v3.25.1
Segment Information
 3 Months Ended
Mar. 31, 2025
Segment Reporting [Abstract]  
Segment Information Segment Information
 
Our operating segments, Crude Oil and NGL, which are also our reportable segments, are organized by product as our Crude Oil and NGL businesses are generally impacted by different market fundamentals and require the use of different assets and business strategies. The Crude Oil segment includes our crude oil pipelines, crude oil storage and marine terminals and related crude oil marketing activities. The NGL segment includes our NGL pipelines, NGL storage, natural gas processing and NGL fractionation facilities and related NGL marketing activities. Our crude oil and NGL marketing activities are included in the respective reporting segments as their primary purpose is to support the utilization of our assets by entering into transactions that facilitate increased volumes handled by our assets, resulting in additional earnings for each of our segments.

Our CODM (our Chief Executive Officer) evaluates segment performance based on measures including Segment Adjusted EBITDA (as defined below). The measure of Segment Adjusted EBITDA forms the basis of our internal financial reporting and is the primary performance measure of segment profit/(loss) used by our CODM in assessing performance and allocating resources among our operating segments. We define Segment Adjusted EBITDA as revenues and equity earnings in unconsolidated entities less (a) significant segment expenses including: (i) purchases and related costs, (ii) field operating costs and (iii) segment general and administrative expenses, plus (b) our proportionate share of the depreciation and amortization expense (including write-downs related to cancelled projects and impairments) of unconsolidated entities, further adjusted (c) for certain selected items including (i) gains and losses on derivative instruments that are related to underlying activities in another period (or the reversal of such adjustments from a prior period), gains and losses on derivatives that are either related to investing activities (such as the purchase of linefill) or purchases of long-term inventory, and inventory valuation adjustments, as applicable, (ii) long-term inventory costing adjustments, (iii) charges for obligations that are expected to be settled with the issuance of equity instruments, (iv) amounts related to deficiencies associated with minimum volume commitments, net of the applicable amounts subsequently recognized into revenue and (v) other items that our CODM believes are integral to understanding our core segment operating performance and (d) to exclude the portion of all preceding items that is attributable to noncontrolling interests in consolidated joint venture entities (“Segment amounts attributable to noncontrolling interests in consolidated joint ventures”).

Our CODM uses Segment Adjusted EBITDA to evaluate the performance of each segment, including analyzing actual results compared to budget and guidance, to assess investment opportunities and to optimize and align assets to maximize returns to stakeholders.

Segment Adjusted EBITDA excludes depreciation and amortization. As an MLP, we make quarterly distributions of our “available cash” (as defined in our partnership agreement) to our unitholders. We look at each period’s earnings before non-cash depreciation and amortization as an important measure of segment performance. The exclusion of depreciation and amortization expense could be viewed as limiting the usefulness of Segment Adjusted EBITDA as a performance measure because it does not account in current periods for the implied reduction in value of our capital assets, such as pipelines and facilities, caused by age-related decline and wear and tear. We compensate for this limitation by recognizing that depreciation and amortization are largely offset by repair and maintenance investments, which act to partially offset the aging and wear and tear in the value of our principal fixed assets. These maintenance investments are a component of field operating costs included in Segment Adjusted EBITDA or in maintenance capital, depending on the nature of the cost. Capital expenditures made to expand the existing operating and/or earnings capacity of our assets are classified as investment capital. Capital expenditures made to replace and/or refurbish partially or fully depreciated assets in order to maintain the operating and/or earnings capacity of our existing assets are classified as maintenance capital, which is deducted in determining “available cash.” Maintenance capital is reviewed by our CODM on a segment basis. Repair and maintenance expenditures incurred in order to maintain the day to day operation of our existing assets are charged to expense as incurred. Assets are not reviewed by our CODM on a segmented basis; therefore, such information is not presented.
The following tables reflect certain financial data for each segment (in millions):
Crude OilNGL
Intersegment
Elimination
Total
Three Months Ended March 31, 2025
Revenues (1):
Product sales$11,008 $596 $(60)$11,544 
Services431 42 (6)467 
Total revenues11,439 638 (66)12,011 
Significant segment expenses:
Purchases and related costs (1)
(10,488)(339)66 (10,761)
Field operating costs
(292)(76)— (368)
Segment general and administrative expenses
(79)(21)— (100)
Total significant segment expenses
(10,859)(436)66 (11,229)
Equity earnings in unconsolidated entities103 — 
Other segment items (2):
Depreciation and amortization of unconsolidated entities (3)
20 — 
Derivative activities and inventory valuation adjustments (4)
(24)(10)
Long-term inventory costing adjustments (5)
— (3)
Deficiencies under minimum volume commitments, net (6)
(7)— 
Equity-indexed compensation expense (7)
9 — 
Transaction-related expenses (8)
5 — 
Segment amounts attributable to noncontrolling interests in consolidated joint ventures (9)
(127)— 
Total other segment items
(124)(13)
Segment Adjusted EBITDA$559 $189 
Investment and acquisition capital expenditures (10) (11)
$785 $41 $826 
Maintenance capital expenditures (11)
$31 $10 $41 
As of March 31, 2025
Investments in unconsolidated entities
$2,745 $— $2,745 
Crude OilNGL
Intersegment
Elimination
Total
Three Months Ended March 31, 2024
Revenues (1):
Product sales$11,176 $458 $(88)$11,546 
Services406 49 (6)449 
Total revenues11,582 507 (94)11,995 
Significant segment expenses:
Purchases and related costs (1)
(10,665)(346)94 (10,917)
Field operating costs
(266)(92)— (358)
Segment general and administrative expenses
(73)(23)— (96)
Total significant segment expenses
(11,004)(461)94 (11,371)
Equity earnings in unconsolidated entities95 — 
Other segment items (2):
Depreciation and amortization of unconsolidated entities (3)
19 — 
Derivative activities and inventory valuation adjustments (4)
37 122 
Long-term inventory costing adjustments (5)
(28)(5)
Deficiencies under minimum volume commitments, net (6)
(12)— 
Equity-indexed compensation expense (7)
9 — 
Foreign currency revaluation (12)
(17)(4)
Segment amounts attributable to noncontrolling interests in consolidated joint ventures (9)
(128)— 
Total other segment items
(120)113 
Segment Adjusted EBITDA$553 $159 
Investment and acquisition capital expenditures (10) (11)
$183 $14 $197 
Maintenance capital expenditures (11)
$46 $11 $57 
As of December 31, 2024
Investments in unconsolidated entities$2,811 $— $2,811 
(1)Segment revenues include intersegment amounts that are eliminated in purchases and related costs. Intersegment activities are conducted at posted tariff rates where applicable, or otherwise at rates similar to those charged to third parties or rates that we believe approximate market at the time the agreement is executed or renegotiated.
(2)Represents adjustments utilized by our CODM in the evaluation of segment results.
(3)Includes our proportionate share of the depreciation and amortization expense (including write-downs related to cancelled projects and impairments) of unconsolidated entities.
(4)We use derivative instruments for risk management purposes and our related processes include specific identification of hedging instruments to an underlying hedged transaction. Although we identify an underlying transaction for each derivative instrument we enter into, there may not be an accounting hedge relationship between the instrument and the underlying transaction. In the course of evaluating our results, we identify differences in the timing of earnings from the derivative instruments and the underlying transactions and exclude the related gains and losses in determining Segment Adjusted EBITDA such that the earnings from the derivative instruments and the underlying transactions impact Segment Adjusted EBITDA in the same period. In addition, we exclude gains and losses on derivatives that are related to (i) investing activities, such as the purchase of linefill, and (ii) purchases of long-term inventory. We also exclude the impact of corresponding inventory valuation adjustments, as applicable.
(5)We carry crude oil and NGL inventory that is comprised of minimum working inventory requirements in third-party assets and other working inventory that is needed for our commercial operations. We consider this inventory necessary to conduct our operations and we intend to carry this inventory for the foreseeable future. Therefore, we classify this inventory as long-term on our balance sheet and do not hedge the inventory with derivative instruments (similar to linefill in our own assets). We exclude the impact of changes in the average cost of the long-term inventory (that result from fluctuations in market prices) and write-downs of such inventory that result from price declines from Segment Adjusted EBITDA.
(6)We, and certain of our equity method investees, have certain agreements that require counterparties to deliver, transport or throughput a minimum volume over an agreed upon period. Substantially all of such agreements were entered into with counterparties to economically support the return on capital expenditure necessary to construct the related asset. Some of these agreements include make-up rights if the minimum volume is not met. We record a receivable from the counterparty in the period that services are provided or when the transaction occurs, including amounts for deficiency obligations from counterparties associated with minimum volume commitments. If a counterparty has a make-up right associated with a deficiency, we defer the revenue attributable to the counterparty’s make-up right and subsequently recognize the revenue at the earlier of when the deficiency volume is delivered or shipped, when the make-up right expires or when it is determined that the counterparty’s ability to utilize the make-up right is remote. We include the impact of amounts billed to counterparties for their deficiency obligation, net of applicable amounts subsequently recognized into revenue or equity earnings, as a selected item impacting comparability. Our CODM views the inclusion of the contractually committed revenues associated with that period as meaningful to Segment Adjusted EBITDA as the related asset has been constructed, is standing ready to provide the committed service and the fixed operating costs are included in the current period results.
(7)Our total equity-indexed compensation expense includes expense associated with awards that will be settled in units and awards that will be settled in cash. The awards that will be settled in units are included in our diluted net income per unit calculation when the applicable performance criteria have been met. We exclude compensation expense associated with these awards in determining Segment Adjusted EBITDA as the dilutive impact of the outstanding awards is included in our diluted net income per unit calculation, as applicable. The portion of compensation expense associated with awards that will be settled in cash is not excluded in determining Segment Adjusted EBITDA. See Note 17 to our Consolidated Financial Statements included in Part IV of our 2024 Annual Report on Form 10-K for a discussion regarding our equity-indexed compensation plans.
(8)Primarily related to acquisitions completed during the first quarter of 2025. See Note 11 for information regarding these transactions.
(9)Reflects amounts attributable to noncontrolling interests in the Permian JV, Cactus II and Red River.
(10)Investment capital and acquisition capital expenditures, including investments in unconsolidated entities.
(11)These amounts combined represent total capital expenditures.
(12)During the periods presented, there were fluctuations in the value of CAD to USD, resulting in the realization of foreign exchange gains and losses on the settlement of foreign currency transactions as well as the revaluation of monetary assets and liabilities denominated in a foreign currency. These gains and losses are not integral to our core operating performance and were therefore excluded in determining Segment Adjusted EBITDA.
Segment Adjusted EBITDA Reconciliation

The following table reconciles Segment Adjusted EBITDA to Net income attributable to PAGP (in millions):
 
Three Months Ended
March 31,
 20252024
Segment Adjusted EBITDA$748 $712 
Total other segment items (1)
1377 
Unallocated general and administrative expenses (2)
(1)(1)
Depreciation and amortization(262)(254)
Gain on asset sales, net
13 — 
Gain on investments in unconsolidated entities, net
31 — 
Interest expense, net(107)(95)
Other income/(expense), net
6 (5)
Income before tax565 364 
Income tax expense
(73)(28)
Net income492 336 
Net income attributable to noncontrolling interests(408)(294)
Net income attributable to PAGP
$84 $42 
(1)See footnotes to the segment financial data tables above for a more detailed discussion of Other segment items.
(2)Represents general and administrative expenses incremental to those of PAA, which are not allocated to our reporting segments in determining Segment Adjusted EBITDA.