Plains All American Pipeline, L.P. (PAA) Business Profile

What it does

Plains All American Pipeline is a publicly traded limited partnership that moves and stores crude oil. It serves producers looking to get oil out of producing regions, refiners seeking supplies for their plants, and other customers that need access to markets or export terminals.

Its infrastructure connects different stages of the oil supply chain. Gathering pipelines collect crude from wellhead or central battery connections and move it to regional hubs. Other pipelines connect those hubs or carry oil over longer distances to refineries, major trading locations and export facilities. Plains also uses trucks and, at times, railcars or barges, and operates terminals and storage facilities.

The company combines those services with a merchant business: it buys crude oil and moves it on its own or third-party assets to customers and sales locations. Different grades of crude have different characteristics, so Plains’ services include keeping grades separate and helping customers reach suitable markets.

Its network is concentrated in the United States and Canada, with its largest asset presence in the Permian Basin. Plains also has natural gas liquids, or NGL, operations. It completed the sale of its Canadian NGL business in May, while retaining NGL assets in the United States.

How it makes money

Plains earns money both by charging for infrastructure services and by purchasing and reselling commodities. Its Crude Oil segment gathers and transports oil, provides storage and terminal services, and sells gathered or bulk-purchased crude. Its NGL segment provides storage and terminal services and transports, stores and sells specification NGL products.

Pipeline revenue comes from tariffs, capacity agreements and other transportation fees. Tariffs and other pipeline fees are typically based on the volume moved and vary by receipt and delivery point. Storage and terminal fees depend on capacity leases and throughput volumes; agreements can run from month to month or for multiple years. Long-term transportation contracts and acreage dedications also support volumes on parts of the network.

In merchant activities, Plains purchases crude and arranges its movement to a sales location. Results are affected by purchase volumes and differences in commodity prices by grade, location and time. Product sales revenue and purchases generally move with the same pricing indices, so a change in the commodity’s market price does not necessarily have the same effect on the margin between them. Plains also uses derivatives to manage commodity price exposure.

For FY2025, product sales revenue was $42.5 billion and service revenue was $1.8 billion. For Q2 2026, adjusted EBITDA attributable to Plains was $738 million; this is a different measure from revenue.

Product sales revenue fell in 2025 primarily because commodity prices were lower, partly offset by higher crude sales volumes. Service revenue rose primarily because of higher pipeline volumes, tariff escalations and acquisitions, partly offset by lower commodity prices and certain Permian long-haul contract rates resetting to market.

Product or service	Revenue, FY2025	Share	Change on the year
Sales	$42.5 billion	96.0%	−9.95%
Service	$1.8 billion	3.98%	4.20%

Customers and how it sells

Plains serves crude oil producers and refiners, as well as other customers using its transportation, storage and terminal services. It reaches them through gathering systems, pipelines, terminals and its merchant business. Merchant sales can occur at Plains terminals, connecting carriers, regional hubs or refineries.

ExxonMobil Corporation and its subsidiaries accounted for 31.0% of revenue in FY2025. The majority of revenue from this customer came from Crude Oil merchant activities, with sales occurring at multiple locations. Plains faces the risk that, if it lost a major customer, it might not find a replacement market at a comparable margin.

The United States accounted for 89.8% of FY2025 revenue and Canada for 10.2%. Plains’ crude assets connect producing areas to demand centers in both countries. Its Permian network links gathering and intra-basin systems to long-haul routes serving markets including Corpus Christi, Houston and Cushing. Its Canadian operations also include crude oil pipelines.

The Canadian NGL business was sold in May. Plains retained NGL assets in the United States, so the earlier geographic revenue shares should be read alongside that change in the business.

Region	Revenue, FY2025	Share	Change on the year
United States	$39.8 billion	89.8%	−8.67%
Canada	$4.5 billion	10.2%	−15.9%

Suppliers and costs

Plains buys crude oil from producers and through bulk purchases for resale. It uses its own infrastructure and third-party assets to move that supply. Its merchant purchases and related costs generally follow the same commodity pricing indices as product sales, making commodity prices a driver of both revenue and purchasing costs.

Operating the network also involves fixed and variable field costs, maintenance, property taxes and overhead. Higher volumes and acquisitions contributed to higher field expenses in 2025, although total field operating costs fell from 2024, when Plains recognized costs associated with settlements related to the Line 901 incident. Depreciation and amortization increased in 2025, largely because of acquisitions.

Plains incurs short-term debt in connection with merchant transactions and to fund certain exchange margin requirements. It describes these borrowings as self-liquidating: merchant borrowings are repaid with sales proceeds, and the commodities purchased in those transactions are volumetrically hedged. Regulation also adds to the cost of operating its pipelines and facilities.

Plains expects to realize $50 million of efficiencies in 2026 and an additional $50 million in 2027. The measures include changes to business processes, targeted trucking adjustments and the consolidation of some marketing offices.

1. Revenue$44.3B
2. Cost of revenue−$41.6B
3. Selling, general and administrative−$342.0M
4. Other operating costs−$899.0M
5. Operating income$1.4B

Competitive position

Plains competes with other pipeline and terminal operators for transportation volumes and facilities business. It also competes in merchant activities with integrated oil companies and their marketing affiliates, independent gatherers, trading platforms, brokers and marketers. No specific competitor is named as such in the available descriptions.

Pipeline competition depends primarily on transportation charges, access to producing and supply regions, and end-user demand. Existing pipelines with unused capacity can compete for an incremental barrel at relatively low operating cost. New projects and capacity expansions can also create competition; Plains has experienced pressure on tariffs and margins for uncommitted barrels and contract renewals. Trucks, rail and barges can offer access to alternative markets, although they typically cost more.

Plains’ assets connect gathering systems, regional hubs, storage, refineries and export routes. Its Permian gathering pipelines are supported by long-term acreage dedications, while long-haul pipelines have long-term commitments. The company also uses its knowledge of crude grades and regional flows in its merchant and logistics activities.

Our reading: The interconnected network and customer commitments provide a meaningful competitive advantage because they combine market access with support for volumes. Our reading: That advantage has limits where rival pipelines have spare capacity and contracts come up for renewal.

Growth opportunities

Plains plans to grow through investments that add connections and capacity to its existing crude oil network, alongside acquisitions where they complement its assets. Its strategy combines transportation, storage and commercial activities to address regional differences in supply and demand.

For 2026, Plains increased planned growth capital spending from $350 million to a range of $400 million to $450 million. The projects include further development of its Permian gathering system to serve dedicated acreage in the Midland and Delaware basins, and expansion of Canadian gathering systems supported by producer commitments. Plains said the Permian joint venture’s total dedicated acreage reached approximately 5.1 million acres.

Plains also expanded Cactus III, adding 75,000 barrels a day of capacity. Its marketing affiliate can use available space while the company seeks longer-term contracts. Plains is evaluating further expansions that would require customer commitments.

The company expects Permian production growth of approximately 100 to 200,000 barrels a day in 2026 versus 2025, measured exit to exit. It attributes the increase from its earlier forecast of relatively flat production mainly to natural gas egress coming online sooner than expected. Plains expects the production ramp to have minimal impact on 2026 EBITDA and to create momentum into 2027.

The Canadian NGL sale supports Plains’ objective of focusing on its core crude oil operations and reducing exposure to commodity price fluctuations and seasonality.

1. $42.1BFY2021
2. $57.3BFY2022
3. $47.3BFY2023
4. $48.9BFY2024
5. $44.3BFY2025

Structural risks

• Volumes and production: Plains’ results depend on the volumes shipped, purchased, stored and gathered through its assets. The pace of natural gas infrastructure development could adversely affect expected crude oil production growth in the Permian Basin.
• Competition and recontracting: Excess pipeline capacity and new infrastructure can intensify competition for uncommitted barrels and renewals. Slower production growth or declines could increase pressure on tariffs and margins.
• Customer and counterparty exposure: Losing a major customer could leave Plains unable to find a replacement market at a comparable margin. The company also faces credit risk from customers and other counterparties.
• Operations and regulation: Pipeline or facility accidents, equipment failures, natural disasters and cybersecurity disruptions can affect operations. Environmental, safety and transportation rules can add costs, while rate regulation and challenges to regulated rates can affect cash flow.
• Partnership and distribution risks: Conflicts may arise between the general partner, Plains and its unitholders. Cash distributions are not guaranteed, and common unitholders may owe taxes on their share of income even without receiving cash distributions.

Leadership

Plains’ Class C shares in PAGP act as a pass-through voting mechanism: Plains votes at the direction of eligible unitholders in elections of eligible PAGP directors. Series B preferred units are non-voting, and common units held by AAP participate through PAGP Class A and Class B shares.

Name	Role	Since	Total pay, FY2025
Willie Chiang,		—	$12.3 million
Al Swanson,		—	$3.2 million
Richard McGee,		—	$3.3 million
Chris Chandler,		—	$9.1 million
Jeremy Goebel,		—	$11.6 million

Bottom line

Our reading

Plains is a crude oil infrastructure and merchant business: its network earns transportation and storage fees, while buying and reselling oil adds exposure to market differences. (item1; item7)

Our reading: Its interconnected assets and commitments support the business, but volumes, recontracting and competition from spare pipeline capacity remain important exposures. (item1; item1a) The Canadian NGL sale narrows its focus, while planned gathering and pipeline investments extend its exposure to crude oil flows. (call_prepared; item7)