Good day and thank you for standing by. Welcome to the PAA and PAGP Fourth Quarter 2024 Earnings Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. Please be advised that today's conference call is being recorded. I would now like to hand the conference over to your speaker today, Blake Fernandez. Please go ahead.

Thank you, Tanya. Good morning, and welcome to Plains All American fourth quarter 2024 earnings call. Today's slide presentation is posted on the Investor Relations website under the News and Events section at ir.plains.com. An audio replay will also be available following today's call. Important disclosures regarding forward-looking statements and non-GAAP financial measures are provided on slide 2. An overview of 2024 results and recent announcements are highlighted on slide 3. A condensed consolidating balance sheet for PAGP and other reference materials are in the appendix. Today's call will be hosted by Willie Chiang, Chairman and CEO; and Al Swanson, Executive Vice President and CFO, along with other members of our management team. With that, I'll turn the call over to Willie.

Thank you, Blake. Good morning, everyone, and thank you for joining us. Let me start with a few comments about our results and our outlook on 2025, and then I'll provide an update on our recent announcements. Let's start with the results. We demonstrated another strong quarter of execution. We exceeded our expectations for the fourth quarter and for the full year, reporting adjusted EBITDA attributable to Plains of $729 million and $2.78 billion, respectively, with full year results just above the high end of our guidance range and exceeding our initial 2024 guidance by approximately $105 million or 4%. Looking to 2025, and as highlighted on slide 4, we provided adjusted EBITDA guidance of $2.8 billion to $2.95 billion, or approximately 3% growth year-over-year at the midpoint of our guidance range. As shown on slide 5, we expect Permian crude production to grow 200,000 to 300,000 barrels a day year end 2024 to year end 2025, with overall basin volumes growing to approximately 6.7 million barrels a day by the end of 2025. We believe this sets up for a very constructive long-haul market over the next several years as volumes grow towards our full utilization of efficient operating capacity. In regard to our Permian long-haul assets for 2025, we expect continued high utilization on our Corpus Christi bound assets, increased volumes on basin pipeline and a modest NBC increase on Wink to Webster. Our Permian gathering JV continues to benefit from the embedded operational synergies and consistent producer activity on our over 4.7 million dedicated acres. Our outside Permian business tends to get less attention externally, but it continues to perform well and generate significant excess cash flow for Plains. We have selectively acquired complementary assets along this footprint over the past couple of years, including the recently acquired Midway Pipeline and Ironwood gathering system, and we continue to explore and develop additional bolt-on opportunities. Before turning the call over to Al for more detail on our guidance and results, I want to provide an update on our recent announcements. Turning to slide 6. We've completed the acquisition of Ironwood Midstream Energy on January 31, which extends and expands our integrated asset base in the Eagle Ford. As seen on slide 7, and as previously announced, we acquired the remaining 50% interest in Midway Pipeline, and a subsidiary of our Permian joint venture acquired the Medallion Delaware Basin crude gathering business. These transactions exemplify Plains' efficient growth strategy, which is focused on expanding our integrated asset base, streamlining operations, all while generating attractive returns for unitholders. Additionally, on January 31st, we closed the purchase of approximately 12.7 million units or 18% of our outstanding Series A preferred units at a par value of $26.25 and which is reflective of our continued effort to not only optimize our asset base, but also our capital structure. Lastly, we accelerated the return of capital framework and announced a 20% increase in the quarterly distribution payable on February 14th for both PAA common units and PAGP Class A shares. On an annualized basis, the distribution represents a $0.25 per unit increase from the distribution we paid in November 2024, bringing the annual distribution to $1.52 per unit, representing a yield of approximately 7.5% based on the current equity price for PAA. With that, I'll turn the call over to Al.

Thanks, Willie. We reported fourth quarter adjusted EBITDA of $729 million, which includes crude oil segment benefits from higher volumes and pipeline tariff escalation. Our NGL segment benefited from higher-than-expected order flows leading to increased C3+ back product sales. Slides 8 and 9 in today's presentation contain segment EBITDA walks, which provide details on our fourth quarter performance. All-in-all, we executed well in 2024 and are well-positioned as we enter 2025. A summary of 2025 guidance and key assumptions are on Slide 10. Looking at 2025 guidance compared to 2024 results and as illustrated by the EBITDA walk on Slide 11, we expect adjusted EBITDA of $2.8 billion to $2.95 billion with year-over-year growth in our crude oil segment and slightly lower NGL segment contributions. Growth in our crude oil segment is primarily driven by contributions from bolt-on acquisitions, volume growth, and pipeline tariff escalation, partially offsetting these tailwinds on the previously discussed reset of certain long-haul contract tariffs that step down in the second half of 2025. While our NGL segment adjusted EBITDA is expected to be slightly lower year-over-year, the business is shifting to approximately 45% fee-based in 2025. I would note that our C3+ spec product sales volumes are approximately 70% hedged for the year in the low $0.70 per gallon level. We remain focused on making disciplined capital investments and expect to invest approximately $400 million of growth capital and approximately $240 million of maintenance capital in 2025 net to PAA. This includes growth capital for the POP JV well connections and intra-basin improvements, integration of our recently completed acquisitions, and capital related to our Fort Saskatchewan debottleneck project. As illustrated on Slide 12, in addition to capital discipline, we remain committed to significant returns of capital and maintaining financial flexibility. For 2025, we expect to generate approximately $1.15 billion of adjusted free cash flow, excluding changes in assets and liabilities, which is reduced by $580 million for the previously announced bolt-on transactions that closed in January. Regarding our balance sheet, we recently raised $1 billion of senior unsecured notes at a rate of 5.95% maturing in 2035. Proceeds were used to fund the recently announced transactions. Regarding our senior note maturity profile, we have $1 billion maturing in October 2025, which we would expect to refinance all or a portion of during the year. Before I turn the call back to Willie, I wanted to provide details on 2 charges that impacted our fourth quarter GAAP results. Our 2024 results include a $140 million noncash impairment related to 2 US NGL terminal assets which are excluded from our adjusted results. Separately, regarding our claim for reimbursement from insurance carriers of $225 million that arose out of a 2022 class action settlement relating to our 2015 Line 901 incident, an arbitration panel ruled that we are not entitled to reimbursement of our $175 million claim against several of the insurers. With respect to our remaining $50 million claim against different insurance carriers, we now regard collection of those claims as being less than probable and GAAP, therefore, requires that we write off the entire $225 million receivable and recognize any future collections as and if they are received. While disappointing, we still expect to operate at or below the low end of our leverage target ratio of 3.25 to 3.75 times in 2025. With that, I'll turn the call back to Willie.

Thank you, Al. 2024 was another solid year of execution for Plains, and we remain confident as we enter 2025 with strong operational momentum and are well positioned to play offense in continuing to deliver value to our unitholders. As we show on Slide 11, we've made meaningful progress on our financial objectives, and we've positioned ourselves to be the investment of choice. In summary, first, our balance sheet strength provides significant financial capacity and flexibility. Secondly, we continue to demonstrate capital discipline and the ability to execute on our efficient growth initiatives including growing the business both organically and inorganically through accretive and synergistic bolt-on acquisitions. And finally, as demonstrated with our recent distribution increase announcement, we remained very focused on increasing return of capital to our unitholders through our multiyear capital allocation framework, while still preserving financial flexibility. From a broader perspective, we're optimistic about a new administration that values energy security and energy independence and one that also supports consumer choice and a level playing field for all sources of energy including hydrocarbons. We believe the world will continue to need North American energy to maintain today's quality of living standards and to help elevate those that are less fortunate. Plains is well positioned to support domestic energy growth with critical infrastructure to connect supply to demand centers across North America. With that, I'll turn the call back over to Blake, who will lead us into Q&A.

Thanks, Willie. As we enter the Q&A session, please limit yourself to one question and one follow-up. For those with additional questions, please feel free to return to the queue. This will allow us to address as many questions as practical in our available time this morning. The IR team will also be available to address any questions you may have. Tonia, I believe we're ready to go to the Q&A session.

Thank you. And our first question will come from Keith Stanley of Wolfe Research. Your line is open, Keith.

Hi, good morning. Thank you. To start, maybe, can you give a little background on how some of these tuck-ins came together in January if it was a long process or it came together pretty quickly. And then give sense on, if there's other meaningful opportunities you're working on currently or that you think are likely you'll be able to execute on this year?

Thanks, Keith. This is Willie. We started 2025 with significant momentum. These deals take time to develop, and our team is always on the lookout for opportunities. We managed to bring several of these deals together, which required a lot of hard work from our team, but we successfully executed everything. We can't control the timing of these events, so we were pleased to begin the year on a strong note. This transition reinforces our shift from a defensive to an offensive approach. We believe there are more opportunities ahead. Considering Plains' footprint and our integrated asset base as an infrastructure company, we connect supply with demand. This allows us to communicate with many people and identify potential options for integrating into our system. There are numerous opportunities for synergies, and we are currently nurturing several of these prospects. Importantly, we are not pursuing growth for its own sake; each opportunity must align with our capital discipline, strategic needs, and potential for synergies throughout our system. Therefore, you can expect more opportunities to arise, though predicting the timing will be challenging. Ultimately, we will only advance projects that provide a strong return for our unitholders.

That's great. If I could shift gears for the second question, I wanted to ask on tariffs. We got the one-month pause here. But if we eventually do get tariffs on Canada, can you walk through some of the dynamics of how that could play out for both your NGL and Crude business and potential impacts for Plains?

Well, Keith, I think we only have an hour for this call, so I’ll try to keep it pretty general. As everyone on the call knows, there are countless scenarios that could develop. We have been working on this for several months, considering various scenarios for what might occur. The short answer is that our guidance range captures the likely outcomes of potential tariffs. However, regarding any conclusions about what the tariffs might be and when they might take effect, it's important to understand that we are actively addressing this and have tried to mitigate many of the potential impacts. Until we have clarity on the tariffs or if they are implemented at all, we are essentially in a scenario planning phase. But rest assured, we are prepared for it, and if the tariffs materialize, we anticipate that the impact will fall within our guidance range.

Great. Thank you.

Thank you, Keith.

And one moment for our next question. Our next question will be coming from Manav Gupta of UBS. Your line is open.

Good morning, team. When you provided the initial 2024 guide versus where it came, the number was much stronger. And I'm just trying to understand, again, if the macro is supportive. When you look at 2025 guide, what could drive you towards the upper-end of that guide and possibly over it as you did in 2024?

Well, Manav, this is Willie. I'll start, and maybe others can jump in. When we look at 2025, I think it's important to consider the macro views that I mentioned regarding the administration. Clearly, a significant factor for us is volume growth and oil price. More activity would definitely lead to higher volumes. We anticipate a growth of 200,000 to 300,000 barrels a day in the Permian. However, as we move forward and listen to some of the producers' calls, there’s considerable activity happening. It has been consistent and also more productive, with the ability to produce higher volumes using fewer rigs and reduced completion activities. If I had to make a wager on momentum, I would bet on the positive side for 2025. Those are some of the key factors I see.

My quick follow-up is on Ironwood. You mentioned that it enhances your Western presence, but it also provides an opportunity to expand into the East. Given your strategy for bolt-on acquisitions, can we expect that you might further develop your Eastern footprint now that you've secured a position through this Ironwood midstream acquisition?

Manav, this is Jeremy. Thank you for the question. The easiest way to think about it is we had a strong footprint in the Eagle Ford. The Western assets of Ironwood overlay our existing system and create a number of synergies between capital and extending our value chain there. On the East side, it is a new area for us. It was basically an asset base run by a private equity company. We're trying to integrate it into our broader footprint and run it like a full integrated midstream business like we do. So over time, that would happen. This year's guide is more about integrating, getting under our foot and getting those investments in place to allow it to be integrated. I think you'd see, just like we've proven with other acquisitions, the ability to compress the multiple over time by driving additional businesses and opportunities through that footprint.

Perfect. Congratulations. I think your strategy of going from defense to offense is really working. Thank you.

Thanks, Manav.

And one moment for our next question. Our next question will be coming from Michael Blum of Wells Fargo. Your line is open, Michael.

Hey, good morning, everyone. So I wanted to ask, you previously guided flat EBITDA from 2024 to 2026. You said growth projects will offset Cactus recontracting. Here, you're up a little bit in 2025. So I just wanted to get a sense of do you now expect EBITDA is going to increase gradually from here on out? Or are there other puts and takes we should be considering over the next couple of years?

Michael, thanks for the question. I want to move away from the flat guidance we provided for 2024 to 2026. To give some context, back then, we had long-term contracts expiring that were quite favorable and reverting to market rates as anticipated. The purpose of that guidance was to provide a snapshot of the business at that time and reassure everyone that we were not facing a significant drop-off. As we grow our business, we expect that by 2026, our performance will surpass that of 2024. The recent deals we've announced contribute positively to our base business, leading us to believe 2026 will indeed be higher than 2024. You might wonder about the pace of this growth, and I assure you, we will continue to enhance our base business through integration efforts and capturing synergies. Our ongoing efficient growth strategy and any additional acquisitions will further contribute to this. While there might be some variability in growth, our clear objective is to increase enterprise value for our unitholders, and we will stay focused on executing this strategy moving forward.

Okay. Great. Thanks for that. Willie, that's helpful. The other question I wanted to ask, in December, you talked about initiatives to streamline operations. You talked about committing to higher margins, expense savings. I'm wondering if you could just provide an update on that, any details on whether any of that is baked into the guidance for 2025? Thanks.

Yeah, Michael. The way I would think about the cost and streamlining effort, it's a continuous process. So this is not something we're going to come out and proclaim a program on how much cost we can cut into the organization or how we can streamline our business. It's what we do. So there are some efficiency streamlining numbers in our numbers this year. But most importantly, as we build our business with the synergies on some of the things that we bring into the system as far as bolt-ons. And we have an ERP project, enterprise risk – enterprise, kind of, consolidating our financial progress, we think that's going to give us an opportunity to drive some more synergies and get some opportunities to further streamline. So it's really something that's baked into what we do every day. And I think what you'll do is you'll see continuous progress as we go through the year and even into next year.

Thank you.

Thanks, Michael.

And our next question will be coming from Jeremy Tonet of JPMorgan Securities LLC. Your line is open, Jeremy.

Hi, good morning.

Good morning, Jeremy.

Thank you for the insights today. I would like to elaborate on the M&A strategy. Clearly, the bolt-on acquisitions can create significant synergies by integrating systems. However, I am curious about how you evaluate an asset in the Mid-Con, which may provide some one-time synergies compared to the Permian, where there may be more ongoing growth opportunities. How does this influence your decision-making process and the opportunities you see ahead?

Jeremy, I'm not sure we heard all that, but the question was really how we think about bolt-ons and M&A across our footprint, is that right?

Yeah. Sorry about that. Just like in the Mid-Con might be more mature, one-time step-up in synergies versus in the Permian where there could be the synergies for connecting but also organic growth on top of it.

Sure. Last year, we saw significant developments like the Stroud acquisition, which is establishing a new platform and a long-term contracted business. We're integrating WaxIn, enhancing throughput and blending in our terminal system at Cushing. This expansion benefits our customers by increasing their access within our facilities and those connected to blending. It's a notable improvement, turning an asset that previously had zero EBITDA into a sustainable business while solidifying our terminal's position. Additionally, our recent transaction with CVR has been advantageous for both parties. We partnered with them in 2017 when they required financing for their projects and turnarounds. This gives us long-term commitments through our terminal and pipeline, fostering a durable relationship at favorable rates. As Willie mentioned, the Mid-Con is a valuable long-term asset for us, alongside our outer Permian assets contributing to free cash flow, ensuring we maintain this trajectory for the next decade.

Jeremy, Willie, again. if you notice again, but if you think about our system and you know well, it's very dynamic. It gives us a lot of opportunity to do different things. And earlier, we had the question around what might happen around Canadian crude tariffs or, for example, crude tariffs. And if you just look at our footprint, you could see if volumes didn't find their way to the US, which is not what our outlook is, but we do have a big system that can swing and bring volumes from the Permian ultimately into pushing into the Mid-Continent north. So you can see there's a broad system that's very flexible that we think about, lots of different option values, and it's good to have choices and options as we go forward.

Got it. Optionality makes sense. If I could take a step back, could you share your views on the macro side, specifically regarding crude oil prices? How do you see them unfolding and which basins do you expect to see growth in over time? I'm looking for a longer-range perspective on the macro situation and how you feel about it.

Sure. It's constructive. You've heard a lot of our peers' calls about low distillate inventories globally, lower crude inventories you've got the supply and demand fundamentals, which were in this neighborhood, but you've got a lot of policy that's driving crude prices right now. And a lot of that could be more sanctions on the rand, more sanctions on Venezuela, tariffs, all those things could lead to price increases, filling the SPR. So there's a lot of that are balancing. And so if the headlines are leading to driving price, people are a little bit confused as to which way it's going. But we think the backlog is constructive from a physical standpoint, from a demand standpoint, and then policy is only enhancing that. And then from which basins are growing, there's pockets in the Rockies that are growing. There's Canada that's growing. The Permian is growing. And then we're even seeing new developments in the Eagle Ford area and the Mid-Continent area that are drawing capital. So we see positive growth around existing assets. And then we see more broad longer-term, we see Canada, the Rockies and the Permian as growth by different areas. And that's where you're seeing a lot of the investment from us as well.

Jeremy, Willie, again. if you notice again, but if you think about our footprint and Jeremy outlined that we expect flat growth in outside the basins of the Permian and in Canada. We're in great ZIP codes. The Permian is the growth engine for the US. One could argue it's probably broader for the world even. And then Western Canada, let's not forget that we've got a footprint there, that's able to take additional NGLs out of gas to produce NGLs that are needed. So two growth areas: Western Canadian Sedimentary Basin and the Permian Basin, we're in both of those ZIP codes.

Got it. Makes sense. Thank you for that.

Thank you.

And one moment for our next question. Our next question will be coming from Brandon Bingham of Scotiabank. Your line is open, Brandon.

Hi, good morning. Thank you for the question. I was wondering if we could revisit the EBITDA guidance. Could you discuss the current TIL pop count that informs this guidance? Are customers generally increasing their well activity year-over-year, decreasing, or is it stable? How does this compare to the outlook for 2024? I understand that companies are doing more with less, but I'm curious if the sentiment in discussions with customers has become more positive, perhaps due to the current administration or changes in the Secretary of Energy position. What are some of the key factors influencing the EBITDA guidance and the broader market outlook?

Hi Brandon, I would say the situation is very consistent. In the Permian Basin, where we have our largest lease gathering activity, and in the Eagle Ford with our Ironwood project, the pace has remained consistent from last year to this year. We're not focusing on just one or two well locations, which makes us more efficient. So I would say it's steady compared to last year, with similar new connections and behind pipe connections. This gives us added confidence in the forecast that Willie outlined at the beginning of the call.

Awesome. Great. And then maybe if we could just turn to the CapEx guide for this year. Could you just help us understand some of the moving pieces embedded in the guide if there's anything related to the deals from January that's in there for this year that might be even dropping lower next year? Was there any slippage from 2024 into this year? I know Q4 CapEx came in a little light versus our expectations. Just any detail you guys could provide would be helpful.

Brandon, this is Chris Chandler, and I'm glad to answer your question. You covered several of our points, which we appreciate. We were able to defer some capital expenditures from 2024 to 2025, and we always aim to optimize our capital spending and avoid unnecessary expenditures. This is contributing to higher spending in both 2025 and 2024. We've also increased our acreage dedication in the Permian, as Jeremy mentioned, which is driving additional investment and volume. Regarding our larger projects for 2025, the two significant ones outside the Permian are the Fort Sask expansion project, which is set to come online in the second quarter of 2025, and investments in the Mid-Con to facilitate the offloading of crude from the Uinta wax basin. This represents a promising new business platform for us and contributes to our capital expenditures. In summary, we remain committed to maintaining our long-term investment capital in the range of $300 million to $400 million and uphold our commitment to capital discipline.

And Brandon, all these projects go through our investment committee. So we stress test all these on returns to make sure that we're only doing the ones that have the best benefit for us.

Awesome. Great to hear. Thanks.

Thank you.

And one moment for our next question. Our next question will be coming from Spiro Dounis of Citi. Your line is open.

Thanks, Operator. Good morning, team. I wanted to touch on the long-haul open position first. Last time we chatted, you had a fairly open position heading into 2026. Just curious where that stands now, given the tightening egress you guys pointed out in the slides and maybe any plans to firm up that capacity?

Thanks, Spiro. This is Jeremy. I'd say it's very consistent. Long haul to Corpus is contracted. Our Houston positions are largely contracted with the exception of BridgeTex, but we made progress in continuing to extend those contracts or restructure those contracts. And then with respect to basin, we're seeing incremental demand, which we put into the guide. And we'll stick to shorter-term contracts until we see the tariffs where we want them to be longer term and expect them to be as the basin continues to fill. So, I'd say it's fairly consistent, but it's definitely constructed.

Great. Very good to hear. Second one, just moving on to the distribution. You guys once again chose an accelerated growth level. And historically, you sort of talked about growth expectations being surpassed as the main driver on why you accelerate that growth a little bit each year. But going forward, it does sound like bolt-ons are going to be perhaps maybe a really meaningful driver of growth. And so just sort of curious, like all else equal, is it fair to say that each bolt-on increases your ability to push that next distribution increase above your baseline amount?

Conceptually, the answer is yes. Obviously, if you think about our business, we've got the base business growth and then we've got bolt-on. So we factor all of that as we go forward. And I mean, we've been very pleased to be able to return more back to the unitholders. In November of 2022, we came out with this framework targeting the $0.15, and we've been able to do $0.20 increases in 2023 and 2024 and now the $0.25 increase in 2025. So I think the framework works, and when we do better, more money goes back to the unitholders. But there's a lot of moving parts, but generally speaking, you're absolutely right. We have a little bit of coverage buffer over this period of time to allow us to continue to grow, even if the bolt-ons and growth may not have been there. But as we go forward and shrink some of that buffer, it's going to be more dependent upon our base business and the timeliness of some of those bolt-ons.

Great. I’ll leave it there. Have a good weekend, guys.

Thanks very much.

Thank you. One moment for our next question. Our next question will be coming from Sunil Sibal of Seaport Global. Your line is open.

Good morning, everyone, and thank you for the clarity on the call. I wanted to begin by asking about your volume guidance in the Permian. How should we think about the cadence of those volumes in 2025? You mentioned an overall volume growth of 200,000 to 300,000 barrels per day in the Permian. How should we interpret that growth in relation to your guidance? If the basin trends towards the higher end of that range, should we expect an upside in your Permian volume numbers?

Sunil, this is Jeremy. First, your cadence on the production growth. I'd say it's consistent with last year. If you think of last year, weather in the beginning of the year led to flattish through the first part of the year and growth July through November was strong. And then we start to flatten out towards the end of the year. Same thing we'll see this year. So I'd say it's second half weighted, but very similar. I think in the context of does it impact our guide. The way I think about it is 300,000 barrels in that day in the context of a 6.5 million barrel a day plus basin, that's really small on a relative basis. So I think the rain certainly encompasses the 200,000 to 300,000 barrels a day. We look at it as a buildup from all the producers we have in the top down and those both marry pretty well. So I'd say, you're not going to see material value variations based on that range 200,000 to 300,000. It will be within our guidance.

Okay. Thanks for that. And then on NGL business, seems like there have been some changes in the competitive landscape and are happening as we speak in the NGL business in Canada. How should we think about Plains' positioning in that area?

Sunil, I'd say a lot of the positioning that you've seen in the Gulf Coast and even Kierra's announcement today, that's not going to have a significant impact in the positioning from ours. We have very unique assets that can't be replicated, and we're very happy with our Canadian NGL footprint and our competitiveness.

Okay. Thanks for that.

Thanks, Sunil.

One moment for our next question. Our next question will be coming from Jean Ann Salisbury of Bank of America. Your line is open.

Hi. Good morning. I have a question about the guidance for long haul on slide 5. You mentioned overall Permian growth of around 300,000, but Plains long-haul will grow by 170. That accounts for over half of that growth. This seems like more market share gain than I anticipated for this year, especially considering the Gray Oak expansion and Seminal returning to crude service. Could you provide more insight into the assumptions behind this, such as the toll to Cushing, any contributions from bolt-ons or contract additions, or anything else relevant?

Sure. So when its much is easy, that's just a step-up in contracts. Physical flow on the Cactus pipelines due to some connecting carrier downtime led to some artificial downtime last year. But that that will be full. So Cactus I and Cactus II, where they had some physical lag last year, won't have this year. And then the pull-to-basin is pretty unique on our system. So I think a function of timing and some unique circumstances that happened last year.

Okay. That makes sense. That’s all for me. Thank you.

Thanks, Jean Ann.

Thank you. One moment for next question. Our next question will be coming from AJ O'Donnell of TPH. Your line is open.

Good morning, everyone. I want to revisit some of the comments regarding the basin that Willie mentioned in his prepared remarks. Considering the current low inventories in Cushing, I'm curious if you foresee a shift occurring earlier this year that would enable some of that growth to be more front-loaded rather than concentrated in the latter half of the year, as you previously indicated.

Sure. With respect to basin, remember, it's refinery pull pipeline. And so you have a peak maintenance season right now. So typical for basin as you'll see lower first quarter volumes unless there's an upset and then you'll see higher through the driving fee. So I think you'll see more full artificial things that could impact that tariffs could certainly impact the pull to domestic refiners to substitute for Canadian barrels. But I would say, by and large, volume growth once the Gulf Coast gets filled, you're going to see more push up basin just from a pricing standpoint. But basin will typically follow refining utilization. So think of it that way.

Okay. And then just one more for me on the NGL segment. Looks like hedges kind of improved. They stepped up a little bit from 60% to 70% and are at $0.70 a gallon. I'm just curious if you could talk about where you're seeing current rates in the market and maybe your ability to hedge the exposed volumes at higher rates?

Sure. That's certainly the reason why we typically hedge more in the front than in the back because you've been in a really steep backwardation. So 2026 would be low to mid-60s, comp would be closer $0.80. And so for us, that's why you've seen more heading in the front, in the back and this year is no different than we've explained in the last couple of years.

Okay. That’s all for me. Thank you, guys.

Thanks, AJ.

And our next question will be coming from Neal Dingmann of Truist Securities. Your line is open, Neal.

Good morning, everyone. Thank you for your time. My first question is about the potential opportunities in the Eastern Eagle Ford that you mentioned regarding Ironwood. I'm curious about the timing for these opportunities. Are we looking at something in the near future, or should we expect it more next year?

The way I look at it is we've just closed January 31, drilled to have it. We're canvassing all the customers and looking at opportunities on the integration. So I think it'd be more of next year. So the multiples the teams talked about and returns have been more predicated on what the current cash flows are, not what we can do with the asset. So we're excited about the opportunity set.

That makes sense. I have a quick question about capital allocation. Beyond your targeted sustainable distribution growth and the bolt-on potential you mentioned, where do you see opportunistic buybacks fitting in? I still feel like your stock appears somewhat discounted compared to some peers, so I'm curious about how this would fit into your plans.

This is Al. We had really no change in our view with regard to that. Any buybacks would be opportunistic and really kind of think of market dislocation. And with the trading of our stock, we would need to see a material kind of change in that valuation. Our preference is to continue to return cash to shareholders or unitholders through distributions, like you've seen with this $0.25 increase for 2025.

Got it. Thanks, Al.

One moment for our next question. Our next question will be coming from John Mackay of Goldman Sachs & Company. Your line is open.

Hey, guys. Good morning. I know we've kind of picked this to death a little bit, but I want to ask one more just on the Permian guide. You're kind of framing Permian at 55% accrued EBITDA this year. We obviously have the Cactus step down later in the year. I was just wondering if you could kind of pick apart the implied Permian EBITDA for the year balancing what's coming off for Cactus 1 versus what you see kind of underlying EBITDA growth is offsetting that.

The way to think about that is tariff volumes and physical volumes can be different. And so a lot of cases, we were paid for volumes that didn't move. And so for Cactus 2, some of that will be incremental just as the pipe fills, Cactus 1 will largely just a step-up in rate for some of the spot. I don't think we're giving a specific guide for that piece.

All right. Fair enough. And then okay.

The slide 11 in the deck provides some insight into the Cactus impact and growth, though it doesn't break it down precisely. I will look into that.

That's fair. In context of your outlook on capacity becoming tighter in the basin next year, when do you expect to provide an update on the re-contracting tailwind? Is this something we should expect to discuss this summer, or will we need to wait until next year? I'm just trying to determine when we could get an update. Thanks.

I think it's just going to be gradual overtime. This is also part of the continuous improvement mindset that Willie outlined. This is something we don't have to rush on. Current differentials wouldn't support it. So we would sign shorter-term contracts. So we'll let you know if there's to talk about, otherwise, we'll continue to optimize the space. And just because it's not contracted, it doesn't mean we're not filling in or finding ways to do shorter-term deals and generate revenue from it. So I look at it as we are absolutely trying to generate as much margin and revenue as we can. And we'll optimize the value of that space. But I wouldn't expect any grand unveil of re-contracting for that asset.

And John, this is Willie. The way I think about it from a macro standpoint. You've got the capacity and you've got economic capacity. It's going to be hard to build a new long-haul pipeline to the Gulf Coast. If you think about commercial commitments it takes, the permitting/supply chain issues. So I think our view is, you have to balance what you think ultimately Permian growth is going to be. So my guess is we're going to get to this point where it is going to get tighter capacity. And we're probably going to live in that space for a while. And whether or not a new long-haul line gets built, it's really going to be dependent upon kind of a broader view of, can the Permian go the next step. So I think we're going to be in pretty good place in the next number of years. We certainly have struggled in the overcapacity years in the past number of years. So I think we're in that whole different sector of time here as we get closer to the full state.

All right. I appreciate the time. Thank you, guys.

Thank you, John.

Thank you. One moment for our next question. Our next question will be coming from Theresa Chen of Barclays. Your line is open, Theresa.

Would you mind reminding us what your PLA volumetric exposure is at this point, just as we try to frame up the sensitivity to the $75 to EBITDA assumption within your 2025 guidance?

Hey Teresa, it's Blake. The last update we've given is four million barrels a year. So call it, a $10 move equates to roughly $40 million of EBITDA.

Thank you.

And I would now like to turn the conference back to Willie Chiang for closing remarks.

Well, listen, thanks to all of you for dialing in and for your continued interest in Plains. We look forward to seeing you soon, as we get out on the road. Have a safe weekend.

And this concludes today's conference call. Thank you for participating. You may now disconnect.