01—Abstract
Summary
Summary of the 10-K filed February 28, 2025. Cited figures are marked; the original filing is the authoritative source.
Plains All American Pipeline, L.P.
(PAA) reported net income attributable to PAA of $772 milliona for 2024, down from $1.230 billion in 2023, a decline the company attributes largely to Line 901 incident costs (including a $225 million write-off of insurance receivable in Q4 2024 and $120 million of settlements in Q3 2024), losses on asset sales and impairments, and higher Canadian withholding tax expense. Segment Adjusted EBITDA rose on the Crude Oil segment, driven by higher pipeline tariff volumes, tariff escalations and acquisitions, partly offset by a decline in NGL segment Adjusted EBITDA to $480 million from $522 million. Consolidated Adjusted EBITDA was $3.326 billion versus $3.167 billion, and Adjusted EBITDA attributable to PAA was $2.779 billion versus $2.711 billion.
Liquidity was over $2.6 billionb at December 31, 2024, with net cash provided by operating activities of $2.49 billion. Management targets an investment-grade credit profile and a leverage multiple averaging 3.25x to 3.75x. Total consolidated debt face value was approximately $7.7 billion.
In early 2025, the company completed a $1 billionc 5.95% senior notes offering, acquired two bolt-on gathering businesses for approximately $580 million net to its interest, and repurchased about 12.7 million Series A preferred units for roughly $333 million. The company expects 2025 investment capital of approximately $500 million ($400 million net to its interest) and maintenance capital of approximately $260 million ($240 million net to its interest), to be funded primarily with retained cash flow. Common unit distributions were $0.38 per unit for the fourth quarter of 2024, paid February 14, 2025.
02—Key points
Key Highlights
- Net income attributable to PAA fell to $772 million ($0.73 per common unit) from $1.230 billion ($1.40 per unit) in 2023, driven largely by Line 901 costs, asset impairments and higher Canadian withholding tax.
- Line 901 incident costs weighed heavily: a $225 million insurance receivable was written off in Q4 2024 after an arbitration ruling, and $120 million of settlements were recognized in Q3 2024. Total estimated Line 901 costs are approximately $870 million.
- Consolidated Adjusted EBITDA rose 5% to $3.326 billion, and Adjusted EBITDA attributable to PAA rose to $2.779 billion from $2.711 billion.
- Crude Oil segment Adjusted EBITDA increased to $2.276 billion from $2.163 billion on higher tariff volumes, tariff escalations and acquisitions, while NGL segment Adjusted EBITDA declined to $480 million from $522 million on lower realized frac spreads.
- Adjusted Free Cash Flow after Distributions fell to $102 million from $809 million, as distributions to common and preferred unitholders and noncontrolling interests rose and investing outflows increased.
- Early 2025 activity included a $1 billion 5.95% senior notes offering, about $580 million net of bolt-on acquisitions, and repurchase of 12.7 million Series A preferred units for about $333 million.
- Liquidity exceeded $2.6 billion at year-end 2024, with about 99% of long-term debt in publicly traded senior notes, and the company reports compliance with its credit agreement covenants.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2024, Plains All American Pipeline kept $0.02.
- Revenue$48.89B100.0%
- Cost of revenue−$45.16B92.4%
- Gross profit$3.73B7.6%
- Operating costs−$2.86B5.8%
- Operating income$868.0M1.8%
- Interest, other & tax$242.0M0.5%
- Net income$1.11B2.3%
Where FY2024 revenue went
$48.89B- Cost of revenue: $45.16B, 92% of revenue
- Operating income: $868.0M, 1.8% of revenue
- Operating costs: $2.86B, 5.8% of revenue
Kept 1.8% as operating incomeOperating income $868.0M · 1.8%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2024filed February 28, 2025Financial Statements
FY2024 against FY2023
| Line item | FY2024FY2023 | Change |
|---|---|---|
| Revenue | $48.89B$47.34B | +3.3% |
| Cost of Revenue | $45.16B$43.94B | +2.8% |
| Gross Profit | $3.73B$3.40B | +9.6% |
| Operating Expenses | $48.02B$46.08B | +4.2% |
| Operating Income | $868.00M$1.26B | −31.0% |
| Net Income | $1.11B$1.50B | −26.0% |
05—Questions
Frequently Asked Questions
Why did net income attributable to PAA decline in 2024?
The filing attributes the decline to higher costs associated with the Line 901 incident, including a $225 million write-off of an insurance receivable in Q4 2024 and $120 million of settlements in Q3 2024. Losses on asset sales and asset impairments (versus gains in 2023) and higher income tax expense, largely from Canadian withholding tax, also contributed. The 2023 period also included a favorable $58 million mark-to-market gain on the Preferred Distribution Rate Reset Option.
How did segment results perform in 2024?
Crude Oil segment Adjusted EBITDA rose to $2.276 billion from $2.163 billion, driven by higher pipeline tariff volumes, tariff escalations and acquisitions, partly offset by fewer market-based opportunities. NGL segment Adjusted EBITDA fell to $480 million from $522 million, primarily due to lower realized frac spreads.
What are the company's capital spending plans for 2025?
Total investment capital for 2025 is projected at approximately $500 million ($400 million net to the company's interest), with about half expected in the Permian JV assets. Maintenance capital is projected at approximately $260 million ($240 million net to its interest). Management expects to fund these primarily with retained cash flow.
What is the company's financial strategy and credit profile target?
The company aims to maintain an investment-grade credit profile, targeting a leverage multiple averaging 3.25x to 3.75x (total debt plus 50% of preferred units divided by Adjusted EBITDA attributable to PAA), an average long-term debt-to-total capitalization of about 50% or less, and an Adjusted EBITDA-to-interest coverage of about 3.3x or better. Its stated focus is multi-year free cash flow and increased returns to equity holders, primarily through distributions.
What distributions have unitholders received recently?
Common unit distributions were $0.3175 per unit in each of the first three quarters of 2024 and $0.3800 for the fourth quarter. On February 14, 2025, the company paid $0.38 per common unit, totaling $267 million. Series A preferred units pay $0.615 per unit quarterly, and the Series B preferred distribution rate for the February 18, 2025 payment was 8.89507% per annum.
06—Continue