Plains All American Pipeline, L.P.

Good day, and thank you for standing by. Welcome to the PAA and PAGP fourth quarter 2023 earnings conference 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 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Blake Fernandez, Vice President of Investor Relations.

Please go ahead. Thank you, Daniel. Good morning, and welcome to Plains All-American fourth quarter 2023 earnings call. Today's slide presentation is posted on the Investor Relations website. under the News and Events section at 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 two. An overview of today's call is provided on slide three. A condensed consolidating balance sheet for PAGP and other reference materials are in the appendix. Today's call will be hosted by Willie Chang, Chairman and CEO, and Al Swanson, Executive Vice President and CFO, as well as other members of our management team. With that, I will turn the call over to Willie.

Thank you, Blake. Good morning, everyone, and thank you for joining us. Today we reported fourth quarter and full year results exceeding expectations in both our crude oil and NGL segments. We've made considerable progress towards our long-term strategy while demonstrating continuous execution of our goals and initiatives. In summary, fourth quarter and full year adjusted EBITDA attributable PAA was $737 million and $2.71 billion respectively, with full year results exceeding the midpoint of our initial guidance by approximately $210 million or 8%. We lowered our long-term leverage ratio target range to 3.25 to 3.75 times, and we ended 2023 with a leverage ratio of 3.1 times. Our efforts to enhance the balance sheet were recognized by the credit rating agencies with two recent upgrades to MID BBB. Additionally, we completed several win-win strategic transactions both in our crude oil and NGL segments, including three Permian Gathering bolt-on transactions, the sale of our interest in a Canadian fractionation facility, and the recent divestiture of approximately 600 crude oil rail cards for proceeds of approximately $40 million. These transactions are representative of our ongoing efforts to optimize our asset base and streamline our operations while generating attractive returns for unit holders. The strong EBITDA results, along with the recent bolt-on transactions and lower leverage, helped underpin a $0.20 per unit annualized increase in our common unit distribution level, which will be payable later this month, and represents a 19% increase in the annualized distribution relative to 2023 levels. Turning to slide four, it should come as no surprise that our 2024 key focus areas remain very consistent with last year's. Our strong operational and equity performance over the past year only serves to reaffirm our strategy. Most notably, our focus on generating meaningful free cash flow, our commitment to capital discipline, and a clear and concise capital allocation framework focused on increasing return of capital to equity holders while maintaining strong balance sheet and financial flexibility. As highlighted on slide 5, we expect adjusted EBITDA attributable to PAA of $2.625 to $2.725 billion for 2024. This reflects year-over-year growth in our crude oil segment underpinned by continued Permian production and tariff volume growth, as well as contributions from recent bolt-on acquisitions. Our guidance also factors in a reduction in our NGL segment, primarily driven by lower forecasted frac spreads year over year. As shown on slide six, we anticipate 2024 Permian crude oil production growth to be between 200,000 to 300,000 barrels a day, exit to exit, with the Delaware Basin driving the majority of the growth. Our updated forecast assumes an average of 300 to 320 horizontal rigged rigs, and as part of our routine fundamentals forecasting process, we will continue monitoring our assumptions as the year progresses. Our Permian JV system is well positioned with more than 4.4 million long-term dedicated acres and operating leverage to provide customers with midstream solutions from the wellhead to demand centers. As we show on slide seven, we expect to capture approximately 275,000 barrels a day of incremental gathering tariff volumes for the full year 2024. For our long-haul systems, we continue to expect high utilization on our corpus-bound assets, a volume step-up on Basin Pipeline, and an MVC step-up on Wink to Webster. In our NGL segment, we continue to focus on optimizing the business and improving the durability of our earnings. During 2023, we closed the sale of our JV interest in Kiera Fort SASC and we sanctioned a 30,000-barrel day de-bottleneck of the Plains Fort Sask complex. The de-bottleneck project remains on budget and unchanged in service date of mid-2025. With that, I'll turn the call over to Al.