Plains All American Pipeline (PAA) 10-Q 2011 Q2 Quarterly report

EXHIBIT 12.1

STATEMENT OF COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

(in millions)

	Six Months Ended
	June 30,			Year Ended December 31,
	2011			2010			2009			2008			2007			2006
EARNINGS (1)
Pre-tax income from continuing operations before noncontrolling interest and income from equity investees	$	435		$	510		$	572		$	430		$	350		$	278
add: Fixed charges	165			321			283			264			233			149
add: Distributed income of equity investees	11			9			7			10			2			1
add: Amortization of capitalized interest	1			1			1			1			—			—
less: Capitalized interest	(11		)	(16		)	(12		)	(17		)	(14		)	(6		)
Total Earnings	$	601		$	825		$	851		$	688		$	571		$	422
FIXED CHARGES (1)
Interest expensed and capitalized (2)	$	150		$	281		$	247		$	233		$	220		$	141
Amortization of debt expense	5			8			7			4			3			3
Portion of rent expense related to interest (33.33%)	10			32			29			27			10			5
Total Fixed Charges	$	165		$	321		$	283		$	264		$	233		$	149
RATIO OF EARNINGS TO FIXED CHARGES (3)	3.65		x	2.57		x	3.00		x	2.60		x	2.45		x	2.83		x

(1)	For purposes of computing the ratio of earnings to fixed charges, “earnings” consists of pre-tax income from continuing operations before income from equity investees plus fixed charges (excluding capitalized interest), distributed income of equity investees and amortization of capitalized interest. “Fixed charges” represents interest incurred (whether expensed or capitalized), amortization of debt expense (including discounts and premiums relating to indebtedness) and the portion of rental expense on leases deemed to be the equivalent of interest.
(2)	Includes interest costs attributable to borrowings for inventory stored in a contango market of $12 million for the six months ended June 30, 2011 and $17 million, $11 million, $21 million, $44 million and $49 million for each of the years ended December 31, 2010, 2009, 2008, 2007 and 2006, respectively.
(3)	Ratios may not recalculate due to rounding.

1