Plains All American Pipeline, L.P.

Good day and thank you for standing by. Welcome to the PAA and PAGP Second Quarter 2021 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. To ask a question during the session, you will need to press star 1 on your telephone keypad. If you require any further assistance, you may press star zero. Without further ado, I would like to welcome your speaker for today, Mr. Roy Lamoureux. Sir, the floor is yours.

Thank you, Carl. Good afternoon, and welcome to Plains All-American's second quarter 2021 earnings call. Today's slide presentation is posted on the Investor Relations website under News and Events section of plainsallamerican.com, where 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 two. A condensed consolidating balance sheet for PAGP and other reference materials are located in the appendix. Willie Chang, Chairman and CEO, and Allison Watson, Executive Vice President and Chief Financial Officer, will host our call. Other members of our team will be available for Q&A, including Harry Pafanis, President, Chris Chandler, Executive Vice President and Chief Operating Officer, Jeremy Goble, Executive Vice President and Chief Commercial Officer, and Chris Herbold, Senior Vice President and Chief Accounting Officer. Before turning the call over to Willie, I'll note that we will focus today's discussion on our second quarter results and full year guidance. With respect to the Permian Basin joint venture that we intend to form with Oryx Midstream, given that the transaction is not expected to close until the fourth quarter, we do not plan to share any additional information beyond what was provided on our July 13th conference call. With that, I will now turn the call over to Willie.

Thank you, Roy, and thanks to everyone for joining our call. This afternoon, we reported better than expected second quarter adjusted EBITDA of $579 million, and we increased our full-year guidance by $25 million to plus or minus $2.175 billion. Our second quarter results benefited from certain timing-related items, which, as Al will discuss, are incorporated within our full-year guidance. A summary of our financial highlights is provided on slide three. In previous calls, we have discussed reaching a positive inflection point in our business. We've been advancing a number of initiatives aimed to maximize free cash flow with the near-term benefit of accelerating debt reduction while returning capital to our equity holders. These initiatives take time to develop and materialize, and I'm very pleased with the progress we have made, with several of the initiatives coming to fruition since our first quarter call in May. A recap is provided on slide four. On asset sales, yesterday we closed the $850 million sale of our natural gas storage business, which was roughly two months ahead of schedule. We continue to progress additional opportunities and expect to achieve $920 million in total asset sales in 2021, well exceeding our initial target of $750 million. Regarding portfolio optimization, we announced the execution of a definitive agreement to form the Strategic Plains Orcs Joint Venture through a cash transaction. This debt-free entity will align directly with our optimization strategies. As for our capital program, we have further reduced our 2021 investment capital by $50 million to plus or minus $325 million, or 25% below our February guidance, with the majority of the reduction related to the cancellation of the Bahalia Connection project. And importantly, on sustainability, last week we published our 2020 Sustainability Report, greatly increasing our quantitative disclosures, including our Scope 1 and Scope 2 greenhouse gas emissions data, which reflect a reduction over the last three years and screens favorably relative to peers on overall emissions. The full report is posted on our website, highlights from which are included within today's presentation. Regarding our macro view, our fundamental outlook remains positive. and we expect global crude oil supply and demand to continue to rebalance over the next several quarters. While recent OPEC Plus actions have largely been consistent with our expectations, we continue to monitor potential near-term headwinds to global demand recovery. As commodity price signals have increased, producer activity in the Permian ramped earlier in the year and have stabilized in recent months. We expect growth activity to resume as supply and demand balance further improves, which we expect to be mid-2022. We believe Plains is well positioned for a multi-year period of Permian growth with significant operating leverage and assets underpinned by high-quality long-term cash flow. Further reinforcing this will be the completion of our recently announced Permian Basin JV with Oryx, our wink to Webster entering full service later this year, as well as the completion of projects outside of the Permian, such as the cap line reversal. As a collective result of this progress, we have further increased our 2021 estimated free cash flow after distributions to plus or minus $1.35 billion, or $450 million, excluding proceeds from asset sales. As is illustrated on slide five, we plan to continue allocating our free cash flow in a balanced manner with a near-term focus on debt reduction, and allocating a larger percentage over time to equity holders. With that, I'll turn the call over to Al.