Plains ALL American Pipeline LP: Q2 FY2026 earnings call

What management said about Q2 FY2026, from the documents filed with the SEC on 9 September 2026: press release. Guidance figures: 3 raised, 1 kept. The quarter’s numbers.

Key takeaways

PAA bought 55% of EPIC: A PAA subsidiary bought a 55% non-operated interest in EPIC Crude Holdings from Diamondback and Kinetik subsidiaries, under an August 30, 2025 agreement, completed October 31, 2025. Source
PAA now owns all of EPIC: PAA indirectly owns 100% of EPIC Crude Holdings and EPIC GP, and is operator of record of the Cactus III Pipeline. Source
Net income attributable to PAA lower: Pro forma net income attributable to PAA from continuing operations was $975 million against $1,052 million historical, after a $100 million pro forma adjustment. Source
Pro forma per unit income lower: Pro forma basic and diluted net income per common unit from continuing operations was $1.01 against $1.12 historical, on 704 million weighted average common units. Source
Q1 Adjusted EBITDA attributable to PAA: First-quarter 2026 Adjusted EBITDA attributable to PAA was $730 million, against $754 million a year earlier. Net income attributable to PAA was $152 million against $443 million.
Adjusted Free Cash Flow guidance raised: Full-year 2026 Adjusted Free Cash Flow guidance increased to approximately $1.850 billion, excluding working capital changes and anticipated NGL divestiture proceeds.
Keyera sale agreement: On June 17, 2025 the company agreed to sell substantially all of its Canadian NGL business to Keyera Corp. US NGL assets are retained.

“The closing of the NGL divestiture will mark a transition to a premier pure play crude oil midstream provider.”
Willie Chiang, Chairman, CEO and President

Guidance

Area	Period	Figure	Against last quarter
Adjusted EBITDA attributable to PAA	Full-year 2026	$2.880 billion +/- $75 million	Raised
Adjusted Free Cash Flow	Full-year 2026	approximately $1.850 billion	Raised
Growth capital	Full-year 2026	$350 million	Kept
Maintenance capital	Full-year 2026	$185 million	Raised
Pro forma leverage ratio	Following closing of the NGL divestiture	toward the midpoint of the 3.25 to 3.75x target range
Cactus III synergies and system efficiencies	2026	$100 million

What changed from last quarter

New: PAA acquired the remaining EPIC interests in two steps, now owns 100% of EPIC Crude Holdings and EPIC GP, and operates the Cactus III Pipeline. Source
Guidance raised: Midpoint of 2026 Adjusted EBITDA attributable to PAA raised by $130 million to $2.880 billion.
Guidance raised: Full-year 2026 Adjusted Free Cash Flow guidance increased to approximately $1.850 billion.

EPIC interests acquired

PAA bought 55% of EPIC: A PAA subsidiary bought a 55% non-operated interest in EPIC Crude Holdings from Diamondback and Kinetik subsidiaries, under an August 30, 2025 agreement, completed October 31, 2025. Source
Remaining 45% bought from Ares: A separate transaction effective November 1, 2025 bought the remaining 45% equity interest from a subsidiary of Ares Management LLC. Source
PAA now owns all of EPIC: PAA indirectly owns 100% of EPIC Crude Holdings and EPIC GP, and is operator of record of the Cactus III Pipeline. Source
Both purchases reported as one: The two purchases are reported as one Transaction because EPIC Crude Holdings is managed by a common management team despite varying equity ownership. Source

Pro forma 2025 combined results

Pro forma revenue near $44.5 billion: Pro forma 2025 revenues were $44,464 million, against PAA historical $44,262 million and EPIC historical $202 million, as if the Transaction occurred January 1, 2025. Source
Operating income rises with EPIC: Pro forma operating income was $1,524 million against PAA historical $1,434 million, with EPIC adding $96 million before a $6 million pro forma adjustment. Source
Interest expense rises on new debt: Pro forma interest expense was $721 million against $554 million historical, including a $94 million pro forma adjustment for acquisition financing. Source
Net income attributable to PAA lower: Pro forma net income attributable to PAA from continuing operations was $975 million against $1,052 million historical, after a $100 million pro forma adjustment. Source

“We remain focused on executing key initiatives in 2026, including closing the pending NGL sale and realizing $100 million of contribution between Cactus III synergies and capturing efficiencies across our system.”
Willie Chiang, Chairman, CEO and President

Per-unit results and distributions

Pro forma per unit income lower: Pro forma basic and diluted net income per common unit from continuing operations was $1.01 against $1.12 historical, on 704 million weighted average common units. Source
Cash distributions may differ: Management states the partnership agreement requires distributing available cash rather than reported earnings, so actual cash distributions may vary significantly from pro forma per unit income. Source
No securities issued for deal: The Transaction involved no issuance or redemption of securities. Pro forma per unit income assumes distributions equal to historical PAA distributions. Source

Acquisition financing and accounting

$1.9 billion of financing assumed: Pro forma interest reflects $1,901 million of financing as if it were obtained on or before January 1, 2025 and outstanding for all of 2025. Source
Rate set at SOFR plus 1.125%: The assumed rate was one-month SOFR plus 1.125% as of the Closing Date. Amortization of debt issuance costs is not considered material to the pro forma. Source
Depreciation and amortization adjusted: Pro forma adds $47 million of depreciation over a blended 47-year life and $55 million of intangible amortization, and removes EPIC's historical $96 million of depreciation and amortization. Source

Presentation and reclassification changes

Inventory margin moved to costs: EPIC's inventory exchange margin was conformed to PAA policy, moving $125 million for 2025 from revenue to purchases and related costs. Source
Acquisition method applied: The Transaction is accounted for as a business combination under ASC 805, using the acquisition method, with transaction accounting adjustments shown in the pro forma. Source
Synergies excluded from pro forma: The pro forma figures are illustrative and preliminary, and exclude anticipated synergies, integration costs and cost savings. Source

First-quarter 2026 results

Q1 Adjusted EBITDA attributable to PAA: First-quarter 2026 Adjusted EBITDA attributable to PAA was $730 million, against $754 million a year earlier. Net income attributable to PAA was $152 million against $443 million.
Crude Adjusted EBITDA rose: Crude oil Adjusted EBITDA was $582 million, up 4%. Contributions from recent bolt-on acquisitions, including Cactus III, and higher pipeline volumes lifted the result.
NGL Adjusted EBITDA declined: NGL Adjusted EBITDA was $145 million, down 23% against the prior-year quarter.
Operating cash flow reported: Net cash provided by operating activities was $418 million for the quarter, and Adjusted Free Cash Flow was $82 million.

Guidance and financial targets

Adjusted Free Cash Flow guidance raised: Full-year 2026 Adjusted Free Cash Flow guidance increased to approximately $1.850 billion, excluding working capital changes and anticipated NGL divestiture proceeds.
Capital plan for 2026: Growth capital stays at $350 million for 2026. Maintenance capital rises to $185 million, reflecting NGL asset ownership into May 2026.
Leverage target path set: Pro forma leverage was 4.1x at quarter-end. Management expects a return toward the 3.25 to 3.75x target range midpoint after the NGL sale.
Distribution yield stated: The quarterly cash distribution was $0.4175 per unit, or $1.67 annualized, representing a current distribution yield of about 7.5%.

Canadian NGL divestiture

Keyera sale agreement: On June 17, 2025 the company agreed to sell substantially all of its Canadian NGL business to Keyera Corp. US NGL assets are retained.
Results split by discontinued operations: The Canadian NGL business met held-for-sale and discontinued-operations criteria, and prior periods were applied retrospectively, so results appear on continuing and discontinued bases.
Planning and restructuring continue: Management said it has continued planning and restructuring of its organizational structure in connection with the pending divestiture.

Crude and NGL volumes

Crude tariff volumes higher: Total crude oil pipeline tariff volume was 10,039 thousand barrels per day in the first quarter of 2026, against 9,086 a year earlier.
Permian volumes rose: Permian Basin crude tariff volume was 7,774 thousand barrels per day, against 6,869 in the prior-year quarter.
NGL pipeline volumes up, sales down: NGL pipeline tariff was 250 thousand barrels per day, against 234. Propane and butane sales fell to 135 from 147.

Management view and priorities

Oil market view constructive: Management said global events accelerated its view of a more constructive crude oil market, and cited the integrated model linking US crude production to global markets.
Transition to pure play crude: Management said closing the NGL sale will mark a transition to a premier pure play crude oil midstream provider.
Capital returns continue: Management said it continues to focus on financial discipline while returning capital to unit holders.

Coming up, as management said on 9 September 2026

Canadian NGL sale closing: Management said the Keyera transaction was expected to close in May 2026.
Leverage migrates to lower end: Management said leverage migrates toward the lower end of the 3.25 to 3.75x range by year-end 2026.

Figures management reported

Figure	Reported
Crude oil pipeline tariff volume (thousand barrels per day)	10,039 (Q1 2026) vs 9,086 (Q1 2025)
Permian Basin crude tariff volume (thousand barrels per day)	7,774 (Q1 2026) vs 6,869 (Q1 2025)
NGL pipeline tariff volume (thousand barrels per day)	250 (Q1 2026) vs 234 (Q1 2025)
Propane and butane sales volume (thousand barrels per day)	135 (Q1 2026) vs 147 (Q1 2025)

Risks management discussed

Financial: Certain Permian long-haul pipeline contract rate resets partly offset higher crude volumes and results.
Demand: Lower weighted average frac spreads and warmer weather reduced NGL sales volumes and results.
Financial: Current income tax expense of about $216 million tied to divestiture planning and restructuring was recognized in the first quarter.

Earlier plans management reported on

Not stated: Management stated it remains committed to financial discipline while continuing to return capital to unit holders.

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.

As filed with the SEC

Open the filing on EDGAR

PLAINS ALL AMERICAN PIPELINE, L.P. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

On November 6, 2025, Plains All American Pipeline, L.P. (“PAA”, “we”, “us”, “our”, or the “Company”) filed a Current Report on Form 8-K, as amended on a Form 8-K/A filed on January 16, 2026, to report that on October 31, 2025, pursuant to a Purchase and Sale Agreement (the “PSA”) entered into on August 30, 2025 by and among a wholly-owned subsidiary (the “Buyer”) of PAA, and subsidiaries of Diamondback Energy, Inc. and Kinetik Holdings Inc. (collectively, the “Sellers”), the Buyer completed the purchase from Sellers of an aggregate 55% non-operated equity interest in EPIC Crude Holdings, LP (“EPIC Crude Holdings”), the entity that owned and operated the Cactus III Pipeline, formerly known as the EPIC Crude Oil Pipeline (the “Cactus III Pipeline”), and an aggregate 55% of the membership interests in EPIC Crude Holdings GP, LLC (“EPIC GP”), the general partner of EPIC Crude Holdings (the “EPIC 55% Transaction”).

Effective November 1, 2025, in a separate transaction from the EPIC 55% Transaction, the Buyer also completed the purchase of the remaining 45% equity interest in EPIC Crude Holdings and the remaining 45% of the membership interests in EPIC GP from a subsidiary of Ares Management LLC (the “Ares Seller”) pursuant to that certain definitive Equity Purchase Agreement (the “EPA”) between the Buyer and the Ares Seller (the “EPIC 45% Transaction,” and, together with the EPIC 55% Transaction, the “EPIC Transactions”).

As a result of the EPIC Transactions, PAA now indirectly owns 100% of the equity interests in EPIC Crude Holdings and 100% of the membership interests in EPIC GP and serves as operator of record of the Cactus III Pipeline. The EPIC Transactions are being reported in aggregate as a singular transaction (the “Transaction”) for purposes of the unaudited pro forma condensed combined financial information below due to EPIC Crude Holdings being managed by a common management team despite varying equity ownership.

The Transaction is accounted for as a business combination and thus the Transaction Accounting Adjustments presented in the unaudited pro forma condensed combined financial information have been prepared using the acquisition method of accounting in accordance with Financial Accounting Standards Board Accounting Standards Codification 805, Business Combinations (“ASC 805”). The unaudited pro forma condensed combined financial information is based on assumptions that we believe are reasonable under the circumstances and are intended for informational purposes only.

The following unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of SEC Regulation S-X and includes pro forma adjustments that are directly attributable to the Transaction and factually supportable. Certain reclassifications have been made to the historical presentation of EPIC Crude Holdings’ financial statements to conform to our presentation and to the presentation of the unaudited pro forma condensed combined financial information contained herein. See Note 4 for additional information.

The unaudited pro forma condensed combined financial information has been derived from and should be read in conjunction with the following historical financial statements and accompanying notes of PAA and EPIC Crude Holdings:

audited consolidated financial statements and related notes of PAA included in PAA’s Annual Report on Form 10-K for the year ended December 31, 2025;
unaudited consolidated financial statements of EPIC Crude Holdings, LP and Subsidiaries as of and for the nine months ended September 30, 2025, filed as Exhibit 99.2 to PAA’s Form 8-K/A dated January 16, 2026.

The unaudited pro forma condensed combined financial information should also be read together with the accompanying notes to the unaudited pro forma condensed combined financial information. The pro forma adjustments are based upon available information and certain assumptions, as described in the accompanying notes to the unaudited pro forma condensed combined financial information, which PAA believes are reasonable under the circumstances.

The following unaudited pro forma condensed statement of combined continuing operations for the year ended December 31, 2025 has been prepared as if the Transaction described above had taken place on January 1, 2025. Because the results of the Transaction are fully reflected in the audited consolidated balance sheet as of December 31, 2025 included in PAA’s Annual Report on Form 10-K for the year ended December 31, 2025, no pro forma balance sheet is included herein.

The unaudited pro forma condensed combined financial information was prepared to reflect transaction accounting adjustments that PAA believes are necessary to present a fair statement of the combined company’s results of operations following the Transaction. They do not reflect any anticipated synergies, integration costs, cost savings, or other potential impacts of combining the businesses. The unaudited pro forma condensed combined financial information is presented for illustrative purposes only and is based on preliminary estimates and assumptions that are subject to change.

The unaudited pro forma condensed combined financial information is not necessarily indicative of the results of the actual or future operations or financial condition that would have been achieved had the Transaction occurred at the date assumed (as noted above). The actual results in the periods following the Transaction may differ significantly from those reflected in the unaudited pro forma condensed combined financial information for a number of reasons.

PLAINS ALL AMERICAN PIPELINE, L.P. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

PLAINS ALL AMERICAN PIPELINE, L.P. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED STATEMENT OF COMBINED CONTINUING OPERATIONS

For the Year Ended December 31, 2025 (in millions, except per unit data)

	PAA Historical	EPIC Historical As Adjusted (Note 4)	Pro Forma Adjustments (Note 2)		PAA Pro Forma Combined
REVENUES	$44,262	$202	$ -		$44,464
COSTS AND EXPENSES
Purchases and related costs	40,433	(72)	-		40,361
Field operating costs	1,154	63	-		1,217
General and administrative expenses	342	19	-		361
Depreciation and amortization	953	96	(96	)(a)	1,055
			47	(b)
			55	(b)
Gain on asset sales, net	(54)	-	-		(54)
Total costs and expenses	42,828	106	6		42,940
OPERATING INCOME	1,434	96	(6)		1,524
OTHER INCOME/(EXPENSE)
Equity earnings in unconsolidated entities	382	-	-		382
Gain on investments in unconsolidated entities, net	31	-	-		31
Interest expense	(554)	(73)	(94	)(c)	(721)
Other income, net	108	-	-		108
INCOME FROM CONTINUING OPERATIONS BEFORE TAX	1,401	23	(100)		1,324
Current income tax expense from continuing operations	(1)	-	-		(1)
Deferred income tax expense from continuing operations	(14)	-	-		(14)
INCOME FROM CONTINUING OPERATIONS, NET OF TAX	1,386	23	(100)		1,309
Net income attributable to noncontrolling interests from continuing operations	(334)	-	-		(334)
NET INCOME ATTRIBUTABLE TO PAA FROM CONTINUING OPERATIONS	$1,052	$23	$(100)		$975
NET INCOME PER COMMON UNIT:
Net income allocated to common unitholders - Basic and Diluted
Net income allocated to common unitholders from continuing operations - Basic and Diluted	$786				$709
Basic and diluted weighted average common units outstanding	704				704
Basic and diluted net income per common unit from continuing operations	$1.12				$1.01

The accompanying notes are an integral part of this Unaudited Pro Forma Condensed Combined Financial Information.

PLAINS ALL AMERICAN PIPELINE, L.P. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

Note 1 - Basis of Presentation

The unaudited pro forma condensed combined financial information was prepared in accordance with Article 11 of SEC Regulation S-X (“Article 11”). The unaudited pro forma condensed combined financial information includes adjustments that depict the accounting for the Transaction using Transaction Accounting Adjustments (as defined in Article 11). Adjustments depicting synergies and dis-synergies of the Transaction (“Management Adjustments”) are not presented herein.

The unaudited pro forma condensed combined financial information and underlying pro forma adjustments are based upon currently available information and certain estimates and assumptions that management believes are factually supportable; therefore, actual results could differ materially from the unaudited pro forma condensed combined financial information. However, we believe the assumptions provide a reasonable basis for presenting the significant effects of the Transaction noted herein. We believe the pro forma adjustments give appropriate effect to those assumptions and are properly applied in the unaudited pro forma condensed combined financial information.

Note 2 - Pro Forma Adjustments

Reflects the elimination of EPIC Crude Holdings’ historical depreciation and amortization of $96 million for the year ended December 31, 2025.
Reflects the depreciation on the acquired property and equipment under the straight-line method of depreciation over a blended average useful life of 47 years resulting in incremental depreciation expense of $47 million for the year ended December 31, 2025. Also reflects the incremental amortization of the intangible assets under the declining balance method resulting in incremental amortization expense of $55 million for the year ended December 31, 2025.
Represents the interest expense on the $1,901 million of financing as if such financing was obtained on or prior to January 1, 2025, and was outstanding for the entire year ended December 31, 2025. The interest rate assumed for purposes of preparing this unaudited pro forma condensed combined financial information was based off the one-month SOFR plus 1.125% as of the Closing Date. The amortization of debt issuance costs is not considered material to the unaudited pro forma condensed combined financial information.

Note 3 - Pro Forma Net Income Per Common Unit

Pro forma basic and diluted net income per common unit is determined by dividing the pro forma net income attributable to PAA (after deducting amounts allocated to preferred unitholders and participating securities) by the basic and diluted weighted average number of common units outstanding during the applicable periods. The Transaction did not involve the issuance or redemption of securities. For purposes of this calculation, we assumed that distributions were equal to historical PAA distributions for the respective periods; all remaining excess earnings were assumed to be allocated to our common unitholders and participating securities in accordance with the contractual terms of our partnership agreement. Because our partnership agreement requires us to distribute available cash rather than earnings reflected in our statement of operations and the pro forma net income per unit calculation has been prepared on an annual basis in lieu of a quarterly basis, actual cash distributions declared and paid by us may vary significantly from reported pro forma net income per common unit.

Note 4 - Reclassification of EPIC Crude Holdings’ Historical Financial Statements

Reclassification adjustments were made to EPIC Crude Holdings’ historical statements of operations for the nine months ended September 30, 2025 and for the period from October 1, 2025 to November 6, 2025. Certain income statement line items presented by EPIC Crude Holdings under GAAP have been reclassified to align with the presentation used by PAA under GAAP. In addition, EPIC Crude Holdings’ historical presentation of margin related to inventory exchanges has been conformed to PAA’s accounting policy, which results in a reclassification from Revenue to Purchases and related costs. The amount of reclassification was $125 million for the year ended December 31, 2025. These reclassification adjustments are shown in the table below:

PLAINS ALL AMERICAN PIPELINE, L.P. AND SUBSIDIARIES

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

EPIC CRUDE HOLDINGS, LP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

For the Nine Months Ended September 30, 2025 and the Period from October 1, 2025 to November 6, 2025 (in millions)

	EPIC	EPIC
	Historical for the Nine Months Ended September 30, 2025	Historical for the Period from October 1, 2025 to November 6, 2025	Reclassification Adjustments	EPIC Historical As Adjusted
	(unaudited)	(unaudited)
REVENUE	$295	$32	$(125)	$202
EXPENSES
Cost of goods sold	46	7	(53)	-
Operations and maintenance	57	6	(63)	-
Depreciation and amortization	86	10	-	96
General and administrative	17	2	(19)	-
Purchases and related costs	-	-	(72)	(72)
Field operating costs	-	-	63	63
General and administrative expenses	-	-	19	19
	206	25	(125)	106
INCOME FROM OPERATIONS	89	7	-	96
OTHER INCOME (EXPENSE)
Interest expense	(67)	(6)	-	(73)
INCOME BEFORE TAXES	22	1	-	23
NET INCOME	$22	$1	$ -	$23