Plains All American Pipeline (PAA) 10-Q 7 Aug 09 2009 Q2 Quarterly report Financial data

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)
In Millions	Jun. 30, 2009	Dec. 31, 2008
CURRENT ASSETS
Cash and cash equivalents	$7	$11
Trade accounts receivable and other receivables, net	1,674	1,525
Inventory	995	801
Other current assets	246	259
Total current assets	2,922	2,596
PROPERTY AND EQUIPMENT	6,028	5,727
Accumulated depreciation	(773)	(668)
Property and equipment, net	5,255	5,059
OTHER ASSETS
Pipeline linefill in owned assets	429	425
Long-term inventory	127	139
Investment in unconsolidated entities	256	257
Goodwill	1,226	1,210
Other, net	344	346
Total assets	10,559	10,032
CURRENT LIABILITIES
Accounts payable and accrued liabilities	1,927	1,507
Short-term debt	938	1,027
Other current liabilities	343	426
Total current liabilities	3,208	2,960
LONG-TERM LIABILITIES
Long-term debt under credit facilities and other	4	40
Senior notes, net of unamortized net discount of $6 and $6, respectively	3,394	3,219
Other long-term liabilities and deferred credits	247	261
Total long-term liabilities	3,645	3,520
COMMITMENTS AND CONTINGENCIES (NOTE 11)
Common unitholders (128,938,683 and 122,911,645 units outstanding, respectively)	3,558	3,469
General partner	85	83
Total partners' capital excluding noncontrolling interest	3,643	3,552
Noncontrolling interest	63
Total partners' capital	3,706	3,552
Total liabilities and partners' capital	$10,559	$10,032

1_CONDENSED CONSOLIDATED BALANC

CONDENSED CONSOLIDATED BALANCE SHEETS (parenthetical) (USD $)
In Millions, except Share data	Jun. 30, 2009	Dec. 31, 2008
Condensed Consolidated Balance Sheets
Senior notes, unamortized net discount	$6	$6
Common unitholders, units outstanding (in units)	128,938,683	122,911,645

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)
In Millions, except Per Share data	3 Months Ended Jun. 30, 2009	3 Months Ended Jun. 30, 2008	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
REVENUES
Crude oil, refined products and LPG sales and related revenues	$4,099	$8,880	$7,231	$15,917
Pipeline tariff activities, trucking and related revenues	130	144	254	268
Storage, terminalling, processing and related revenues	53	36	100	70
Total revenues	4,282	9,060	7,585	16,255
COSTS AND EXPENSES
Crude oil, refined products and LPG purchases and related costs	3,829	8,724	6,619	15,560
Field operating costs	160	152	312	297
General and administrative expenses	54	51	100	90
Depreciation and amortization	56	52	114	100
Total costs and expenses	4,099	8,979	7,145	16,047
OPERATING INCOME	183	81	440	208
OTHER INCOME/(EXPENSE)
Equity earnings in unconsolidated entities	5	4	8	7
Interest expense (net of capitalized interest of $2, $3, $5 and $9, respectively)	(56)	(49)	(107)	(91)
Interest income and other income/(expense), net	2	10	5	12
INCOME BEFORE TAX	134	46	346	136
Current income tax expense		(5)	(2)	(6)
Deferred income tax benefit	2		3	3
NET INCOME	136	41	347	133
NET INCOME-LIMITED PARTNERS	102	16	282	83
NET INCOME-GENERAL PARTNER	$34	$25	$65	$50
BASIC NET INCOME PER LIMITED PARTNER UNIT (in dollars per unit)	0.79	0.09	2.2	0.65
DILUTED NET INCOME PER LIMITED PARTNER UNIT (in dollars per unit)	0.78	0.09	2.18	0.64
BASIC WEIGHTED AVERAGE UNITS OUTSTANDING (in units)	129	120	126	118
DILUTED WEIGHTED AVERAGE UNITS OUTSTANDING (in units)	130	121	127	119

2_CONDENSED CONSOLIDATED STATEM

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (parenthetical) (USD $)
In Millions	3 Months Ended Jun. 30, 2009	3 Months Ended Jun. 30, 2008	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Condensed Consolidated Statements of Operations
Interest expense, capitalized	$2	$3	$5	$9

3_CONDENSED CONSOLIDATED STATEM

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
In Millions	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$347	$133
Reconciliation of net income to net cash provided by operating activities:
Depreciation and amortization	114	100
Equity compensation charge	30	24
Other	(1)	(13)
Changes in assets and liabilities, net of acquisitions:
Trade accounts receivable and other	(162)	(559)
Inventory	(178)	(234)
Accounts payable and other liabilities	137	1,125
Net cash provided by operating activities	287	576
CASH FLOWS FROM INVESTING ACTIVITIES
Cash paid in connection with acquisitions	(56)	(661)
Additions to property, equipment and other	(228)	(301)
Investment in unconsolidated entities	(5)	(40)
Cash received for sale of noncontrolling interest in a subsidiary	26
Proceeds from the sale of assets and other	10	15
Net cash used in investing activities	(253)	(987)
CASH FLOWS FROM FINANCING ACTIVITIES
Net borrowings/(repayments) on revolving credit facility	(459)	(204)
Net borrowings/(repayments) on short-term letter of credit and hedged inventory facility	157	(56)
Net proceeds from the issuance of senior notes (Note 5)	350	597
Net proceeds from the issuance of common units	210	315
Distributions paid to common unitholders (Note 7)	(227)	(199)
Distributions paid to general partner (Note 7)	(64)	(52)
Other financing activities	(5)	(5)
Net cash provided by (used in) financing activities	(38)	396
Effect of translation adjustment on cash		2
Net decrease in cash and cash equivalents	(4)	(13)
Cash and cash equivalents, beginning of period	11	24
Cash and cash equivalents, end of period	7	11
Cash paid for interest, net of amounts capitalized	103	92
Cash paid for income taxes	$7	$4

4_CONDENSED CONSOLIDATED STATEM

CONDENSED CONSOLIDATED STATEMENT OF PARTNERS CAPITAL (USD $)
In Millions	Common Units	General Partner	Partners' Capital Excluding Noncontrolling Interest	Noncontrolling Interest	Total
Balance, beginning of period at Dec. 31, 2008	$3,469	$83	$3,552		$3,552
Number of Units, Balance at beginning of period at Dec. 31, 2008	123
Increase (Decrease) in Partners' Capital - Rollforward
Sale of noncontrolling interest in a subsidiary	(36)	(1)	(37)	63	26
Net income	282	65	347		347
Issuance of common units	206	4	210		210
Issuance of common units (in units)	6
Issuance of common units under Long Term Incentive Plans ("LTIP")	12		12		12
Distributions	(227)	(64)	(291)		(291)
Class B Units of Plains AAP, L.P.	2		2		2
Other comprehensive loss	(150)	(2)	(152)		(152)
Balance, end of period at Jun. 30, 2009	$3,558	$85	$3,643	$63	$3,706
Number of Units, Balance at end of period at Jun. 30, 2009	129

5_CONDENSED CONSOLIDATED STATEM

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $)
In Millions	3 Months Ended Jun. 30, 2009	3 Months Ended Jun. 30, 2008	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Net income	$136	$41	$347	$133
Other comprehensive income/(loss)	(32)	20	(152)	(45)
Comprehensive income	$104	$61	$195	$88

6_CONDENSED CONSOLIDATED STATEM

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME PARTNERS CAPITAL (USD $)
In Millions	Cash Flow Hedging Activities	Translation Adjustments	Other	Total
Balance at beginning of period at Dec. 31, 2008	$161	($86)	$0	$75
Accumulated Other Comprehensive Income - Rollforward
Reclassification adjustments	(118)			(118)
Changes in fair value of outstanding hedge positions	(38)			(38)
Deferred losses on settled hedges, net	(47)			(47)
Currency translation adjustment		59		59
Proportionate share of our unconsolidated entities' other comprehensive loss			(8)	(8)
Total period activity	(203)	59	(8)	(152)
Balance at end of period at Jun. 30, 2009	($42)	($27)	($8)	($77)

Organization and Basis of Prese

Organization and Basis of Presentation
	6 Months Ended Jun. 30, 2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Organization and Basis of Presentation	Note 1Organization and Basis of Presentation As used in this Form10-Q, the terms Partnership, Plains, we, us, our, ours and similar terms refer to Plains All American Pipeline, L.P. and its subsidiaries, unless the context indicates otherwise. References to our general partner, as the context requires, include any or all of PAA GP LLC, Plains AAP, L.P. and Plains All American GP LLC. The accompanying condensed consolidated interim financial statements should be read in conjunction with our consolidated financial statements and notes thereto presented in our 2008 Annual Report on Form10-K. The financial statements have been prepared in accordance with the instructions for interim reporting as prescribed by the Securities and Exchange Commission. All adjustments (consisting only of normal recurring adjustments) that in the opinion of management were necessary for a fair statement of the results for the interim periods have been reflected. All significant intercompany transactions have been eliminated. The condensed balance sheet data as of December31, 2008 was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. The results of operations for the three and six months ended June30, 2009 should not be taken as indicative of the results to be expected for the full year. Subsequent events have been evaluated through the financial statements issuance date of August 7, 2009 and have been included within the following footnotes where applicable.

Recent Accounting Pronouncement

Recent Accounting Pronouncements
	6 Months Ended Jun. 30, 2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Recent Accounting Pronouncements	Note 2Recent Accounting Pronouncements Standards Adopted as of April1, 2009 In May2009, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standard (SFAS) No.165, Subsequent Events (SFAS 165). SFAS 165 establishes general standards of accounting for and disclosure of subsequent events or events that occur after the balance sheet date but before financial statements are issued. This standard sets forth (i)the period after the balance sheet date during which management shall evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, (ii)the circumstances under which an entity shall recognize events or transactions occurring after the balance sheet date in its financial statements and (iii)the disclosures that an entity shall make about events or transactions that occurred after the balance sheet date. This standard was effective for interim or annual periods ending after June 15, 2009; therefore, we have adopted SFAS 165 as of April1, 2009. Adoption did not have any material impact on our financial position, results of operations or cash flows. In April2009, the FASB issued FASBStaff Position (FSP) No.FAS 107-1, Interim Disclosures about Fair Value of Financial Statements (FSP No.FAS 107-1). FSP No.FAS 107-1 increases the frequency of fair value disclosures from annual to quarterly in an effort to provide financial statement users with more timely and transparent information about the effects of current market conditions on financial instruments. This is intended to address concerns raised by some financial statement users about the lack of comparability resulting from the use of different measurement attributes for financial instruments. These disclosures are also intended to stimulate more robust discussions about financial instrument valuations between users and reporting entities. We have adopted FSP No.FAS 107-1 as of April1, 2009. Adoption did not have any material impact on our financial position, results of operations or cash flows. Standards Adopted as of January1, 2009 In November2008, the Emerging Issues Task Force (EITF) issued Issue No.08-06, Equity Method Investment Accounting Considerations (EITF08-06). EITF08-06 addresses certain accounting considerations, including initial measurement, decreases in investment value, and changes in the level of ownership or degree of influence related to equity method investments. We have adopted EITF08-06 as of January1, 2009. Adoption did not have any material impact on our financial position, results of operations or cash flows. In April2008, the FASB issued FSP No.FAS142-3, Determination of the Useful Life of Intangible Assets (FSP No.FAS142-3). FSPNo.FAS142-3 amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under SFAS No. 142, Goodwill and Other Intangible Assets (SFAS142). The intent of this FSP is to improve the consistency between the useful life of a recognized intangible asset under SFAS142 and the period of expected cash flows used to measure the fair value of

Trade Accounts Receivable

Trade Accounts Receivable
	6 Months Ended Jun. 30, 2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Trade Accounts Receivable	Note 3Trade Accounts Receivable At June30, 2009 and December31, 2008, we had received approximately $147 million and $66 million, respectively, of advance cash payments from third parties to mitigate credit risk. In addition, we enter into netting arrangements with our counterparties. These arrangements cover a significant part of our transactions and also serve to mitigate credit risk. We review all outstanding accounts receivable balances on a monthly basis and record a reserve for amounts that we expect will not be fully recovered. Actual balances are not applied against the reserve until substantially all collection efforts have been exhausted. At June30, 2009 and December31, 2008, substantially all of our net accounts receivable classified as current assets were less than 30 days past their scheduled invoice date. Our allowance for doubtful accounts receivable totaled $8 million and $5 million at June30, 2009 and December31, 2008, respectively. Although we consider our allowance for doubtful trade accounts receivable to be adequate, actual amounts could vary significantly from estimated amounts.

Inventory, Linefill and Long-te

Inventory, Linefill and Long-term Inventory
	6 Months Ended Jun. 30, 2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Inventory, Linefill and Long-term Inventory	Note 4Inventory, Linefill and Long-term Inventory Inventory, linefill and long-term inventory consisted of the following (barrels in thousands and dollars in millions, except per barrel amounts): June30, 2009 December31, 2008 Dollars/ Dollars/ Barrels Dollars Barrel (1) Barrels Dollars Barrel (1) Inventory Crude oil 13,694 $ 774 $ 56.52 9,986 $ 421 $ 42.16 LPG 5,882 216 $ 36.72 7,748 370 $ 47.75 Refined products 40 2 $ 50.00 103 5 $ 48.54 Parts and supplies N/A 3 N/A N/A 5 N/A Inventory subtotal 19,616 995 17,837 801 Pipeline linefill in owned assets Crude oil 9,101 427 $ 46.92 9,148 422 $ 46.13 LPG 51 2 $ 39.22 67 3 $ 44.78 Pipeline linefill in owned assets subtotal 9,152 429 9,215 425 Long-term inventory Crude oil 1,690 115 $ 68.05 1,781 121 $ 67.94 LPG 342 12 $ 35.09 363 18 $ 49.59 Long-term inventory subtotal 2,032 127 2,144 139 Total 30,800 $ 1,551 29,196 $ 1,365 (1) The prices listed represent a weighted average associated with various grades and qualities of crude oil, LPG and refined products and, accordingly, are not comparable to published benchmarks for such products.

Debt

Debt
	6 Months Ended Jun. 30, 2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Debt	Note 5Debt Debt consists of the following (in millions): June30, December31, 2009 2008 Short-term debt: Senior secured hedged inventory facility bearing interest at a rate of 2.1% and 2.3% at June30, 2009 and December31, 2008, respectively $ 436 $ 280 Senior unsecured revolving credit facility, bearing interest at a rate of 0.8% and 1.1% at June30, 2009 and December31, 2008, respectively (1) 325 746 Senior notes, net of unamortized discount (2) (3) 175 Other 2 1 Total short-term debt 938 1,027 Long-term debt: Long-term debt under senior unsecured revolving credit facility and other (1) 4 40 Senior notes, net of unamortized net premium and discount 3,394 3,219 Total long-term debt (1)(3) 3,398 3,259 Total debt $ 4,336 $ 4,286 (1) At June30, 2009 and December31, 2008, we have classified $325 million and $746 million, respectively, of borrowings under our senior unsecured revolving credit facility as short-term. These borrowings are designated as working capital borrowings, must be repaid within one year and are primarily for hedged LPG and crude oil inventory and New York Mercantile Exchange (NYMEX) and Intercontinental Exchange (ICE) margin deposits. (2) Our $175 million 4.75% senior notes will mature on August 15, 2009 (see discussion of the issuance of our $350 million 8.75% senior notes below). (3) We estimate the aggregate fair value of our fixed-rate senior notes at June 30, 2009 to be approximately $3,550 million. Our fixed-rate senior notes are traded among institutions, which trades are routinely published by a reporting service. Our determination of fair value is based on reported trading activity near quarter end. In July2009, we completed the issuance of $500 million of 4.25% Senior Notes due September1, 2012. The senior notes were sold at 99.802% of face value. Interest payments are due on March1 and September1 of each year, beginning on March1, 2010. We used the net proceeds from this offering to supplement the capital available under our existing hedged inventory facility to fund working capital needs associated with base levels of routine foreign crude oil import and for seasonal LPG inventory requirements. Concurrent with the issuance of these Senior Notes, we entered into interest rate swaps whereby we receive fixed payments at 4.25% and pay three-month LIBOR plus a spread on a notional principal amount of $150 million maturing in two years and an additional $150 million notional principal amount maturing in three years. In April2009, we completed the issuance of $350 million of 8.75% Senior Notes due May1, 2019. The senior notes were sold at 99.994% of face value. Interest payments are due on May1 and November1 of each year, beginning on November1, 2009. We used the net proceeds from this offering to reduce outstanding borrowings under our credit facilities, which may be reborrowed to fund future investments and for general partnership purposes, including repayment of our $175 million 4.75% senior notes that mature in August 2009. Letters of Credit In connection

Net Income Per Limited Partner

Net Income Per Limited Partner Unit
	6 Months Ended Jun. 30, 2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Net Income Per Limited Partner Unit	Note 6Net Income per Limited Partner Unit Basic and diluted net income per unit is determined by dividing our limited partners interest in net income by the weighted average number of limited partner units outstanding during the period. Pursuant to EITF07-04, the limited partners interest in net income is calculated by first reducing net income by the distribution pertaining to the current periods net income, which is to be paid in the subsequent quarter (including the incentive distribution interest in excess of the 2% general partner interest). Then, the remaining undistributed earnings or excess distributions over earnings, if any, are allocated to the general partner and limited partners in accordance with the contractual terms of the partnership agreement. The adoption of EITF 07-04 resulted in a change to our calculation of earnings per unit by using distributions applicable to the period rather than distributions paid in the period (applicable to the previous period). Also, in accordance with EITF 07-04, earnings per unit for prior periods were recast to conform to this revised calculation. The following table sets forth the computation of basic and diluted earnings per limited partner unit for the six months ended June30, 2009 and 2008 (amounts in millions, except per unit data): Three Months Ended June30, Six Months Ended June30, 2009 2008 2009 2008 Numerator for basic and diluted earnings per limited partner unit: Net income $ 136 $ 41 $ 347 $ 133 Less: General partners incentive distribution paid (1) (32 ) (25 ) (60 ) (49 ) Subtotal 104 16 287 84 Less: General partner 2% ownership (1) (2 ) (5 ) (1 ) Net income available to limited partners 102 16 282 83 Adjustment in accordance with EITF 07-04 (1) (5 ) (5 ) (7 ) Net income available to limited partners in accordance with EITF 07-04 $ 102 $ 11 $ 277 $ 76 Denominator: Basic weighted average number of limited partner units outstanding 129 120 126 118 Effect of dilutive securities: Weighted average LTIP units (2) 1 1 1 1 Diluted weighted average number of limited partner units outstanding 130 121 127 119 Basic net income per limited partner unit $ 0.79 $ 0.09 $ 2.20 $ 0.65 Diluted net income per limited partner unit $ 0.78 $ 0.09 $ 2.18 $ 0.64 (1) We allocate net income to our general partner based on the distribution paid during the current quarter (including the incentive distribution interest in excess of the 2% general partner interest). EITF 07-04 requires that the distribution pertaining to the current periods net income, which is to be paid in the subsequent quarter, be utilized within the earnings per unit calculation. We reflect the impact of this difference as the Adjustment in accordance with EITF 07-04. (2) Our LTIP awards (described in Note 8) that contemplate the issuance of common units are considered dilutive unless (i)vestin

Partners Capital and Distributi

Partners Capital and Distributions
	1/1/2009 - 6/30/2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Partners' Capital and Distributions	Note 7Partners Capital and Distributions Equity Offerings During the six months ended June30, 2009 and 2008, we completed the following equity offerings of our common units (in millions, except per unit data): General Gross Proceeds Partner Net Period Units Issued Unit Price from Sale Contribution Costs (1) Proceeds 2009 March2009 5,750,000 $ 36.90 $ 212 $ 4 $ (6 ) $ 210 2008 April2008 6,900,000 $ 46.31 $ 320 $ 6 $ (11 ) $ 315 (1) Costs include the gross spread paid to underwriters in connection with the March 2009 and April 2008 equity offerings of common units. LTIP Vesting In May2009, in connection with the settlement of vested LTIP awards, we issued 277,038 common units at a price of $41.23, for a fair value of approximately $12 million. Distributions The following table details the distributions related to the first six months of 2009 and 2008, net of reductions to the general partners incentive distributions (in millions, except per unit amounts): DistributionsPaid Distributions Common GeneralPartner perlimited DateDeclared DatePaidorToBePaid Units Incentive 2% Total partnerunit 2009 July15, 2009 August14, 2009 (1) $ 117 $ 32 $ 2 $ 151 $ 0.9050 April8, 2009 May15, 2009 $ 117 $ 32 $ 2 $ 151 $ 0.9050 January14, 2009 February13, 2009 $ 110 $ 28 $ 2 $ 140 $ 0.8925 2008 July14, 2008 August14, 2008 $ 109 $ 30 $ 2 $ 141 $ 0.8875 April17, 2008 May15, 2008 $ 100 $ 25 $ 2 $ 127 $ 0.8650 January16, 2008 February14, 2008 $ 99 $ 23 $ 2 $ 124 $ 0.8500 (1) Payable to unitholders of record on August4, 2009, for the period April1, 2009 through June30, 2009. Upon closing of the Pacific and Rainbow acquisitions, our general partner agreed to reduce the amounts due it as incentive distributions. The total reduction in incentive distributions related to these acquisitions is $75 million. Following the distribution in August2009, the aggregate remaining incentive distribution reductions related to these acquisitions will be approximately $21 million.

Equity Compensation Plans

Equity Compensation Plans
	6 Months Ended Jun. 30, 2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Equity Compensation Plans	Note 8Equity Compensation Plans Long-Term Incentive Plans For discussion of our Long-Term Incentive Plan (LTIP) awards, see Note 10 to our Consolidated Financial Statements included in our 2008 Annual Report on Form10-K. At June30, 2009, the following LTIP awards were outstanding (units in millions): Vesting LTIP Units Distribution Estimated Unit Vesting Date Outstanding Amount 2009 2010 2011 2012 2013 0.6 (1) $3.20 0.6 1.4 (2) $3.50 - $4.50 0.8 0.5 0.1 1.5 (3) $3.50 - $4.00 0.9 0.2 0.4 3.5 (4)(5) 1.5 1.0 0.9 0.1 (1) Upon our February2007 annualized distribution of $3.20, these LTIP awards satisfied all distribution requirements and will vest upon completion of the respective service period. (2) These LTIP awards have performance conditions requiring the attainment of an annualized distribution of between $3.50 and $4.50 and vest upon the later of a certain date or the attainment of such levels. If the performance conditions are not attained while the grantee remains employed by us, or the grantee does not meet the employment requirements, these awards will be forfeited. For purposes of this disclosure, the awards are presented above assuming that the distribution levels are attained, that all grantees remain employed by us through the vesting date, and that the awards will vest on the earliest date possible regardless of our current assessment of probability. (3) These LTIP awards have performance conditions requiring the attainment of an annualized distribution of between $3.50 and $4.00. Fifty percent of these awards will vest in 2012 regardless of whether the performance conditions are attained. For purposes of this disclosure, the awards are presented above assuming the distribution levels are attained and that the awards will vest on the earliest date possible regardless of our current assessment of probability. (4) Approximately 1.7million of our approximately 3.5million outstanding LTIP awards also include Distribution Equivalent Rights (DERs), of which 1 million are currently earned. (5) LTIP units outstanding do not include ClassB units of Plains AAP,L.P. described below. Our LTIP activity is summarized in the following table (in millions, except weighted average grant date fair values per unit): Weighted Average Grant Date Units Fair Value per Unit Outstanding, December31, 2008 3.9 $ 36.44 Granted 0.3 $ 26.56 Vested (0.6 ) $ 34.72 Cancelled or forfeited (0.1 ) $ 38.99 Outstanding, June30, 2009 3.5 $ 36.68 Our accrued liability at June30, 2009 related to all outstanding LTIP awards and DERs is approximately $55million, which includes an accrual associated with our assessment that an annualized distribution of $3.75 is probable of occurring. We have not deemed a distribution of more than $3.75 to be probable. At December31, 2008, the accrued liability was approximately $55million. ClassB Units of Plains AAP,L.P. At June30, 2009, 165,500 ClassB units were outstanding, of which 38,500 unit

Derivatives and Risk Management

Derivatives and Risk Management Activities
	6 Months Ended Jun. 30, 2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Derivatives and Risk Management Activities	Note 9Derivatives and Risk Management Activities We identify the risks that underlie our core business activities and utilize risk management activities to mitigate those risks when we determine that there is value in doing so. We use various derivative instruments to (i)manage our exposure to commodity price risk as well as to optimize our profits, (ii)manage our exposure to interest-rate risk and (iii)manage our exposure to currency exchange-rate risk. Our policy is to use derivative instruments only for risk management purposes. Our commodity risk management policies and procedures are designed to monitor NYMEX, ICE and over-the-counter positions, as well as physical volumes, grades, locations, delivery schedules and storage capacity to help ensure that our hedging activities address our risks. Our interest rate and foreign currency risk management policies and procedures are designed to monitor our positions and ensure that those positions are consistent with our objectives and approved strategies. Our policy is to formally document all relationships between hedging instruments and hedged items, as well as our risk management objectives and strategies for undertaking the hedge. We calculate hedge effectiveness on a quarterly basis. This process includes specific identification of the hedging instrument and the hedged transaction, the nature of the risk being hedged and how the hedging instruments effectiveness will be assessed. Both at the inception of the hedge and on an ongoing basis, we assess whether the derivatives used in a transaction are highly effective in offsetting changes in cash flows or the fair value of hedged items. A discussion of our derivative activities by risk category follows. Commodity Price Risk Hedging Our core business activities contain certain commodity price-related risks that we manage in various ways, including the use of derivative instruments. Our policy is generally (i)to purchase only product for which we have a market, (ii)to structure our sales contracts so that price fluctuations do not materially affect the segment profit we earn, and (iii)not to acquire and hold physical inventory, futures contracts or other derivative products for the purpose of speculating on outright commodity price changes. Although we seek to maintain a position that is substantially balanced within our marketing activities, we purchase crude oil and LPG from thousands of locations and may experience net unbalanced positions as a result of production, transportation and delivery variances, as well as logistical issues associated with inclement weather conditions and other uncontrollable events that occur within each month. In connection with our efforts to maintain a balanced position, our personnel are authorized to purchase or sell an aggregate limit of up to 810,000 barrels of crude oil, refined products and LPG relative to the volumes originally scheduled for such month, based on interim information. The purpose of these purchases and sales is to manage risk as opposed to establishing a risk position. When unscheduled physical inventory builds or draws do occur, they are monitored constantly and managed to a

Income Taxes

Income Taxes
	6 Months Ended Jun. 30, 2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Income Taxes	Note 10Income Taxes U.S. Federal and State Taxes As a master limited partnership, we are not subject to U.S. federal income taxes; rather, the tax effect of our operations is passed through to our unitholders. Although, we are subject to state income taxes in some states, the impact is immaterial. Canadian Federal and Provincial Taxes Certain of our Canadian subsidiaries are corporations for Canadian tax purposes, thus their operations are subject to Canadian federal and provincial income taxes. The remainder of our Canadian operations is conducted through an operating limited partnership, which has historically been treated as a flow-through entity for tax purposes. This entity is subject to Canadian legislation passed in June2007 that imposes entity-level taxes on certain types of flow-through entities. This legislation includes safe harbor guidelines that grandfather certain existing entities (which, we believe, would include us) and delay the effective date of such legislation until 2011 provided that such entities do not exceed the normal growth guidelines. Although we continuously review acquisition opportunities that, if consummated, could cause us to exceed the normal growth guidelines, we believe that we are currently within the normal growth guidelines.

Commitments and Contingencies

Commitments and Contingencies
	6 Months Ended Jun. 30, 2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Commitments and Contingencies	Note 11Commitments and Contingencies Litigation Pipeline Releases. In January2005 and December2004, we experienced two unrelated releases of crude oil that reached rivers located near the sites where the releases originated. In early January2005, an overflow from a temporary storage tank located in East Texas resulted in the release of approximately 1,200 barrels of crude oil, a portion of which reached the Sabine River. In late December2004, one of our pipelines in West Texas experienced a rupture that resulted in the release of approximately 4,500 barrels of crude oil, a portion of which reached a remote location of the Pecos River. In both cases, emergency response personnel under the supervision of a unified command structure consisting of representatives of Plains, the Environmental Protection Agency (the EPA), the Texas Commission on Environmental Quality and the Texas Railroad Commission conducted clean-up operations at each site. Approximately 980 and 4,200 barrels were recovered from the two respective sites. The unrecovered oil was removed or otherwise addressed by us in the course of site remediation. Aggregate costs associated with the releases, including estimated remediation costs, are estimated to be approximately $5 million to $6 million. In cooperation with the appropriate state and federal environmental authorities, we have completed our work with respect to site restoration, subject to some ongoing remediation at the Pecos River site. EPA has referred these two crude oil releases, as well as several other smaller releases, to the U.S. Department of Justice (the DOJ) for further investigation in connection with a civil penalty enforcement action under the Federal Clean Water Act. We have cooperated in the investigation and are currently involved in settlement discussions with DOJ and EPA. Our assessment is that it is probable we will pay penalties related to the releases. We may also be subjected to injunctive remedies that would impose additional requirements, costs and constraints on our operations. We have accrued our current estimate of the likely penalties as a loss contingency, which is included in the estimated aggregate costs set forth above. We understand that the maximum permissible penalty, if any, that EPA could assess with respect to the subject releases under relevant statutes would be approximately $6.8 million. Such statutes contemplate the potential for substantial reduction in penalties based on mitigating circumstances and factors. We believe that several of such circumstances and factors exist, and thus have been a primary focus in our discussions with the DOJ and EPA with respect to these matters. SemCrude L.P., et al Debtors (U.S. Bankruptcy Court Delaware). We will from time to time have claims relating to insolvent suppliers, customers or counterparties, such as the bankruptcy proceedings of SemCrude. As a result of our statutory protections and contractual rights of setoff, substantially all of our pre-petition claims against SemCrude should be satisfied. Certain creditors of SemCrude and its affiliates have challenged our contractual and statutory rights to setoff certain of our pay

Operating Segments

Operating Segments
	6 Months Ended Jun. 30, 2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Operating Segments	Note 12Operating Segments We manage our operations through three operating segments: (i)Transportation, (ii)Facilities and (iii)Marketing. The following table reflects certain financial data for each segment for the periods indicated (in millions): Transportation Facilities Marketing Total Three Months Ended June30, 2009 Revenues: External Customers $ 130 $ 53 $ 4,099 $ 4,282 Intersegment (1) 108 32 140 Total revenues of reportable segments $ 238 $ 85 $ 4,099 $ 4,422 Equity earnings of unconsolidated entities $ 2 $ 3 $ $ 5 Segment profit (2)(3)(4) $ 114 $ 52 $ 78 $ 244 Maintenance capital $ 16 $ 3 $ 3 $ 22 Three Months Ended June30, 2008 Revenues: External Customers $ 143 $ 37 $ 8,880 $ 9,060 Intersegment (1) 89 28 1 118 Total revenues of reportable segments $ 232 $ 65 $ 8,881 $ 9,178 Equity earnings of unconsolidated entities $ 1 $ 3 $ $ 4 Segment profit/(loss) (2)(3)(4) $ 106 $ 36 $ (5 ) $ 137 Maintenance capital $ 11 $ 5 $ 1 $ 17 Six Months Ended June30, 2009 Revenues: External Customers $ 254 $ 100 $ 7,231 $ 7,585 Intersegment (1) 210 62 272 Total revenues of reportable segments $ 464 $ 162 $ 7,231 $ 7,857 Equity earnings of unconsolidated entities $ 3 $ 5 $ $ 8 Segment profit (2)(3)(4) $ 226 $ 98 $ 238 $ 562 Maintenance capital $ 30 $ 10 $ 4 $ 44 Six Months Ended June30, 2008 Revenues: External Customers $ 268 $ 70 $ 15,917 $ 16,255 Intersegment (1) 169 54 1 224 Total revenues of reportable segments $ 437 $ 124 $ 15,918 $ 16,479 Equity earnings of unconsolidated entities $ 3 $ 4 $ $ 7 Segment profit (2)(3)(4) $ 195 $ 68 $ 52 $ 315 Maintenance capital $ 25 $ 10 $ 2 $ 37 (1) Intersegment sales are conducted at posted tariff rates, rates similar to those charged to third parties or rates that we believe approximate market rates. For further discussion, see Analysis of Operating Segments under Item 7 of our 2008 Annual Report on Form10-K. (2) Gains/losses from derivative activities are included in marketing revenues and impact segment profit. (3) Marketing segment profit includes interest expense on contango inventory purchases of $3 million and $4 million for the three months ended June30, 2009 and 2008, respectively, and $5 million and $10 million for the six months ended June30, 2009 and 2008, respectively. (4) The following table reconciles segment profit to net income (in millions): For the Three Months For the Six Months Ended June30, Ended June30, 2009 2008 2009 2008 Segment

Supplemental Condensed Consolid

Supplemental Condensed Consolidating Financial Information
	6 Months Ended Jun. 30, 2009 USD / shares
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Supplemental Condensed Consolidating Financial Information	Note 13 Supplemental Condensed Consolidating Financial Information For purposes of this Note 13, Plains All American is referred to as Parent. See Note 13 to our Consolidated Financial Statements included in PartIV of our 2008 Annual Report on Form10-K for detail of which subsidiaries are classified as Guarantor Subsidiaries and which subsidiaries are classified as Non-Guarantor Subsidiaries. There have been no material changes in the entities that constitute our guarantor and non-guarantor subsidiaries since December31, 2008. The following supplemental condensed consolidating financial information reflects the Parents separate accounts, the combined accounts of the Guarantor Subsidiaries, the combined accounts of the Non-Guarantor Subsidiaries, the combined consolidating adjustments and eliminations and the Parents consolidated accounts for the dates and periods indicated. For purposes of the following condensed consolidating information, the Parents investments in its subsidiaries and the Guarantor Subsidiaries investments in their subsidiaries are accounted for under the equity method of accounting (all amounts in millions): Condensed Consolidating Balance Sheet As of June30, 2009 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets $ 2,669 $ 3,107 $ 154 $ (3,008 ) $ 2,922 Property, plant and equipment, net 4,334 921 5,255 Investment in unconsolidated entities 4,736 1,206 (5,686 ) 256 Other assets 23 1,787 316 2,126 Total assets $ 7,428 $ 10,434 $ 1,391 $ (8,694 ) $ 10,559 LIABILITIES AND PARTNERS CAPITAL Total current liabilities $ 329 $ 5,635 $ 252 $ (3,008 ) $ 3,208 Long-term debt 3,393 5 3,398 Other long-term liabilities 246 1 247 Total liabilities 3,722 5,886 253 (3,008 ) 6,853 Partners capital excluding noncontrolling interest 3,643 4,485 1,138 (5,623 ) 3,643 Noncontrolling interest 63 63 (63 ) 63 Total partners capital 3,706 4,548 1,138 (5,686 ) 3,706 Total liabilities and partners capital $ 7,428 $ 10,434 $ 1,391 $ (8,694 ) $ 10,559 Condensed Consolidating Balance Sheet As of December31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets $ 2,698 $ 2,789 $ 110 $ (3,001 ) $ 2,596 Property, plant and equipment, net 4,410 649 5,059 Investment in unconsolidated entities 4,388 895 (5,026 ) 257 Other assets 27 1,777 316 2,120 Total assets $ 7,113 $ 9,871 $ 1,075 $ (8,027 ) $ 10,032 LIABILITIES AND PARTNERS CAPITAL Total current liabilities $ 304 $ 5,411 $ 246 $

DOCUMENT AND ENTITY INFORMATION

DOCUMENT AND ENTITY INFORMATION (USD $)
In Millions, except Share data	6 Months Ended Jun. 30, 2009	Aug. 04, 2009	Jun. 30, 2008
Document and Entity Information
Entity Registrant Name	PLAINS ALL AMERICAN PIPELINE LP
Entity Central Index Key	0001070423
Document Type	10-Q
Document Period End Date	2009-06-30
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$4,900
Entity Common Stock, Shares Outstanding		128,938,683