PLAINS GP HOLDINGS LP

Previous wording

We are a Delaware limited partnership that has elected to be taxed as a corporation for United States federal income tax purposes. As of June 30, 2024, our sole cash-generating assets consisted of an approximate 85% limited partner interest in AAP. We also own a 100% managing member interest in GP LLC, which holds the non-economic general partner interest in AAP. As of June 30, 2024, AAP directly owned a limited partner interest in PAA through its ownership of approximately 232.7 million PAA common units (approximately 30% of PAA’s total outstanding common units and Series A preferred units combined). AAP is the sole member of PAA GP, which holds the non-economic general partner interest in PAA.

Current wording

We are a Delaware limited partnership that has elected to be taxed as a corporation for United States federal income tax purposes. As of September 30, 2024, our sole cash-generating assets consisted of an approximate 85% limited partner interest in AAP. We also own a 100% managing member interest in GP LLC, which holds the non-economic general partner interest in AAP. As of September 30, 2024, AAP directly owned a limited partner interest in PAA through its ownership of approximately 232.9 million PAA common units (approximately 30% of PAA’s total outstanding common units and Series A preferred units combined). AAP is the sole member of PAA GP, which holds the non-economic general partner interest in PAA.

Previous wording

During the first six months of 2024, we recognized net income of $653 million compared to $776 million during the first six months of 2023. Net income for the 2023 period includes favorable impacts from gains on asset sales and the mark-to-market adjustment of the Preferred Distribution Rate Reset Option, contributing to the relative decrease in net income in 2024. Our Crude Oil segment results were more favorable for the first six months of 2024 compared to 2023 and our NGL segment results were relatively flat year-over-year.

Current wording

During the first nine months of 2024, we recognized net income of $953 million compared to $1.044 billion during the first nine months of 2023. Results from our operations increased for the first nine months of 2024 over the comparable 2023 period due to more favorable results from our Crude Oil segment, partially offset by less favorable results from our NGL segment. Net income for the 2023 period includes favorable impacts from gains on asset sales and the mark-to-market adjustment of the Preferred Distribution Rate Reset Option, contributing to the relative decrease in net income in 2024. In addition, the 2024 results were impacted by an increase in costs associated with settlements related to the Line 901 incident that occurred in May 2015 and higher income tax expense.

Previous wording

Product sales revenues and purchases increased for the three and six months ended June 30, 2024 compared to the same periods in 2023 primarily due to higher commodity prices in the 2024 periods.

Current wording

Product sales revenues and purchases increased for the three months ended September 30, 2024 compared to the same period in 2023 primarily due to higher crude oil sales volumes in the 2024 period, partially offset by lower commodity prices.

Previous wording

Revenues from services increased for the three and six months ended June 30, 2024 compared to the same periods in 2023 primarily due to higher pipeline volumes and tariff escalations, as well as the impact of acquisitions.

Current wording

Revenues from services increased for the nine months ended September 30, 2024 compared to the same period in 2023 primarily due to higher pipeline volumes and tariff escalations, as well as the impact of acquisitions, partially offset by timing of revenue recognition in the third quarter of 2023.

Previous wording

The increase in general and administrative expenses for the three and six months ended June 30, 2024 compared to the same periods in 2023 was primarily due to (i) higher information systems costs due to ongoing systems conversion and integration work and (ii) higher employee-related costs, including an increase in equity-indexed compensation expense (a portion of which is excluded in the calculation of Adjusted EBITDA and Segment Adjusted EBITDA).

Current wording

The increase in general and administrative expenses for the three and nine months ended September 30, 2024 compared to the same periods in 2023 was primarily due to (i) higher employee-related costs and (ii) higher information systems costs due to ongoing systems conversion and integration work.

Previous wording

The net gain on asset sales for the six months ended June 30, 2023 was primarily comprised of a gain of approximately $140 million related to the sale of our Keyera Fort Saskatchewan facility in the first quarter of 2023. See Note 7 to our Consolidated Financial Statements included in Part IV of our 2023 Annual Report on Form 10-K for additional information.

Current wording

The net gain on asset sales for the nine months ended September 30, 2023 was primarily comprised of a gain of approximately $140 million related to the sale of our Keyera Fort Saskatchewan facility in the first quarter of 2023. See Note 7 to our Consolidated Financial Statements included in Part IV of our 2023 Annual Report on Form 10-K for additional information.

Previous wording

(1)The activity during the periods presented was primarily related to the impact from the change in the USD to CAD exchange rate on the portion of our intercompany net investment that is not long-term in nature.

Current wording

(1)The activity during the periods presented was primarily related to the impact from the change in the CAD to USD exchange rate on the portion of our intercompany net investment that is not long-term in nature.

Previous wording

The net favorable income tax variance for the six months ended June 30, 2024 compared to the same period in 2023 was primarily due to the tax impact of (i) the Keyera Fort Saskatchewan divestiture in the first quarter of 2023 (ii) lower year-over-year income within our Canadian operations as impacted by fluctuations of derivative mark-to-market valuations and (iii) lower earnings at PAA on income attributable to PAGP, partially offset by (iv) higher income tax expense in the second quarter of 2024 associated with Canadian withholding tax on dividends from our Canadian entities to other Plains entities.

Current wording

The net unfavorable income tax variance for the nine months ended September 30, 2024 compared to the same period in 2023 was primarily due to higher income tax expense in the second quarter of 2024 associated with Canadian withholding tax on dividends from our Canadian entities to other Plains entities, partially offset by the impact of lower earnings at PAA on income attributable to PAGP.

Previous wording

(6)Other income, net on our Condensed Consolidated Statements of Operations, adjusted for selected items impacting comparability (“Adjusted other income/(expense), net”) is included in Adjusted EBITDA and excluded from Segment Adjusted EBITDA.

Current wording

(6)“Other income, net” on our Condensed Consolidated Statements of Operations, adjusted for selected items impacting comparability (“Adjusted other income, net”) is included in Adjusted EBITDA and excluded from Segment Adjusted EBITDA.

Previous wording

Our Crude Oil segment operations generally consist of gathering and transporting crude oil using pipelines, gathering systems, trucks and, at times, on barges or railcars, in addition to providing terminalling, storage and other related services utilizing our integrated assets across the United States and Canada. Our assets provide services to third parties as well as to our merchant activities. Our merchant activities include the purchase of crude oil supply and the movement of this supply on our assets or third-party assets to sales locations, including our terminals, third-party connecting carriers, regional hubs or to refineries. Our merchant activities are governed by our risk management policies.

Current wording

Our Crude Oil segment operations generally consist of gathering and transporting crude oil using pipelines (including gathering systems), trucks and, at times, on barges or railcars, in addition to providing terminalling, storage and other related services utilizing our integrated assets across the United States and Canada. Our assets provide services to third parties as well as to our merchant activities. Our merchant activities include the purchase of crude oil supply and the movement of this supply on our assets or third-party assets to sales locations, including our terminals, third-party connecting carriers, regional hubs or to refineries. Our merchant activities are governed by our risk management policies.

Previous wording

Crude Oil Segment Adjusted EBITDA increased for the three and six months ended June 30, 2024 compared to the same periods in 2023 primarily due to higher tariff volumes on our pipelines, tariff escalations and contributions from acquisitions, partially offset by fewer market-based opportunities.

Current wording

Crude Oil Segment Adjusted EBITDA increased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to higher tariff volumes on our pipelines, tariff escalations and contributions from acquisitions, partially offset by fewer market-based opportunities.

Previous wording

The following is a more detailed discussion of the significant factors impacting Segment Adjusted EBITDA for the three and six months ended June 30, 2024 compared to the same periods in 2023.

Current wording

The following is a more detailed discussion of the significant factors impacting Segment Adjusted EBITDA for the three and nine months ended September 30, 2024 compared to the same periods in 2023.

Previous wording

Net Revenues and Equity Earnings. Our results were favorably impacted by (i) volume growth across our pipeline systems driven by increased production as well as increased movements from the Rocky Mountain region to Cushing, Oklahoma, (ii) tariff escalations and (iii) contributions from acquisitions.

Current wording

Net Revenues and Equity Earnings. Our results were favorably impacted by (i) volume growth across our pipeline systems driven by increased production in the Permian Basin region as well as increased movements from the Rocky Mountain region to Cushing, Oklahoma, (ii) the benefit of tariff escalations and (iii) contributions from acquisitions.

Previous wording

Additionally, our results for the three and six months ended June 30, 2024 compared to 2023 reflect fewer crude oil market-based opportunities.

Current wording

Additionally, our results for the three and nine months ended September 30, 2024 compared to the same periods in 2023 reflect fewer crude oil market-based opportunities.

Previous wording

Field Operating Costs. For the three and six months ended June 30, 2024 compared to the same periods in 2023, we recognized higher expenses associated with (i) employee-related costs primarily resulting from higher average headcount and salaries, (ii) property taxes due to the impact of favorable adjustments in 2023 and (iii) incremental operating costs associated with acquisitions. The unfavorable variance for the three and six months ended June 30, 2024 compared to 2023 was partially offset by (iv) lower utilities-related costs as a result of lower prices, partially offset by higher volumes, (v) a decrease in the amount of drag reducing agents used and (vi) decreased costs resulting from lower third-party trucked volumes.

Current wording

Field Operating Costs. For the three and nine months ended September 30, 2024 compared to the same periods in 2023, we recognized higher expenses associated with (i) an increase in costs associated with settlements related to the Line 901 incident that occurred in May 2015 (which impact field operating costs, but are excluded from Segment Adjusted EBITDA, and thus are reflected as an “Adjustment” in the table above), (ii) employee-related costs primarily resulting from higher average headcount and salaries, (iii) property taxes due to the impact of favorable adjustments in 2023 and (iv) incremental operating costs associated with acquisitions, partially offset by (v) decreased costs resulting from lower third-party trucked volumes. Field operating costs for the nine months ended September 30, 2024 compared to the same period in 2023 were also favorably impacted by lower utilities-related costs as a result of lower prices, partially offset by higher volumes and an increase in the amount of drag reducing agents used.

Previous wording

The increase in maintenance capital spending for the three and six months ended June 30, 2024 compared to the same periods in 2023 was primarily due to timing of routine integrity maintenance.

Current wording

The increase in maintenance capital spending for the three and nine months ended September 30, 2024 compared to the same periods in 2023 was primarily due to higher costs resulting from increased pipeline integrity activities and trucking lease buyouts. Additionally, the three months ended September 30, 2024 compared to the same 2023 period was further impacted by timing of tank integrity activities.

Previous wording

NGL Segment Adjusted EBITDA increased for the three months ended June 30, 2024 compared to 2023 as a result of higher propane and butane sales volumes, primarily due to turnarounds impacting sales volumes in the second quarter of 2023, and incremental margins from iso-to-normal butane spread benefits in the second quarter of 2024.

Current wording

NGL Segment Adjusted EBITDA decreased for the three and nine months ended September 30, 2024 compared to the same periods in 2023 primarily as a result of the impact of lower realized frac spreads, partially offset by higher propane and butane sales volumes. The nine months ended September 30, 2024 compared to the same period in 2023 further benefited from incremental margins from iso-to-normal butane spreads in the first half of 2024.

Previous wording

Net Revenues. Net revenues include the impact of derivative activities and long-term inventory costing adjustments, which are excluded from Segment Adjusted EBITDA and thus are reflected as an “Adjustment” in the table above. Excluding such impacts, net revenues increased for the second quarter of 2024 compared to 2023 and were relatively flat for the six months ended June 30, 2024 compared to 2023.

Current wording

Net Revenues. Net revenues include the impact of derivative activities and long-term inventory costing adjustments, which are excluded from Segment Adjusted EBITDA, and thus are reflected as an “Adjustment” in the table above. Excluding such impacts, net revenues decreased for the three and nine months ended September 30, 2024 compared to the same periods in 2023.

Previous wording

For both the three- and six-month periods ended June 30, 2024 compared to the same periods in 2023, we had lower field operating costs recoveries at our Empress straddle plants realized through our commercial agreements.

Current wording

The decrease in net revenues for the three and nine months ended September 30, 2024 compared to the same periods in 2023 was primarily due to (i) lower realized frac spreads and (ii) lower field operating cost recoveries at our Empress straddle plants realized through our commercial agreements, partially offset by (iii) higher propane and butane sales volumes.

Previous wording

Field Operating Costs. The decrease in field operating costs for the six months ended June 30, 2024 compared to the same period in 2023 was primarily due to decreased utilities-related costs largely as a result of lower prices, partially offset by higher maintenance and integrity costs. The decrease in utilities-related costs was partially offset by the lower benefit to net revenues of operating cost recoveries realized through commercial agreements.

Current wording

Field Operating Costs. The decrease in field operating costs for the three and nine months ended September 30, 2024 compared to the same periods in 2023 was primarily due to (i) decreased utilities-related costs largely as a result of lower prices and (ii) a decrease in unrealized mark-to-market losses on power hedges (which impact our field operating costs, but are excluded from Segment Adjusted EBITDA, and thus are reflected as an “Adjustment” in the table above), partially offset by (iii) higher maintenance costs and (iv) higher employee-related costs primarily resulting from higher average headcount and salaries. The decrease in utilities-related costs was partially offset by the lower benefit to net revenues of operating cost recoveries realized through commercial agreements.

Previous wording

The decrease in maintenance capital spending for the three and six months ended June 30, 2024 compared to the same periods in 2023 was primarily due to timing of equipment repairs and replacement projects for certain of our pipeline systems and fractionation facilities.

Current wording

The decrease in maintenance capital spending for the nine months ended September 30, 2024 compared to the same period in 2023 was primarily due to timing of equipment repairs and replacement projects for certain of our pipeline systems and fractionation facilities.

Previous wording

As of June 30, 2024, although we had a working capital deficit of $18 million, we had approximately $3.2 billion of liquidity available to meet our ongoing operating, investing and financing needs, subject to continued covenant compliance, as noted below (in millions):

Current wording

As of September 30, 2024, we had a working capital surplus of $34 million and approximately $3.3 billion of liquidity available to meet our ongoing operating, investing and financing needs, subject to continued covenant compliance, as noted below (in millions):

Previous wording

(2)Available capacity under the PAA senior unsecured revolving credit facility and the PAA senior secured hedged inventory facility was reduced by outstanding letters of credit issued under these facilities of less than $1 million and $39 million, respectively.

Current wording

(2)Available capacity under the PAA senior unsecured revolving credit facility and the PAA senior secured hedged inventory facility was reduced by outstanding letters of credit issued under these facilities of less than $1 million and $34 million, respectively.

Previous wording

(3)Excludes restricted cash of $3 million.

Current wording

(3)Excludes restricted cash of $4 million.

Previous wording

Net cash provided by operating activities for the first six months of 2024 and 2023 was $1.070 billion and $1.629 billion, respectively, and primarily resulted from earnings from our operations. Both periods were also impacted by changes in working capital items. The 2024 period was impacted unfavorably, primarily by margin requirements related to our hedging activities. The 2023 period was impacted favorably, largely associated with reducing inventory levels during the period.

Current wording

Net cash provided by operating activities for the first nine months of 2024 and 2023 was $1.758 billion and $1.712 billion, respectively, and primarily resulted from earnings from our operations.

Previous wording

(3)Investment capital and maintenance capital, net to our 65% interest in the Permian JV, was approximately $144 million and $109 million, respectively, for the six months ended June 30, 2024, and approximately $141 million and $103 million, respectively, for the six months ended June 30, 2023.

Current wording

(3)Investment capital and maintenance capital, net to our 65% interest in the Permian JV, was approximately $232 million and $174 million, respectively, for the nine months ended September 30, 2024, and approximately $221 million and $158 million, respectively, for the nine months ended September 30, 2023.

Previous wording

2024 Investment and Maintenance Capital. Total investment capital for the year ending December 31, 2024 is projected to be approximately $465 million ($375 million net to our interest). Approximately half of our projected investment capital expenditures are expected to be invested in the Permian JV assets. Additionally, maintenance capital for 2024 is projected to be approximately $270 million ($250 million net to our interest). We expect to fund our 2024 investment and maintenance capital expenditures primarily with retained cash flow.

Current wording

2024 Investment and Maintenance Capital. Total investment capital for the year ending December 31, 2024 is projected to be approximately $455 million ($360 million net to our interest). Approximately half of our projected investment capital expenditures are expected to be invested in the Permian JV assets. Additionally, maintenance capital for 2024 is projected to be approximately $270 million ($250 million net to our interest). We expect to fund our 2024 investment and maintenance capital expenditures primarily with retained cash flow.

Previous wording

Proceeds from the sale of assets have generally been used to fund our investment capital projects and reduce debt levels. The following table summarizes the proceeds received during the first six months of 2024 and 2023 from sales of assets (in millions):

Current wording

Proceeds from the sale of assets have generally been used to fund our investment capital projects and reduce debt levels. The following table summarizes the proceeds received during the first nine months of 2024 and 2023 from sales of assets (in millions):

Previous wording

(1)Represents proceeds, including working capital adjustments, net of transaction costs. The proceeds from divestitures for the six months ended June 30, 2023 were primarily from the sale of our 21% non-operated/undivided joint interest in the Keyera Fort Saskatchewan facility in February 2023. See Note 7 to our Consolidated Financial Statements included in Part IV of our 2023 Annual Report on Form 10-K for additional discussion of this transaction.

Current wording

(1)Represents proceeds, including working capital adjustments, net of transaction costs. The proceeds from divestitures for the nine months ended September 30, 2023 were primarily from the sale of our 21% non-operated/undivided joint interest in the Keyera Fort Saskatchewan facility in February 2023. See Note 7 to our Consolidated Financial Statements included in Part IV of our 2023 Annual Report on Form 10-K for additional discussion of this transaction.

Previous wording

During the six months ended June 30, 2024, we had net repayments under the PAA commercial paper program of $433 million. The net repayments resulted primarily from cash flow from operating activities and proceeds from the issuance of PAA’s $650 million, 5.70% senior notes in June 2024, which offset borrowings during the period related to funding needs for capital investments, inventory purchases and other general partnership purposes.

Current wording

During the nine months ended September 30, 2024, we had net repayments under the PAA commercial paper program of $433 million. The net repayments resulted primarily from cash flow from operating activities and proceeds from the issuance of PAA’s $650 million, 5.70% senior notes in June 2024, which offset borrowings during the period related to funding needs for capital investments, inventory purchases and other general partnership purposes.

Previous wording

We had no net borrowings or repayments under the PAA credit facilities or commercial paper program during the six months ended June 30, 2023.

Current wording

We had no net borrowings or repayments under the PAA credit facilities or commercial paper program during the nine months ended September 30, 2023.

Previous wording

In June 2024, PAA completed the offering of $650 million, 5.70% senior notes due September 2034 at a public offering price of 99.953%. Interest payments are due on March 15 and September 15 of each year, commencing on March 15, 2025. PAA intends to use the net proceeds from this offering of $643 million, after deducting the underwriting discount and offering expenses, to partially repay the principal amount of its $750 million, 3.60% senior notes due November 2024 and, pending such repayment, has used a portion of the proceeds to repay outstanding borrowings under its commercial paper program and for general partnership purposes.

Current wording

In June 2024, PAA completed the offering of $650 million, 5.70% senior notes due September 2034 at a public offering price of 99.953%. Interest payments are due on March 15 and September 15 of each year, commencing on March 15, 2025. PAA used the net proceeds from this offering of $643 million, after deducting the underwriting discount and offering expenses, along with other cash on hand, to repay on November 1, 2024 the principal amount of its $750 million, 3.60% senior notes due November 2024. Prior to such repayment, PAA used a portion of the net proceeds from the offering to repay outstanding borrowings under its commercial paper program and for general partnership purposes.

Previous wording

There were no repurchases under the Common Equity Repurchase Program (the “Program”) during the six months ended June 30, 2024 or 2023. The remaining available capacity under the Program as of June 30, 2024 was $198 million.

Current wording

There were no repurchases under the Common Equity Repurchase Program (the “Program”) during the nine months ended September 30, 2024 or 2023. The remaining available capacity under the Program as of September 30, 2024 was $198 million.

Previous wording

PAGP Registration Statements. We have filed with the SEC a shelf registration statement that, subject to effectiveness at the time of use, allows us to issue up to a specified amount of equity securities (“PAGP Traditional Shelf”). At June 30, 2024, we had approximately $939 million of unsold securities available. We also have access to a universal shelf registration statement (“PAGP WKSI Shelf”), which provides us with the ability to offer and sell an unlimited amount of equity securities, subject to market conditions and our capital needs. We did not conduct any offerings under the PAGP Traditional Shelf or PAGP WKSI Shelf during the six months ended June 30, 2024.

Current wording

PAGP Registration Statements. We have filed with the SEC a shelf registration statement that, subject to effectiveness at the time of use, allows us to issue up to a specified amount of equity securities (“PAGP Traditional Shelf”). At September 30, 2024, we had approximately $939 million of unsold securities available. We also have access to a universal shelf registration statement (“PAGP WKSI Shelf”), which provides us with the ability to offer and sell an unlimited amount of equity securities, subject to market conditions and our capital needs. We did not conduct any offerings under the PAGP Traditional Shelf or PAGP WKSI Shelf during the nine months ended September 30, 2024.

Previous wording

PAA Registration Statements. PAA periodically accesses the capital markets for both equity and debt financing. PAA has filed with the SEC a universal shelf registration statement that, subject to effectiveness at the time of use, allows PAA to issue up to a specified amount of debt or equity securities (“PAA Traditional Shelf”), under which PAA had approximately $1.1 billion of unsold securities available at June 30, 2024. PAA did not conduct any offerings under the PAA Traditional Shelf during the six months ended June 30, 2024. PAA also has access to a universal shelf registration statement (“PAA WKSI Shelf”), which provides it with the ability to offer and sell an unlimited amount of debt and equity securities, subject to market conditions and its capital needs. The offering of PAA’s $650 million, 5.70% senior notes in June 2024 was conducted under the PAA WKSI Shelf.

Current wording

PAA Registration Statements. PAA periodically accesses the capital markets for both equity and debt financing. PAA has filed with the SEC a universal shelf registration statement that, subject to effectiveness at the time of use, allows PAA to issue up to a specified amount of debt or equity securities (“PAA Traditional Shelf”), under which PAA had approximately $1.1 billion of unsold securities available at September 30, 2024. PAA did not conduct any offerings under the PAA Traditional Shelf during the nine months ended September 30, 2024. PAA also has access to a universal shelf registration statement (“PAA WKSI Shelf”), which provides it with the ability to offer and sell an unlimited amount of debt and equity securities, subject to market conditions and its capital needs. The offering of PAA’s $650 million, 5.70% senior notes in June 2024 was conducted under the PAA WKSI Shelf.

Previous wording

On August 14, 2024, we will pay a quarterly cash distribution of $0.3175 per Class A share ($1.27 per Class A share on an annualized basis) to shareholders of record at the close of business on July 31, 2024 for the period from April 1, 2024 through June 30, 2024, which is unchanged from the distribution per share paid in May of 2024. See Note 6 to our Condensed Consolidated Financial Statements for details of distributions paid during the first six months of 2024.

Current wording

On November 14, 2024, we will pay a quarterly cash distribution of $0.3175 per Class A share ($1.27 per Class A share on an annualized basis) to shareholders of record at the close of business on October 31, 2024 for the period from July 1, 2024 through September 30, 2024, which is unchanged from the distribution per share paid in August of 2024. See Note 6 to our Condensed Consolidated Financial Statements for details of distributions paid during the first nine months of 2024.

Previous wording

On August 15, 2024 , PAA will pay a quarterly cash distribution of approximately $24.77 per unit to its Series B preferred unitholders of record at the close of business on August 1, 2024 for the period from May 15, 2024 through August 14, 2024.

Current wording

On November 15, 2024 , PAA will pay a quarterly cash distribution of approximately $24.25 per unit to its Series B preferred unitholders of record at the close of business on November 1, 2024 for the period from August 15, 2024 through November 14, 2024.

Previous wording

On August 14, 2024, PAA will pay a quarterly cash distribution of $0.3175 per common unit ($1.27 per unit on an annualized basis) to common unitholders of record at the close of business on July 31, 2024 for the period from April 1, 2024 through June 30, 2024, which is unchanged from the distribution per unit paid in May of 2024.

Current wording

On November 14, 2024, PAA will pay a quarterly cash distribution of $0.3175 per common unit ($1.27 per unit on an annualized basis) to common unitholders of record at the close of business on October 31, 2024 for the period from July 1, 2024 through September 30, 2024, which is unchanged from the distribution per unit paid in August of 2024.

Previous wording

See Note 6 to our Condensed Consolidated Financial Statements for details of distributions paid to noncontrolling interests during the six months ended June 30, 2024.

Current wording

See Note 6 to our Condensed Consolidated Financial Statements for details of distributions paid to noncontrolling interests during the nine months ended September 30, 2024.

Previous wording

Letters of Credit. In connection with our merchant activities, we provide certain suppliers with irrevocable standby letters of credit to secure our obligation for the purchase and transportation of crude oil, NGL and natural gas. Our liabilities with respect to these purchase obligations are recorded in accounts payable on our balance sheet in the month the product is purchased. Generally, these letters of credit are issued for periods of up to seventy days and are terminated upon completion of each transaction. Additionally, we issue letters of credit to support insurance programs, derivative transactions, including hedging-related margin obligations, and construction activities. At June 30, 2024 and December 31, 2023, we had outstanding letters of credit of approximately $143 million and $205 million, respectively.

Current wording

Letters of Credit. In connection with our merchant activities, we provide certain suppliers with irrevocable standby letters of credit to secure our obligation for the purchase and transportation of crude oil, NGL and natural gas. Our liabilities with respect to these purchase obligations are recorded in accounts payable on our balance sheet in the month the product is purchased. Generally, these letters of credit are issued for periods of up to seventy days and are terminated upon completion of each transaction. Additionally, we issue letters of credit to support insurance programs, derivative transactions, including hedging-related margin obligations, and construction activities. At September 30, 2024 and December 31, 2023, we had outstanding letters of credit of approximately $108 million and $205 million, respectively.