Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended | |
Jun. 30, 2014 | Jul. 31, 2014 | |
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 | 30-Jun-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 368,940,903 |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q2 | ' |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
CURRENT ASSETS | ' | ' |
Cash and cash equivalents | $27 | $41 |
Trade accounts receivable and other receivables, net | 3,730 | 3,638 |
Inventory | 1,096 | 1,065 |
Other current assets | 315 | 220 |
Total current assets | 5,168 | 4,964 |
PROPERTY AND EQUIPMENT | 13,410 | 12,473 |
Accumulated depreciation | -1,797 | -1,654 |
Property and equipment, net | 11,613 | 10,819 |
OTHER ASSETS | ' | ' |
Goodwill | 2,502 | 2,503 |
Linefill and base gas | 895 | 798 |
Long-term inventory | 287 | 251 |
Investments in unconsolidated entities | 545 | 485 |
Other, net | 485 | 540 |
Total assets | 21,495 | 20,360 |
CURRENT LIABILITIES | ' | ' |
Accounts payable and accrued liabilities | 4,301 | 3,983 |
Short-term debt | 763 | 1,113 |
Other current liabilities | 359 | 315 |
Total current liabilities | 5,423 | 5,411 |
LONG-TERM LIABILITIES | ' | ' |
Senior notes, net of unamortized discount of $16 and $15, respectively | 7,409 | 6,710 |
Long-term debt under credit facilities and other | 5 | 5 |
Other long-term liabilities and deferred credits | 546 | 531 |
Total long-term liabilities | 7,960 | 7,246 |
COMMITMENTS AND CONTINGENCIES (NOTE 11) | ' | ' |
PARTNERS' CAPITAL | ' | ' |
Common unitholders (367,822,748 and 359,133,200 units outstanding, respectively) | 7,731 | 7,349 |
General partner | 322 | 295 |
Total partners' capital excluding noncontrolling interests | 8,053 | 7,644 |
Noncontrolling interests | 59 | 59 |
Total partners' capital | 8,112 | 7,703 |
Total liabilities and partners' capital | $21,495 | $20,360 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Millions, except Share data, unless otherwise specified | ||
CONSOLIDATED BALANCE SHEETS | ' | ' |
Senior notes, unamortized discount (in dollars) | $16 | $15 |
Common unitholders, units outstanding (in units) | 367,822,748 | 359,133,200 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
REVENUES | ' | ' | ' | ' |
Supply and Logistics segment revenues | $10,856 | $9,933 | $22,201 | $20,157 |
Transportation segment revenues | 195 | 165 | 376 | 338 |
Facilities segment revenues | 144 | 197 | 301 | 420 |
Total revenues | 11,195 | 10,295 | 22,878 | 20,915 |
COSTS AND EXPENSES | ' | ' | ' | ' |
Purchases and related costs | 10,280 | 9,387 | 20,950 | 18,825 |
Field operating costs | 360 | 343 | 696 | 684 |
General and administrative expenses | 90 | 91 | 179 | 196 |
Depreciation and amortization | 100 | 91 | 196 | 173 |
Total costs and expenses | 10,830 | 9,912 | 22,021 | 19,878 |
OPERATING INCOME | 365 | 383 | 857 | 1,037 |
OTHER INCOME/(EXPENSE) | ' | ' | ' | ' |
Equity earnings in unconsolidated entities | 23 | 11 | 44 | 23 |
Interest expense (net of capitalized interest of $10, $10, $22 and $19, respectively) | -82 | -75 | -161 | -152 |
Other income/(expense), net | 4 | -1 | 2 | -1 |
INCOME BEFORE TAX | 310 | 318 | 742 | 907 |
Current income tax expense | -16 | -8 | -52 | -53 |
Deferred income tax expense | -6 | -10 | -18 | -17 |
NET INCOME | 288 | 300 | 672 | 837 |
Net income attributable to noncontrolling interests | -1 | -8 | -1 | -16 |
NET INCOME ATTRIBUTABLE TO PAA | 287 | 292 | 671 | 821 |
NET INCOME ATTRIBUTABLE TO PAA: | ' | ' | ' | ' |
LIMITED PARTNERS | 166 | 197 | 435 | 631 |
GENERAL PARTNER | $121 | $95 | $236 | $190 |
BASIC NET INCOME PER LIMITED PARTNER UNIT (in dollars per unit) | $0.45 | $0.58 | $1.19 | $1.85 |
DILUTED NET INCOME PER LIMITED PARTNER UNIT (in dollars per unit) | $0.45 | $0.57 | $1.18 | $1.84 |
BASIC WEIGHTED AVERAGE UNITS OUTSTANDING (in units) | 365 | 340 | 363 | 338 |
DILUTED WEIGHTED AVERAGE UNITS OUTSTANDING (in units) | 367 | 342 | 365 | 341 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
CONSOLIDATED STATEMENTS OF OPERATIONS | ' | ' | ' | ' |
Interest expense, capitalized interest | $10 | $10 | $22 | $19 |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ' | ' | ' | ' |
Net income | $288 | $300 | $672 | $837 |
Other comprehensive income/(loss) | 91 | -92 | -45 | -138 |
Comprehensive income | 379 | 208 | 627 | 699 |
Comprehensive income attributable to noncontrolling interests | -1 | -15 | -1 | -20 |
Comprehensive income attributable to PAA | $378 | $193 | $626 | $679 |
CONDENSED_CONSOLIDATED_STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Increase (Decrease) in Accumulated Other Comprehensive Income | ' | ' | ' | ' |
Balance at beginning of period | ' | ' | ($97) | $80 |
Reclassification adjustments | ' | ' | 10 | -16 |
Deferred gain (loss) on cash flow hedges, net of tax | ' | ' | -51 | 62 |
Currency translation adjustments | ' | ' | -4 | -184 |
Total period activity | 91 | -92 | -45 | -138 |
Balance at end of period | -142 | -58 | -142 | -58 |
Derivative Instruments | ' | ' | ' | ' |
Increase (Decrease) in Accumulated Other Comprehensive Income | ' | ' | ' | ' |
Balance at beginning of period | ' | ' | -77 | -120 |
Reclassification adjustments | ' | ' | 10 | -16 |
Deferred gain (loss) on cash flow hedges, net of tax | ' | ' | -51 | 62 |
Total period activity | ' | ' | -41 | 46 |
Balance at end of period | -118 | -74 | -118 | -74 |
Translation Adjustments | ' | ' | ' | ' |
Increase (Decrease) in Accumulated Other Comprehensive Income | ' | ' | ' | ' |
Balance at beginning of period | ' | ' | -20 | 200 |
Currency translation adjustments | ' | ' | -4 | -184 |
Total period activity | ' | ' | -4 | -184 |
Balance at end of period | ($24) | $16 | ($24) | $16 |
CONDENSED_CONSOLIDATED_STATEME4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 6 Months Ended | |
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' |
Net income | $672 | $837 |
Reconciliation of net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 196 | 173 |
Equity-indexed compensation expense | 68 | 78 |
Inventory valuation adjustments | 37 | ' |
Deferred income tax expense | 18 | 17 |
Gain on sales of linefill and base gas | -8 | -3 |
Gain on foreign currency revaluation | -5 | -5 |
Settlement of terminated interest rate hedging instruments | -7 | ' |
Equity earnings in unconsolidated entities, net of distributions | 7 | -1 |
Other | 5 | ' |
Changes in assets and liabilities, net of acquisitions | -20 | 241 |
Net cash provided by operating activities | 963 | 1,337 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' |
Cash paid in connection with acquisitions, net of cash acquired | -2 | -31 |
Additions to property, equipment and other | -918 | -785 |
Cash received for sales of linefill and base gas | 23 | 14 |
Cash paid for purchases of linefill and base gas | -140 | -24 |
Investment in unconsolidated entities | -67 | -112 |
Proceeds from sales of assets | 3 | 3 |
Other investing activities | ' | 3 |
Net cash used in investing activities | -1,101 | -932 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' |
Net repayments under PAA senior secured hedged inventory facility (Note 6) | ' | -85 |
Net repayments under PAA senior unsecured revolving credit facility (Note 6) | ' | -65 |
Net repayments under PNG credit agreement | ' | -36 |
Net repayments under PAA commercial paper program (Note 6) | -344 | ' |
Proceeds from the issuance of senior notes (Note 6) | 698 | ' |
Net proceeds from the issuance of common units (Note 8) | 453 | 331 |
Net proceeds from the issuance of PNG common units | ' | 30 |
Distributions paid to common unitholders (Note 8) | -450 | -384 |
Distributions paid to general partner (Note 8) | -222 | -175 |
Distributions paid to noncontrolling interests | -1 | -24 |
Other financing activities | -10 | -2 |
Net cash provided by/(used in) financing activities | 124 | -410 |
Effect of translation adjustment on cash | ' | -3 |
Net decrease in cash and cash equivalents | -14 | -8 |
Cash and cash equivalents, beginning of period | 41 | 24 |
Cash and cash equivalents, end of period | 27 | 16 |
Cash paid for: | ' | ' |
Interest, net of amounts capitalized | 161 | 146 |
Income taxes, net of amounts refunded | $104 | $18 |
CONDENSED_CONSOLIDATED_STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (USD $) | Total | Common Units | General Partner | Partners' Capital Excluding Noncontrolling Interests | Noncontrolling Interests |
In Millions, except Share data, unless otherwise specified | |||||
Balance, beginning of period at Dec. 31, 2012 | $7,146 | $6,388 | $249 | $6,637 | $509 |
Balance, beginning of period (in units) at Dec. 31, 2012 | ' | 335,300,000 | ' | ' | ' |
Increase (Decrease) in Partners' Capital | ' | ' | ' | ' | ' |
Net income | 837 | 631 | 190 | 821 | 16 |
Distributions | -583 | -384 | -175 | -559 | -24 |
Issuance of common units | 331 | 324 | 7 | 331 | ' |
Issuance of common units (in units) | ' | 5,900,000 | ' | ' | ' |
Issuance of common units under LTIP, net of units tendered by employees to satisfy tax withholding obligations | -11 | -11 | ' | -11 | ' |
Issuance of common units under LTIP, net of units tendered by employees to satisfy tax withholding obligations (in units) | ' | 500,000 | ' | ' | ' |
Equity-indexed compensation expense | 20 | 16 | 2 | 18 | 2 |
Distribution equivalent right payments | -3 | -3 | ' | -3 | ' |
Other comprehensive income/(loss) | -138 | -139 | -3 | -142 | 4 |
Issuance of PNG common units | 30 | 6 | ' | 6 | 24 |
Balance, end of period at Jun. 30, 2013 | 7,629 | 6,828 | 270 | 7,098 | 531 |
Balance, end of period (in units) at Jun. 30, 2013 | ' | 341,700,000 | ' | ' | ' |
Balance, beginning of period at Dec. 31, 2013 | 7,703 | 7,349 | 295 | 7,644 | 59 |
Balance, beginning of period (in units) at Dec. 31, 2013 | 359,133,200 | 359,100,000 | ' | ' | ' |
Increase (Decrease) in Partners' Capital | ' | ' | ' | ' | ' |
Net income | 672 | 435 | 236 | 671 | 1 |
Distributions | -673 | -450 | -222 | -672 | -1 |
Issuance of common units | 453 | 444 | 9 | 453 | ' |
Issuance of common units (in units) | ' | 8,100,000 | ' | ' | ' |
Issuance of common units under LTIP, net of units tendered by employees to satisfy tax withholding obligations | -17 | -18 | 1 | -17 | ' |
Issuance of common units under LTIP, net of units tendered by employees to satisfy tax withholding obligations (in units) | ' | 600,000 | ' | ' | ' |
Equity-indexed compensation expense | 23 | 19 | 4 | 23 | ' |
Distribution equivalent right payments | -3 | -3 | ' | -3 | ' |
Other comprehensive income/(loss) | -45 | -44 | -1 | -45 | ' |
Other | -1 | -1 | ' | -1 | ' |
Balance, end of period at Jun. 30, 2014 | $8,112 | $7,731 | $322 | $8,053 | $59 |
Balance, end of period (in units) at Jun. 30, 2014 | 367,822,748 | 367,800,000 | ' | ' | ' |
Organization_and_Basis_of_Cons
Organization and Basis of Consolidation and Presentation | 6 Months Ended | ||
Jun. 30, 2014 | |||
Organization and Basis of Consolidation and Presentation | ' | ||
Organization and Basis of Consolidation and Presentation | ' | ||
Note 1—Organization and Basis of Consolidation and Presentation | |||
Organization | |||
Plains All American Pipeline, L.P. is a Delaware limited partnership formed in 1998. Our operations are conducted directly and indirectly through our primary operating subsidiaries. As used in this Form 10-Q and unless the context indicates otherwise, the terms “Partnership,” “Plains,” “PAA,” “we,” “us,” “our,” “ours” and similar terms refer to Plains All American Pipeline, L.P. and its subsidiaries. | |||
We own and operate midstream energy infrastructure and provide logistics services for crude oil, natural gas liquids (“NGL”), natural gas and refined products. The term NGL includes ethane and natural gasoline products as well as products commonly referred to as liquefied petroleum gas (“LPG”), such as propane and butane. When used in this Form 10-Q, NGL refers to all NGL products including LPG. We own an extensive network of pipeline transportation, terminalling, storage, and gathering assets in key crude oil and NGL producing basins and transportation corridors and at major market hubs in the United States and Canada. Our business activities are conducted through three operating segments: (i) Transportation, (ii) Facilities and (iii) Supply and Logistics. See Note 12 for further discussion of our operating segments. | |||
Our 2% general partner interest is held by PAA GP LLC, a Delaware limited liability company, whose sole member is Plains AAP, L.P. (“AAP”), a Delaware limited partnership. In addition to its ownership of PAA GP LLC, AAP also owns all of our incentive distribution rights. Plains All American GP LLC (“GP LLC”), a Delaware limited liability company, is AAP’s general partner. GP LLC manages our operations and activities and employs our domestic officers and personnel. Our Canadian officers and personnel are employed by our subsidiary, Plains Midstream Canada ULC (“PMC”). References to our “general partner,” as the context requires, include any or all of PAA GP LLC, AAP and GP LLC. | |||
Definitions | |||
Additional defined terms are used in this Form 10-Q and shall have the meanings indicated below: | |||
AOCI | =font> | Accumulated other comprehensive income | |
Bcf | =font> | Billion cubic feet | |
Btu | =font> | British thermal unit | |
CAD | =font> | Canadian dollar | |
DERs | =font> | Distribution equivalent rights | |
EBITDA | =font> | Earnings before interest, taxes, depreciation and amortization | |
FASB | =font> | Financial Accounting Standards Board | |
GAAP | =font> | Generally accepted accounting principles in the United States | |
ICE | =font> | IntercontinentalExchange | |
LIBOR | =font> | London Interbank Offered Rate | |
LTIP | =font> | Long-term incentive plan | |
Mcf | =font> | Thousand cubic feet | |
MLP | =font> | Master limited partnership | |
NGL | =font> | Natural gas liquids including ethane, natural gasoline products, propane and butane | |
NYMEX | =font> | New York Mercantile Exchange | |
PLA | =font> | Pipeline loss allowance | |
PNG | =font> | PAA Natural Gas Storage, L.P. | |
SEC | =font> | Securities and Exchange Commission | |
USD | =font> | United States dollar | |
White Cliffs | =font> | White Cliffs Pipeline, LLC | |
WTI | =font> | West Texas Intermediate | |
Basis of Consolidation and Presentation | |||
The accompanying unaudited condensed consolidated interim financial statements and notes thereto should be read in conjunction with our 2013 Annual Report on Form 10-K. The financial statements have been prepared in accordance with the instructions for interim reporting as set forth by the SEC. 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 in consolidation. Certain reclassifications have been made to information from previous years to conform to the current presentation. The condensed consolidated balance sheet data as of December 31, 2013 was derived from audited financial statements, but does not include all disclosures required by GAAP. The results of operations for the three and six months ended June 30, 2014 should not be taken as indicative of results to be expected for the entire year. | |||
Subsequent events have been evaluated through the financial statements issuance date and have been included in the following footnotes where applicable. | |||
Recent_Accounting_Pronouncemen
Recent Accounting Pronouncements | 6 Months Ended |
Jun. 30, 2014 | |
Recent Accounting Pronouncements | ' |
Recent Accounting Pronouncements | ' |
Note 2—Recent Accounting Pronouncements | |
Other than as discussed below and in our 2013 Annual Report on Form 10-K, no new accounting pronouncements have become effective or have been issued during the six months ended June 30, 2014 that are of significance or potential significance to us. | |
In May 2014, the FASB issued guidance regarding the recognition of revenue from contracts with customers with the underlying principle that an entity will recognize revenue to reflect amounts expected to be received in exchange for the provision of goods and services to customers upon the transfer of those goods or services. The guidance also requires additional disclosures about the nature, amount, timing and uncertainty of revenue and the related cash flows. This guidance becomes effective for interim and annual periods beginning after December 15, 2016 and can be adopted either with a full retrospective approach or a modified retrospective approach with a cumulative-effect adjustment as of the date of adoption. We are currently evaluating which transition approach to apply and the effect that adopting this guidance will have on our financial position, results of operations and cash flows. | |
In April 2014, the FASB issued guidance that modifies the criteria under which assets to be disposed of are evaluated to determine if such assets qualify as a discontinued operation and requires new disclosures for both discontinued operations and certain other disposals that do not meet the definition of a discontinued operation. This guidance is effective prospectively for annual and interim reporting periods beginning after December 15, 2014. Early adoption is permitted but only for disposals (or classifications as held for sale) that have not been reported in financial statements previously issued or available for issue. We are currently evaluating the provisions of this authoritative guidance and assessing its impact, but do not believe our adoption will have a material impact on our financial position, results of operations or cash flows. | |
In March 2013, the FASB issued guidance regarding the release of cumulative translation adjustments into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a business within a foreign entity. This guidance became effective for interim and annual periods beginning after December 15, 2013. We adopted this guidance on January 1, 2014. Our adoption did not have a material impact on our financial position, results of operations or cash flows. | |
Accounts_Receivable
Accounts Receivable | 6 Months Ended |
Jun. 30, 2014 | |
Accounts Receivable | ' |
Accounts Receivable | ' |
Note 3—Accounts Receivable | |
Our accounts receivable are primarily from purchasers and shippers of crude oil and, to a lesser extent, purchasers of NGL and natural gas storage. These purchasers include, but are not limited to, refiners, producers, marketing and trading companies and financial institutions that are active in the physical and financial commodity markets. The majority of our accounts receivable relate to our crude oil supply and logistics activities that can generally be described as high volume and low margin activities, in many cases involving exchanges of crude oil volumes. | |
To mitigate credit risk related to our accounts receivable, we have in place a rigorous credit review process. We closely monitor market conditions in order to make a determination with respect to the amount, if any, of credit to be extended to any given customer and the form and amount of financial performance assurances we require. Such financial assurances are commonly provided to us in the form of advance cash payments, standby letters of credit or parental guarantees. As of June 30, 2014 and December 31, 2013, we had received approximately $157 million and $117 million, respectively, of advance cash payments from third parties to mitigate credit risk. Furthermore, as of June 30, 2014 and December 31, 2013, we had received approximately $384 million and $426 million, respectively, of standby letters of credit to support obligations due from third parties, a portion of which applies to future business. In addition, in an effort to mitigate credit risk, a significant portion of our transactions with counterparties are settled on a net-cash basis. Further, we enter into netting agreements (contractual agreements that allow us to offset receivables and payables with those counterparties against each other on our balance sheet) for a majority of such arrangements. | |
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. We do not apply actual balances against the reserve until we have exhausted substantially all collection efforts. At June 30, 2014 and December 31, 2013, substantially all of our accounts receivable (net of allowance for doubtful accounts) were less than 30 days past their scheduled invoice date. Our allowance for doubtful accounts receivable totaled approximately $5 million at both June 30, 2014 and December 31, 2013. Although we consider our allowance for doubtful accounts receivable to be adequate, actual amounts could vary significantly from estimated amounts. | |
Inventory_Linefill_and_Base_Ga
Inventory, Linefill and Base Gas and Long-term Inventory | 6 Months Ended | ||||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||||
Inventory, Linefill and Base Gas and Long-term Inventory | ' | ||||||||||||||||||||||
Inventory, Linefill and Base Gas and Long-term Inventory | ' | ||||||||||||||||||||||
Note 4—Inventory, Linefill and Base Gas and Long-term Inventory | |||||||||||||||||||||||
Inventory, linefill and base gas and long-term inventory consisted of the following as of the dates indicated (barrels and natural gas volumes in thousands and carrying value in millions): | |||||||||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||||||||
Unit of | Carrying | Price/ | Unit of | Carrying | Price/ | ||||||||||||||||||
Volumes | Measure | Value | Unit (1) | Volumes | Measure | Value | Unit (1) | ||||||||||||||||
Inventory | |||||||||||||||||||||||
Crude oil | 6,233 | barrels | $ | 579 | $ | 92.89 | 6,951 | barrels | $ | 540 | $ | 77.69 | |||||||||||
NGL | 10,591 | barrels | 444 | $ | 41.92 | 8,061 | barrels | 352 | $ | 43.67 | |||||||||||||
Natural gas | 10,824 | Mcf | 50 | $ | 4.62 | 40,505 | Mcf | 150 | $ | 3.7 | |||||||||||||
Other | N/A | 23 | N/A | N/A | 23 | N/A | |||||||||||||||||
Inventory subtotal | 1,096 | 1,065 | |||||||||||||||||||||
Linefill and base gas | |||||||||||||||||||||||
Crude oil | 11,211 | barrels | 713 | $ | 63.6 | 10,966 | barrels | 679 | $ | 61.92 | |||||||||||||
NGL | 1,214 | barrels | 56 | $ | 46.13 | 1,341 | barrels | 62 | $ | 46.23 | |||||||||||||
Natural gas | 26,612 | Mcf | 126 | $ | 4.73 | 16,615 | Mcf | 57 | $ | 3.43 | |||||||||||||
Linefill and base gas subtotal | 895 | 798 | |||||||||||||||||||||
Long-term inventory | |||||||||||||||||||||||
Crude oil | 2,712 | barrels | 220 | $ | 81.12 | 2,498 | barrels | 202 | $ | 80.86 | |||||||||||||
NGL | 1,681 | barrels | 67 | $ | 39.86 | 1,161 | barrels | 49 | $ | 42.2 | |||||||||||||
Long-term inventory subtotal | 287 | 251 | |||||||||||||||||||||
Total | $ | 2,278 | $ | 2,114 | |||||||||||||||||||
(1) Price per unit of measure represents a weighted average associated with various grades, qualities and locations. Accordingly, these prices may not coincide with any published benchmarks for such products. | |||||||||||||||||||||||
At the end of each reporting period, we assess the carrying value of our inventory and make any adjustments necessary to reduce the carrying value to the applicable net realizable value. We recorded a charge of approximately $37 million during the six months ended June 30, 2014 related to the writedown of our natural gas inventory that was purchased in conjunction with managing natural gas storage deliverability requirements during the extended period of severe cold weather in the first quarter of 2014. This adjustment is a component of “Purchases and related costs” in our accompanying condensed consolidated statements of operations. | |||||||||||||||||||||||
Goodwill
Goodwill | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Goodwill | ' | |||||||||||||
Goodwill | ' | |||||||||||||
Note 5—Goodwill | ||||||||||||||
The table below reflects our goodwill by segment and changes during the period indicated (in millions): | ||||||||||||||
Transportation | Facilities | Supply and Logistics | Total | |||||||||||
Balance at December 31, 2013 | $ | 878 | $ | 1,162 | $ | 463 | $ | 2,503 | ||||||
Foreign currency translation adjustments | (1 | ) | — | — | (1 | ) | ||||||||
Balance at June 30, 2014 | $ | 877 | $ | 1,162 | $ | 463 | $ | 2,502 | ||||||
We completed our annual goodwill impairment test as of June 30, 2014 and determined that there was no impairment of goodwill. | ||||||||||||||
Debt
Debt | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Debt | ' | |||||||
Debt | ' | |||||||
Note 6—Debt | ||||||||
Debt consisted of the following as of the dates indicated (in millions): | ||||||||
June 30, | December 31, | |||||||
2014 | 2013 | |||||||
SHORT-TERM DEBT | ||||||||
PAA commercial paper notes, bearing a weighted-average interest rate of 0.29% and 0.33%, respectively (1) | $ | 760 | $ | 1,109 | ||||
Other | 3 | 4 | ||||||
Total short-term debt | 763 | 1,113 | ||||||
LONG-TERM DEBT | ||||||||
Senior notes, net of unamortized discounts of $16 and $15, respectively (2) | 7,409 | 6,710 | ||||||
Other | 5 | 5 | ||||||
Total long-term debt | 7,414 | 6,715 | ||||||
Total debt (3) | $ | 8,177 | $ | 7,828 | ||||
(1) PAA commercial paper notes are backstopped by the PAA senior unsecured revolving credit facility and the PAA senior secured hedged inventory facility, which mature in August 2018 and August 2016, respectively; as such, any borrowings under the PAA commercial paper program reduce the available capacity under these facilities. At June 30, 2014 and December 31, 2013, we classified $760 million and $1.1 billion, respectively, of borrowings under our commercial paper program as short-term. These borrowings are primarily designated as working capital borrowings, must be repaid within one year and are primarily for hedged NGL and crude oil inventory and NYMEX and ICE margin deposits. | ||||||||
(2) As of June 30, 2014, we have classified our $150 million, 5.25% senior notes due June 2015 as long-term based on our ability and intent to refinance them on a long-term basis. | ||||||||
(3) Our fixed-rate senior notes had a face value of approximately $7.4 billion and $6.7 billion at June 30, 2014 and December 31, 2013, respectively. We estimated the aggregate fair value of these notes as of June 30, 2014 and December 31, 2013 to be approximately $8.2 billion and $7.2 billion, respectively. Our fixed-rate senior notes are traded among institutions, and these trades are routinely published by a reporting service. Our determination of fair value is based on reported trading activity near quarter end. We estimate that the carrying value of outstanding borrowings under our credit facilities and agreements and commercial paper program approximates fair value as interest rates reflect current market rates. The fair value estimates for both our senior notes and credit facilities are based upon observable market data and are classified within Level 2 of the fair value hierarchy. See Note 10 for additional discussion of the fair value hierarchy. | ||||||||
Borrowings and Repayments | ||||||||
Total borrowings under our credit agreements and the commercial paper program for the six months ended June 30, 2014 and 2013 were approximately $34.6 billion and $7.6 billion, respectively. Total repayments under our credit agreements and the commercial paper program for the six months ended June 30, 2014 and 2013 were approximately $34.9 billion and $7.8 billion, respectively. The variance in total gross borrowings and repayments is impacted by various business and financial factors including, but not limited to, the timing, average term and method of general partnership borrowing activities. | ||||||||
Letters of Credit | ||||||||
In connection with our supply and logistics activities, we provide certain suppliers with irrevocable standby letters of credit to secure our obligation for the purchase of crude oil, NGL and natural gas. Additionally, we issue letters of credit to support insurance programs and construction activities. At June 30, 2014 and December 31, 2013, we had outstanding letters of credit of approximately $38 million and $41 million, respectively. | ||||||||
Senior Notes Issuance | ||||||||
On April 23, 2014, we completed the issuance of $700 million, 4.70% senior notes due 2044 at a public offering price of 99.734%. Interest payments are due on June 15 and December 15 of each year, commencing on December 15, 2014. In anticipation of the issuance of these senior notes, we entered into $250 million notional principal amount of U.S. treasury locks in March and April 2014 to hedge the treasury rate portion of the interest rate on a portion of the notes. We terminated these treasury locks in April 2014. See Note 10 for additional disclosure. | ||||||||
Net_Income_Per_Limited_Partner
Net Income Per Limited Partner Unit | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Net Income Per Limited Partner Unit | ' | |||||||||||||
Net Income Per Limited Partner Unit | ' | |||||||||||||
Note 7—Net Income Per Limited Partner Unit | ||||||||||||||
Basic and diluted net income per limited partner unit is determined pursuant to the two-class method for Master Limited Partnerships as prescribed in the FASB guidance. The two-class method is an earnings allocation formula that is used to determine earnings to our general partner, common unitholders and participating securities according to distributions pertaining to the current period’s net income and participation rights in undistributed earnings. Under this method, all earnings are allocated to our general partner, common unitholders and participating securities based on their respective rights to receive distributions, regardless of whether those earnings would actually be distributed during a particular period from an economic or practical perspective. | ||||||||||||||
The Partnership calculates basic and diluted net income per limited partner unit by dividing net income attributable to Plains, after deducting the amount allocated to the general partner’s interest, incentive distribution rights (“IDRs”) and participating securities, by the basic and diluted weighted-average number of limited partner units outstanding during the period. Participating securities include LTIP awards that have vested DERs, which entitle the grantee to a cash payment equal to the cash distribution paid on our outstanding common units. | ||||||||||||||
Diluted net income per limited partner unit is computed based on the weighted average number of units plus the effect of dilutive potential units outstanding during the period using the two-class method. Our LTIP awards that contemplate the issuance of common units are considered dilutive unless (i) vesting occurs only upon the satisfaction of a performance condition and (ii) that performance condition has yet to be satisfied. LTIP awards that are deemed to be dilutive are reduced by a hypothetical unit repurchase based on the remaining unamortized fair value, as prescribed by the treasury stock method in guidance issued by the FASB. See Note 15 to our Consolidated Financial Statements included in Part IV of our 2013 Annual Report on Form 10-K for a complete discussion of our LTIP awards including specific discussion regarding DERs. | ||||||||||||||
The following table sets forth the computation of basic and diluted earnings per limited partner unit for the three and six months ended June 30, 2014 and 2013 (in millions, except per unit data): | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Basic Net Income per Limited Partner Unit | ||||||||||||||
Net income attributable to PAA | $ | 287 | $ | 292 | $ | 671 | $ | 821 | ||||||
Less: General partner’s incentive distribution (1) | (117 | ) | (91 | ) | (227 | ) | (177 | ) | ||||||
Less: General partner 2% ownership (1) | (4 | ) | (4 | ) | (9 | ) | (13 | ) | ||||||
Net income available to limited partners | 166 | 197 | 435 | 631 | ||||||||||
Less: Undistributed earnings allocated and distributions to participating securities (1) | (1 | ) | (1 | ) | (3 | ) | (5 | ) | ||||||
Net income available to limited partners in accordance with application of the two-class method for MLPs | $ | 165 | $ | 196 | $ | 432 | $ | 626 | ||||||
Basic weighted average number of limited partner units outstanding | 365 | 340 | 363 | 338 | ||||||||||
Basic net income per limited partner unit | $ | 0.45 | $ | 0.58 | $ | 1.19 | $ | 1.85 | ||||||
Diluted Net Income per Limited Partner Unit | ||||||||||||||
Net income attributable to PAA | $ | 287 | $ | 292 | $ | 671 | $ | 821 | ||||||
Less: General partner’s incentive distribution (1) | (117 | ) | (91 | ) | (227 | ) | (177 | ) | ||||||
Less: General partner 2% ownership (1) | (4 | ) | (4 | ) | (9 | ) | (13 | ) | ||||||
Net income available to limited partners | 166 | 197 | 435 | 631 | ||||||||||
Less: Undistributed earnings allocated and distributions to participating securities (1) | (1 | ) | (1 | ) | (3 | ) | (3 | ) | ||||||
Net income available to limited partners in accordance with application of the two-class method for MLPs | $ | 165 | $ | 196 | $ | 432 | $ | 628 | ||||||
Basic weighted average number of limited partner units outstanding | 365 | 340 | 363 | 338 | ||||||||||
Effect of dilutive securities: Weighted average LTIP units | 2 | 2 | 2 | 3 | ||||||||||
Diluted weighted average number of limited partner units outstanding | 367 | 342 | 365 | 341 | ||||||||||
Diluted net income per limited partner unit | $ | 0.45 | $ | 0.57 | $ | 1.18 | $ | 1.84 | ||||||
(1) We calculate net income available to limited partners based on the distributions pertaining to the current period’s net income. After adjusting for the appropriate period’s distributions, the remaining undistributed earnings or excess distributions over earnings, if any, are allocated to the general partner, limited partners and participating securities in accordance with the contractual terms of the partnership agreement and as further prescribed under the two-class method. | ||||||||||||||
Pursuant to the terms of our partnership agreement, the general partner’s incentive distribution is limited to a percentage of available cash, which, as defined in the partnership agreement, is net of reserves deemed appropriate. As such, IDRs are not allocated undistributed earnings or distributions in excess of earnings in the calculation of net income per limited partner unit. If, however, undistributed earnings were allocated to our IDRs beyond amounts distributed to them under the terms of the partnership agreement, basic and diluted earnings per limited partner unit as reflected in the table above would be impacted as follows: | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30 , | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Basic net income per limited partner unit impact | $ | — | $ | — | $ | — | $ | (0.33 | ) | |||||
Diluted net income per limited partner unit impact | $ | — | $ | — | $ | — | $ | (0.33 | ) | |||||
Partners_Capital_and_Distribut
Partners' Capital and Distributions | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
Partners' Capital and Distributions | ' | |||||||||||||||||||
Partners' Capital and Distributions | ' | |||||||||||||||||||
Note 8—Partners’ Capital and Distributions | ||||||||||||||||||||
Distributions | ||||||||||||||||||||
The following table details the distributions paid during or pertaining to the first six months of 2014, net of reductions to the general partner’s incentive distributions (in millions, except per unit amounts): | ||||||||||||||||||||
Distributions Paid | Distributions | |||||||||||||||||||
Common | General Partner | per limited | ||||||||||||||||||
Date Declared | Distribution Date | Units | Incentive | 2% | Total | partner unit | ||||||||||||||
July 8, 2014 | August 14, 2014 (1) | $ | 238 | $ | 117 | $ | 5 | $ | 360 | $ | 0.645 | |||||||||
April 7, 2014 | May 15, 2014 | $ | 229 | $ | 110 | $ | 5 | $ | 344 | $ | 0.63 | |||||||||
January 9, 2014 | February 14, 2014 | $ | 221 | $ | 102 | $ | 5 | $ | 328 | $ | 0.615 | |||||||||
(1) Payable to unitholders of record at the close of business on August 1, 2014 for the period April 1, 2014 through June 30, 2014. | ||||||||||||||||||||
Continuous Offering Program | ||||||||||||||||||||
During the six months ended June 30, 2014, we issued an aggregate of approximately 8.1 million common units under our continuous offering program, generating proceeds of approximately $453 million, including our general partner’s proportionate capital contribution, net of approximately $4 million of commissions to our sales agents. | ||||||||||||||||||||
Noncontrolling Interests in Subsidiaries | ||||||||||||||||||||
As of June 30, 2014, noncontrolling interests in subsidiaries consisted of a 25% interest in SLC Pipeline LLC. On December 31, 2013, we purchased the noncontrolling interests in PNG, and PNG became our wholly-owned subsidiary. | ||||||||||||||||||||
EquityIndexed_Compensation_Pla
Equity-Indexed Compensation Plans | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Equity-Indexed Compensation Plans | ' | |||||||||||||
Equity-Indexed Compensation Plans | ' | |||||||||||||
Note 9—Equity-Indexed Compensation Plans | ||||||||||||||
We refer to the PAA LTIPs and AAP Management Units collectively as our “Equity-indexed compensation plans.” For additional discussion of our equity-indexed compensation plans and awards, see Note 15 to our Consolidated Financial Statements included in Part IV of our 2013 Annual Report on Form 10-K. | ||||||||||||||
PAA LTIP Awards. Our equity-indexed compensation activity for LTIP awards denominated in PAA units is summarized in the following table (units in millions): | ||||||||||||||
Units (1) | Weighted Average Grant | |||||||||||||
Date | ||||||||||||||
Fair Value per Unit | ||||||||||||||
Outstanding at December 31, 2013 | 8.4 | $ | 36.97 | |||||||||||
Granted | 0.9 | $ | 46.61 | |||||||||||
Vested (2) | (1.8 | ) | $ | 25.39 | ||||||||||
Cancelled or forfeited | (0.3 | ) | $ | 38.88 | ||||||||||
Outstanding at June 30, 2014 | 7.2 | $ | 41.05 | |||||||||||
(1) Amounts do not include AAP Management Units. | ||||||||||||||
(2) Approximately 0.6 million PAA common units were issued, net of tax withholding of 0.3 million units, during the six months ended June 30, 2014 in connection with the settlement of vested awards. The remaining PAA awards that vested during the six months ended June 30, 2014 of approximately 0.9 million units were settled in cash. | ||||||||||||||
AAP Management Units. The following table contains a summary of AAP Management Units (in millions): | ||||||||||||||
Reserved for Future | Outstanding | Outstanding Units | Grant Date | |||||||||||
Grants | Earned | Fair Value Of Outstanding AAP | ||||||||||||
Management Units (1) | ||||||||||||||
Balance at December 31, 2013 | 3.5 | 48.6 | 47 | $ | 51 | |||||||||
Granted | (0.4 | ) | 0.4 | — | 11 | |||||||||
Earned | N/A | N/A | 0.8 | N/A | ||||||||||
Balance at June 30, 2014 | 3.1 | 49 | 47.8 | $ | 62 | |||||||||
(1) Of the grant date fair value, approximately $4 million was recognized as expense during the six months ended June 30, 2014. Of the $62 million grant date fair value, approximately $52 million had been recognized through June 30, 2014. | ||||||||||||||
Other Consolidated Equity-Indexed Compensation Information. The table below summarizes the expense recognized and the value of vesting (settled both in units and cash) related to our equity-indexed compensation plans and includes both liability-classified and equity-classified awards (in millions): | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Equity-indexed compensation expense | $ | 34 | $ | 27 | $ | 68 | $ | 78 | ||||||
LTIP unit-settled vestings | $ | 44 | $ | 46 | $ | 51 | $ | 46 | ||||||
LTIP cash-settled vestings | $ | 51 | $ | 60 | $ | 52 | $ | 60 | ||||||
DER cash payments | $ | 2 | $ | 2 | $ | 4 | $ | 4 | ||||||
Derivatives_and_Risk_Managemen
Derivatives and Risk Management Activities | 6 Months Ended | ||||||||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||||||||
Derivatives and Risk Management Activities | ' | ||||||||||||||||||||||||||
Derivatives and Risk Management Activities | ' | ||||||||||||||||||||||||||
Note 10—Derivatives and Risk Management Activities | |||||||||||||||||||||||||||
We identify the risks that underlie our core business activities and use risk management strategies to mitigate those risks when we determine that there is value in doing so. Our policy is to use derivative instruments for risk management purposes and not for the purpose of speculating on hydrocarbon commodity (referred to herein as “commodity”) price changes. 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 commodity risk management policies and procedures are designed to help ensure that our hedging activities address our risks by monitoring our derivative positions, as well as physical volumes, grades, locations, delivery schedules and storage capacity. Our interest rate and currency exchange rate risk management policies and procedures are designed to monitor our derivative positions and ensure that those positions are consistent with our objectives and approved strategies. When we apply hedge accounting, our policy is to formally document all relationships between hedging instruments and hedged items, as well as our risk management objectives for undertaking the hedge. This process includes specific identification of the hedging instrument and the hedged transaction, the nature of the risk being hedged and how the hedging instrument’s 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. | |||||||||||||||||||||||||||
Commodity Price Risk Hedging | |||||||||||||||||||||||||||
Our core business activities involve certain commodity price-related risks that we manage in various ways, including through the use of derivative instruments. Our policy is to (i) only purchase inventory for which we have a market, (ii) structure our sales contracts so that price fluctuations do not materially affect our operating income and (iii) not acquire and hold physical inventory or derivatives for the purpose of speculating on commodity price changes. The material commodity-related risks inherent in our business activities can be divided into the following general categories: | |||||||||||||||||||||||||||
Commodity Purchases and Sales — In the normal course of our operations, we purchase and sell commodities. We use derivatives to manage the associated risks and to optimize profits. As of June 30, 2014, net derivative positions related to these activities included: | |||||||||||||||||||||||||||
· An average of 210,100 barrels per day net long position (total of 6.5 million barrels) associated with our crude oil purchases, which was unwound ratably during July 2014 to match monthly average pricing. | |||||||||||||||||||||||||||
· A net short spread position averaging approximately 21,300 barrels per day (total of 14.3 million barrels), which hedges a portion of our anticipated crude oil lease gathering purchases through June 2016. These derivatives are time spreads consisting of offsetting purchases and sales between two different months. Our use of these derivatives does not expose us to outright price risk. | |||||||||||||||||||||||||||
· An average of 2,800 barrels per day (total of 0.8 million barrels) of butane/WTI spread positions, which hedge specific butane sales contracts that are priced as a percentage of WTI through March 2015. | |||||||||||||||||||||||||||
· An average of 19,300 barrels per day (total of 1.8 million barrels) of WTI/Brent crude oil grade spread positions through September 2014. These derivatives allow us to lock in grade basis differentials where we are hedging anticipated purchases of crude oil based on a WTI index and hedging anticipated sales of crude oil based on a Brent index. Our use of these derivatives does not expose us to outright price risk. | |||||||||||||||||||||||||||
· A long position of approximately 4.1 Bcf through April 2016 related to anticipated base gas requirements. | |||||||||||||||||||||||||||
· A short position of approximately 10.7 Bcf through February 2015 related to anticipated sales of natural gas inventory. | |||||||||||||||||||||||||||
· A net short position of approximately 7.6 million barrels through December 2015 related to the anticipated sales of our crude oil, NGL and refined products inventory. | |||||||||||||||||||||||||||
Pipeline Loss Allowance Oil — As is common in the pipeline transportation industry, our tariffs incorporate a loss allowance factor that is intended to offset losses due to evaporation, measurement and other losses in transit. We utilize derivative instruments to hedge a portion of the anticipated sales of the allowance oil that is to be collected under our tariffs. As of June 30, 2014, our PLA hedges included a net short position for an average of approximately 1,600 barrels per day (total of 1.5 million barrels) through December 2016 and a long call option position of approximately 0.7 million barrels through December 2016. | |||||||||||||||||||||||||||
Natural Gas Processing/NGL Fractionation — As part of our supply and logistics activities, we purchase natural gas for processing and NGL mix for fractionation, and we sell the resulting individual specification products (including ethane, propane, butane and condensate). In conjunction with these activities, we hedge the price risk associated with the purchase of the natural gas and the subsequent sale of the individual specification products. As of June 30, 2014, we had a long natural gas position of approximately 31.3 Bcf through December 2016, a short propane position of approximately 5.2 million barrels through December 2016, a short butane position of approximately 1.5 million barrels through December 2016 and a short WTI position of approximately 0.6 million barrels through December 2016. In addition, we had a long power position of 0.6 million megawatt hours which hedges a portion of our power supply requirements at our natural gas processing and fractionation plants through December 2016. | |||||||||||||||||||||||||||
To the extent they qualify and we decide to make the election, all of our commodity derivatives where we elect hedge accounting are designated as cash flow hedges. We have determined that substantially all of our physical purchase and sale agreements qualify for the normal purchase normal sale scope exception. Physical commodity contracts that meet the definition of a derivative but are ineligible, or not designated, for the normal purchase normal sale scope exception are recorded on the balance sheet at fair value, with changes in fair value recognized in earnings. | |||||||||||||||||||||||||||
Interest Rate Risk Hedging | |||||||||||||||||||||||||||
We use interest rate derivatives to hedge interest rate risk associated with anticipated debt issuances and outstanding debt instruments. The derivative instruments we use to manage this risk consist primarily of interest rate swaps and treasury locks. As of June 30, 2014, AOCI includes deferred losses of approximately $101 million that relate to open and terminated interest rate derivatives that were designated for hedge accounting. The terminated interest rate derivatives were cash-settled in connection with the issuance or refinancing of debt agreements. The deferred loss related to these instruments is being amortized to interest expense over the terms of the hedged debt instruments. | |||||||||||||||||||||||||||
We have entered into forward starting interest rate swaps to hedge the underlying benchmark interest rate related to forecasted debt issuances through 2015. The following table summarizes the terms of our forward starting interest rate swaps as of June 30, 2014 (notional amounts in millions): | |||||||||||||||||||||||||||
Hedged Transaction | Number and Types of | Notional | Expected | Average Rate | Accounting | ||||||||||||||||||||||
Derivatives Employed | Amount | Termination Date | Locked | Treatment | |||||||||||||||||||||||
Anticipated debt offering | 10 forward starting swaps (30-year) | $ | 250 | 6/15/15 | 3.60% | Cash flow hedge | |||||||||||||||||||||
In anticipation of our April 2014 issuance of senior notes, we entered into an aggregate of five treasury lock agreements in March and April 2014 for a combined notional amount of $250 million at a locked in rate of 3.64%. The treasury locks were designated as cash flow hedges, thus, changes in fair value are deferred in AOCI. In connection with our April 2014 senior notes issuance, these treasury locks were terminated prior to maturity for an aggregate cash payment of approximately $7 million. The effective portion of the treasury locks was deferred in AOCI and amortized to interest expense over the life of the senior notes. | |||||||||||||||||||||||||||
Currency Exchange Rate Risk Hedging | |||||||||||||||||||||||||||
Because a significant portion of our Canadian business is conducted in CAD and, at times, a portion of our debt is denominated in CAD, we use foreign currency derivatives to minimize the risks of unfavorable changes in exchange rates. These instruments include foreign currency exchange contracts and forwards. | |||||||||||||||||||||||||||
As of June 30, 2014, our outstanding foreign currency derivatives include derivatives we use to (i) hedge currency exchange risk associated with USD-denominated commodity purchases and sales in Canada and (ii) hedge currency exchange risk created by the use of USD-denominated commodity derivatives to hedge commodity price risk associated with CAD-denominated commodity purchases and sales. | |||||||||||||||||||||||||||
The following table summarizes our open forward exchange contracts as of June 30, 2014 (in millions): | |||||||||||||||||||||||||||
USD | CAD | Average Exchange Rate USD | |||||||||||||||||||||||||
to CAD | |||||||||||||||||||||||||||
Forward exchange contracts that exchange CAD for USD: | |||||||||||||||||||||||||||
2014 | $ | 273 | $ | 292 | $1.00 - $1.07 | ||||||||||||||||||||||
2015 | 77 | 82 | $1.00 - $1.07 | ||||||||||||||||||||||||
$ | 350 | $ | 374 | $1.00 - $1.07 | |||||||||||||||||||||||
Forward exchange contracts that exchange USD for CAD: | |||||||||||||||||||||||||||
2014 | $ | 273 | $ | 297 | $1.00 - $1.09 | ||||||||||||||||||||||
2015 | 77 | 84 | $1.00 - $1.09 | ||||||||||||||||||||||||
$ | 350 | $ | 381 | $1.00 - $1.09 | |||||||||||||||||||||||
Net position by currency: | |||||||||||||||||||||||||||
2014 | $ | — | $ | (5 | ) | ||||||||||||||||||||||
2015 | — | (2 | ) | ||||||||||||||||||||||||
$ | — | $ | (7 | ) | |||||||||||||||||||||||
Summary of Financial Impact | |||||||||||||||||||||||||||
We record all open derivatives on the balance sheet as either assets or liabilities measured at fair value. Changes in the fair value of derivatives are recognized currently in earnings unless specific hedge accounting criteria are met. For derivatives that qualify as cash flow hedges, changes in fair value of the effective portion of the hedges are deferred in AOCI and recognized in earnings in the periods during which the underlying physical transactions are recognized in earnings. Derivatives that do not qualify for hedge accounting and the portion of cash flow hedges that are not highly effective in offsetting changes in cash flows of the hedged items are recognized in earnings each period. Cash settlements associated with our derivative activities are reflected as cash flows from operating activities in our condensed consolidated statements of cash flows. | |||||||||||||||||||||||||||
A summary of the impact of our derivative activities recognized in earnings for the three and six months ended June 30, 2014 and 2013 is as follows (in millions): | |||||||||||||||||||||||||||
Three Months Ended June 30, 2014 | Three Months Ended June 30, 2013 | ||||||||||||||||||||||||||
Derivatives in Hedging | Derivatives in Hedging | ||||||||||||||||||||||||||
Relationships | Relationships | ||||||||||||||||||||||||||
Location of gain/(loss) | Gain/(loss) | Other | Derivatives | Total | Gain/(loss) | Other | Derivatives | Total | |||||||||||||||||||
reclassified | gain/(loss) | Not | reclassified | gain/(loss) | Not | ||||||||||||||||||||||
from | recognized | Designated | from | recognized | Designated | ||||||||||||||||||||||
AOCI into | in income | as a | AOCI into | in income | as a | ||||||||||||||||||||||
income | Hedge | income (1) | Hedge | ||||||||||||||||||||||||
Commodity Derivatives | |||||||||||||||||||||||||||
Supply and Logistics segment revenues | $ | 12 | $ | — | $ | — | $ | 12 | $ | 21 | $ | — | $ | 21 | $ | 42 | |||||||||||
Facilities segment revenues | — | — | — | — | (9 | ) | — | — | (9 | ) | |||||||||||||||||
Field operating costs | — | — | — | — | — | — | 4 | 4 | |||||||||||||||||||
Interest Rate Derivatives | |||||||||||||||||||||||||||
Interest expense | (1 | ) | — | — | (1 | ) | (2 | ) | — | — | (2 | ) | |||||||||||||||
Foreign Currency Derivatives | |||||||||||||||||||||||||||
Supply and Logistics segment revenues | — | — | 9 | 9 | — | — | — | — | |||||||||||||||||||
Other income/(expense), net | — | — | — | — | 1 | — | — | 1 | |||||||||||||||||||
Total Gain/(Loss) on Derivatives Recognized in Net Income | $ | 11 | $ | — | $ | 9 | $ | 20 | $ | 11 | $ | — | $ | 25 | $ | 36 | |||||||||||
Six Months Ended June 30, 2014 | Six Months Ended June 30, 2013 | ||||||||||||||||||||||||||
Derivatives in Hedging | Derivatives in Hedging | ||||||||||||||||||||||||||
Relationships | Relationships | ||||||||||||||||||||||||||
Location of gain/(loss) | Gain/(loss) | Other | Derivatives | Total | Gain/(loss) | Other | Derivatives | Total | |||||||||||||||||||
reclassified | gain/(loss) | Not | reclassified | gain/(loss) | Not | ||||||||||||||||||||||
from | recognized | Designated | from | recognized | Designated | ||||||||||||||||||||||
AOCI into | in income | as a | AOCI into | in income | as a | ||||||||||||||||||||||
income | Hedge | income (1) | Hedge | ||||||||||||||||||||||||
Commodity Derivatives | |||||||||||||||||||||||||||
Supply and Logistics segment revenues | $ | (8 | ) | $ | — | $ | — | $ | (8 | ) | $ | 29 | $ | — | $ | 59 | $ | 88 | |||||||||
Facilities segment revenues | — | — | — | — | (12 | ) | — | — | (12 | ) | |||||||||||||||||
Field operating costs | — | — | (1 | ) | (1 | ) | — | — | 5 | 5 | |||||||||||||||||
Interest Rate Derivatives | |||||||||||||||||||||||||||
Interest expense | (2 | ) | — | — | (2 | ) | (3 | ) | — | — | (3 | ) | |||||||||||||||
Foreign Currency Derivatives | |||||||||||||||||||||||||||
Other income/(expense), net | — | — | — | — | 2 | — | — | 2 | |||||||||||||||||||
Total Gain/(Loss) on Derivatives Recognized in Net Income | $ | (10 | ) | $ | — | $ | (1 | ) | $ | (11 | ) | $ | 16 | $ | — | $ | 64 | $ | 80 | ||||||||
(1) During the three months ended June 30, 2013 we reclassified gains of approximately $1 million and $1 million from AOCI to Supply and Logistics segment revenues and Facilities segment revenues, respectively, as a result of anticipated hedged transactions that are probable of not occurring. During the six months ended June 30, 2013, we reclassified gains of approximately $3 million and $1 million from AOCI to Supply and Logistics segment revenues and Facilities segment revenues, respectively, as a result of anticipated hedged transactions that are probable of not occurring. During the three and six months ended June 30, 2014, all of our hedged transactions were probable of occurring. | |||||||||||||||||||||||||||
The following table summarizes the derivative assets and liabilities on our condensed consolidated balance sheet on a gross basis as of June 30, 2014 (in millions): | |||||||||||||||||||||||||||
Asset Derivatives | Liability Derivatives | ||||||||||||||||||||||||||
Balance Sheet | Balance Sheet | ||||||||||||||||||||||||||
Location | Fair Value | Location | Fair Value | ||||||||||||||||||||||||
Derivatives designated as hedging instruments: | |||||||||||||||||||||||||||
Commodity derivatives | Other current assets | $ | 7 | Other current assets | $ | (4 | ) | ||||||||||||||||||||
Other long-term assets | 1 | ||||||||||||||||||||||||||
Interest rate derivatives | Other current assets | 1 | Other current liabilities | (8 | ) | ||||||||||||||||||||||
Total derivatives designated as hedging instruments | $ | 9 | $ | (12 | ) | ||||||||||||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||||||||
Commodity derivatives | Other current assets | $ | 76 | Other current assets | $ | (56 | ) | ||||||||||||||||||||
Other long-term assets | 2 | Other long-term assets | (1 | ) | |||||||||||||||||||||||
Other long-term liabilities | 1 | Other current liabilities | (1 | ) | |||||||||||||||||||||||
Other long-term liabilities | (5 | ) | |||||||||||||||||||||||||
Foreign currency derivatives | Other current assets | 6 | |||||||||||||||||||||||||
Total derivatives not designated as hedging instruments | $ | 85 | $ | (63 | ) | ||||||||||||||||||||||
Total derivatives | $ | 94 | $ | (75 | ) | ||||||||||||||||||||||
The following table summarizes the derivative assets and liabilities on our condensed consolidated balance sheet on a gross basis as of December 31, 2013 (in millions): | |||||||||||||||||||||||||||
Asset Derivatives | Liability Derivatives | ||||||||||||||||||||||||||
Balance Sheet | Balance Sheet | ||||||||||||||||||||||||||
Location | Fair Value | Location | Fair Value | ||||||||||||||||||||||||
Derivatives designated as hedging instruments: | |||||||||||||||||||||||||||
Commodity derivatives | Other current assets | $ | 36 | Other current assets | $ | (24 | ) | ||||||||||||||||||||
Other long-term assets | 5 | ||||||||||||||||||||||||||
Interest rate derivatives | Other long-term assets | 26 | |||||||||||||||||||||||||
Total derivatives designated as hedging instruments | $ | 67 | $ | (24 | ) | ||||||||||||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||||||||
Commodity derivatives | Other current assets | $ | 60 | Other current assets | $ | (117 | ) | ||||||||||||||||||||
Other long-term assets | 5 | Other long-term assets | (6 | ) | |||||||||||||||||||||||
Other current liabilities | 1 | Other current liabilities | (5 | ) | |||||||||||||||||||||||
Other long-term liabilities | (1 | ) | |||||||||||||||||||||||||
Foreign currency derivatives | Other current liabilities | (4 | ) | ||||||||||||||||||||||||
Total derivatives not designated as hedging instruments | $ | 66 | $ | (133 | ) | ||||||||||||||||||||||
Total derivatives | $ | 133 | $ | (157 | ) | ||||||||||||||||||||||
Our derivative transactions are governed through ISDA (International Swaps and Derivatives Association) master agreements and clearing brokerage agreements. These agreements include stipulations regarding the right of set off in the event that we or our counterparty default on our performance obligations. If a default were to occur, both parties have the right to net amounts payable and receivable into a single net settlement between parties. | |||||||||||||||||||||||||||
Our accounting policy is to offset derivative assets and liabilities executed with the same counterparty when a master netting arrangement exists. Accordingly, we also offset derivative assets and liabilities with amounts associated with cash margin. Our exchange-traded derivatives are transacted through clearing brokerage accounts and are subject to margin requirements as established by the respective exchange. On a daily basis, our account equity (consisting of the sum of our cash balance and the fair value of our open derivatives) is compared to our initial margin requirement resulting in the payment or return of variation margin. As of June 30, 2014, we had a net broker receivable of approximately $66 million (consisting of initial margin of $54 million increased by $12 million of variation margin that had been posted by us). As of December 31, 2013, we had a net broker receivable of approximately $161 million (consisting of initial margin of $85 million increased by $76 million of variation margin that had been posted by us). | |||||||||||||||||||||||||||
The following tables present information about derivatives and financial assets and liabilities that are subject to offsetting, including enforceable master netting arrangements at June 30, 2014 and December 31, 2013 (in millions): | |||||||||||||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||||||||||||
Derivative | Derivative | Derivative | Derivative | ||||||||||||||||||||||||
Asset Positions | Liability Positions | Asset Positions | Liability Positions | ||||||||||||||||||||||||
Netting Adjustments: | |||||||||||||||||||||||||||
Gross position - asset/(liability) | $ | 94 | $ | (75 | ) | $ | 133 | $ | (157 | ) | |||||||||||||||||
Netting adjustment | (62 | ) | 62 | (148 | ) | 148 | |||||||||||||||||||||
Cash collateral paid/(received) | 66 | — | 161 | — | |||||||||||||||||||||||
Net position - asset/(liability) | $ | 98 | $ | (13 | ) | $ | 146 | $ | (9 | ) | |||||||||||||||||
Balance Sheet Location After Netting Adjustments: | |||||||||||||||||||||||||||
Other current assets | $ | 96 | $ | — | $ | 116 | $ | — | |||||||||||||||||||
Other long-term assets | 2 | — | 30 | — | |||||||||||||||||||||||
Other current liabilities | — | (9 | ) | — | (8 | ) | |||||||||||||||||||||
Other long-term liabilities | — | (4 | ) | — | (1 | ) | |||||||||||||||||||||
$ | 98 | $ | (13 | ) | $ | 146 | $ | (9 | ) | ||||||||||||||||||
As of June 30, 2014, there was a net loss of approximately $118 million deferred in AOCI including tax effects. The deferred net loss recorded in AOCI is expected to be reclassified to future earnings contemporaneously with (i) the earnings recognition of the underlying hedged commodity transaction or (ii) interest expense accruals associated with underlying debt instruments. Of the total net loss deferred in AOCI at June 30, 2014, we expect to reclassify a net loss of approximately $4 million to earnings in the next twelve months. The remaining deferred loss of approximately $114 million is expected to be reclassified to earnings through 2045. A portion of these amounts are based on market prices as of June 30, 2014; thus, actual amounts to be reclassified will differ and could vary materially as a result of changes in market conditions. | |||||||||||||||||||||||||||
The net deferred gain/(loss), including tax effects, recognized in AOCI for derivatives for the three and six months ended June 30, 2014 and 2013 are as follows (in millions): | |||||||||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||
Commodity derivatives, net | $ | — | $ | 3 | $ | (12 | ) | $ | 11 | ||||||||||||||||||
Interest rate derivatives, net | (19 | ) | 32 | (39 | ) | 51 | |||||||||||||||||||||
Total | $ | (19 | ) | $ | 35 | $ | (51 | ) | $ | 62 | |||||||||||||||||
At June 30, 2014 and December 31, 2013, none of our outstanding derivatives contained credit-risk related contingent features that would result in a material adverse impact to us upon any change in our credit ratings. Although we may be required to post margin on our cleared derivatives as described above, we do not require our non-cleared derivative counterparties to post collateral with us. | |||||||||||||||||||||||||||
Recurring Fair Value Measurements | |||||||||||||||||||||||||||
Derivative Financial Assets and Liabilities | |||||||||||||||||||||||||||
The following table sets forth by level within the fair value hierarchy our financial assets and liabilities that were accounted for at fair value on a recurring basis as of June 30, 2014 and December 31, 2013 (in millions): | |||||||||||||||||||||||||||
Fair Value as of June 30, 2014 | Fair Value as of December 31, 2013 | ||||||||||||||||||||||||||
Recurring Fair Value Measures (1) | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||
Commodity derivatives | $ | 28 | $ | (9 | ) | $ | 1 | $ | 20 | $ | 16 | $ | (59 | ) | $ | (3 | ) | $ | (46 | ) | |||||||
Interest rate derivatives | — | (7 | ) | — | (7 | ) | — | 26 | — | 26 | |||||||||||||||||
Foreign currency derivatives | — | 6 | — | 6 | — | (4 | ) | — | (4 | ) | |||||||||||||||||
Total net derivative asset/(liability) | $ | 28 | $ | (10 | ) | $ | 1 | $ | 19 | $ | 16 | $ | (37 | ) | $ | (3 | ) | $ | (24 | ) | |||||||
(1) Derivative assets and liabilities are presented above on a net basis but do not include related cash margin deposits. | |||||||||||||||||||||||||||
Level 1 | |||||||||||||||||||||||||||
Level 1 of the fair value hierarchy includes exchange-traded commodity derivatives such as futures and options. The fair value of exchange-traded commodity derivatives is based on unadjusted quoted prices in active markets. | |||||||||||||||||||||||||||
Level 2 | |||||||||||||||||||||||||||
Level 2 of the fair value hierarchy includes exchange-cleared commodity derivatives and over-the-counter commodity, interest rate and foreign currency derivatives that are traded in active markets. In addition, it includes certain physical commodity contracts. The fair value of these derivatives is based on broker price quotations which are corroborated with market observable inputs. | |||||||||||||||||||||||||||
Level 3 | |||||||||||||||||||||||||||
Level 3 of the fair value hierarchy includes certain physical commodity contracts. The fair value of our level 3 physical commodity contracts is based on a valuation model utilizing broker-quoted forward commodity prices, and timing estimates, which involve management judgment. The significant unobservable inputs used in the fair value measurement of our level 3 derivatives are forward prices obtained from brokers. A significant increase or decrease in these forward prices could result in a material change in fair value to our level 3 derivatives. | |||||||||||||||||||||||||||
Rollforward of Level 3 Net Asset | |||||||||||||||||||||||||||
The following table provides a reconciliation of changes in fair value of the beginning and ending balances for our derivatives classified as level 3 (in millions): | |||||||||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||
Beginning Balance | $ | 1 | $ | 1 | $ | (3 | ) | $ | 4 | ||||||||||||||||||
Unrealized gains/(losses): | |||||||||||||||||||||||||||
Included in earnings (1) | — | 1 | — | 1 | |||||||||||||||||||||||
Included in other comprehensive income | — | — | — | — | |||||||||||||||||||||||
Settlements | — | — | 3 | (3 | ) | ||||||||||||||||||||||
Derivatives entered into during the period | — | 2 | 1 | 2 | |||||||||||||||||||||||
Transfers out of level 3 | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | 1 | $ | 4 | $ | 1 | $ | 4 | |||||||||||||||||||
Change in unrealized gains/(losses) included in earnings relating to level 3 derivatives still held at the end of the periods | $ | 1 | $ | 3 | $ | 1 | $ | 3 | |||||||||||||||||||
(1) We reported unrealized gains and losses associated with level 3 commodity derivatives in our condensed consolidated statements of operations as Supply and Logistics segment revenues. | |||||||||||||||||||||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2014 | |
Commitments and Contingencies. | ' |
Commitments and Contingencies | ' |
Note 11—Commitments and Contingencies | |
Litigation | |
General. In the ordinary course of business, we are involved in various legal proceedings. To the extent we are able to assess the likelihood of a negative outcome for these proceedings, our assessments of such likelihood range from remote to probable. If we determine that a negative outcome is probable and the amount of loss is reasonably estimable, we accrue the estimated amount. We do not believe that the outcome of these legal proceedings, individually or in the aggregate, will have a material adverse effect on our financial condition, results of operations or cash flows. Although we believe that our operations are presently in material compliance with applicable requirements, as we acquire and incorporate additional assets it is possible that the EPA or other governmental entities may seek to impose fines, penalties or performance obligations on us (or on a portion of our operations) as a result of any past noncompliance whether such noncompliance initially developed before or after our acquisition. | |
Pemex Exploración y Producción v. Big Star Gathering Ltd L.L.P. et al (the “Big Star Lawsuit”) and Pemex Exploración y Producción v. Murphy Energy et al (the “Murphy Lawsuit”). In two cases filed in the Texas Southern District Court in May 2011 and April 2012, Pemex Exploración y Producción (“PEP”) alleges that certain parties stole condensate from pipelines and gathering stations and conspired with U.S. companies (primarily in Texas) to import and market the stolen condensate. PEP does not allege that Plains was part of any conspiracy, but that it dealt in the condensate only after it had been obtained by others and resold to Plains Marketing, L.P. PEP seeks actual damages, attorney’s fees, and statutory penalties from Plains Marketing, L.P. In February 2013, the Court granted Plains Marketing, L.P.’s motion to be dismissed from the Murphy Lawsuit. In October 2013, the Court issued an order in the Big Star Lawsuit granting summary judgment in favor of Plains Marketing, L.P. with respect to all of PEP’s remaining claims against Plains Marketing, L.P. In February 2014, the Court affirmed its order granting summary judgment in favor of Plains Marketing, L.P. in the Big Star Lawsuit, denied PEP’s motion for reconsideration, severed the case against Plains from the other defendants and issued a final judgment dismissing all claims against Plains. The time for PEP to appeal the final judgment in both cases has lapsed. Plains’ motion to sever Plains from the remainder of the defendants in the Murphy Lawsuit in order to obtain a final judgment has been granted. | |
In the Matter of Rancho LPG Holdings LLC, Respondent. In May 2014, Rancho LPG Holdings LLC (“Rancho”), a wholly owned subsidiary of PAA, entered into a Consent Agreement and Final Order (“Consent Agreement”) with the EPA regarding alleged violations of certain risk management plan regulations under the federal Clean Air Act at Rancho’s LPG storage facility in San Pedro, California. The allegations, which Rancho disputed, arose from inspections of the facility by the EPA during 2010 and 2011. Pursuant to the Consent Agreement, Rancho agreed to pay a civil penalty of $260,000; however, no injunctive relief was sought by the EPA. Further, the Rancho facility was determined, as of the date of the Consent Agreement, to be in full compliance with the regulations that were the subject of the alleged violations. | |
Environmental | |
General. Although we believe that our efforts to enhance our leak prevention and detection capabilities have produced positive results, we have experienced (and likely will experience future) releases of hydrocarbon products into the environment from our pipeline, rail and storage operations. These releases can result from unpredictable man-made or natural forces and may reach surface water bodies, groundwater aquifers or other sensitive environments. Whether current or past, damages and liabilities associated with any such releases from our assets may substantially affect our business. | |
At June 30, 2014, our estimated undiscounted reserve for environmental liabilities totaled approximately $92 million, of which approximately $13 million was classified as short-term and approximately $79 million was classified as long-term. At December 31, 2013, our estimated undiscounted reserve for environmental liabilities totaled approximately $93 million, of which approximately $11 million was classified as short-term and approximately $82 million was classified as long-term. The short- and long-term environmental liabilities referenced above are reflected in “Accounts payable and accrued liabilities” and “Other long-term liabilities and deferred credits,” respectively, on our condensed consolidated balance sheets. At June 30, 2014 and December 31, 2013, we had recorded receivables totaling approximately $8 million and $10 million, respectively, for amounts probable of recovery under insurance and from third parties under indemnification agreements, which are predominantly reflected in “Trade accounts receivable and other receivables, net” on our condensed consolidated balance sheets. | |
In some cases, the actual cash expenditures may not occur for three years or longer. Our estimates used in these reserves are based on information currently available to us and our assessment of the ultimate outcome. Among the many uncertainties that impact our estimates are the necessary regulatory approvals for, and potential modification of, our remediation plans, the limited amount of data available upon initial assessment of the impact of soil or water contamination, changes in costs associated with environmental remediation services and equipment and the possibility of existing legal claims giving rise to additional liabilities. Therefore, although we believe that the reserve is adequate, costs incurred may be in excess of the reserve and may potentially have a material adverse effect on our financial condition, results of operations or cash flows. | |
Rainbow Pipeline Release. During April 2011, we experienced a crude oil release of approximately 28,000 barrels of crude oil on a remote section of our Rainbow Pipeline located in Alberta, Canada. Since the release and through June 30, 2014, we spent approximately $70 million, before insurance recoveries, in connection with site clean-up, reclamation and remediation activities, and as of June 30, 2014, we did not have any material outstanding liabilities or insurance receivables relating to this release. On February 26, 2013, the Alberta Energy Regulator (“AER”) issued four enforcement actions against PMC for failure to comply with certain regulatory requirements in connection with the release, including requirements related to operations and maintenance procedures, leak detection and response, backfill and compaction procedures and emergency response plan testing. PMC has taken and continues to take appropriate actions necessary to respond to and comply with the enforcement actions set forth in the report, including the implementation of additional risk assessment procedures and other actions designed to minimize the risk that similar incidents occur in the future and enhance the effectiveness of PMC’s response to any such future incidents. In addition, on April 23, 2013, the Alberta Crown Prosecutor filed charges under the Alberta Environmental Protection and Enhancement Act against PMC relating to the release. PMC settled these charges in July 2014 for $450,000 CAD. | |
Rangeland Pipeline Release. During June 2012, we experienced a crude oil release on a section of our Rangeland Pipeline located near Sundre, Alberta, Canada. Approximately 3,000 barrels were released into the Red Deer River and were contained downstream in the Gleniffer Reservoir. Remediation activities in the reservoir area were completed by June 30, 2012, remediation of the remaining impacted areas of government-owned lands was completed by September 30, 2012 and interim closure, in respect of those lands, was received from the applicable regulatory agencies. A long-term monitoring plan has been developed and implemented in accordance with regulatory requirements. Through June 30, 2014, we spent approximately $47 million, before insurance recoveries, in connection with site clean-up, reclamation and remediation activities. On July 4, 2013, the AER issued four enforcement actions against PMC citing failure to inspect water crossings, failure to complete an engineering assessment to determine suitability of continued operation of the Rangeland Pipeline, failure to maintain updated emergency response plans, and failure to conduct regular public awareness programs. In addition, on May 30, 2014, the Alberta Crown Prosecutor and Public Prosecution Services of Canada filed charges under the Alberta Environmental Protection and Enhancement Act and Canadian Federal Fisheries Act against PMC relating to the release. PMC settled all of such charges in July 2014 for an aggregate of $850,000 CAD. | |
Bay Springs Pipeline Release. During February 2013, we experienced a crude oil release of approximately 120 barrels on a portion of one of our pipelines near Bay Springs, Mississippi. Most of the released oil was contained within our pipeline right of way, but some of the released oil entered a nearby waterway where it was contained with booms. The EPA has issued an administrative order requiring us to take various actions in response to the release, including remediation, reporting and other actions. We have satisfied the requirements of the administrative order; however, we may be subjected to a civil penalty. The aggregate cost to clean up and remediate the site was approximately $6 million. | |
Kemp River Pipeline Release. During May and June 2013, two separate releases were discovered on our Kemp River pipeline in Northern Alberta, Canada that, in the aggregate, resulted in the release of approximately 700 barrels of condensate and light crude oil. Clean-up and remediation activities are being conducted in cooperation with the applicable regulatory agencies. AER’s final investigation is not complete. To date, no charges, fines or penalties have been assessed against PMC with respect to these releases; however, it is possible that fines or penalties may be assessed against PMC in the future. We estimate that the aggregate clean-up and remediation costs associated with these releases will be approximately $15 million. Through June 30, 2014, we spent approximately $8 million in connection with clean-up and remediation activities. | |
Operating_Segments
Operating Segments | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Operating Segments | ' | |||||||||||||
Operating Segments | ' | |||||||||||||
Note 12—Operating Segments | ||||||||||||||
We manage our operations through three operating segments: (i) Transportation, (ii) Facilities and (iii) Supply and Logistics. Our Chief Operating Decision Maker (our Chief Executive Officer) evaluates segment performance based on measures including segment profit and maintenance capital investment. We define segment profit as revenues and equity earnings in unconsolidated entities less (i) purchases and related costs, (ii) field operating costs and (iii) segment general and administrative expenses. Each of the items above excludes depreciation and amortization. Maintenance capital consists of capital expenditures for the replacement of partially or fully depreciated assets in order to maintain the operating and/or earnings capacity of our existing assets. The following table reflects certain financial data for each segment for the periods indicated (in millions): | ||||||||||||||
Transportation | Facilities | Supply and Logistics | Total | |||||||||||
Three Months Ended June 30, 2014 | ||||||||||||||
Revenues (1): | ||||||||||||||
External Customers | $ | 195 | $ | 144 | $ | 10,856 | $ | 11,195 | ||||||
Intersegment (2) | 217 | 133 | 4 | 354 | ||||||||||
Total revenues of reportable segments | $ | 412 | $ | 277 | $ | 10,860 | $ | 11,549 | ||||||
Equity earnings in unconsolidated entities | $ | 23 | $ | — | $ | — | $ | 23 | ||||||
Segment profit (3) (4) | $ | 221 | $ | 134 | $ | 133 | $ | 488 | ||||||
Maintenance capital | $ | 42 | $ | 5 | $ | 1 | $ | 48 | ||||||
Three Months Ended June 30, 2013 | ||||||||||||||
Revenues: | ||||||||||||||
External Customers | $ | 165 | $ | 197 | $ | 9,933 | $ | 10,295 | ||||||
Intersegment (2) | 200 | 151 | 1 | 352 | ||||||||||
Total revenues of reportable segments | $ | 365 | $ | 348 | $ | 9,934 | $ | 10,647 | ||||||
Equity earnings in unconsolidated entities | $ | 11 | $ | — | $ | — | $ | 11 | ||||||
Segment profit (3) (4) | $ | 160 | $ | 149 | $ | 176 | $ | 485 | ||||||
Maintenance capital | $ | 23 | $ | 11 | $ | 5 | $ | 39 | ||||||
Transportation | Facilities | Supply and Logistics | Total | |||||||||||
Six Months Ended June 30, 2014 | ||||||||||||||
Revenues (1): | ||||||||||||||
External Customers | $ | 376 | $ | 301 | $ | 22,201 | $ | 22,878 | ||||||
Intersegment (2) | 422 | 275 | 27 | 724 | ||||||||||
Total revenues of reportable segments | $ | 798 | $ | 576 | $ | 22,228 | $ | 23,602 | ||||||
Equity earnings in unconsolidated entities | $ | 44 | $ | — | $ | — | $ | 44 | ||||||
Segment profit (3) (4) | $ | 427 | $ | 288 | $ | 382 | $ | 1,097 | ||||||
Maintenance capital | $ | 76 | $ | 15 | $ | 4 | $ | 95 | ||||||
Six Months Ended June 30, 2013 | ||||||||||||||
Revenues: | ||||||||||||||
External Customers | $ | 338 | $ | 420 | $ | 20,157 | $ | 20,915 | ||||||
Intersegment (2) | 394 | 283 | 1 | 678 | ||||||||||
Total revenues of reportable segments | $ | 732 | $ | 703 | $ | 20,158 | $ | 21,593 | ||||||
Equity earnings in unconsolidated entities | $ | 23 | $ | — | $ | — | $ | 23 | ||||||
Segment profit (3) (4) | $ | 323 | $ | 300 | $ | 610 | $ | 1,233 | ||||||
Maintenance capital | $ | 55 | $ | 18 | $ | 9 | $ | 82 | ||||||
(1) Effective January 1, 2014, our natural gas sales and costs, primarily attributable to the activities performed by our natural gas storage commercial optimization group, are reported in the Supply and Logistics segment. Such items were previously reported in the Facilities segment. | ||||||||||||||
(2) Segment revenues and purchases and related costs include intersegment amounts. Intersegment sales are conducted at posted tariff rates, rates similar to those charged to third parties or rates that we believe approximate market. For further discussion, see “Analysis of Operating Segments” under Item 7 of our 2013 Annual Report on Form 10-K. | ||||||||||||||
(3) Supply and Logistics segment profit includes interest expense (related to hedged inventory purchases) of approximately $5 million for each of the three months ended June 30, 2014 and 2013 and approximately $7 million and $10 million for the six months ended June 30, 2014 and 2013, respectively. | ||||||||||||||
(4) The following table reconciles segment profit to net income attributable to PAA (in millions): | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Segment profit | $ | 488 | $ | 485 | $ | 1,097 | $ | 1,233 | ||||||
Depreciation and amortization | (100 | ) | (91 | ) | (196 | ) | (173 | ) | ||||||
Interest expense, net | (82 | ) | (75 | ) | (161 | ) | (152 | ) | ||||||
Other income/(expense), net | 4 | (1 | ) | 2 | (1 | ) | ||||||||
Income before tax | 310 | 318 | 742 | 907 | ||||||||||
Income tax expense | (22 | ) | (18 | ) | (70 | ) | (70 | ) | ||||||
Net income | 288 | 300 | 672 | 837 | ||||||||||
Net income attributable to noncontrolling interests | (1 | ) | (8 | ) | (1 | ) | (16 | ) | ||||||
Net income attributable to PAA | $ | 287 | $ | 292 | $ | 671 | $ | 821 | ||||||
Related_Party_Transactions
Related Party Transactions | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Related Party Transactions | ' | |||||||||||||
Related Party Transactions | ' | |||||||||||||
Note 13—Related Party Transactions | ||||||||||||||
See Note 14 to our Consolidated Financial Statements included in Part IV of our 2013 Annual Report on Form 10-K for a complete discussion of our related party transactions. | ||||||||||||||
Occidental Petroleum Corporation | ||||||||||||||
As of June 30, 2014, a subsidiary of Occidental Petroleum Corporation (“Oxy”) owned approximately 25% of our general partner and had a representative on the board of directors of GP LLC. During the three and six months ended June 30, 2014 and 2013, we recognized sales and transportation revenues and purchased petroleum products from companies affiliated with Oxy. These transactions were conducted at posted tariff rates or prices that we believe approximate market. See detail below (in millions): | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Revenues | $ | 351 | $ | 424 | $ | 443 | $ | 694 | ||||||
Purchases and related costs | $ | 209 | $ | 214 | $ | 468 | $ | 375 | ||||||
We currently have a netting arrangement with Oxy. Our gross receivable and payable amounts with affiliates of Oxy were as follows (in millions): | ||||||||||||||
June 30, | December 31, | |||||||||||||
2014 | 2013 | |||||||||||||
Trade accounts receivable and other receivables | $ | 460 | $ | 133 | ||||||||||
Accounts payable | $ | 321 | $ | 181 | ||||||||||
Inventory_Linefill_and_Base_Ga1
Inventory, Linefill and Base Gas and Long-term Inventory (Tables) | 6 Months Ended | ||||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||||
Inventory, Linefill and Base Gas and Long-term Inventory | ' | ||||||||||||||||||||||
Components of inventory, linefill and base gas and long-term inventory | ' | ||||||||||||||||||||||
Inventory, linefill and base gas and long-term inventory consisted of the following as of the dates indicated (barrels and natural gas volumes in thousands and carrying value in millions): | |||||||||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||||||||
Unit of | Carrying | Price/ | Unit of | Carrying | Price/ | ||||||||||||||||||
Volumes | Measure | Value | Unit (1) | Volumes | Measure | Value | Unit (1) | ||||||||||||||||
Inventory | |||||||||||||||||||||||
Crude oil | 6,233 | barrels | $ | 579 | $ | 92.89 | 6,951 | barrels | $ | 540 | $ | 77.69 | |||||||||||
NGL | 10,591 | barrels | 444 | $ | 41.92 | 8,061 | barrels | 352 | $ | 43.67 | |||||||||||||
Natural gas | 10,824 | Mcf | 50 | $ | 4.62 | 40,505 | Mcf | 150 | $ | 3.7 | |||||||||||||
Other | N/A | 23 | N/A | N/A | 23 | N/A | |||||||||||||||||
Inventory subtotal | 1,096 | 1,065 | |||||||||||||||||||||
Linefill and base gas | |||||||||||||||||||||||
Crude oil | 11,211 | barrels | 713 | $ | 63.6 | 10,966 | barrels | 679 | $ | 61.92 | |||||||||||||
NGL | 1,214 | barrels | 56 | $ | 46.13 | 1,341 | barrels | 62 | $ | 46.23 | |||||||||||||
Natural gas | 26,612 | Mcf | 126 | $ | 4.73 | 16,615 | Mcf | 57 | $ | 3.43 | |||||||||||||
Linefill and base gas subtotal | 895 | 798 | |||||||||||||||||||||
Long-term inventory | |||||||||||||||||||||||
Crude oil | 2,712 | barrels | 220 | $ | 81.12 | 2,498 | barrels | 202 | $ | 80.86 | |||||||||||||
NGL | 1,681 | barrels | 67 | $ | 39.86 | 1,161 | barrels | 49 | $ | 42.2 | |||||||||||||
Long-term inventory subtotal | 287 | 251 | |||||||||||||||||||||
Total | $ | 2,278 | $ | 2,114 | |||||||||||||||||||
(1) Price per unit of measure represents a weighted average associated with various grades, qualities and locations. Accordingly, these prices may not coincide with any published benchmarks for such products. | |||||||||||||||||||||||
Goodwill_Tables
Goodwill (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Goodwill | ' | |||||||||||||
Schedule of goodwill by segment and changes during the period | ' | |||||||||||||
The table below reflects our goodwill by segment and changes during the period indicated (in millions): | ||||||||||||||
Transportation | Facilities | Supply and Logistics | Total | |||||||||||
Balance at December 31, 2013 | $ | 878 | $ | 1,162 | $ | 463 | $ | 2,503 | ||||||
Foreign currency translation adjustments | (1 | ) | — | — | (1 | ) | ||||||||
Balance at June 30, 2014 | $ | 877 | $ | 1,162 | $ | 463 | $ | 2,502 | ||||||
Debt_Tables
Debt (Tables) | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Debt | ' | |||||||
Components of debt | ' | |||||||
Debt consisted of the following as of the dates indicated (in millions): | ||||||||
June 30, | December 31, | |||||||
2014 | 2013 | |||||||
SHORT-TERM DEBT | ||||||||
PAA commercial paper notes, bearing a weighted-average interest rate of 0.29% and 0.33%, respectively (1) | $ | 760 | $ | 1,109 | ||||
Other | 3 | 4 | ||||||
Total short-term debt | 763 | 1,113 | ||||||
LONG-TERM DEBT | ||||||||
Senior notes, net of unamortized discounts of $16 and $15, respectively (2) | 7,409 | 6,710 | ||||||
Other | 5 | 5 | ||||||
Total long-term debt | 7,414 | 6,715 | ||||||
Total debt (3) | $ | 8,177 | $ | 7,828 | ||||
(1) PAA commercial paper notes are backstopped by the PAA senior unsecured revolving credit facility and the PAA senior secured hedged inventory facility, which mature in August 2018 and August 2016, respectively; as such, any borrowings under the PAA commercial paper program reduce the available capacity under these facilities. At June 30, 2014 and December 31, 2013, we classified $760 million and $1.1 billion, respectively, of borrowings under our commercial paper program as short-term. These borrowings are primarily designated as working capital borrowings, must be repaid within one year and are primarily for hedged NGL and crude oil inventory and NYMEX and ICE margin deposits. | ||||||||
(2) As of June 30, 2014, we have classified our $150 million, 5.25% senior notes due June 2015 as long-term based on our ability and intent to refinance them on a long-term basis. | ||||||||
(3) Our fixed-rate senior notes had a face value of approximately $7.4 billion and $6.7 billion at June 30, 2014 and December 31, 2013, respectively. We estimated the aggregate fair value of these notes as of June 30, 2014 and December 31, 2013 to be approximately $8.2 billion and $7.2 billion, respectively. Our fixed-rate senior notes are traded among institutions, and these trades are routinely published by a reporting service. Our determination of fair value is based on reported trading activity near quarter end. We estimate that the carrying value of outstanding borrowings under our credit facilities and agreements and commercial paper program approximates fair value as interest rates reflect current market rates. The fair value estimates for both our senior notes and credit facilities are based upon observable market data and are classified within Level 2 of the fair value hierarchy. See Note 10 for additional discussion of the fair value hierarchy. | ||||||||
Net_Income_Per_Limited_Partner1
Net Income Per Limited Partner Unit (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Net Income Per Limited Partner Unit | ' | |||||||||||||
Computation of basic and diluted earnings per limited partner unit | ' | |||||||||||||
The following table sets forth the computation of basic and diluted earnings per limited partner unit for the three and six months ended June 30, 2014 and 2013 (in millions, except per unit data): | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Basic Net Income per Limited Partner Unit | ||||||||||||||
Net income attributable to PAA | $ | 287 | $ | 292 | $ | 671 | $ | 821 | ||||||
Less: General partner’s incentive distribution (1) | (117 | ) | (91 | ) | (227 | ) | (177 | ) | ||||||
Less: General partner 2% ownership (1) | (4 | ) | (4 | ) | (9 | ) | (13 | ) | ||||||
Net income available to limited partners | 166 | 197 | 435 | 631 | ||||||||||
Less: Undistributed earnings allocated and distributions to participating securities (1) | (1 | ) | (1 | ) | (3 | ) | (5 | ) | ||||||
Net income available to limited partners in accordance with application of the two-class method for MLPs | $ | 165 | $ | 196 | $ | 432 | $ | 626 | ||||||
Basic weighted average number of limited partner units outstanding | 365 | 340 | 363 | 338 | ||||||||||
Basic net income per limited partner unit | $ | 0.45 | $ | 0.58 | $ | 1.19 | $ | 1.85 | ||||||
Diluted Net Income per Limited Partner Unit | ||||||||||||||
Net income attributable to PAA | $ | 287 | $ | 292 | $ | 671 | $ | 821 | ||||||
Less: General partner’s incentive distribution (1) | (117 | ) | (91 | ) | (227 | ) | (177 | ) | ||||||
Less: General partner 2% ownership (1) | (4 | ) | (4 | ) | (9 | ) | (13 | ) | ||||||
Net income available to limited partners | 166 | 197 | 435 | 631 | ||||||||||
Less: Undistributed earnings allocated and distributions to participating securities (1) | (1 | ) | (1 | ) | (3 | ) | (3 | ) | ||||||
Net income available to limited partners in accordance with application of the two-class method for MLPs | $ | 165 | $ | 196 | $ | 432 | $ | 628 | ||||||
Basic weighted average number of limited partner units outstanding | 365 | 340 | 363 | 338 | ||||||||||
Effect of dilutive securities: Weighted average LTIP units | 2 | 2 | 2 | 3 | ||||||||||
Diluted weighted average number of limited partner units outstanding | 367 | 342 | 365 | 341 | ||||||||||
Diluted net income per limited partner unit | $ | 0.45 | $ | 0.57 | $ | 1.18 | $ | 1.84 | ||||||
(1) We calculate net income available to limited partners based on the distributions pertaining to the current period’s net income. After adjusting for the appropriate period’s distributions, the remaining undistributed earnings or excess distributions over earnings, if any, are allocated to the general partner, limited partners and participating securities in accordance with the contractual terms of the partnership agreement and as further prescribed under the two-class method. | ||||||||||||||
Undistributed earnings allocation to IDRs impact on basic and diluted earnings per limited partner unit | ' | |||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30 , | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Basic net income per limited partner unit impact | $ | — | $ | — | $ | — | $ | (0.33 | ) | |||||
Diluted net income per limited partner unit impact | $ | — | $ | — | $ | — | $ | (0.33 | ) | |||||
Partners_Capital_and_Distribut1
Partners' Capital and Distributions (Tables) | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
Partners' Capital and Distributions | ' | |||||||||||||||||||
Total cash distributions paid | ' | |||||||||||||||||||
The following table details the distributions paid during or pertaining to the first six months of 2014, net of reductions to the general partner’s incentive distributions (in millions, except per unit amounts): | ||||||||||||||||||||
Distributions Paid | Distributions | |||||||||||||||||||
Common | General Partner | per limited | ||||||||||||||||||
Date Declared | Distribution Date | Units | Incentive | 2% | Total | partner unit | ||||||||||||||
July 8, 2014 | August 14, 2014 (1) | $ | 238 | $ | 117 | $ | 5 | $ | 360 | $ | 0.645 | |||||||||
April 7, 2014 | May 15, 2014 | $ | 229 | $ | 110 | $ | 5 | $ | 344 | $ | 0.63 | |||||||||
January 9, 2014 | February 14, 2014 | $ | 221 | $ | 102 | $ | 5 | $ | 328 | $ | 0.615 | |||||||||
(1) Payable to unitholders of record at the close of business on August 1, 2014 for the period April 1, 2014 through June 30, 2014. | ||||||||||||||||||||
EquityIndexed_Compensation_Pla1
Equity-Indexed Compensation Plans (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Equity-Indexed Compensation Plans | ' | |||||||||||||
Summary of equity-indexed compensation activity for long-term incentive plan awards | ' | |||||||||||||
PAA LTIP Awards. Our equity-indexed compensation activity for LTIP awards denominated in PAA units is summarized in the following table (units in millions): | ||||||||||||||
Units (1) | Weighted Average Grant | |||||||||||||
Date | ||||||||||||||
Fair Value per Unit | ||||||||||||||
Outstanding at December 31, 2013 | 8.4 | $ | 36.97 | |||||||||||
Granted | 0.9 | $ | 46.61 | |||||||||||
Vested (2) | (1.8 | ) | $ | 25.39 | ||||||||||
Cancelled or forfeited | (0.3 | ) | $ | 38.88 | ||||||||||
Outstanding at June 30, 2014 | 7.2 | $ | 41.05 | |||||||||||
(1) Amounts do not include AAP Management Units. | ||||||||||||||
(2) Approximately 0.6 million PAA common units were issued, net of tax withholding of 0.3 million units, during the six months ended June 30, 2014 in connection with the settlement of vested awards. The remaining PAA awards that vested during the six months ended June 30, 2014 of approximately 0.9 million units were settled in cash. | ||||||||||||||
Summary of AAP Management Units | ' | |||||||||||||
AAP Management Units. The following table contains a summary of AAP Management Units (in millions): | ||||||||||||||
Reserved for Future | Outstanding | Outstanding Units | Grant Date | |||||||||||
Grants | Earned | Fair Value Of Outstanding AAP | ||||||||||||
Management Units (1) | ||||||||||||||
Balance at December 31, 2013 | 3.5 | 48.6 | 47 | $ | 51 | |||||||||
Granted | (0.4 | ) | 0.4 | — | 11 | |||||||||
Earned | N/A | N/A | 0.8 | N/A | ||||||||||
Balance at June 30, 2014 | 3.1 | 49 | 47.8 | $ | 62 | |||||||||
(1) Of the grant date fair value, approximately $4 million was recognized as expense during the six months ended June 30, 2014. Of the $62 million grant date fair value, approximately $52 million had been recognized through June 30, 2014. | ||||||||||||||
Summary of expense recognized and value of vesting related to equity-indexed compensation plans | ' | |||||||||||||
The table below summarizes the expense recognized and the value of vesting (settled both in units and cash) related to our equity-indexed compensation plans and includes both liability-classified and equity-classified awards (in millions): | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Equity-indexed compensation expense | $ | 34 | $ | 27 | $ | 68 | $ | 78 | ||||||
LTIP unit-settled vestings | $ | 44 | $ | 46 | $ | 51 | $ | 46 | ||||||
LTIP cash-settled vestings | $ | 51 | $ | 60 | $ | 52 | $ | 60 | ||||||
DER cash payments | $ | 2 | $ | 2 | $ | 4 | $ | 4 | ||||||
Derivatives_and_Risk_Managemen1
Derivatives and Risk Management Activities (Tables) | 6 Months Ended | ||||||||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||||||||
Derivative disclosures | ' | ||||||||||||||||||||||||||
Schedule of interest rate risk hedging | ' | ||||||||||||||||||||||||||
The following table summarizes the terms of our forward starting interest rate swaps as of June 30, 2014 (notional amounts in millions): | |||||||||||||||||||||||||||
Hedged Transaction | Number and Types of | Notional | Expected | Average Rate | Accounting | ||||||||||||||||||||||
Derivatives Employed | Amount | Termination Date | Locked | Treatment | |||||||||||||||||||||||
Anticipated debt offering | 10 forward starting swaps (30-year) | $ | 250 | 6/15/15 | 3.60% | Cash flow hedge | |||||||||||||||||||||
Open foreign currency exchange contracts | ' | ||||||||||||||||||||||||||
The following table summarizes our open forward exchange contracts as of June 30, 2014 (in millions): | |||||||||||||||||||||||||||
USD | CAD | Average Exchange Rate USD | |||||||||||||||||||||||||
to CAD | |||||||||||||||||||||||||||
Forward exchange contracts that exchange CAD for USD: | |||||||||||||||||||||||||||
2014 | $ | 273 | $ | 292 | $1.00 - $1.07 | ||||||||||||||||||||||
2015 | 77 | 82 | $1.00 - $1.07 | ||||||||||||||||||||||||
$ | 350 | $ | 374 | $1.00 - $1.07 | |||||||||||||||||||||||
Forward exchange contracts that exchange USD for CAD: | |||||||||||||||||||||||||||
2014 | $ | 273 | $ | 297 | $1.00 - $1.09 | ||||||||||||||||||||||
2015 | 77 | 84 | $1.00 - $1.09 | ||||||||||||||||||||||||
$ | 350 | $ | 381 | $1.00 - $1.09 | |||||||||||||||||||||||
Net position by currency: | |||||||||||||||||||||||||||
2014 | $ | — | $ | (5 | ) | ||||||||||||||||||||||
2015 | — | (2 | ) | ||||||||||||||||||||||||
$ | — | $ | (7 | ) | |||||||||||||||||||||||
Impact of derivative activities recognized in earnings | ' | ||||||||||||||||||||||||||
A summary of the impact of our derivative activities recognized in earnings for the three and six months ended June 30, 2014 and 2013 is as follows (in millions): | |||||||||||||||||||||||||||
Three Months Ended June 30, 2014 | Three Months Ended June 30, 2013 | ||||||||||||||||||||||||||
Derivatives in Hedging | Derivatives in Hedging | ||||||||||||||||||||||||||
Relationships | Relationships | ||||||||||||||||||||||||||
Location of gain/(loss) | Gain/(loss) | Other | Derivatives | Total | Gain/(loss) | Other | Derivatives | Total | |||||||||||||||||||
reclassified | gain/(loss) | Not | reclassified | gain/(loss) | Not | ||||||||||||||||||||||
from | recognized | Designated | from | recognized | Designated | ||||||||||||||||||||||
AOCI into | in income | as a | AOCI into | in income | as a | ||||||||||||||||||||||
income | Hedge | income (1) | Hedge | ||||||||||||||||||||||||
Commodity Derivatives | |||||||||||||||||||||||||||
Supply and Logistics segment revenues | $ | 12 | $ | — | $ | — | $ | 12 | $ | 21 | $ | — | $ | 21 | $ | 42 | |||||||||||
Facilities segment revenues | — | — | — | — | (9 | ) | — | — | (9 | ) | |||||||||||||||||
Field operating costs | — | — | — | — | — | — | 4 | 4 | |||||||||||||||||||
Interest Rate Derivatives | |||||||||||||||||||||||||||
Interest expense | (1 | ) | — | — | (1 | ) | (2 | ) | — | — | (2 | ) | |||||||||||||||
Foreign Currency Derivatives | |||||||||||||||||||||||||||
Supply and Logistics segment revenues | — | — | 9 | 9 | — | — | — | — | |||||||||||||||||||
Other income/(expense), net | — | — | — | — | 1 | — | — | 1 | |||||||||||||||||||
Total Gain/(Loss) on Derivatives Recognized in Net Income | $ | 11 | $ | — | $ | 9 | $ | 20 | $ | 11 | $ | — | $ | 25 | $ | 36 | |||||||||||
Six Months Ended June 30, 2014 | Six Months Ended June 30, 2013 | ||||||||||||||||||||||||||
Derivatives in Hedging | Derivatives in Hedging | ||||||||||||||||||||||||||
Relationships | Relationships | ||||||||||||||||||||||||||
Location of gain/(loss) | Gain/(loss) | Other | Derivatives | Total | Gain/(loss) | Other | Derivatives | Total | |||||||||||||||||||
reclassified | gain/(loss) | Not | reclassified | gain/(loss) | Not | ||||||||||||||||||||||
from | recognized | Designated | from | recognized | Designated | ||||||||||||||||||||||
AOCI into | in income | as a | AOCI into | in income | as a | ||||||||||||||||||||||
income | Hedge | income (1) | Hedge | ||||||||||||||||||||||||
Commodity Derivatives | |||||||||||||||||||||||||||
Supply and Logistics segment revenues | $ | (8 | ) | $ | — | $ | — | $ | (8 | ) | $ | 29 | $ | — | $ | 59 | $ | 88 | |||||||||
Facilities segment revenues | — | — | — | — | (12 | ) | — | — | (12 | ) | |||||||||||||||||
Field operating costs | — | — | (1 | ) | (1 | ) | — | — | 5 | 5 | |||||||||||||||||
Interest Rate Derivatives | |||||||||||||||||||||||||||
Interest expense | (2 | ) | — | — | (2 | ) | (3 | ) | — | — | (3 | ) | |||||||||||||||
Foreign Currency Derivatives | |||||||||||||||||||||||||||
Other income/(expense), net | — | — | — | — | 2 | — | — | 2 | |||||||||||||||||||
Total Gain/(Loss) on Derivatives Recognized in Net Income | $ | (10 | ) | $ | — | $ | (1 | ) | $ | (11 | ) | $ | 16 | $ | — | $ | 64 | $ | 80 | ||||||||
(1) During the three months ended June 30, 2013 we reclassified gains of approximately $1 million and $1 million from AOCI to Supply and Logistics segment revenues and Facilities segment revenues, respectively, as a result of anticipated hedged transactions that are probable of not occurring. During the six months ended June 30, 2013, we reclassified gains of approximately $3 million and $1 million from AOCI to Supply and Logistics segment revenues and Facilities segment revenues, respectively, as a result of anticipated hedged transactions that are probable of not occurring. During the three and six months ended June 30, 2014, all of our hedged transactions were probable of occurring. | |||||||||||||||||||||||||||
Summary of derivative assets and liabilities on condensed consolidated balance sheet | ' | ||||||||||||||||||||||||||
The following table summarizes the derivative assets and liabilities on our condensed consolidated balance sheet on a gross basis as of June 30, 2014 (in millions): | |||||||||||||||||||||||||||
Asset Derivatives | Liability Derivatives | ||||||||||||||||||||||||||
Balance Sheet | Balance Sheet | ||||||||||||||||||||||||||
Location | Fair Value | Location | Fair Value | ||||||||||||||||||||||||
Derivatives designated as hedging instruments: | |||||||||||||||||||||||||||
Commodity derivatives | Other current assets | $ | 7 | Other current assets | $ | (4 | ) | ||||||||||||||||||||
Other long-term assets | 1 | ||||||||||||||||||||||||||
Interest rate derivatives | Other current assets | 1 | Other current liabilities | (8 | ) | ||||||||||||||||||||||
Total derivatives designated as hedging instruments | $ | 9 | $ | (12 | ) | ||||||||||||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||||||||
Commodity derivatives | Other current assets | $ | 76 | Other current assets | $ | (56 | ) | ||||||||||||||||||||
Other long-term assets | 2 | Other long-term assets | (1 | ) | |||||||||||||||||||||||
Other long-term liabilities | 1 | Other current liabilities | (1 | ) | |||||||||||||||||||||||
Other long-term liabilities | (5 | ) | |||||||||||||||||||||||||
Foreign currency derivatives | Other current assets | 6 | |||||||||||||||||||||||||
Total derivatives not designated as hedging instruments | $ | 85 | $ | (63 | ) | ||||||||||||||||||||||
Total derivatives | $ | 94 | $ | (75 | ) | ||||||||||||||||||||||
The following table summarizes the derivative assets and liabilities on our condensed consolidated balance sheet on a gross basis as of December 31, 2013 (in millions): | |||||||||||||||||||||||||||
Asset Derivatives | Liability Derivatives | ||||||||||||||||||||||||||
Balance Sheet | Balance Sheet | ||||||||||||||||||||||||||
Location | Fair Value | Location | Fair Value | ||||||||||||||||||||||||
Derivatives designated as hedging instruments: | |||||||||||||||||||||||||||
Commodity derivatives | Other current assets | $ | 36 | Other current assets | $ | (24 | ) | ||||||||||||||||||||
Other long-term assets | 5 | ||||||||||||||||||||||||||
Interest rate derivatives | Other long-term assets | 26 | |||||||||||||||||||||||||
Total derivatives designated as hedging instruments | $ | 67 | $ | (24 | ) | ||||||||||||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||||||||
Commodity derivatives | Other current assets | $ | 60 | Other current assets | $ | (117 | ) | ||||||||||||||||||||
Other long-term assets | 5 | Other long-term assets | (6 | ) | |||||||||||||||||||||||
Other current liabilities | 1 | Other current liabilities | (5 | ) | |||||||||||||||||||||||
Other long-term liabilities | (1 | ) | |||||||||||||||||||||||||
Foreign currency derivatives | Other current liabilities | (4 | ) | ||||||||||||||||||||||||
Total derivatives not designated as hedging instruments | $ | 66 | $ | (133 | ) | ||||||||||||||||||||||
Total derivatives | $ | 133 | $ | (157 | ) | ||||||||||||||||||||||
Schedule of derivatives assets and liabilities that are subject to offsetting, including enforceable master netting arrangements | ' | ||||||||||||||||||||||||||
The following tables present information about derivatives and financial assets and liabilities that are subject to offsetting, including enforceable master netting arrangements at June 30, 2014 and December 31, 2013 (in millions): | |||||||||||||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||||||||||||
Derivative | Derivative | Derivative | Derivative | ||||||||||||||||||||||||
Asset Positions | Liability Positions | Asset Positions | Liability Positions | ||||||||||||||||||||||||
Netting Adjustments: | |||||||||||||||||||||||||||
Gross position - asset/(liability) | $ | 94 | $ | (75 | ) | $ | 133 | $ | (157 | ) | |||||||||||||||||
Netting adjustment | (62 | ) | 62 | (148 | ) | 148 | |||||||||||||||||||||
Cash collateral paid/(received) | 66 | — | 161 | — | |||||||||||||||||||||||
Net position - asset/(liability) | $ | 98 | $ | (13 | ) | $ | 146 | $ | (9 | ) | |||||||||||||||||
Balance Sheet Location After Netting Adjustments: | |||||||||||||||||||||||||||
Other current assets | $ | 96 | $ | — | $ | 116 | $ | — | |||||||||||||||||||
Other long-term assets | 2 | — | 30 | — | |||||||||||||||||||||||
Other current liabilities | — | (9 | ) | — | (8 | ) | |||||||||||||||||||||
Other long-term liabilities | — | (4 | ) | — | (1 | ) | |||||||||||||||||||||
$ | 98 | $ | (13 | ) | $ | 146 | $ | (9 | ) | ||||||||||||||||||
Net deferred gain/(loss), including tax effects, recognized in AOCI for derivatives | ' | ||||||||||||||||||||||||||
The net deferred gain/(loss), including tax effects, recognized in AOCI for derivatives for the three and six months ended June 30, 2014 and 2013 are as follows (in millions): | |||||||||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||
Commodity derivatives, net | $ | — | $ | 3 | $ | (12 | ) | $ | 11 | ||||||||||||||||||
Interest rate derivatives, net | (19 | ) | 32 | (39 | ) | 51 | |||||||||||||||||||||
Total | $ | (19 | ) | $ | 35 | $ | (51 | ) | $ | 62 | |||||||||||||||||
Derivative financial assets and liabilities within the fair value hierarchy accounted for at fair value on a recurring basis | ' | ||||||||||||||||||||||||||
The following table sets forth by level within the fair value hierarchy our financial assets and liabilities that were accounted for at fair value on a recurring basis as of June 30, 2014 and December 31, 2013 (in millions): | |||||||||||||||||||||||||||
Fair Value as of June 30, 2014 | Fair Value as of December 31, 2013 | ||||||||||||||||||||||||||
Recurring Fair Value Measures (1) | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||
Commodity derivatives | $ | 28 | $ | (9 | ) | $ | 1 | $ | 20 | $ | 16 | $ | (59 | ) | $ | (3 | ) | $ | (46 | ) | |||||||
Interest rate derivatives | — | (7 | ) | — | (7 | ) | — | 26 | — | 26 | |||||||||||||||||
Foreign currency derivatives | — | 6 | — | 6 | — | (4 | ) | — | (4 | ) | |||||||||||||||||
Total net derivative asset/(liability) | $ | 28 | $ | (10 | ) | $ | 1 | $ | 19 | $ | 16 | $ | (37 | ) | $ | (3 | ) | $ | (24 | ) | |||||||
(1) Derivative assets and liabilities are presented above on a net basis but do not include related cash margin deposits. | |||||||||||||||||||||||||||
Reconciliation of changes in fair value of derivatives classified as level 3 | ' | ||||||||||||||||||||||||||
The following table provides a reconciliation of changes in fair value of the beginning and ending balances for our derivatives classified as level 3 (in millions): | |||||||||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||
Beginning Balance | $ | 1 | $ | 1 | $ | (3 | ) | $ | 4 | ||||||||||||||||||
Unrealized gains/(losses): | |||||||||||||||||||||||||||
Included in earnings (1) | — | 1 | — | 1 | |||||||||||||||||||||||
Included in other comprehensive income | — | — | — | — | |||||||||||||||||||||||
Settlements | — | — | 3 | (3 | ) | ||||||||||||||||||||||
Derivatives entered into during the period | — | 2 | 1 | 2 | |||||||||||||||||||||||
Transfers out of level 3 | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | 1 | $ | 4 | $ | 1 | $ | 4 | |||||||||||||||||||
Change in unrealized gains/(losses) included in earnings relating to level 3 derivatives still held at the end of the periods | $ | 1 | $ | 3 | $ | 1 | $ | 3 | |||||||||||||||||||
(1) We reported unrealized gains and losses associated with level 3 commodity derivatives in our condensed consolidated statements of operations as Supply and Logistics segment revenues. | |||||||||||||||||||||||||||
Operating_Segments_Tables
Operating Segments (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Operating Segments | ' | |||||||||||||
Segment financial data | ' | |||||||||||||
The following table reflects certain financial data for each segment for the periods indicated (in millions): | ||||||||||||||
Transportation | Facilities | Supply and Logistics | Total | |||||||||||
Three Months Ended June 30, 2014 | ||||||||||||||
Revenues (1): | ||||||||||||||
External Customers | $ | 195 | $ | 144 | $ | 10,856 | $ | 11,195 | ||||||
Intersegment (2) | 217 | 133 | 4 | 354 | ||||||||||
Total revenues of reportable segments | $ | 412 | $ | 277 | $ | 10,860 | $ | 11,549 | ||||||
Equity earnings in unconsolidated entities | $ | 23 | $ | — | $ | — | $ | 23 | ||||||
Segment profit (3) (4) | $ | 221 | $ | 134 | $ | 133 | $ | 488 | ||||||
Maintenance capital | $ | 42 | $ | 5 | $ | 1 | $ | 48 | ||||||
Three Months Ended June 30, 2013 | ||||||||||||||
Revenues: | ||||||||||||||
External Customers | $ | 165 | $ | 197 | $ | 9,933 | $ | 10,295 | ||||||
Intersegment (2) | 200 | 151 | 1 | 352 | ||||||||||
Total revenues of reportable segments | $ | 365 | $ | 348 | $ | 9,934 | $ | 10,647 | ||||||
Equity earnings in unconsolidated entities | $ | 11 | $ | — | $ | — | $ | 11 | ||||||
Segment profit (3) (4) | $ | 160 | $ | 149 | $ | 176 | $ | 485 | ||||||
Maintenance capital | $ | 23 | $ | 11 | $ | 5 | $ | 39 | ||||||
Transportation | Facilities | Supply and Logistics | Total | |||||||||||
Six Months Ended June 30, 2014 | ||||||||||||||
Revenues (1): | ||||||||||||||
External Customers | $ | 376 | $ | 301 | $ | 22,201 | $ | 22,878 | ||||||
Intersegment (2) | 422 | 275 | 27 | 724 | ||||||||||
Total revenues of reportable segments | $ | 798 | $ | 576 | $ | 22,228 | $ | 23,602 | ||||||
Equity earnings in unconsolidated entities | $ | 44 | $ | — | $ | — | $ | 44 | ||||||
Segment profit (3) (4) | $ | 427 | $ | 288 | $ | 382 | $ | 1,097 | ||||||
Maintenance capital | $ | 76 | $ | 15 | $ | 4 | $ | 95 | ||||||
Six Months Ended June 30, 2013 | ||||||||||||||
Revenues: | ||||||||||||||
External Customers | $ | 338 | $ | 420 | $ | 20,157 | $ | 20,915 | ||||||
Intersegment (2) | 394 | 283 | 1 | 678 | ||||||||||
Total revenues of reportable segments | $ | 732 | $ | 703 | $ | 20,158 | $ | 21,593 | ||||||
Equity earnings in unconsolidated entities | $ | 23 | $ | — | $ | — | $ | 23 | ||||||
Segment profit (3) (4) | $ | 323 | $ | 300 | $ | 610 | $ | 1,233 | ||||||
Maintenance capital | $ | 55 | $ | 18 | $ | 9 | $ | 82 | ||||||
(1) Effective January 1, 2014, our natural gas sales and costs, primarily attributable to the activities performed by our natural gas storage commercial optimization group, are reported in the Supply and Logistics segment. Such items were previously reported in the Facilities segment. | ||||||||||||||
(2) Segment revenues and purchases and related costs include intersegment amounts. Intersegment sales are conducted at posted tariff rates, rates similar to those charged to third parties or rates that we believe approximate market. For further discussion, see “Analysis of Operating Segments” under Item 7 of our 2013 Annual Report on Form 10-K. | ||||||||||||||
(3) Supply and Logistics segment profit includes interest expense (related to hedged inventory purchases) of approximately $5 million for each of the three months ended June 30, 2014 and 2013 and approximately $7 million and $10 million for the six months ended June 30, 2014 and 2013, respectively. | ||||||||||||||
(4) The following table reconciles segment profit to net income attributable to PAA (in millions): | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Segment profit | $ | 488 | $ | 485 | $ | 1,097 | $ | 1,233 | ||||||
Depreciation and amortization | (100 | ) | (91 | ) | (196 | ) | (173 | ) | ||||||
Interest expense, net | (82 | ) | (75 | ) | (161 | ) | (152 | ) | ||||||
Other income/(expense), net | 4 | (1 | ) | 2 | (1 | ) | ||||||||
Income before tax | 310 | 318 | 742 | 907 | ||||||||||
Income tax expense | (22 | ) | (18 | ) | (70 | ) | (70 | ) | ||||||
Net income | 288 | 300 | 672 | 837 | ||||||||||
Net income attributable to noncontrolling interests | (1 | ) | (8 | ) | (1 | ) | (16 | ) | ||||||
Net income attributable to PAA | $ | 287 | $ | 292 | $ | 671 | $ | 821 | ||||||
Reconciliation of segment profit to net income attributable to PAA | ' | |||||||||||||
The following table reconciles segment profit to net income attributable to PAA (in millions): | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Segment profit | $ | 488 | $ | 485 | $ | 1,097 | $ | 1,233 | ||||||
Depreciation and amortization | (100 | ) | (91 | ) | (196 | ) | (173 | ) | ||||||
Interest expense, net | (82 | ) | (75 | ) | (161 | ) | (152 | ) | ||||||
Other income/(expense), net | 4 | (1 | ) | 2 | (1 | ) | ||||||||
Income before tax | 310 | 318 | 742 | 907 | ||||||||||
Income tax expense | (22 | ) | (18 | ) | (70 | ) | (70 | ) | ||||||
Net income | 288 | 300 | 672 | 837 | ||||||||||
Net income attributable to noncontrolling interests | (1 | ) | (8 | ) | (1 | ) | (16 | ) | ||||||
Net income attributable to PAA | $ | 287 | $ | 292 | $ | 671 | $ | 821 | ||||||
Related_Party_Transactions_Tab
Related Party Transactions (Tables) (Oxy) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Oxy | ' | |||||||||||||
Related party transaction | ' | |||||||||||||
Information related to transactions with related parties | ' | |||||||||||||
These transactions were conducted at posted tariff rates or prices that we believe approximate market. See detail below (in millions): | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Revenues | $ | 351 | $ | 424 | $ | 443 | $ | 694 | ||||||
Purchases and related costs | $ | 209 | $ | 214 | $ | 468 | $ | 375 | ||||||
We currently have a netting arrangement with Oxy. Our gross receivable and payable amounts with affiliates of Oxy were as follows (in millions): | ||||||||||||||
June 30, | December 31, | |||||||||||||
2014 | 2013 | |||||||||||||
Trade accounts receivable and other receivables | $ | 460 | $ | 133 | ||||||||||
Accounts payable | $ | 321 | $ | 181 | ||||||||||
Organization_and_Basis_of_Cons1
Organization and Basis of Consolidation and Presentation (Details) | 6 Months Ended |
Jun. 30, 2014 | |
segment | |
Organization | ' |
Operating segments number | 3 |
General partner ownership interest (as a percent) | 2.00% |
Accounts_Receivable_Details
Accounts Receivable (Details) (USD $) | 6 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Jun. 30, 2014 | Dec. 31, 2013 |
Accounts Receivable | ' | ' |
Advance cash payments received from third parties to mitigate credit risk | $157 | $117 |
Standby letters of credit | 384 | 426 |
Substantially all accounts receivable, net, maximum age of balances past their scheduled invoice date | '30 days | '30 days |
Allowance for doubtful accounts receivable | $5 | $5 |
Inventory_Linefill_and_Base_Ga2
Inventory, Linefill and Base Gas and Long-term Inventory (Details) (USD $) | 6 Months Ended | |
In Millions, unless otherwise specified | Jun. 30, 2014 | Dec. 31, 2013 |
Inventory by category | ' | ' |
Inventory | $1,096 | $1,065 |
Linefill and base gas | 895 | 798 |
Long-term inventory | 287 | 251 |
Total | 2,278 | 2,114 |
Charge related to the write-down of inventory | 37 | ' |
Crude oil | ' | ' |
Inventory by category | ' | ' |
Inventory | 579 | 540 |
Linefill and base gas | 713 | 679 |
Long-term inventory | 220 | 202 |
Inventory, Volumes (in barrels or in Mcf) | 6,233,000 | 6,951,000 |
Linefill and base gas, Volumes (in barrels or in Mcf) | 11,211,000 | 10,966,000 |
Long-term inventory, Volumes (in barrels or in Mcf) | 2,712,000 | 2,498,000 |
Inventory, Price/Unit of measure (in dollars per unit) | 92.89 | 77.69 |
Linefill and base gas, Price/Unit of measure (in dollars per unit) | 63.6 | 61.92 |
Long-term inventory, Price/Unit of measure (in dollars per unit) | 81.12 | 80.86 |
NGL | ' | ' |
Inventory by category | ' | ' |
Inventory | 444 | 352 |
Linefill and base gas | 56 | 62 |
Long-term inventory | 67 | 49 |
Inventory, Volumes (in barrels or in Mcf) | 10,591,000 | 8,061,000 |
Linefill and base gas, Volumes (in barrels or in Mcf) | 1,214,000 | 1,341,000 |
Long-term inventory, Volumes (in barrels or in Mcf) | 1,681,000 | 1,161,000 |
Inventory, Price/Unit of measure (in dollars per unit) | 41.92 | 43.67 |
Linefill and base gas, Price/Unit of measure (in dollars per unit) | 46.13 | 46.23 |
Long-term inventory, Price/Unit of measure (in dollars per unit) | 39.86 | 42.2 |
Natural gas | ' | ' |
Inventory by category | ' | ' |
Inventory | 50 | 150 |
Linefill and base gas | 126 | 57 |
Inventory, Volumes (in barrels or in Mcf) | 10,824,000 | 40,505,000 |
Linefill and base gas, Volumes (in barrels or in Mcf) | 26,612,000 | 16,615,000 |
Inventory, Price/Unit of measure (in dollars per unit) | 4.62 | 3.7 |
Linefill and base gas, Price/Unit of measure (in dollars per unit) | 4.73 | 3.43 |
Charge related to the write-down of inventory | 37 | ' |
Other | ' | ' |
Inventory by category | ' | ' |
Inventory | $23 | $23 |
Goodwill_Details
Goodwill (Details) (USD $) | 6 Months Ended | |||||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 |
Transportation | Facilities | Facilities | Supply and Logistics | Supply and Logistics | ||
Changes in goodwill | ' | ' | ' | ' | ' | ' |
Balance at beginning of period | $2,503 | $878 | $1,162 | $1,162 | $463 | $463 |
Foreign currency translation adjustments | -1 | -1 | ' | ' | ' | ' |
Balance at end of period | 2,502 | 877 | 1,162 | 1,162 | 463 | 463 |
Impairment | $0 | ' | ' | ' | ' | ' |
Debt_Details
Debt (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Short-term debt: | ' | ' |
Other short-term debt | $3 | $4 |
Total short-term debt | 763 | 1,113 |
Long-term debt: | ' | ' |
Senior notes, net of unamortized discounts of $16 and $15, respectively | 7,409 | 6,710 |
Unamortized discounts | 16 | 15 |
Long-term debt, other | 5 | 5 |
Total long-term debt | 7,414 | 6,715 |
Total debt | 8,177 | 7,828 |
Senior notes | ' | ' |
Long-term debt: | ' | ' |
Senior notes, net of unamortized discounts of $16 and $15, respectively | 7,409 | 6,710 |
Unamortized discounts | 16 | 15 |
5.25% senior notes maturing in June 2015 | ' | ' |
Long-term debt: | ' | ' |
Debt instrument, interest rate (as a percent) | 5.25% | ' |
Senior notes | 150 | ' |
Commercial paper notes | ' | ' |
Short-term debt: | ' | ' |
PAA commercial paper notes, bearing a weighted-average interest rate of 0.29% and 0.33%, respectively | $760 | $1,109 |
Weighted average interest rate, short-term (as a percent) | 0.29% | 0.33% |
Debt_Details_2
Debt (Details 2) (USD $) | Apr. 23, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Apr. 23, 2014 |
Treasury locks entered into in anticipation of issuance of 4.70% senior notes due 2044 | Letters of credit | Letters of credit | Credit agreements and commercial paper program | Credit agreements and commercial paper program | Senior notes | Senior notes | Senior notes | Senior notes | 4.70% senior notes due 2044 | |
Level 2 | Level 2 | |||||||||
Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt instrument face value | ' | ' | ' | ' | ' | $7,400,000,000 | $6,700,000,000 | ' | ' | $700,000,000 |
Debt instrument fair value | ' | ' | ' | ' | ' | ' | ' | 8,200,000,000 | 7,200,000,000 | ' |
Total borrowings | ' | ' | ' | 34,600,000,000 | 7,600,000,000 | ' | ' | ' | ' | ' |
Total repayments | ' | ' | ' | 34,900,000,000 | 7,800,000,000 | ' | ' | ' | ' | ' |
Outstanding letters of credit | ' | 38,000,000 | 41,000,000 | ' | ' | ' | ' | ' | ' | ' |
Debt instrument, interest rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.70% |
Percentage of face value at which senior notes are sold | ' | ' | ' | ' | ' | ' | ' | ' | ' | 99.73% |
Notional amount of derivatives | $250,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net_Income_Per_Limited_Partner2
Net Income Per Limited Partner Unit (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Basic and Diluted Net Income Per Limited Partner Unit | ' | ' | ' | ' |
General partner ownership interest (as a percent) | ' | ' | 2.00% | ' |
Numerator for Basic and Diluted Net Income per Limited Partner Unit: | ' | ' | ' | ' |
Net income attributable to PAA | $287 | $292 | $671 | $821 |
Net income available to limited partners | 166 | 197 | 435 | 631 |
Denominator for Basic and Diluted Net Income per Limited Partner Unit: | ' | ' | ' | ' |
Basic weighted average number of limited partner units outstanding (in units) | 365 | 340 | 363 | 338 |
Effect of dilutive securities: | ' | ' | ' | ' |
Weighted average LTIP units (in units) | 2 | 2 | 2 | 3 |
Diluted weighted average number of limited partner units outstanding (in units) | 367 | 342 | 365 | 341 |
Basic and Diluted Net Income per Limited Partner Unit | ' | ' | ' | ' |
Basic net income per limited partner unit (in dollars per unit) | $0.45 | $0.58 | $1.19 | $1.85 |
Diluted net income per limited partner unit (in dollars per unit) | $0.45 | $0.57 | $1.18 | $1.84 |
Basic Net Income Per Limited Partner Unit | ' | ' | ' | ' |
Numerator for Basic and Diluted Net Income per Limited Partner Unit: | ' | ' | ' | ' |
Net income attributable to PAA | 287 | 292 | 671 | 821 |
Less: General partner's incentive distribution | -117 | -91 | -227 | -177 |
Less: General partner 2% ownership | -4 | -4 | -9 | -13 |
Net income available to limited partners | 166 | 197 | 435 | 631 |
Less: Undistributed earnings allocated and distributions to participating securities | -1 | -1 | -3 | -5 |
Net income available to limited partners in accordance with application of the two-class method for MLPs | 165 | 196 | 432 | 626 |
Diluted Net Income Per Limited Partner Unit | ' | ' | ' | ' |
Numerator for Basic and Diluted Net Income per Limited Partner Unit: | ' | ' | ' | ' |
Net income attributable to PAA | 287 | 292 | 671 | 821 |
Less: General partner's incentive distribution | -117 | -91 | -227 | -177 |
Less: General partner 2% ownership | -4 | -4 | -9 | -13 |
Net income available to limited partners | 166 | 197 | 435 | 631 |
Less: Undistributed earnings allocated and distributions to participating securities | -1 | -1 | -3 | -3 |
Net income available to limited partners in accordance with application of the two-class method for MLPs | $165 | $196 | $432 | $628 |
Net_Income_Per_Limited_Partner3
Net Income Per Limited Partner Unit (Details 2) (USD $) | 6 Months Ended |
Jun. 30, 2013 | |
Basic and Diluted Net Income per Limited Partner Unit | ' |
Basic net income per limited partner unit impact (in dollars per unit) | ($0.33) |
Diluted net income per limited partner unit impact (in dollars per unit) | ($0.33) |
Partners_Capital_and_Distribut2
Partners' Capital and Distributions (Details) (USD $) | 0 Months Ended | 6 Months Ended | 0 Months Ended | 6 Months Ended | 0 Months Ended | 6 Months Ended |
In Millions, except Per Share data, unless otherwise specified | 15-May-14 | Jun. 30, 2014 | Feb. 14, 2014 | Jun. 30, 2014 | Aug. 14, 2014 | Jun. 30, 2014 |
First Quarter Distribution | First Quarter Distribution | Fourth Quarter Distribution | Fourth Quarter Distribution | Subsequent Event | Subsequent Event | |
Second Quarter Distribution | Second Quarter Distribution | |||||
Incentive Distribution Made to Managing Member or General Partner | ' | ' | ' | ' | ' | ' |
Distributions paid to common unit holders | $229 | ' | $221 | ' | $238 | ' |
Distributions paid to General Partner - Incentive | 110 | ' | 102 | ' | 117 | ' |
Distributions paid to General Partner - 2% | 5 | ' | 5 | ' | 5 | ' |
Total distributions paid during the period | $344 | ' | $328 | ' | $360 | ' |
Cash distributions per limited partner unit (in dollars per unit) | $0.63 | ' | $0.62 | ' | $0.65 | ' |
Unitholders of record, date | ' | ' | ' | ' | ' | 1-Aug-14 |
Distribution declared, date | ' | 7-Apr-14 | ' | 9-Jan-14 | ' | 8-Jul-14 |
Partners_Capital_and_Distribut3
Partners' Capital and Distributions (Details 2) (USD $) | 6 Months Ended | |
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 |
Partners Capital and Distribution | ' | ' |
Net proceeds from Sale | $453 | $331 |
Continuous Offering Program | ' | ' |
Partners Capital and Distribution | ' | ' |
Units Issued | 8.1 | ' |
Net proceeds from Sale | 453 | ' |
Commissions paid | $4 | ' |
Partners_Capital_and_Distribut4
Partners' Capital and Distributions (Details 3) (SLC Pipeline LLC) | Jun. 30, 2014 |
SLC Pipeline LLC | ' |
Partners Capital and Distribution | ' |
Noncontrolling interests, ownership percentage of noncontrolling owners | 25.00% |
EquityIndexed_Compensation_Pla2
Equity-Indexed Compensation Plans (Details) (PAA Long-term Incentive Plan Awards, USD $) | 6 Months Ended |
In Millions, except Per Share data, unless otherwise specified | Jun. 30, 2014 |
PAA Long-term Incentive Plan Awards | ' |
Outstanding (in units) | ' |
Outstanding at beginning of period (in units) | 8.4 |
Granted (in units) | 0.9 |
Vested (in units) | -1.8 |
Cancelled or forfeited (in units) | -0.3 |
Outstanding at end of period (in units) | 7.2 |
Weighted Average Grant Date Fair Value per unit | ' |
Outstanding at beginning of period (in dollars per unit) | $36.97 |
Granted (in dollars per unit) | $46.61 |
Vested (in dollars per unit) | $25.39 |
Cancelled or forfeited (in dollars per unit) | $38.88 |
Outstanding at end of period (in dollars per unit) | $41.05 |
Units issued in connection with the settlement of vested awards, net of tax withholding (in units) | 0.6 |
Units withheld for taxes (in units) | 0.3 |
Vested awards settled in cash (in units) | 0.9 |
EquityIndexed_Compensation_Pla3
Equity-Indexed Compensation Plans (Details 2) (USD $) | 3 Months Ended | 6 Months Ended | 83 Months Ended | |||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2014 |
AAP Management Units | AAP Management Units | |||||
Reserved for Future Grants | ' | ' | ' | ' | ' | ' |
Reserved for future grants outstanding, beginning balance (in units) | ' | ' | ' | ' | 3.5 | ' |
Units granted (in units) | ' | ' | ' | ' | -0.4 | ' |
Reserved for future grants outstanding, ending balance (in units) | ' | ' | ' | ' | 3.1 | 3.1 |
Outstanding | ' | ' | ' | ' | ' | ' |
Outstanding, beginning balance (in units) | ' | ' | ' | ' | 48.6 | ' |
Units granted (in units) | ' | ' | ' | ' | 0.4 | ' |
Outstanding, ending balance (in units) | ' | ' | ' | ' | 49 | 49 |
Outstanding Units Earned | ' | ' | ' | ' | ' | ' |
Outstanding Units Earned, beginning balance (in units) | ' | ' | ' | ' | 47 | ' |
Units earned (in units) | ' | ' | ' | ' | 0.8 | ' |
Outstanding Units Earned, ending balance (in units) | ' | ' | ' | ' | 47.8 | 47.8 |
Grant Date Fair Value of Outstanding AAP Management Units | ' | ' | ' | ' | ' | ' |
Grant Date Fair Value of Outstanding AAP Management Units, beginning balance | ' | ' | ' | ' | $51 | ' |
Units granted | ' | ' | ' | ' | 11 | ' |
Grant Date Fair Value of Outstanding AAP Management Units, ending balance | ' | ' | ' | ' | 62 | 62 |
Equity-indexed compensation expense | $34 | $27 | $68 | $78 | $4 | $52 |
EquityIndexed_Compensation_Pla4
Equity-Indexed Compensation Plans (Details 3) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Other Consolidated Equity-Indexed Compensation Information | ' | ' | ' | ' |
Equity-indexed compensation expense | $34 | $27 | $68 | $78 |
LTIP unit-settled vestings | 44 | 46 | 51 | 46 |
LTIP cash-settled vestings | 51 | 60 | 52 | 60 |
DER cash payments | $2 | $2 | $4 | $4 |
Derivatives_and_Risk_Managemen2
Derivatives and Risk Management Activities (Details) | Jun. 30, 2014 |
bbl | |
Net long position associated with crude oil purchases | ' |
Commodity Price Risk Hedging: | ' |
Average derivative positions notional amount per day (in barrels) | 210,100 |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 6,500,000 |
Net short spread position hedging anticipated crude oil lease gathering purchases | ' |
Commodity Price Risk Hedging: | ' |
Average derivative positions notional amount per day (in barrels) | 21,300 |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 14,300,000 |
Butane/WTI spread positions | ' |
Commodity Price Risk Hedging: | ' |
Average derivative positions notional amount per day (in barrels) | 2,800 |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 800,000 |
WTI/Brent spread positions | ' |
Commodity Price Risk Hedging: | ' |
Average derivative positions notional amount per day (in barrels) | 19,300 |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 1,800,000 |
Long natural gas position for anticipated base gas requirements | ' |
Commodity Price Risk Hedging: | ' |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 4,100,000 |
Short natural gas position related to anticipated natural gas sales | ' |
Commodity Price Risk Hedging: | ' |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 10,700,000 |
Net short position related to anticipated sales of crude oil, NGL and refined products inventory | ' |
Commodity Price Risk Hedging: | ' |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 7,600,000 |
PLA crude oil net short position | ' |
Commodity Price Risk Hedging: | ' |
Average derivative positions notional amount per day (in barrels) | 1,600 |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 1,500,000 |
PLA crude oil long call option position | ' |
Commodity Price Risk Hedging: | ' |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 700,000 |
Long natural gas position for natural gas purchases | ' |
Commodity Price Risk Hedging: | ' |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 31,300,000 |
Short propane position related to subsequent sale of products | ' |
Commodity Price Risk Hedging: | ' |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 5,200,000 |
Short butane position related to subsequent sale of products | ' |
Commodity Price Risk Hedging: | ' |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 1,500,000 |
Short WTI position related to subsequent sale of products | ' |
Commodity Price Risk Hedging: | ' |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 600,000 |
Long power position for power supply requirements | ' |
Commodity Price Risk Hedging: | ' |
Derivative position notional amount (in barrels, Mcf or megawatt hours) | 600,000 |
Derivatives_and_Risk_Managemen3
Derivatives and Risk Management Activities (Details 2) (USD $) | Jun. 30, 2014 | Jun. 30, 2014 | Apr. 23, 2014 | Apr. 30, 2014 | Apr. 23, 2014 |
In Millions, unless otherwise specified | 10 forward starting interest rate swaps (30-year) | Treasury locks entered into in anticipation of issuance of 4.70% senior notes due 2044 | Treasury locks entered into in anticipation of issuance of 4.70% senior notes due 2044 | Treasury locks entered into in anticipation of issuance of 4.70% senior notes due 2044 | |
Cash flow hedge | Cash flow hedge | Cash flow hedge | |||
contract | contract | ||||
Interest Rate Risk Hedging | ' | ' | ' | ' | ' |
Net deferred gains (losses) from interest rate risk hedging included in AOCI | ($101) | ' | ' | ' | ' |
Number of outstanding interest rate swaps (in contracts) | ' | 10 | ' | ' | 5 |
Rate of fixed interest to be received on interest rate swap (as a percent) | ' | 3.60% | ' | ' | 3.64% |
Notional amount of derivatives | ' | 250 | 250 | ' | 250 |
Cash payment for (proceeds from) termination of interest rate swaps | ' | ' | ' | $7 | ' |
Derivatives_and_Risk_Managemen4
Derivatives and Risk Management Activities (Details 3) | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 |
In Millions, unless otherwise specified | Net Position By Currency of Foreign Currency Derivatives | Net Position By Currency of Foreign exchange forward contracts maturing in 2014 | Net Position By Currency of Foreign exchange forward contracts maturing in 2015 | Foreign exchange forward contracts that exchange CAD for USD at the rate USD 1.00 to CAD 1.07 maturing in 2014 | Foreign exchange forward contracts that exchange CAD for USD at the rate USD 1.00 to CAD 1.07 maturing in 2014 | Foreign exchange forward contracts that exchange CAD for USD at the rate USD 1.00 to CAD 1.07 maturing in 2015 | Foreign exchange forward contracts that exchange CAD for USD at the rate USD 1.00 to CAD 1.07 maturing in 2015 | Foreign exchange forward contracts that exchange CAD for USD at the rate USD 1.00 to CAD 1.07 | Foreign exchange forward contracts that exchange CAD for USD at the rate USD 1.00 to CAD 1.07 | Foreign exchange forward contracts that exchange USD for CAD at the rate USD 1.00 to CAD 1.09 maturing in 2014 | Foreign exchange forward contracts that exchange USD for CAD at the rate USD 1.00 to CAD 1.09 maturing in 2014 | Foreign exchange forward contracts that exchange USD for CAD at the rate USD 1.00 to CAD 1.09 maturing in 2015 | Foreign exchange forward contracts that exchange USD for CAD at the rate USD 1.00 to CAD 1.09 maturing in 2015 | Foreign exchange forward contracts that exchange USD for CAD at the rate USD 1.00 to CAD 1.09 | Foreign exchange forward contracts that exchange USD for CAD at the rate USD 1.00 to CAD 1.09 |
CAD | CAD | CAD | USD ($) | CAD | USD ($) | CAD | USD ($) | CAD | USD ($) | CAD | USD ($) | CAD | USD ($) | CAD | |
Currency Exchange Rate Risk Hedging: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notional amount of derivatives | ' | ' | ' | $273 | 292 | $77 | 82 | $350 | 374 | $273 | 297 | $77 | 84 | $350 | 381 |
Average exchange rate for outstanding foreign currency forward exchange contracts | ' | ' | ' | ' | 1.07 | ' | 1.07 | ' | 1.07 | ' | 1.09 | ' | 1.09 | ' | 1.09 |
Net position by currency | -7 | -5 | -2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivatives_and_Risk_Managemen5
Derivatives and Risk Management Activities (Details 4) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Total | $20 | $36 | ($11) | $80 |
Commodity Derivatives | Supply and Logistics segment revenues | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Total | 12 | 42 | -8 | 88 |
Commodity Derivatives | Facilities segment revenues | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Total | ' | -9 | ' | -12 |
Commodity Derivatives | Field Operating costs | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Total | ' | 4 | -1 | 5 |
Interest Rate Derivatives | Interest expense | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Total | -1 | -2 | -2 | -3 |
Foreign Currency Derivatives | Supply and Logistics segment revenues | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Total | 9 | ' | ' | ' |
Foreign Currency Derivatives | Other income/(expense), net | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Total | ' | 1 | ' | 2 |
Derivatives designated as hedging instruments | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Amount of gain/(loss) reclassified from AOCI into income | 11 | 11 | -10 | 16 |
Derivatives designated as hedging instruments | Commodity Derivatives | Supply and Logistics segment revenues | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Amount of gain/(loss) reclassified from AOCI into income | 12 | 21 | -8 | 29 |
Derivatives designated as hedging instruments | Commodity Derivatives | Facilities segment revenues | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Amount of gain/(loss) reclassified from AOCI into income | ' | -9 | ' | -12 |
Derivatives designated as hedging instruments | Interest Rate Derivatives | Interest expense | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Amount of gain/(loss) reclassified from AOCI into income | -1 | -2 | -2 | -3 |
Derivatives designated as hedging instruments | Foreign Currency Derivatives | Other income/(expense), net | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Amount of gain/(loss) reclassified from AOCI into income | ' | 1 | ' | 2 |
Derivatives designated as hedging instruments | Hedged Transactions probable of not occurring | Supply and Logistics segment revenues | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Amount of gain/(loss) reclassified from AOCI into income | ' | 1 | ' | 3 |
Derivatives designated as hedging instruments | Hedged Transactions probable of not occurring | Facilities segment revenues | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Amount of gain/(loss) reclassified from AOCI into income | ' | 1 | ' | 1 |
Derivatives not designated as hedging instruments | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Total | 9 | 25 | -1 | 64 |
Derivatives not designated as hedging instruments | Commodity Derivatives | Supply and Logistics segment revenues | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Total | ' | 21 | ' | 59 |
Derivatives not designated as hedging instruments | Commodity Derivatives | Field Operating costs | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Total | ' | 4 | -1 | 5 |
Derivatives not designated as hedging instruments | Foreign Currency Derivatives | Supply and Logistics segment revenues | ' | ' | ' | ' |
Impact of derivative activities recognized in earnings | ' | ' | ' | ' |
Total | $9 | ' | ' | ' |
Derivatives_and_Risk_Managemen6
Derivatives and Risk Management Activities (Details 5) (USD $) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 |
contract | contract | contract | |||
Derivatives disclosures | ' | ' | ' | ' | ' |
Asset Derivatives Fair Value | $94 | ' | $94 | ' | $133 |
Liability Derivatives Fair Value | -75 | ' | -75 | ' | -157 |
Net gain (loss) deferred in AOCI | -118 | ' | -118 | ' | ' |
Net gain (loss) expected to be reclassified to earnings in next 12 months | ' | ' | -4 | ' | ' |
Gain (loss) expected to be reclassified to earnings through 2045 | ' | ' | -114 | ' | ' |
Net deferred gain/(loss) recognized in AOCI on derivatives (effective portion) | -19 | 35 | -51 | 62 | ' |
Broker receivable | 66 | ' | 66 | ' | 161 |
Initial margin | 54 | ' | 54 | ' | 85 |
Variation margin posted/(returned) | ' | ' | 12 | ' | 76 |
Number of outstanding derivatives containing credit-risk related contingent features | 0 | ' | 0 | ' | 0 |
Derivative credit-risk related contingent features | ' | ' | 'none of our outstanding derivatives contained credit-risk related contingent features that would result in a material adverse impact to us upon any change in our credit ratings | ' | ' |
Commodity Derivatives | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Net deferred gain/(loss) recognized in AOCI on derivatives (effective portion) | ' | 3 | -12 | 11 | ' |
Interest Rate Derivatives | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Net deferred gain/(loss) recognized in AOCI on derivatives (effective portion) | -19 | 32 | -39 | 51 | ' |
Derivatives designated as hedging instruments | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Asset Derivatives Fair Value | 9 | ' | 9 | ' | 67 |
Liability Derivatives Fair Value | -12 | ' | -12 | ' | -24 |
Derivatives designated as hedging instruments | Commodity Derivatives | Other current assets | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Asset Derivatives Fair Value | 7 | ' | 7 | ' | 36 |
Liability Derivatives Fair Value | -4 | ' | -4 | ' | -24 |
Derivatives designated as hedging instruments | Commodity Derivatives | Other long-term assets | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Asset Derivatives Fair Value | 1 | ' | 1 | ' | 5 |
Derivatives designated as hedging instruments | Interest Rate Derivatives | Other current assets | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Asset Derivatives Fair Value | 1 | ' | 1 | ' | ' |
Derivatives designated as hedging instruments | Interest Rate Derivatives | Other long-term assets | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Asset Derivatives Fair Value | ' | ' | ' | ' | 26 |
Derivatives designated as hedging instruments | Interest Rate Derivatives | Other current liabilities | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Liability Derivatives Fair Value | -8 | ' | -8 | ' | ' |
Derivatives not designated as hedging instruments | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Asset Derivatives Fair Value | 85 | ' | 85 | ' | 66 |
Liability Derivatives Fair Value | -63 | ' | -63 | ' | -133 |
Derivatives not designated as hedging instruments | Commodity Derivatives | Other current assets | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Asset Derivatives Fair Value | 76 | ' | 76 | ' | 60 |
Liability Derivatives Fair Value | -56 | ' | -56 | ' | -117 |
Derivatives not designated as hedging instruments | Commodity Derivatives | Other long-term assets | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Asset Derivatives Fair Value | 2 | ' | 2 | ' | 5 |
Liability Derivatives Fair Value | -1 | ' | -1 | ' | -6 |
Derivatives not designated as hedging instruments | Commodity Derivatives | Other current liabilities | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Asset Derivatives Fair Value | ' | ' | ' | ' | 1 |
Liability Derivatives Fair Value | -1 | ' | -1 | ' | -5 |
Derivatives not designated as hedging instruments | Commodity Derivatives | Other long-term liabilities | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Asset Derivatives Fair Value | 1 | ' | 1 | ' | ' |
Liability Derivatives Fair Value | -5 | ' | -5 | ' | -1 |
Derivatives not designated as hedging instruments | Foreign Currency Derivatives | Other current assets | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Asset Derivatives Fair Value | 6 | ' | 6 | ' | ' |
Derivatives not designated as hedging instruments | Foreign Currency Derivatives | Other current liabilities | ' | ' | ' | ' | ' |
Derivatives disclosures | ' | ' | ' | ' | ' |
Liability Derivatives Fair Value | ' | ' | ' | ' | ($4) |
Derivatives_and_Risk_Managemen7
Derivatives and Risk Management Activities (Details 6) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Derivative Asset Positions | ' | ' |
Gross Position - Asset | $94 | $133 |
Netting Adjustment | -62 | -148 |
Cash collateral paid | 66 | 161 |
Net Position - Asset | 98 | 146 |
Derivative Liability Positions | ' | ' |
Gross Position - Liability | -75 | -157 |
Netting Adjustment | 62 | 148 |
Net Position - Liability | -13 | -9 |
Other current assets | ' | ' |
Derivative Asset Positions | ' | ' |
Net Position - Asset | 96 | 116 |
Other long-term assets | ' | ' |
Derivative Asset Positions | ' | ' |
Net Position - Asset | 2 | 30 |
Other current liabilities | ' | ' |
Derivative Liability Positions | ' | ' |
Net Position - Liability | -9 | -8 |
Other long-term liabilities | ' | ' |
Derivative Liability Positions | ' | ' |
Net Position - Liability | ($4) | ($1) |
Derivatives_and_Risk_Managemen8
Derivatives and Risk Management Activities (Details 7) (USD $) | 3 Months Ended | 6 Months Ended | ||||||||||||||||||||||||||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 |
Level 3 | Level 3 | Level 3 | Level 3 | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | Recurring Fair Value Measures | |
Level 1 | Level 1 | Level 1 | Level 1 | Level 2 | Level 2 | Level 2 | Level 2 | Level 2 | Level 2 | Level 2 | Level 2 | Level 3 | Level 3 | Level 3 | Level 3 | Total | Total | Total | Total | Total | Total | Total | Total | |||||
Commodity Derivatives | Commodity Derivatives | Commodity Derivatives | Commodity Derivatives | Interest Rate Derivatives | Interest Rate Derivatives | Foreign Currency Derivatives | Foreign Currency Derivatives | Commodity Derivatives | Commodity Derivatives | Commodity Derivatives | Commodity Derivatives | Interest Rate Derivatives | Interest Rate Derivatives | Foreign Currency Derivatives | Foreign Currency Derivatives | |||||||||||||
Recurring Fair Value Measures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net derivative asset/(liability) | ' | ' | ' | ' | $28 | $16 | $28 | $16 | ($10) | ($37) | ($9) | ($59) | ($7) | $26 | $6 | ($4) | $1 | ($3) | $1 | ($3) | $19 | ($24) | $20 | ($46) | ($7) | $26 | $6 | ($4) |
Roll forward of Level 3 Net Asset | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Beginning Balance | 1 | 1 | -3 | 4 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrealized gains/(losses): | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Included in earnings | ' | 1 | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Settlements | ' | ' | 3 | -3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivatives entered into during the period | ' | 2 | 1 | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ending Balance | 1 | 4 | 1 | 4 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Change in unrealized gains/(losses) included in earnings relating to level 3 derivatives still held at the end of the periods | $1 | $3 | $1 | $3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (USD $) | Apr. 30, 2012 | 31-May-14 |
Pemex Exploracion y Produccion (PEP) | Alleged violations of risk management plan regulations under the federal Clean Air Act | |
case | Rancho | |
Loss Contingencies | ' | ' |
Total number of cases filed | 2 | ' |
Amount of civil penalty agreed to | ' | ($260,000) |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details 2) | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Apr. 30, 2011 | Jun. 30, 2014 | Feb. 26, 2013 | Jul. 31, 2014 | Jun. 30, 2012 | Jun. 30, 2014 | Jul. 04, 2013 | Jul. 31, 2014 | Feb. 28, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2014 |
USD ($) | USD ($) | Minimum | Rainbow Pipeline Release | Rainbow Pipeline Release | Rainbow Pipeline Release | Rainbow Pipeline Release | Rangeland Pipeline Release | Rangeland Pipeline Release | Rangeland Pipeline Release | Rangeland Pipeline Release | Bay Springs Pipeline Release | Bay Springs Pipeline Release | Kemp River Pipeline Release | Kemp River Pipeline Release | Kemp River Pipeline Release | |
bbl | USD ($) | enforcementaction | Subsequent Event | bbl | USD ($) | enforcementaction | Subsequent Event | bbl | USD ($) | event | USD ($) | USD ($) | ||||
CAD | CAD | bbl | ||||||||||||||
Environmental | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated undiscounted reserve for environmental liabilities | $92,000,000 | $93,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated undiscounted reserve for environmental liabilities, short-term | 13,000,000 | 11,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated undiscounted reserve for environmental liabilities, long-term | 79,000,000 | 82,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Probable recoveries from insurers and from third parties under indemnification agreements recorded as a receivable | 8,000,000 | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Actual cash expenditures for environmental liabilities, period paid | ' | ' | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total estimated cost to clean up and remediate the site, before insurance recoveries | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15,000,000 | ' |
Total cost to clean up and remediate the site, before insurance recoveries | ' | ' | ' | ' | 70,000,000 | ' | ' | ' | 47,000,000 | ' | ' | ' | 6,000,000 | ' | ' | ' |
Cost incurred, to date, to clean up and remediate the site, before insurance recoveries | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,000,000 |
Estimated size of release (in barrels) | ' | ' | ' | 28,000 | ' | ' | ' | 3,000 | ' | ' | ' | 120 | ' | 700 | ' | ' |
Settlement charges paid | ' | ' | ' | ' | ' | ' | 450,000 | ' | ' | ' | 850,000 | ' | ' | ' | ' | ' |
Charges, fines or penalties assessed | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | $0 |
Number of enforcement actions | ' | ' | ' | ' | ' | 4 | ' | ' | ' | 4 | ' | ' | ' | ' | ' | ' |
Number of events occurred | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' |
Operating_Segments_Details
Operating Segments (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
segment | ||||
Operating Segments | ' | ' | ' | ' |
Operating segments number | ' | ' | 3 | ' |
Revenues: | ' | ' | ' | ' |
Revenues | $11,195 | $10,295 | $22,878 | $20,915 |
Segment Reporting, Disclosure of Other Information about Entity's Reportable Segments | ' | ' | ' | ' |
Equity earnings in unconsolidated entities | 23 | 11 | 44 | 23 |
Segment profit | 488 | 485 | 1,097 | 1,233 |
Maintenance capital | 48 | 39 | 95 | 82 |
Transportation | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Revenues | 195 | 165 | 376 | 338 |
Segment Reporting, Disclosure of Other Information about Entity's Reportable Segments | ' | ' | ' | ' |
Equity earnings in unconsolidated entities | 23 | 11 | 44 | 23 |
Segment profit | 221 | 160 | 427 | 323 |
Maintenance capital | 42 | 23 | 76 | 55 |
Facilities | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Revenues | 144 | 197 | 301 | 420 |
Segment Reporting, Disclosure of Other Information about Entity's Reportable Segments | ' | ' | ' | ' |
Segment profit | 134 | 149 | 288 | 300 |
Maintenance capital | 5 | 11 | 15 | 18 |
Supply and Logistics | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Revenues | 10,856 | 9,933 | 22,201 | 20,157 |
Segment Reporting, Disclosure of Other Information about Entity's Reportable Segments | ' | ' | ' | ' |
Segment profit | 133 | 176 | 382 | 610 |
Maintenance capital | 1 | 5 | 4 | 9 |
Interest expense related to hedged inventory | 5 | 5 | 7 | 10 |
Operating Segments | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Revenues | 11,549 | 10,647 | 23,602 | 21,593 |
Operating Segments | Transportation | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Revenues | 412 | 365 | 798 | 732 |
Operating Segments | Facilities | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Revenues | 277 | 348 | 576 | 703 |
Operating Segments | Supply and Logistics | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Revenues | 10,860 | 9,934 | 22,228 | 20,158 |
Intersegment | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Revenues | -354 | -352 | -724 | -678 |
Intersegment | Transportation | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Revenues | -217 | -200 | -422 | -394 |
Intersegment | Facilities | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Revenues | -133 | -151 | -275 | -283 |
Intersegment | Supply and Logistics | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Revenues | ($4) | ($1) | ($27) | ($1) |
Operating_Segments_Details_2
Operating Segments (Details 2) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Reconciliation of segment profit to net income attributable to PAA | ' | ' | ' | ' |
Segment profit | $488 | $485 | $1,097 | $1,233 |
Depreciation and amortization | -100 | -91 | -196 | -173 |
Interest expense, net | -82 | -75 | -161 | -152 |
Other income/(expense), net | 4 | -1 | 2 | -1 |
INCOME BEFORE TAX | 310 | 318 | 742 | 907 |
Income tax expense | -22 | -18 | -70 | -70 |
NET INCOME | 288 | 300 | 672 | 837 |
Net income attributable to noncontrolling interests | -1 | -8 | -1 | -16 |
NET INCOME ATTRIBUTABLE TO PAA | $287 | $292 | $671 | $821 |
Related_Party_Transactions_Det
Related Party Transactions (Details) (Oxy, USD $) | 3 Months Ended | 6 Months Ended | |||
In Millions, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 |
Oxy | ' | ' | ' | ' | ' |
Related party transaction | ' | ' | ' | ' | ' |
Related party ownership of general partner interest (as a percent) | 25.00% | ' | 25.00% | ' | ' |
Revenues | $351 | $424 | $443 | $694 | ' |
Purchases and related costs | 209 | 214 | 468 | 375 | ' |
Trade accounts receivable and other receivables, gross | 460 | ' | 460 | ' | 133 |
Accounts payable, gross | $321 | ' | $321 | ' | $181 |