vs. Baseline Plus Term

Baseline Results Reflects managements assessment

of generally sustainable cash flows from

all three business segments in a variety of

routine market conditions

Used by management in developing its

recommendations regarding distribution growth

Baseline Plus Results Reflects net incremental cash flows derived by the Marketin

optimization activities in favorable market conditions (conta

Incremental contributions not considered by management wrecommendations regarding distribution growth; does resunormal coverage ratio

Incremental cash flows above Baseline estimates are treateto pay down debt or fund capital investments (i.e., not distri

Incremental cash flows are only included in guidance for vewith strong visibility; forward guidance does not assume cofavorable conditions for longer-term

Bas

BaseCash


32/180

24

Investment of Baseline Plus IncrementalConverting a Recurring But Unpredictable Cash Flow StreaPlus) to a Recurring Predictable Stream (Baseline)

Illustration Only

Real, likely recurring, but unpredictable cash flow usedcapital investment opportunities Assumes Baseline Plus cash flow of $50 MM in Year 1, $2

MM in Year 3 and $30 MM in Year 4 average of ~$40 mil

Baseline Plus Incremental cash flow paired with similar a50% equity / 50% debt financing mix) and invested into con a one year lag at a 7x multiple*

$50

$30

$70

$20

$0$10$20$30$40$50$60$70$80

Yr 1 Yr 2 Yr 3 Yr 4

$inMillion

Recurring Cash Flow from Investment of Yr 1 Baseline Plus CF Recurring Cash Flow from Inv

Recurring Cash Flow from Investment of Yr 3 Baseline Plus CF Recurring Cash Flow from Inv

Baseline Plus Cash Flow

.

* For example, in Year 1 $50 million of baseline plus cash flow is paired with $50 million of debt; thus $100 mat a 7x multiple, which generates annual net cash flow beginning in Year 2 of $10.3 million (($100 MM / 7) 8% interest rate)).

BaselinePlus

Incremental


33/180

25

$0

$150

$300$450

$600

$750

$900$1,050

2004 2005 2006 2007 20

Adjuste

dEBITDA($MM)

Baseline Guidance (2) Performance Above Baseline Guidance Upda

PAA Has Delivered Significant Growth in BasEBITDA and Solid Performance vs. Annual G

$779

$88

$511$408

$252

(1) Midpoint of annual guidance consists primarily of expected baseline performance, with the anticipfavorable market conditions included only for near-term visibility that exists at the time guidance is

(2) Baseline guidance for 2004-09 periods based on the midpoint of annual guidance from February guUpdated 2009 guidance based on the midpoint from 05/06/09 8-K.

Performance exceeding

baseline guidance due tofavorable market, acquisitionsand/or increases in baseline

performance


34/180

26

Business Model Reinforced By Performance vPAA Has Delivered Predictable and Durable Results In All T

$25

$50

$75

$100

$125

$150

$175

$200

$225

$250

$275$300

1Q02

2Q02

3Q02

4Q02

1Q03

2Q03

3Q03

4Q03

1Q04

2Q04

3Q04

4Q04

1Q05

2Q05

3Q05

4Q05

1Q06

2Q06

3Q06

4Q06

1Q07

2Q07

3Q07

4Q07

1Q08

2Q08

3Q

AdjustedEBITDA($MM)

Guidance Range Historical Performance Projected Perf

29 Consecutive Quarters of Performance in Line with G

$15.00

$30.00

$45.00

$60.00

$75.00

$90.00

$105.00

$120.00

$135.00

1/2/2002

7/2/2002

1/2/2003

7/2/2003

1/2/2004

7/2/2004

1/2/2005

7/2/2005

1/2/2006

7/2/2006

1/2/2007

7/2/2007

1/2/2008

7/2/2008

1/2/2009

$

perBarrel

NYMEX Crude Oil Prices

Source: Bloomberg Financial

($10.00)

($8.00)

($6.00)

($4.00)

($2.00)

$0.00

$2.00

$4.00

1/1/2002

7/1/2002

1/1/2003

7/1/2003

1/1/2004

7/1/2004

1/1/2005

7/1/2005

1/1/2006

7/1/2006

1/1/2007

7/1/2007

1/1/2008

7/1/2008

1/1/2009

$p

erBarrel

Contango

Backwardation

Crude Oil Market Structure(2,3)

-$13.00

-$10.00

-$7.00

-$4 . 00

-$1.00

$2 . 00

$5.00

$8 . 00

Jan-02

M I D L

WTS

P OS

(D

D

(1) 2Q09 (G) based on mid-point guidance furnished via Form 8-K on 5/06/09. (2) Crude Oil Market Structure Chart doesdata point on which the backwardated spread widened to over $11/barrel. (3) Source: Platts


35/180

27

Every Day, Producers, Refiners, Traders and SophFinancial Investors Risk Billions Forecasting Crud

$68

.58

$69

.37

$70

.07

$70

.58

$71

.04

$71

.52

$71

.92

$72.2

2

$72.

48

$72

.74

$7

2.99

$

73

.24

$73

.46

$73

.68

$73

.90

$74

.12

$74

.34

$74

.57

$ 7

$65.00

$70.00

$75.00

$80.00

Jul-0

9

Aug-09

Sep-09

Oct-0

9

Nov-09

Dec-09

Jan-10

Feb-

10

Mar

-10

Apr-1

0

May

-10

Jun-10

Jul-1

0

Aug-10

Sep-10

Oct-1

0

Nov-10

Dec-10

Jan-11

Fe

NYMEX Forward Curve as of June 1, 2009

Source: Bloomberg


36/180

28

Assessing the Accuracy of the MarketVision on Crude Oil Prices

$10.00

$30.00

$50.00

$70.00

$90.00

$110.00

$130.00

$150.00

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2

Actual Price Forward Curve

Source: Bloomberg (06/01/09)

Conclusion: Continued Volatility is Likely


37/180

Looking Forward


38/180

30

PAAs Scenario Assessment for 20(The Environment For Which We Are Positioning)

General

The global economy may getworse before it gets better expecting a few head fakes

Deleveraging of the globalfinancial system will take a while likely to see tight credit for anextended period

Consolidation of banks willcomplicate overall credit extension

Cost of capital has made a stepchange increase (relative to 2004to early 2008)

Capital markets access will be

selective and potentially sporadic IG rating matters

Differentiation has occurred / willcontinue size and reliability ofbusiness models matter

Energy Sector

Oil and gas cobeen adverseprices

Retracement in response totake time dueeconomy and

Commodity pto be volatile,in short perio(potential for fakes)

Volatility favoassets; espec

complementamodels


39/180

31

Investment grade credit rating (Baa3/BBB-)

Solid balance sheet

Ample liquidity pro forma availability of ~$1.8 billio2009*

$1.6 Billion Committed Revolving Credit Facility, Maturing in J

$525 Million Annual Committed Hedged Inventory Facility

Includes benefit of $210 million equity offering completed in Mmillion debt offering completed in April 2009

Long-term debt is 99% fixed (@ avg. of 6.7%) with avyears**

Scalable, flexible capital program no major project

Solid distribution coverage Potential to utilize solid financial positioning to act o

on attractive acquisition and expansion opportunitie

PAA is Well Prepared for a Challenging En(even if it extends through 2010)

* Pro forma for $350 million April 2009 senior notes offering; availability would be ~$1.7 billion after repasenior notes due in August 2009.

** Pro forma for $350 million April 2009 senior notes offering and May 2009 termination of $60 million of srepayment of $175 million senior notes due in August 2009.


40/180

32

What if the Economic Slump and Uncertain FMarkets Extend for Several Years?

(1) Financially well positioned @ 3/31/09; (2) Execution of 2009 Pl

positioning; (3) Recent financings further enhance positioning Strategic role of PAAs assets, counter-cyclical balance of busine

of capital projects, intense focus on liquidity, management expermake mid-course adjustments position PAA to navigate an exten

Many required functions of PAAs asset base cannot be performe

2009 2010 2011 2012 2

PAA surviving

& growing

Conceptual Illustration of

Economy / Financial Markets

PAA

surviving

& growing,

but less

PA

su

m

gr

Absent [Bargain] Acquisitions


41/180

33

81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 0 1 2

PAA Management Has Successfully NThrough A Number of Challenging Pe

$34$87$108$110

$13

1988-

1996

1997 1998 1999 2000 2001 200

0

1

2

3

4

5

6

7

8

9

10

80 82 84 86 88 90 92 94 96 98 00

Oil mmbls Gas mmboe

PLX Upstream Production Volumes:

/--EnergyEuphoria (vol. I)---/

/--Oil PriceCrash--/

/--Natural Gas

Deregulation,

Price Collapse &

Take-or-pay period---/

/--Major

Recession---//--The

Event--/

/--9/11/

Enron

Energy

Merch

Meltdo

/--PLX

Miami

Fee--/

/--PLX & P

Separate-

/--Energy Sector

Consolidation Period---/

/--Energy Bank Consol & Attrition--/

Carter--/-----------------Reagan----------------------/-------Bush 41-------/----------Clinton---------------------------------/------ Bus

(1981-2009YTD)

/--Oil

Price

Plunge--/

/--Major Recession&

Stagflation ---/

Note: 2009(G) reflects midpoint of PAAs public guidance furnished via 8-K on May 6, 2009 and excludes seleimpacting comparability.

/----------S&L Crisis----------/


42/180

34

PAA Forward Game Plan

Execute, Execute, Execute Deliver on guidance / plan

Under-promise and over-perform

Maintain significant financial flexibility

Tighten up existing organization eliminate ineffic

during rapid growth periods (Increase revenue andefficiencies/decrease cost)

Pursue attractive incremental acquisition / consoliopportunities: Have raised overall return requirements

Intend to carefully exploit:

Cost of capital and availability advantages Fundamental synergy advantages

Continue development / expansion of natural gas sand related opportunities


43/180

Overview of PAA Business A& Impact on PAA During an E

Period Of Economic Weak

Harry Pefanis

President & COO


44/180

36

PAAs Activities are Conducted on Four ProduPrimarily Inefficient & Lightly Regulated Portion of the Valu

Crude Oil

Natural GaFacProducers

Undergro

Gathering Pipeline

Injection / Wi

LNG Tanker

Salt

Dome

CommonCarrier

Pipelines

Refined Transportation,Refineries

Barge

Common CPipeline

Tanker

StoragePipeline

LPG

Transportation, Facilities & MarketingProducers Refiners

Truck

Terminal /Storage /ExchangeLocationBarge

Pipeline

Pipeline GatheringInjection Station

Pipeline

Tanker

Refinery

Rail Car

Above Ground or

Underground

Storage

Pipeline

Transportation, Facilities & Marketing

Truck

Gas Plants

Chemical

Plants

Retail

Distribution

Diluent for

Heavy Crude


45/180

37

Assets(1)

Products

Cash Flow

Transportation

~17,000 miles of Pipelines

24 MMBbls Storage

Capacity

86 Trucks

341 Trailers65 Barges(2)

36 Tugs(2)

~1 MMBbls of Linefill

Crude Oil

Refined Products

Fee Based

Facilities~61 MMBbls Storage

Capacity

~31 BCF Nat Gas

Storage(3)

2 Fractionation Plants

1 Isomerization Unit

~400 MMCFD Processing

Capacity(4)

Crude Oil

Natural Gas

Refined Products

LPG

Fee Based

|------------------- Merchant Optimizatio

Baseline = ~70% Fee Based

ReportingSegments

(1) Includes owned or leased as(2) Ownership through 50% inte(3) Ownership through PAA/Vul(4) Average throughput, design

Activities Conducted via Three SegPAA Cash Flow Underpinned by Fee & Fee-Equivalent Act


46/180

38

PAA Adjusted Segment EBITDA Cont

21%

30%

49%

2009 Guidance (2)Midpoint Total Adjusted EBITDA = $977 Million

Transportation

Facilities

Marketing

(1) Please see Appendix for reconciliation of Adjusted EBITDA to GAAP measures. Excludes


47/180

39

Fee Based Activities Have Steadily In

0%

25%

50%

75%

100%

2005 2006 2007 2008

%ofAdjusted

EBITDA

Fee Based Non-Fee Base

AdjustedEBITDA $511 $779 $887$408

49% 51%61%

69%

Note: 2009(G) reflects midpoint of PAAs public guidance furnished via 8-K on May 6, 2009 and exitems impacting comparability.


48/180

40

Principal Drivers of Segment Perf

Qd

F

Sd

A F

f

Integrity costs,regulatory compliancecosts

API 653 (costs andtiming)

Lease renewals rates Measurement

gains/losses

Volumes variances

PPI Index

Integrity costs,regulatory compliancecosts

Power costs Pipeline Loss

Allowance

InfluencesonProfitability

Vgis

Rb

Leased capacity

Lease rates &throughput fees

Variable operatingcosts

Throughput volumes

Tariffs per barrel

Variable operating

costs

PrincipalPerformanceDrivers

~20%~50%% of 2009AdjustedEBITDA (1)

FacilitiesTransportation

(1) 2009(G) reflects midpoint of PAAs public guidance furnished via 8-K on May 6, 2009 and excludes seleimpacting comparability.


49/180

41

Transportation Segment UnderpinnedGeographically Diverse Asset Base

33%

9%

12%

15%

18%

13%

28%

4%

25%

10%

16%

17%

Pipeline Miles(1)

By Region By Region

PAAs pipelines represent a diverse blend of supply andassets transporting a variety of both domestic and forei

waterborne) crudes from multiple basins

Southwestern US Western US US Rockies US Gulf Coast Central US Canada

(1) Pipeline miles as of 12/31/08 and pipeline volumes for the quarter ended 03/31/09.

Pipeline Volum


50/180

42

Transportation Volumes and RevenueRemained Durable Over Time

Pipeline Revenues

$0

$150

$300

$450

$600

$750

$900

2002 2003 2004 2005 2006 2007 2008

$in

Millions

.

Pipeline Volumes

0

500

1,000

1,500

2,000

2,500

3,000

2002 2003 2004 2005 2006 2007 2008

MBP

D

Note: Includes activity associated with subsequent expansion activities for acquired pipelines.

Pre-01 01 02 03 04 05 06 07

Same Store Sales Pipelines Grouped by Yr of Acquisiti


51/180

43

Facilities Segment Storage CapacGeographic Diversity and Product Composition

41%

4%15%

9%

3%

28%

Mid Continent Rockies

Gulf Coast East Coast

West Coast Canada

Geographic LocationBy Region

ProductBy Servic

15%

10%

5%

Crude Oil

LPG

Note: Capacity as of 03/31/09


52/180


53/180

45

Baseline Marketing Segment ActivitiesCritical to Industry Value Chain

~5%


54/180

46

Marketing Segment Activities

Represents approximately 10 15% of baseline

Primarily seasonal storage with product pre-sold contracts or hedged on NYMEX or via OTC

Propane primarily wholesaler to large number oconsumers (in excess of 750 customers)

Butane primarily used as feedstock for isomerizCalifornia, as diluent for heavy crude oil movemegasoline blending by refiners

LPG MarketingAverage ~100 mb/d*

Primarily seasonalstorage/sales, although somespot/rack sales

Significant use of captiveassets

Represents approximately 80% of baseline segm

Primarily related to lease gathering and foreign cr

Hedge to protect and optimize margins

Purchases are index related; no outright price ris

Margins impacted by quality, location and inter-m

Provide logistical and administrative services to o ~3-5 million barrels of tankage support these acti

Crude oil activity~630 mb/d*

~60 mb/d Foreign*

Significant use of captiveassets

Ability to capture quality/location arbitrages anddistressed crudes

Overview / CommenActivity

* Based on full year 2009 guidance furnished via Form 8-K on May 6, 2009.


55/180

47

Marketing Segment Activities(Continued)

Represents less than 5% of segment cash flow

Primarily rack sales that are back to back

Minimal inventory requirements

Entered business in early 2007 with a small acqu

Potential growth area volumes and margins havsince 2007

Refined ProductsMarketing

Average ~ 40mb/d*

Contribution varies, but is approximately 5% of bprofit.

Can be meaningfully additive to baseline during pvolatility and strong contango conditions (i.e., Ba

Hedge to protect and optimize margins

In a contango market this provides counter-cyclic

lease gathering business

Tankage leased from Facilities segment

Merchant storageAn aggregate of ~8 mmbbls ofwhich ~2 mmbbls are inremote locations and areavailable for lease optimizationor contango

Capacity changes based onallocation of assets, 3rd partyleases, etc

Overview / CommenActivity

* Based on full year 2009 guidance furnished via Form 8-K on May 6, 2009.


56/180

48

Lease Gathering BusinessLargest Contributor to Baseline Marketing Cash Flow

We consider a large part of the business Fee-Equivalent Provide dependable transportation services to our customers

Perform administrative services for our customers, including revetax disbursement services (PAA cuts ~50,000 checks every month

PAA size, past performance and investment grade credit rating a sproducers extend gathering company ~50 days credit)

Total crude oil lease gathering volumes ~ 630,000 b/d (includin

>90% sold on similar floating basis as purchased

No outright price risk

Minimal margin risk, sales are managed against index


57/180

Potential Impact of ExtenPeriod of Economic Weak

on PAA Business


58/180

50

Potential Impact on PAA of Selected Issuan Extended Period of Economic Weakn

Decrease in the FERC Index (PPI + 1.3

Domestic Production Declines

Demand Destruction

High / Low Oil Prices

Acquisitions


59/180

51

Impact of Potential Decrease in FER

Minimal impact to PAAs pipelines

Portion of pipelines protected by contractual with shippers

Generally PAA is not charging the maximum

Canadian pipelines are not subject to the PPI

Intra-state pipelines are not subject to the PP

Marketing margins would improve (due ttariff costs)


60/180

52

Potential Domestic Production D

Transportation Segment Impact Lower volumes on gathering systems and Ba

Higher volumes on Capline and Western Corr

Facilities Segment Impact

Increased demand for tankage to handle impo

Marketing Segment Impact

Lower lease gathering volumes

Increased foreign import volumes


61/180

53

Potential Longer-Term Demand Destr

Transportation Segment

Lower pipeline volumes

Tariffs would be based on PPI

Facilities Segment

Less demand for operational storage Increased demand for contango/product storage

would exceed demand

Marketing Segment

Minor impact if prices stay at current to higher l

Lower prices would negatively impact gatheringand segment profit

Expect to have favorable acquisition opportuni


62/180

54

$40 / $100 Crude OilImpact on PAAs Operating / Financial Results

Likely senvironDomeswell

Foreign business natural hedgeagainst domestic depletion

Domestic / Foreign

Higher level of

Lower requirementsHedged inventory workingcapital requirements

No

Minimexposmargi

Long-domesvolum

More pcosts

PLA h

No

Minimal commodity exposure /some potential pressure onmargins

Long-term scenario mayimpact field production declinerates

Less pressure on operatingcosts

PLA hedged through 2012

Meaningful impact toPAAs core cash flow?

$40 OilArea of Concern

Conclusion: No material impact to PAA from either price


63/180

55

Favorable Outlook for Acquisition

Less competition due to: Higher entry barriers to MLP space Limited access to/depth of equity/debt capital for non Increased focus of many IG MLP's on existing project Higher cost of capital across the board Less leveragability by private equity shops

Increased importance of fundamental synergiegaps PAAs broad asset base, business model and past ex

represent a competitive advantage

Reluctance of some sellers to deal with less e

buyers

More attractive multiples / higher returns May take time for non-distressed sellers to adapt


64/180


65/180

Commercial Activities

John von BergSr. Vice President, Commercial Ac


66/180

58

Purpose of Presentation

Provide overview of Commercial Groupresponsibilities and activities and how tactivities support and augment PAAs bMarketing cash flow

Highlight a sample of the tools and strautilized by the Commercial Group to locand preserve upside potential

Provide overview of risk controls that gcommercial activities


67/180


68/180

60

Commercial Group ResponsibilitSupporting Baseline; Contributing to Bas

Majority of Baseline Marketing segment contributiocomprised of natural margin provided by logisticalperformed for producers and refiners

PAA Commercial Group supports Baseline Marketimargin by

Managing risk inherent in baseline business

Locking-in margin

Minimizing downside exposure

PAA commercial activities play

role in Baseline Plus performance by Preserving & capturing upside potential

Optimizing assets Bas

BaselinCash


69/180

61

Optimizing An Asset Rich Com

We reduce exposure and optimize assets allocating our assets to protect against anfrom market conditions

Allocation requires us to take a view of the maour business plan

Allocation and optimization process does not losses, but rather locks in profits and determinupside opportunity we retain

Not a question of if we are going to make mhow much we are going to make

We do not speculate on commodity prices


70/180

62

Business Model Inputs For CommeActivities

ASSETS CAPITA

KNOWLEDGEEXECUT

~630,000 bbls/day of LeaseProduction

~12 MMbls of working capacitytankage(1) currently leased toMarketing group

~10 MMBbls of Linefill andLong-Term Inventory

Extensive fleet of trucks,trailers and barges

10 key employees withincommercial group with >250years of combinedexperience

Extensive understanding ofcrude markets (location,grade and time spreadrisks), resources andfinancial instrumentsavailable to mitigate theserisks

$525 MCommInvento

$1.6 BiFacility

InvestmLinefillInvento

Requirepositionaccordalocationspread

downsicapturemarket

CommercialActivities

(1) Shell capacity = ~14 MMB


71/180

63

~8

Crude OilLPG MarkCrude OilRefined P

Crude Location, Grade & Timing Differentials

Operating costs (trucks, pipelines) Tariff costs and PLA Pricing (index, grade and location differentials) Inventory

Waterborne Foreign Purchases Pricing differentials (Brent/WTI, CFDs, LLS) Freight Measurement losses

Timing & volume of tankage

Crude Oil Merchant Tankage Tank utilization risk Timing & volume of tankage

Refined Products

Pricing differentials (grade and location differentials)

Utilize NYMEX contracts as a risk management tool Transparent and available 24 hours/day Creditworthy counter-parties (or appropriate credit protection) Flexibility to close / re-establish positions

Risks, Activities and Aspects of MarkSegment Managed by Commercial Tea

As an MLP that pays out a large percentage of its cash flow, PAA must uand mitigate the risks inherent in its business.

Note: LPG MarMidstrea


72/180

64

PAA Manages Risks to Meet its Busin

Producer Analogy: Producer is naturally long crude oil

Producer has plan based on $60 per barrel crud

Two strategies available to lock-in plan Sell all oil outright for $65 per barrel

Locks-in $5 per barrel above plan, but caps upside

Buy $62 Put for $2 cost (realizes at least $60 per barrel

Locks-in plan, and reserves upside

PAA Similarities: PAA is naturally long assets / infrastructure

PAA does not have a producers price risk, buthave location, time spread and utilization risk

Use combination of strategies to lock-in profitsretain upside


73/180

65

Tools/Strategies Used To Manage Achieve Baseline or Baseline Plus

Market EnvironmentMarket Structure

Backward

Contango

Transition

Differentials

Basis

Location

Quality

Su

Ship / store / ex

Optimize produ

Calendar time s

Calendar time s(synthetic lease

Short, medium strategies

PAA Tools / Strategies


74/180

66

Example: Lease Gathering BusineFee-Equivalent Contributor to Baseline

ProductionArea

PAA

MarketHub

Pipelin

*PAA also incurs cost to carry 10 mmbls of pipeline linefill to affect movements in owned and 3rd party pipelin

WellheadPrice

TruckingCosts

PipelineTariff

TotalCost

$50.70 $0.60 $0.50 $52.00

+ + + =

CostKnown

MarginLocked?

NYMEX lesslocation /

qualitydifferential

Projectedfrom

historicalcosts

Tariff isposted

Price

G&ACost

$0.20

*

Projectedfrom

historicalcosts


75/180

PAAs Commercial Activities Cenon Optimizing Diverse Asset B


76/180

68

Example: Contango MarginCapturing Incremental Value from Strategic Location

Step 1:

PAA buys crudeoil in Month #1and sells crude oil

in Month #2,either from

customers or onthe NYMEX

Step 2:

PAA receives thedelivery of crude oil

at its storagelocation c

Step 3:

PAA stores the crudeoil between the time ofreceipt and the time of

delivery

Purchase InMonth #1

MonthlyTankLease

MonthlyCost ofCapital

TotalCost

$50.00 0.40 0.20 $50.60

+ + =

CostKnown

MarginLocked?

Purchased Negotiatedlong-term

lease

Hedgedinventory

facility andPAA

revolver

Price

Customeror NYMEX

Terminal

PAAPipeline Pipeline


77/180


78/180

70

PAA Commercial Activities Governed bComprehensive Risk Management Polic

Risk Management policy governs various commercial activities including physical pand sale transactions as well as the use ofutures/options/derivative instruments

Prescribes defined limits for certain transactio

Prohibits outright speculation on commodity p

Provides allowance for routine inventory balan

All positions are around a hard asset or a purccontract

Comprehensive risk compliance reports sexecutive management


79/180

71

Commercial Activities Take-Away

Commercial Activities support baseline maprofitability and help enable baseline plus p

Supported by significant asset base

Minimal risk to changes in the outright price ocommodity

Limited to ongoing inventory balancing

No equity at risk

Only locking-in margin and preserving upside when

Downside is opportunity value given up by locking-according to business plan

Governed by comprehensive risk managemen


80/180



81/180

U.S. Capital Projects Over

Mark GormanSr. VP, Operations & Business Dev


82/180

74

Capital Project Environment: Rapid InGrowth Caused Escalating Costs

Capital investment for organic growth projects, both acroand at PAA, has increased dramatically

The increased activity, which was exacerbated by the impGulf Coast hurricanes, led to increased costs and reduce

experienced construction resources

During this time period, PAA employed an alliance time agreement to ensure access to construction resources

Despite certain favorable contract terms, PAA still experienotable cost pressures

MLP Organic Growth Spending(1)

(2001 2008)

$0

$4,000

$8,000

$12,000

$16,000

$20,000

2001 2002 2003 2004 2005 2006 2007 2008

(1) Source: Wachovia Capital Markets

(dollars in millions)

PAA Organic Gro(2001 2

$0

$100

$200

$300

$400

$500

$600

2001 2002 2003 2004

(dollars in millions)


83/180

75

Capital Project Environment: Recent CShowing Signs of Improvement

Due to economic slow-down, cost pressures have easeexperienced construction resources have become mor

Contractors showing signs of being hungry again anmore aggressive on pricing

Note: IHS/CERA Downstream Capital Costs Index from Capital Cost Analysis Forum D2009 Market Update dated May 1, 2009.


84/180

76

PAA Positioning Relative to Changing(Current environment has eased some industry cost press

Virtues of PAAs capital program have enabled PAA to brecent decreases in costs

Composed of larger number of smaller projects (No multi-capital projects)

Can be scaled according to environment (2009 progra~30% decrease from previous years)

Generally shorter permitting & construction times (typmonths)

Mitigates impact of a cost overrun or time delay on an(portfolio effect)

More ratable (versus lumpy) cash flow build-up

Many projects are expansions of existing storage facilities

Easier (than long-haul pipelines) to assess constructigeography and terrain, enabling more fixed-price ty

We have canceled alliance agreement and now require f

As a result, Cushing Phase VII, St. James Phase III and Pabenefited materially from decreased costs resulting from competition


85/180

77

PAA Has Focused On Strengthening Its Development Process

Developed a more comprehensive project development ensure more consistent execution of project constructiotiming and design expectations due to Ramp-up in organic growth investment

Resulting cost pressures

Continued focus on organic growth

Addressed in mid-2008 by integrating pipeline / terminagroups, engineering and operations under one senior V Commercial: develops project economics for new facilities

existing facilities or process improvements that reduce co

Engineering: design, permit, procure and construct faciliti

Operations: start-up and test facilities, on-going operation

Under project development process, projects are evalua

based on cost, timing, complexity and various other me Project classification determines necessary level of advan

coordination and project oversight


86/180

78

HurdleHurdle rate if overspentby 25%

Hurdle rate ifoverspent by

50%

Sensitivity

Some riskNo riskEHS Risk

OSomeNone (Inside Fence)CommunityImpacts

CompModify existing orstraightforward

NonePermitting

DependDependent oncooperative 3rd Party

Internal projectInterdependence

Projecupo

Limited flexibility inproject schedule

No economical timeconstraints

Schedule

SignifiMinimal impact tofacility or 3rd Party

No impact to facilityor 3rd Party

Complexity

New application withinPAA of established

technology

RoutineTechnology

$1 15 MM< $1 MMCost

Class IIClass I

PAA Project Development ProcesIllustration of Project Classification Matrix


87/180


88/180

PAA Project Portfo


89/180

81

PAAs Sizable Portfolio of Organic ProjecFoundation for and Visibility of Future Gr

PAAs current portfolio of organic growth projects 2009 capital program of $350 million

Additional portfolio of ~$300 - $600+ million of

Additional portfolio projects are in various stages

Engineering

Customer discussions / negotiations Permitting

Projects generally are not included in announced until project AFE is approved

Not all current portfolio projects will advance to finconstruction; however, PAA is continuously in discustomers for new capital investment opportunitie


90/180

82

2009 Capital ProgramWeighted Towards Storage Projects

Dpmdp

Phs

St. James Phase III (1) 85$

Rangeland Tankage and Connections 35

Kerrobert Pumping Project 34

Cushing Phase VII 29

Nipisi Storage and Truck Terminal 20Patoka Phase II 20

Salt Lake City 14

Pier 400 13

Paulsboro 8

Other Projects (2) 92Total Expansion Capital 350$

(1) Includes a dock and condensate tanks. (2) Primarily pipeline connections, upgrades astations, new tank construction and refurbishing, and carry-over of projects started in 20

Excerpt from May 6, 2009 Form 8-K (dollars in millions)


91/180

83

Location of Major U.S. Capital Pro

Patoka

Pier 400Cushing

St. James


92/180

84

2.3 MMBbl Phase VII $40 million 4 570,000 barrel tanks

To be in service in 2Q 2010

Increases PAAs total capacity to 13.1MMBbls

Per barrel costs have come down by>20% versus original AFE

Expansion supported by long-termleases with large refiner

Refiners use Cushing tankage primarilyfor operations (therefore need tankageregardless of market structure)

Tankage provides refiners ability to

stage barrels for ratable refining runs &pipeline deliveries

Note: Pipelines shown are to Cushing hub and may not be directly connectedto PAA facilities.

Inbound

Outbou

Propose

Sun

OXY

Keysto

OXY

SEM

PAA (3)

SEM

Osage

COP

COPCu

PAA (Basin)

Cushing Phase VIIContinuing to Expand our Flagship Facility


93/180

85

Phases I & II

~6 MM barrels of crude oil capacity

Manifold & header system capable of receivingand delivering at main line rates

Phase III: Mississippi River Dock &Condensate Storage ~$131 Million

Dock to accommodate 2 barges and 1 ship(room to construct an additional ship bay)

Dedicated crude & condensatemanifolding, pre-built for additionalproducts

Expected in service 4Q09

900K bbls condensate storage ( 3 300k bbltanks) to be in service 2Q10

Expect condensate to be received at St. James,transported up Capline, into Patoka and on toCanada for diluent

Expansion Capabilities

Only ~163 acres of >1,850 acres utilized bycurrent operations & expansions

Given strategic land position with river accessand proximity to railroad, believe that theremay be additional expansion possibilities

Ship Shoal

SPR /Shell

XOM (3)

Shell

St J

Inb

OuInb

St. James Phase III Dock & Condensate StorLeveraging Strong Positioning

CanadianCrude

US/FoCru

Note: Pipelines shown are to St. Jammay not be directly connected to


94/180

86

Patoka Terminal Fundamental D

We believe that new supply patterns will transform Patoka from

intersection to an important market hub/trading location

Third-party storage capacity at Patoka = ~12 MMBbls

New pipeline projects to/from Patoka require

additional operational storage Keystone (24 lateral from Wood River)

Southern Access

Southern Lights

Significant influx of new crude grades requires

tankage for segregation & blending Heavy bitumen from Canada

Synthetic grades

Condensate for Southern Lights

New expansions potentially used for: Segregating crude grades

Custom blending for refinery requirements

Staging batches

Market structure (Contango)

XOM

Capwood

WoodPat

Southern Acces

Keystone

Mu

Note: Pipelines shown are to the Patoka hub and may not be directly connected to PAAs facility.


95/180

87

Phase I -- $89 million total cost 2.8 million bbls of crude oil capacity

3 670,000 barrel tanks


Majority leased to 3rd parties

In service Q1 2009

Phase II -- $25 million total cost 600,000 bbls of condensate tankage


Supported by long-term 3rd party lease

agreement

Projected in-service 2Q 2010

Highly flexible Pipeline connected to PAA terminals at St.

James, Cushing, Edmonton & Kerrobert

Able to receive and deliver at line rates

Designed for expansion Sufficient land position

Oversized manifoldInbound pipelines

Outbound pipelines

Proposed or Announced

PAA Patoka Facility Phases I & II

XOM

Capwood (PAA)

WoodPat

Southern Access

Keystone

Musta

Pa

CanadianCrude

US/FoCru

Note: Pipelines shown are to Patoka hub and may notbe directly connected to PAAs facility.


96/180

88

Paulsboro, NJ Terminal

Refined Product Tank Expansion $44 million 8-tank expansion for total of 1 million additional bar

Placed 450,000 barrels into service during 4Q08 and550,000 barrels into service during 2Q09

Increased PAAs total storage capacity in the Philad~4 MMBbls


97/180

89

Pier 400 Project Still out there, but

Deep water berth, will accommodate ULCC vessels with barrel cargos, up to 4 million barrels of drain-dry storagethroughput capacity of up to ~350,000 barrels per day baemission levels.

Project initiated by Pacific in 2003. Achieved major milesNovember 2008, by obtaining approval of EIR / EIS. In ACity Council ratified the EIR. One objection still under a

Added costs and uncertain economy will likely slow dowadvancements, absent compromises (redesign of facilityincreased cost sharing of customers / port).

Will continue to advance efforts,but shifted project to potentialstatus in early 2008 (vs. plannedstatus). Continue to believe it isa when not if project.

Project Tanks

San


98/180

90

Capital Projects To Be Placed In ServicMulti-Year Period, Providing Growth Vis

Major Projects 2008 1H2009 2H2009 1H2010

Cushing Phase VI In Service

Ft. Laramie In Service

West Hynes Expansion In Service

Patoka Phase I In Service

Salt Lake City Expansion In Service

St. James Phase II In Service In Service

Paulsboro Tankage (1) In Service In Service

Kerrobert Expansion

Edmonton Expansion

Gas Storage JV (1,3) In Service In Service

St. James Phase III (2)

Patoka Phase II

Cushing Phase VII

Martinez Terminal In Service

Pier 400

Future Projects

Note: PAAs capital program is composed of numerous other projects in addition to those listed above. (1in service in stages. A portion of the storage capacity attributable to these expansions is in service. (2) Prodock and condensate tankage, coming in service in stages. (3) Includes 24 BCF at the PAA/Vulcan Pine Prstorage facility, the first ~14 BCF of which is online, with additional capacity expected to come into servicethrough 2010. Cash flow in the joint venture is expected to be initially used to fund ongoing construction reduce project debt.


99/180

91

Take-Away Points

In recent years, the industry and PAA have grappled costs and reduced resource availability, but we are fsigns that conditions are improving

PAAs has a sizeable project portfolio that is favorabrelative to changing market conditions, which we belcompetitive advantage

Scalable portfolio of diverse projects Flexibility to adapt to changing economic and financia

Not committed to multi-year, multi-billion dollar projec

PAA has implemented a more comprehensive projecprocess designed to more efficiently bring projects otargeted cost and time parameters

PAAs current projects are supported with third-partyare progressing as planned and provide visibility fornext several years


100/180



101/180

Plains Midstream CanadStrategically Positionedfor Continued Success

Dave DuckettPresident


102/180


103/180

95

Plains Midstream Canada: Overview

2001 PAA acquisition of Canadian marketing and tassets of Murphy Oil Company Ltd. (primarily fee-and CANPET Energy Group (primarily entrepreneumanagement) formed subsidiary now operated as:

Plains Midstream Canada (PMC)

PMCs strengths: Operationally flexible, strategically located assets

Predominantly fee-based Proven business model and proven management

Safe, reliable, experienced operator

Focused on creating and sustaining excellence in core co

Extensive crude oil and LPG marketing experience

Favorably positioned for future growth

Since 2001: $1.8 billion cumulative CAPEX 10-fold increase in adjusted EBITDA Increased percentage of fee-based revenues


104/180

96

PMC Significant Growth in Assets since 200Driven by Organic Projects and Acquisitions

2001

Crude Oil

Pipeline (active miles) ~800

Crude Oil Tankage (barrels) 1.3 MM

Crude Oil Pipeline Volumes 180 mbpd 4

Truck units 72 Trailers

1 Truck

24

LPG

LPG Storage (barrels) 0.005 MM

LPG Railcars (leased) 150

Truck units 6 Trailers 9

Employees

Calgary Office 61Field (Canada) 47

(U.S.) 22

Total 130

Calgary OfField (Cana

(U

T

*As of March 31, 2009


105/180

97

PMCs Strategic Crude Oil Pipeline Posit

MANITOBA

SASKATCHEWAN

ALBERTA

Regina

Edmonton

Wapella

Manito

WascanaSouth Sask

Calv

en

Rainbow

Milk River

Rangeland

Joarcam

KM

IPF

AthabascaOilsands

IPF

TransMountain

(KM)

Enbridge

Enbridge

Pembina

Pembina

PMC Assets Hig

Fee-based reven

Location in key

Strong competit

Supply growth a

offset to areas odecline

IPF


106/180

98

MANITOBA

SASKATCHEWAN

ALBERTA

PMC Crude Oil Facilities

Regina

Hardisty

Red Earth

Red Jacket

Edmonton

Atlantis

Gull Lake

MidaleCromer

Cantuar

Central Alberta

Rimbey

High Prairie

Wapella

Manito

Marshall

WascanaSouth Sask

Calv

en

Rainbow

Milk River

Rangeland

Joarcam

Kerrobert

IPF

AthabascaOilsands

IPF

TransMountain

(KM)

Enbridge

Enbridge

Pembina

Milk River

KM

Pembina

PMC Asset H

Handle multiple

Many facilities lopipelines providaccessibility

Flexible transpoalternatives (railat certain facilitiprofitability

Unity

Sundre

IPF


107/180

99

Crude Oil Growth Opportunities

Well positioned for continued organic groacquisitions

Valley Pipeline acquisition April 2009

Completed $687 million Rainbow Pipe Linin May 2008

Performing in line with expectations; pursuing orgaprojects identified at purchase

Q4 2008 Westlock Truck Terminal expansion co Q1 2009 Cal Ven Diversion project completed Nipisi Terminal Diluent Return Line (potential project)

Other Organic Growth Projects/Initiatives Manito: Kerrobert Pumping Project

Rangeland: Storage, Connections, Expansion Later

Increasing Efficiency of Existing Capacity


108/180

100

Rainbow: Nipisi Terminal Project

~$18 million total cost

Expected in service in Q4 2009

Construct truck and storageterminal along Rainbow PipelineSystem to provide:

Raw Heavy Crude Blending Condensate Marketing

Blended Heavy Terminalling

Diluent Supply

Future expansion potential from

related projects Crude Oil Treater

Rainbow Diluent Return Line


109/180

101

Rainbow: Diluent Return LinePotential project in early stages of development

Diluent returntime of acquiterm upside p

Potential to rdiluent volum

Development

oil productiondemand

Th

ree

Cre

eks

Rainbow

L.

Bu

ffa

lo

Red Earth

Cal

Ven

Pelican Lake

Utikuma Station

Mitsue Station

Westlock Station

Edmonton

Flatbush Station

Ca

lVen

Atlantis

Nipisi

Cadotte Station

Gold

en

Wabasca

Seal P/L

Proposed Diluent LineRainbow

Plains terminal

Plains truck terminal

Plains pipeline

3rd party pipeline

ALBERTAALBERTA

Edmonton

Calv

enRainbow


110/180

102

Manito: Kerrobert Pumping Proje

~$43 million total cost Expected in Service

Q4 2009

Kerrobert Terminal isPMCs largest storageasset with ~1.7 million

barrels of storagecapacity

Project entailsconstructingadditional receipt anddelivery flexibility topump into storage and

Enbridge at line rates

Will provide access to multiple Western Canadian heavy crude oil, enabling significant additional flexsupply diversity


111/180

103

Rangeland: Storage, Connections, Expans

Total Cost: ~$48 million Modifications, upgrades and

expansions to Rangeland systemincluding:

Sundre Piping Modifications

Tanks to be reconfigured to maximize

operations and marketing storage Expected in Service: Q3 2009

Edmonton Storage Construct additional 240,000 bbl of crude oil

storage capacity

Expected In Service: Early Q4 2009

Expansion Laterals Construction of a 6 condensate and 4

butane pipeline from Harmattan, AB toSundre, AB

Proposed construction of a 6 condensatepipeline from Madden, AB to Harmattan, AB Proposed ex

Expansion la

Plains truck

Plains pipeli

3rd party pip

Sundre

Ma

Ra

ngeland


112/180


113/180

105

LPG Business Strategy

Overview Inefficient market similar to crude oil market

Logistical assets/flexibility storage, pipeline and truck/r

Opportunity to capitalize on regional supply/demand imbaweather, refinery upsets, seasonal rotation) utilizing invenassets

Dual purpose facilities (both Propane & Butane)

Propane

Wholesale focus

Demand based business model hub and spoke distribut

Volume and margins lock in margin up front on base bu

Butane

Supplying refineries for gasoline blending and diluent for(primarily in Canada)


114/180

106

Propane Marketing Overview

Product purchased in bulk and sold into wholesalers/retailers

PMC storage capability key to meet sedemand

Many small customers results in very dcredit exposure

Very flexible transportation logistics wtransportation methods utilized (pipeliand rail)


115/180

107

PMCs LPG Facilities Favorably LocatMajor Population Centers

Portland ORPortland OR UpperUpperPeninsula MPeninsula M

TulsaTulsaOKOK

Davenport IADavenport IA

GrandGrandRapids MIRapids MI

CharloCharlo

Moline ILMoline IL

Phoenix AZPhoenix AZ

Bakersfield CABakersfield CA

Grande PrairieGrande PrairieABAB

Seattle WASeattle WA

San Pedro CASan Pedro CACaverns

Terminals

Cold Storage

Fractionation

Third-PartyMarket Hub

Mont Belvieu TX

ConwayConway

KSKS

POPULATION CENTERSPOPULATION CENTERS


116/180

108

Butane Marketing Overview

Shafter fractionator in Bakersfield, CAsource

Transportation logistics key to meet bodemand and to supply diluent for heav

Trucks and rail are widely used

Seasonal demand for refiners handledstorage frequently storage facilities hboth propane and butane

Heavy oil pipeline operators like PMC hnatural demand base


117/180

109

LPG Growth Opportunities

Acquisitions / Internal growth

Internal Growth Projects ~$12 millio

Shafter expansion (California)

Liquefied hydrogen tank to process high olefin butan

Reactivate existing V-3 column (Q1 2010)

Harmattan C3 Batching Project (Alberta)

Expand product slate to include propane from HarmaKeyera Rimbey pipeline to increase HVP pipeline utili

Our growth strategy includes expan

Customer base

Geographical footprint

Strategic assets


118/180

110

PMC Outlook and Conclusion

PMC has grown significantly over the yea

PMC believes there are numerous growthopportunities within Canada

PMC has solid strategic positioning for fugrowth in Canadian crude oil as well as Cand U.S. LPG markets.

We continue to actively pursue both acquisitioorganic investment opportunities


119/180



120/180

Financial Growth Strate& Risk Management

Al SwansonSenior VP & CFO


121/180

8/14/2019 PAA Plains All America Pipeline Jun 20

paa plains all america pipeline jun 2009 presentation

Documents