Common use of Environmental Remediation Clause in Contracts

Environmental Remediation. We currently own or lease, and in the past have owned and leased, properties where hazardous liquids, including hydrocarbons, are or have been handled. These properties and the hazardous liquids or associated wastes disposed thereon may be subject to CERCLA, RCRA and state and Canadian federal and provincial laws and regulations. Under such laws and regulations, we could be required to remove or remediate hazardous liquids or associated wastes (including wastes disposed of or released by prior owners or operators) and to clean up contaminated property (including contaminated groundwater). We maintain insurance of various types with varying levels of coverage that we consider adequate under the circumstances to cover our operations and properties. The insurance policies are subject to deductibles and retention levels that we consider reasonable and not excessive. Consistent with insurance coverage generally available in the industry, in certain circumstances our insurance policies provide limited coverage for losses or liabilities relating to gradual pollution, with broader coverage for sudden and accidental occurrences. In conjunction with our acquisitions, we typically make an assessment of potential environmental exposure and determine whether to negotiate an indemnity, what the terms of any indemnity should be and whether to obtain environmental risk insurance, if available. These contractual indemnifications typically are subject to specific monetary requirements that must be satisfied before indemnification will apply, and have term and total dollar limits. For instance, in connection with the purchase of former Texas New Mexico (“TNM”) pipeline assets from Link in 2004, we identified a number of environmental liabilities for which we received a purchase price reduction from Link and recorded a total environmental reserve of $20 million, of which we agreed in an arrangement with TNM to bear the first $11 million in costs of pre-May 1999 environmental issues. TNM also agreed to pay all costs in excess of $20 million (excluding certain deductibles). TNM’s obligations are guaranteed by Shell Oil Products (“SOP”). As of December 31, 2009, we had incurred approximately $16 million of remediation costs associated with these sites, while SOP’s share has been approximately $6 million. In another example, as a result of our merger with Pacific, we assumed liability for a number of ongoing remediation sites associated with releases from pipeline or storage operations. We have evaluated each of the sites requiring remediation and developed reserve estimates for the Pacific sites, which total approximately $18 million at December 31, 2009. In connection with the acquisition of certain crude oil transmission and gathering assets from SOP in 2002, SOP purchased an environmental insurance policy covering known and unknown environmental matters associated with operations prior to closing. We are a named beneficiary under the policy, which has a $100,000 deductible per site, an aggregate coverage limit of $70 million, and expires in 2012. Other assets we have acquired or will acquire in the future may have environmental remediation liabilities for which we are not indemnified. We have in the past experienced and in the future likely will experience releases of crude oil into the environment from our pipeline and storage operations. We also may discover environmental impacts from past releases that were previously unidentified. See Note 11 for further environmental discussion. Note 13—Supplemental Condensed Consolidating Financial Information Some but not all of our 100% owned subsidiaries have issued full, unconditional and joint and several guarantees of our Senior Notes. Given that certain, but not all, subsidiaries are guarantors of our Senior Notes, we are required to present the following supplemental condensed consolidating financial information. For purposes of the following footnote: • we are referred to as “Parent;” • the “Guarantor Subsidiaries” are all subsidiaries other than the Non-Guarantor subsidiaries defined below; and • The “Non-Guarantor Subsidiaries” as of December 31, 2009 include two California Public Utilities Commission regulated entities, our natural gas storage subsidiaries and other minor subsidiaries. The following supplemental condensed consolidating financial information reflects the Parent’s separate accounts, the combined accounts of the Guarantor Subsidiaries, the combined accounts of the Non-Guarantor Subsidiaries, the combined consolidating adjustments and eliminations and the Parent’s consolidated accounts for the dates and periods indicated. For purposes of the following condensed consolidating information, the Parent’s investments in its subsidiaries and the Guarantor Subsidiaries’ investments in their subsidiaries are accounted for under the equity method of accounting (in millions): Condensed Consolidating Balance Sheet As of December 31, 2009 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ..................................... $ 3,428 $ 3,831 $ 209 $ (3,810) $ 3,658 Property, plant and equipment, net ............. — 4,606 1,734 — 6,340 Investment in unconsolidated entities ......... 5,295 1,652 — (6,865) 82 Other assets ................................................. 29 2,342 367 (460) 2,278 Total assets ............................................. $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities ................................ $ 456 $ 6,849 $ 287 $ (3,810) $ 3,782 Long-term debt ........................................... 4,137 15 450 (460) 4,142 Other long-term liabilities ........................... — 271 4 — 275 Total liabilities ....................................... 4,593 7,135 741 (4,270) 8,199 Partners’ capital excluding noncontrolling interest ............................ 4,096 5,233 1,569 (6,802) 4,096 Noncontrolling interest ............................... 63 63 — (63) 63 Total partners’ capital ............................. 4,159 5,296 1,569 (6,865) 4,159 Total liabilities and partners’ capital ........... $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 As of December 31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ...................................... $ 2,698 $ 2,789 $ 110 $ (3,001) $ 2,596 Property, plant and equipment, net .............. — 4,410 649 — 5,059 Investment in unconsolidated entities .......... 4,388 895 — (5,026) 257 Other assets.................................................. 27 1,777 316 — 2,120 Total assets .............................................. $ 7,113 $ 9,871 $ 1,075 $ (8,027) $ 10,032 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities................................. $ 304 $ 5,411 $ 246 $ (3,001) $ 2,960 Long-term debt ............................................ 3,257 2 — — 3,259 Other long-term liabilities............................ — 260 1 — 261 Total liabilities ......................................... 3,561 5,673 247 (3,001) 6,480 Partners’ capital excluding noncontrolling interest ............................. 3,552 4,198 828 (5,026) 3,552 Noncontrolling interest ................................ — — — — — Total partners’ capital .............................. 3,552 4,198 828 (5,026) 3,552 Total liabilities and partners’ capital............ $ 7,113 $ 9,871 $ 1,075 $ (8,027) $ 10,032 Condensed Consolidating Statements of Operations Twelve Months Ended December 31, 2009 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues(1) ............................. $ — $ 1,707 $ 157 $ — $ 1,864 Field operating costs .................................... — (589) (49) — (638) General and administrative expenses........... — (196) (15) — (211) Depreciation and amortization ..................... (4) (200) (32) — (236) Operating income/(loss)............................... (4) 722 61 — 779 Equity earnings in unconsolidated entities... 822 64 — (871) 15 Interest income (expense) ............................ (234) 14 (4) — (224) Other income, net......................................... (4) 20 — — 16 Income tax expense...................................... — (6) — — (6) Net income................................................... 580 814 57 (871) 580 Less: Net income attributable to noncontrolling interest ......................... (1) (1) — 1 (1) Net income attributable to Plains ................. $ 579 $ 813 $ 57 $ (870) $ 579 Year Ended December 31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................. $ — $ 1,469 $ 113 $ — $ 1,582 Field operating costs ..................................... — (575) (42) — (617) General and administrative expenses............ — (149) (11) — (160) Depreciation and amortization ...................... (3) (187) (21) — (211) Operating income/(loss)................................ (3) 558 39 — 594 Equity earnings in unconsolidated entities.... 629 45 — (660) 14 Interest expense ............................................ (195) (1) — — (196) Other income, net.......................................... 6 26 1 — 33 Income tax expense....................................... — (8) — — (8) Net income.................................................... $ 437 $ 620 $ 40 $ (660) $ 437 Year Ended December 31, 2007 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................ $ — $ 1,271 $ 122 $ — $ 1,393 Field operating costs .................................... — (493) (38) — (531) General and administrative expenses........... — (161) (3) — (164) Depreciation and amortization ..................... (3) (157) (20) — (180) Operating income/(loss)............................... (3) 460 61 — 518 Equity earnings in unconsolidated entities...................................................... 524 66 — (575) 15 Interest expense ........................................... (161) (1) — — (162) Other income, net......................................... 5 5 — — 10 Income tax expense...................................... — (16) — — (16) Net income................................................... $ 365 $ 514 $ 61 $ (575) $ 365

Environmental Remediation. We currently own or lease, and in the past have owned and leased, properties where hazardous liquids, including hydrocarbons, are or have been handled. These properties and the hazardous liquids or associated wastes disposed thereon may be subject to CERCLA, RCRA and state and Canadian federal and provincial laws and regulations. Under such laws and regulations, we could be required to remove or remediate hazardous liquids or associated wastes (including wastes disposed of or released by prior owners or operators) and to clean up contaminated property (including contaminated groundwater). We maintain insurance of various types with varying levels of coverage that we consider adequate under the circumstances to cover our operations and properties. The insurance policies are subject to deductibles and retention levels that we consider reasonable and not excessive. Consistent with insurance coverage generally available in the industry, in certain circumstances our insurance policies provide limited coverage for losses or liabilities relating to gradual pollution, with broader coverage for sudden and accidental occurrences. In conjunction with our acquisitions, we typically make an assessment of potential environmental exposure and determine whether to negotiate an indemnity, what the terms of any indemnity should be and whether to obtain environmental risk insurance, if available. These contractual indemnifications typically are subject to specific monetary requirements that must be satisfied before indemnification will apply, and have term and total dollar limits. For instance, in connection with the purchase of former Texas New Mexico (“TNM”) pipeline assets from Link in 2004, we identified a number of environmental liabilities for which we received a purchase price reduction from Link and recorded a total environmental reserve of $20 million, of which we agreed in an arrangement with TNM to bear the first $11 million in costs of pre-May 1999 environmental issues. TNM also agreed to pay all costs in excess of $20 million (excluding certain deductibles). TNM’s obligations are guaranteed by Shell Oil Products (“SOP”). As of December 31, 2009, we had incurred approximately $16 million of remediation costs associated with these sites, while SOP’s share has been approximately $6 million. In another example, as a result of our merger with Pacific, we assumed liability for a number of ongoing remediation sites associated with releases from pipeline or storage operations. We have evaluated each of the sites requiring remediation and developed reserve estimates for the Pacific sites, which total approximately $18 million at December 31, 2009. In connection with the acquisition of certain crude oil transmission and gathering assets from SOP in 2002, SOP purchased an environmental insurance policy covering known and unknown environmental matters associated with operations prior to closing. We are a named beneficiary under the policy, which has a $100,000 deductible per site, an aggregate coverage limit of $70 million, and expires in 2012. Other assets we have acquired or will acquire in the future may have environmental remediation liabilities for which we are not indemnified. We have in the past experienced and in the future likely will experience releases of crude oil into the environment from our pipeline and storage operations. We also may discover environmental impacts from past releases that were previously unidentified. See Note 11 for further environmental discussion. Note 13—Supplemental Condensed Consolidating Financial Information Some but not all of our 100% owned subsidiaries have issued full, unconditional and joint and several guarantees of our Senior Notes. Given that certain, but not all, subsidiaries are guarantors of our Senior Notes, we are required to present the following supplemental condensed consolidating financial information. For purposes of the following footnote: • we are referred to as “Parent;” • the “Guarantor Subsidiaries” are all subsidiaries other than the Non-Guarantor subsidiaries defined below; and • The “Non-Guarantor Subsidiaries” as of December 31, 2009 include two California Public Utilities Commission regulated entities, our natural gas storage subsidiaries and other minor subsidiaries. The following supplemental condensed consolidating financial information reflects the Parent’s separate accounts, the combined accounts of the Guarantor Subsidiaries, the combined accounts of the Non-Guarantor Subsidiaries, the combined consolidating adjustments and eliminations and the Parent’s consolidated accounts for the dates and periods indicated. For purposes of the following condensed consolidating information, the Parent’s investments in its subsidiaries and the Guarantor Subsidiaries’ investments in their subsidiaries are accounted for under the equity method of accounting (in millions): Condensed Consolidating Balance Sheet As of December 31, 2009 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ..................................... $ 3,428 $ 3,831 $ 209 $ (3,810) $ 3,658 Property, plant and equipment, net ............. — 4,606 1,734 — 6,340 Investment in unconsolidated entities ......... 5,295 1,652 — (6,865) 82 Other assets ................................................. 29 2,342 367 (460) 2,278 Total assets ............................................. $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities ................................ $ 456 $ 6,849 $ 287 $ (3,810) $ 3,782 Long-term debt ........................................... 4,137 15 450 (460) 4,142 Other long-term liabilities ........................... — 271 4 — 275 Total liabilities ....................................... 4,593 7,135 741 (4,270) 8,199 Partners’ capital excluding noncontrolling interest ............................ 4,096 5,233 1,569 (6,802) 4,096 Noncontrolling interest ............................... 63 63 — (63) 63 Total partners’ capital ............................. 4,159 5,296 1,569 (6,865) 4,159 Total liabilities and partners’ capital ........... $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 As of December 31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ...................................... $ 2,698 $ 2,789 $ 110 $ (3,001) $ 2,596 Property, plant and equipment, net .............. — 4,410 649 — 5,059 Investment in unconsolidated entities .......... 4,388 895 — (5,026) 257 Other assets.................................................. 27 1,777 316 — 2,120 Total assets .............................................. $ 7,113 $ 9,871 $ 1,075 $ (8,027) $ 10,032 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities................................. $ 304 $ 5,411 $ 246 $ (3,001) $ 2,960 Long-term debt ............................................ 3,257 2 — — 3,259 Other long-term liabilities............................ — 260 1 — 261 Total liabilities ......................................... 3,561 5,673 247 (3,001) 6,480 Partners’ capital excluding noncontrolling interest ............................. 3,552 4,198 828 (5,026) 3,552 Noncontrolling interest ................................ — — — — — Total partners’ capital .............................. 3,552 4,198 828 (5,026) 3,552 Total liabilities and partners’ capital............ $ 7,113 $ 9,871 $ 1,075 $ (8,027) $ 10,032 Condensed Consolidating Statements of Operations Twelve Months Ended December 31, 2009 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues(1) ............................. $ — $ 1,707 $ 157 $ — $ 1,864 Field operating costs .................................... — (589) (49) — (638) General and administrative expenses........... — (196) (15) — (211) Depreciation and amortization ..................... (4) (200) (32) — (236) Operating income/(loss)............................... (4) 722 61 — 779 Equity earnings in unconsolidated entities... 822 64 — (871) 15 Interest income (expense) ............................ (234) 14 (4) — (224) Other income, net......................................... (4) 20 — — 16 Income tax expense...................................... — (6) — — (6) Net income................................................... 580 814 57 (871) 580 Less: Net income attributable to noncontrolling interest ......................... (1) (1) — 1 (1) Net income attributable to Plains ................. $ 579 $ 813 $ 57 $ (870) $ 579 Year Ended December 31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................. $ — $ 1,469 $ 113 $ — $ 1,582 Field operating costs ..................................... — (575) (42) — (617) General and administrative expenses............ — (149) (11) — (160) Depreciation and amortization ...................... (3) (187) (21) — (211) Operating income/(loss)................................ (3) 558 39 — 594 Equity earnings in unconsolidated entities.... 629 45 — (660) 14 Interest expense ............................................ (195) (1) — — (196) Other income, net.......................................... 6 26 1 — 33 Income tax expense....................................... — (8) — — (8) Net income.................................................... $ 437 $ 620 $ 40 $ (660) $ 437 Year Ended December 31, 2007 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................ $ — $ 1,271 $ 122 $ — $ 1,393 Field operating costs .................................... — (493) (38) — (531) General and administrative expenses........... — (161) (3) — (164) Depreciation and amortization ..................... (3) (157) (20) — (180) Operating income/(loss)............................... (3) 460 61 — 518 Equity earnings in unconsolidated entities...................................................... 524 66 — (575) 15 Interest expense ........................................... (161) (1) — — (162) Other income, net......................................... 5 5 — — 10 Income tax expense...................................... — (16) — — (16) Net income................................................... $ 365 $ 514 $ 61 $ (575) $ 365.

Environmental Remediation. We currently own or lease, and in the past have owned and leased, properties where hazardous liquids, including hydrocarbons, are or have been handled. These properties and the hazardous liquids or associated wastes disposed thereon may be subject to CERCLA, RCRA and state and Canadian federal and provincial laws and regulations. Under such laws and regulations, we could be required to remove or remediate hazardous liquids or associated wastes (including wastes disposed of or released by prior owners or operators) and to clean up contaminated property (including contaminated groundwater). We maintain insurance of various types with varying levels of coverage that we consider adequate under the circumstances to cover our operations and properties. The insurance policies are subject to deductibles and retention levels that we consider reasonable and not excessive. Consistent with insurance coverage generally available in the industry, in certain circumstances our insurance policies provide limited coverage for losses or liabilities relating to gradual pollution, with broader coverage for sudden and accidental occurrences. In conjunction with our acquisitions, we typically make an assessment of potential environmental exposure and determine whether to negotiate an indemnity, what the terms of any indemnity should be and whether to obtain environmental risk insurance, if available. These contractual indemnifications typically are subject to specific monetary requirements that must be satisfied before indemnification will apply, and have term and total dollar limits. For instance, in connection with the purchase of former Texas New Mexico (“TNM”) TNM pipeline assets from Link in 2004, we identified a number of environmental liabilities for which we received a purchase price reduction from Link and recorded a total environmental reserve of $20 million, of which we agreed in an arrangement with TNM to bear the first $11 million in costs of pre-May 1999 environmental issues. TNM also agreed to pay all costs in excess of $20 million (excluding certain deductibles). TNM’s obligations are guaranteed by Shell Oil Products (“SOP”). As of December 31, 20092010, we had incurred approximately $16 19 million of remediation costs associated with these sites, while SOP’s share has been approximately $6 8 million. In another example, as a result of our merger with Pacific, we assumed liability for a number of ongoing remediation sites associated with releases from pipeline or storage operations. We have evaluated each of the sites requiring remediation and developed reserve estimates for the Pacific sites, which total approximately $18 million at December 31, 2009. In connection with the acquisition of certain crude oil transmission and gathering assets from SOP in 2002, SOP purchased an environmental insurance policy covering known and unknown environmental matters associated with operations prior to closing. We are a named beneficiary under the policy, which has a $100,000 deductible per site, an aggregate coverage limit of $70 million, and expires in 2012. Other assets we have acquired or will acquire in the future may have environmental remediation liabilities for which we are not indemnified. We have in the past experienced and in the future likely will experience releases of crude oil into the environment from our pipeline and storage operations. We also may discover environmental impacts from past releases that were previously unidentified. See Note 11 for further environmental discussion. Note 13—Supplemental Condensed Consolidating Financial Information Some but not all of our 100% owned subsidiaries have issued full, unconditional and joint and several guarantees of our Senior Notes. Given that certain, but not all, subsidiaries are guarantors of our Senior Notes, we are required to present the following supplemental condensed consolidating financial information. For purposes of the following footnote: • we are referred to as “Parent;” • the “Guarantor Subsidiaries” are all subsidiaries other than the Non-Guarantor subsidiaries Subsidiaries defined below; and • The “Non-Guarantor Subsidiaries” as of December 31, 2009 2010 include two California Public Utilities Commission regulated entities, our natural gas storage subsidiaries and other minor subsidiaries. The following supplemental condensed consolidating financial information reflects the Parent’s separate accounts, the combined accounts of the Guarantor Subsidiaries, the combined accounts of the Non-Guarantor Subsidiaries, the combined consolidating adjustments and eliminations and the Parent’s consolidated accounts for the dates and periods indicated. For purposes of the following condensed consolidating information, the Parent’s investments in its subsidiaries and the Guarantor Subsidiaries’ investments in their subsidiaries are accounted for under the equity method of accounting (in millions): Condensed Consolidating Balance Sheet Sheets Parent Combined Guarantor Subsidiaries As of December 31, 2010 Combined Non-Guarantor Subsidiaries Eliminations Consolidated ASSETS Total current assets $ 3,460 $ 4,394 $ 510 $ (3,983) $ 4,381 Property and equipment, net 2 4,870 1,819 — 6,691 Investments in unconsolidated entities 6,302 2,173 — (8,275) 200 Other assets, net 28 1,976 553 (126) 2,431 Total assets $ 9,792 $ 13,413 $ 2,882 $ (12,384) $ 13,703 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities $ 853 $ 6,836 $ 509 $ (3,983) $ 4,215 Long-term debt 4,366 5 386 (126) 4,631 Other long-term liabilities — 270 14 — 284 Total liabilities 5,219 7,111 909 (4,109) 9,130 Partners’ capital excluding noncontrolling interests 4,342 6,241 1,973 (8,214) 4,342 Noncontrolling interests 231 61 — (61) 231 Total partners’ capital 4,573 6,302 1,973 (8,275) 4,573 Total liabilities and partners’ capital $ 9,792 $ 13,413 $ 2,882 $ (12,384) $ 13,703 Parent Combined Guarantor Subsidiaries As of December 31, 2009 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ..................................... $ 3,428 $ 3,831 $ 209 $ (3,810) $ 3,658 Property, plant Property and equipment, net ............. — 4,606 1,734 — 6,340 Investment Investments in unconsolidated entities ......... 5,295 1,652 — (6,865) 82 Other assets ................................................. assets, net 29 2,342 367 (460) 2,278 Total assets ............................................. $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities ................................ $ 456 $ 6,849 $ 287 $ (3,810) $ 3,782 Long-term debt ........................................... 4,137 15 450 (460) 4,142 Other long-term liabilities ........................... — 271 4 — 275 Total liabilities ....................................... 4,593 7,135 741 (4,270) 8,199 Partners’ capital excluding noncontrolling interest ............................ 4,096 5,233 1,569 (6,802) 4,096 Noncontrolling interest ............................... 63 63 — (63) 63 Total partners’ capital ............................. 4,159 5,296 1,569 (6,865) 4,159 Total liabilities and partners’ capital ........... $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 As of December 31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ...................................... $ 2,698 $ 2,789 $ 110 $ (3,001) $ 2,596 Property, plant and equipment, net .............. — 4,410 649 — 5,059 Investment in unconsolidated entities .......... 4,388 895 — (5,026) 257 Other assets.................................................. 27 1,777 316 — 2,120 Total assets .............................................. $ 7,113 $ 9,871 $ 1,075 $ (8,027) $ 10,032 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities................................. $ 304 $ 5,411 $ 246 $ (3,001) $ 2,960 Long-term debt ............................................ 3,257 2 — — 3,259 Other long-term liabilities............................ — 260 1 — 261 Total liabilities ......................................... 3,561 5,673 247 (3,001) 6,480 Partners’ capital excluding noncontrolling interest ............................. 3,552 4,198 828 (5,026) 3,552 Noncontrolling interest ................................ — — — — — Total partners’ capital .............................. 3,552 4,198 828 (5,026) 3,552 Total liabilities and partners’ capital............ $ 7,113 $ 9,871 $ 1,075 $ (8,027) $ 10,032 F-52 Condensed Consolidating Statements of Operations Twelve Months Ended December 31, 2009 Combined Parent Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues(1) ............................. $ — $ 1,707 $ 157 $ — $ 1,864 Field operating costs .................................... — (589) (49) — (638) General and administrative expenses........... — (196) (15) — (211) Depreciation and amortization ..................... (4) (200) (32) — (236) Operating income/(loss)............................... (4) 722 61 — 779 Equity earnings in unconsolidated entities... 822 64 — (871) 15 Interest income (expense) ............................ (234) 14 (4) — (224) Other income, net......................................... (4) 20 — — 16 Income tax expense...................................... — (6) — — (6) Net income................................................... 580 814 57 (871) 580 Less: Net income attributable to noncontrolling interest ......................... (1) (1) — 1 (1) Net income attributable to Plains ................. $ 579 $ 813 $ 57 $ (870) $ 579 Year Ended December 31, 2008 2010 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................. $ — $ 1,469 1,749 $ 113 223 $ — $ 1,582 1,972 Field operating costs ..................................... — (575632) (4257) — (617689) General and administrative expenses............ expenses — (149230) (1130) — (160260) Depreciation and amortization ...................... (34) (187207) (2145) — (211256) Operating income/(loss)................................ ) (34) 558 39 680 91 — 594 767 Equity earnings in unconsolidated entities.... 629 45 entities 778 86 — (660861) 14 3 Interest expense ............................................ (195income/(expense) (1254) — — 13 (196) Other income, net.......................................... 6 26 1 — 33 Income tax expense....................................... — (8) — — (8) Net income.................................................... $ 437 $ 620 $ 40 $ (660) $ 437 Year Ended December 31, 2007 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................ $ — $ 1,271 $ 122 $ — $ 1,393 Field operating costs .................................... — (493) (387) — (531248) General and administrative expenses........... — Other income/(expense), net (1616) (3) — (164) Depreciation and amortization ..................... (3) (157) (20) — (1809) Operating income/(loss)............................... (3) 460 61 Income tax benefit — 518 Equity earnings in unconsolidated entities...................................................... 524 66 — (575) 15 Interest expense ........................................... (161) (1) 1 — — 1 Less: Net income attributable to noncontrolling interests (162) Other income, net......................................... 5 5 — — 10 Income tax expense...................................... — (16) — — (16) Net income................................................... $ 365 $ 514 $ 61 $ (575) $ 3659)

Environmental Remediation. We currently own or lease, and in the past have owned and leased, properties where hazardous liquids, including hydrocarbons, are or have been handled. These properties and the hazardous liquids or associated wastes disposed thereon may be subject to CERCLA, RCRA and state and Canadian federal and provincial laws and regulations. Under such laws and regulations, we could be required to remove or remediate hazardous liquids or associated wastes (including wastes disposed of or released by prior owners or operators) and to clean up contaminated property (including contaminated groundwater). We maintain insurance of various types with varying levels of coverage that we consider adequate under the circumstances to cover our operations and properties. The insurance policies are subject to deductibles and retention levels that we consider reasonable and not excessive. Consistent with insurance coverage generally available in the industry, in certain circumstances our insurance policies provide limited coverage for losses or liabilities relating to gradual pollution, with broader coverage for sudden and accidental occurrences. In conjunction with our acquisitions, we typically make an assessment of potential environmental exposure and determine whether to negotiate an indemnity, what the terms of any indemnity should be and whether to obtain environmental risk insurance, if available. These contractual indemnifications typically are subject to specific monetary requirements that must be satisfied before indemnification will apply, and have term and total dollar limits. For instance, in connection with the purchase of former Texas New Mexico (“TNM”) TNM pipeline assets from Link in 2004, we identified a number of environmental liabilities for which we received a purchase price reduction from Link and recorded a total environmental reserve of $20 million, of which we agreed in an arrangement with TNM to bear the first $11 million in costs of pre-May 1999 environmental issues. TNM also agreed to pay all costs in excess of $20 million (excluding certain deductibles). TNM’s obligations are guaranteed by Shell Oil Products (“SOP”). As of December 31, 20092010, we had incurred approximately $16 19 million of remediation costs associated with these sites, while SOP’s share has been approximately $6 8 million. In another example, as a result of our merger with Pacific, we assumed liability for a number of ongoing remediation sites associated with releases from pipeline or storage operations. We have evaluated each of the sites requiring remediation and developed reserve estimates for the Pacific sites, which total approximately $18 million at December 31, 2009. In connection with the acquisition of certain crude oil transmission and gathering assets from SOP in 2002, SOP purchased an environmental insurance policy covering known and unknown environmental matters associated with operations prior to closing. We are a named beneficiary under the policy, which has a $100,000 deductible per site, an aggregate coverage limit of $70 million, and expires in 2012. Other assets we have acquired or will acquire in the future may have environmental remediation liabilities for which we are not indemnified. We have in the past experienced and in the future likely will experience releases of crude oil into the environment from our pipeline and storage operations. We also may discover environmental impacts from past releases that were previously unidentified. See Note 11 for further environmental discussion. Note 13—Supplemental Condensed Consolidating Financial Information Some but not all of our 100% owned subsidiaries have issued full, unconditional and joint and several guarantees of our Senior Notes. Given that certain, but not all, subsidiaries are guarantors of our Senior Notes, we are required to present the following supplemental condensed consolidating financial information. For purposes of the following footnote: • we are referred to as “Parent;” • the “Guarantor Subsidiaries” are all subsidiaries other than the Non-Guarantor subsidiaries Subsidiaries defined below; and • The “Non-Guarantor Subsidiaries” as of December 31, 2009 2010 include two California Public Utilities Commission regulated entities, our natural gas storage subsidiaries and other minor subsidiaries. The following supplemental condensed consolidating financial information reflects the Parent’s separate accounts, the combined accounts of the Guarantor Subsidiaries, the combined accounts of the Non-Guarantor Subsidiaries, the combined consolidating adjustments and eliminations and the Parent’s consolidated accounts for the dates and periods indicated. For purposes of the following condensed consolidating information, the Parent’s investments in its subsidiaries and the Guarantor Subsidiaries’ investments in their subsidiaries are accounted for under the equity method of accounting (in millions): Condensed Consolidating Balance Sheet Sheets Combined Guarantor As of December 31, 2009 2010 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ..................................... $ 3,460 $ 4,394 $ 510 $ (3,983) $ 4,381 Property and equipment, net 2 4,870 1,819 — 6,691 Investments in unconsolidated entities 6,302 2,173 — (8,275) 200 Other assets, net 28 1,976 553 (126) 2,431 Total assets $ 9,792 $ 13,413 $ 2,882 $ (12,384) $ 13,703 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities $ 853 $ 6,836 $ 509 $ (3,983) $ 4,215 Long-term debt 4,366 5 386 (126) 4,631 Other long-term liabilities — 270 14 — 284 Total liabilities 5,219 7,111 909 (4,109) 9,130 Partners’ capital excluding noncontrolling interests 4,342 6,241 1,973 (8,214) 4,342 Noncontrolling interests 231 61 — (61) 231 Total partners’ capital 4,573 6,302 1,973 (8,275) 4,573 Total liabilities and partners’ capital $ 9,792 $ 13,413 $ 2,882 $ (12,384) $ 13,703 Combined Guarantor As of December 31, 2009 Combined Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets $ 3,428 $ 3,831 $ 209 $ (3,810) $ 3,658 Property, plant Property and equipment, net ............. — 4,606 1,734 — 6,340 Investment Investments in unconsolidated entities ......... 5,295 1,652 — (6,865) 82 Other assets ................................................. assets, net 29 2,342 367 (460) 2,278 Total assets ............................................. $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities ................................ $ 456 $ 6,849 $ 287 $ (3,810) $ 3,782 Long-term debt ........................................... 4,137 15 450 (460) 4,142 Other long-term liabilities ........................... — 271 4 — 275 Total liabilities ....................................... 4,593 7,135 741 (4,270) 8,199 Partners’ capital excluding noncontrolling interest ............................ 4,096 5,233 1,569 (6,802) 4,096 Noncontrolling interest ............................... 63 63 — (63) 63 Total partners’ capital ............................. 4,159 5,296 1,569 (6,865) 4,159 Total liabilities and partners’ capital ........... $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 As of December 31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ...................................... $ 2,698 $ 2,789 $ 110 $ (3,001) $ 2,596 Property, plant and equipment, net .............. — 4,410 649 — 5,059 Investment in unconsolidated entities .......... 4,388 895 — (5,026) 257 Other assets.................................................. 27 1,777 316 — 2,120 Total assets .............................................. $ 7,113 $ 9,871 $ 1,075 $ (8,027) $ 10,032 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities................................. $ 304 $ 5,411 $ 246 $ (3,001) $ 2,960 Long-term debt ............................................ 3,257 2 — — 3,259 Other long-term liabilities............................ — 260 1 — 261 Total liabilities ......................................... 3,561 5,673 247 (3,001) 6,480 Partners’ capital excluding noncontrolling interest ............................. 3,552 4,198 828 (5,026) 3,552 Noncontrolling interest ................................ — — — — — Total partners’ capital .............................. 3,552 4,198 828 (5,026) 3,552 Total liabilities and partners’ capital............ $ 7,113 $ 9,871 $ 1,075 $ (8,027) $ 10,032 F-52 Condensed Consolidating Statements of Operations Twelve Months Year Ended December 31, 2010 Parent Combined Guarantor Subsidiaries Combined Non-Guarantor Subsidiaries Eliminations Consolidated Net operating revenues (1) $ — $ 1,749 $ 223 $ — $ 1,972 Field operating costs — (632) (57) — (689) General and administrative expenses — (230) (30) — (260) Depreciation and amortization (4) (207) (45) — (256) Operating income/(loss) (4) 680 91 — 767 Equity earnings in unconsolidated entities 778 86 — (861) 3 Interest income/(expense) (254) 13 (7) — (248) Other income/(expense), net (6) (3) — — (9) Income tax benefit — 1 — — 1 Net income Less: Net income attributable to 514 777 84 (861) 514 noncontrolling interests (9) (2) — 2 (9) Net income attributable to Plains $ 505 $ 775 $ 84 $ (859) $ 505 Year Ended December 31, 2009 Combined Parent Combined Guarantor Subsidiaries Combined Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues(1revenues (1) ............................. $ — $ 1,707 $ 157 $ — $ 1,864 Field operating costs .................................... — (589) (49) — (638) General and administrative expenses........... expenses — (196) (15) — (211) Depreciation and amortization ..................... (4) (200) (32) — (236) Operating income/(loss)............................... ) (4) 722 61 — 779 Equity earnings in unconsolidated entities... entities 822 64 — (871) 15 Interest income (expenseincome/(expense) ............................ (234) 14 (4) — (224) Other income, net......................................... net (4) 20 — — 16 Income tax expense...................................... expense — (6) — — (6) Net income................................................... income Less: Net income attributable to 580 814 57 (871) $ 580 Less: Net income attributable to noncontrolling interest ......................... (1) (1) — 1 (1) Net income attributable to Plains ................. $ 579 $ 813 $ 57 $ (870) $ 579 Year Ended December 31, 2008 Combined Parent Combined Guarantor Subsidiaries Combined Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................. $ — $ 1,469 $ 113 $ — $ 1,582 Field operating costs ..................................... — (575) (42) — (617) General and administrative expenses............ expenses — (149) (11) — (160) Depreciation and amortization ...................... (3) (187) (21) — (211) Operating income/(loss)................................ ) (3) 558 39 — 594 Equity earnings in unconsolidated entities.... entities 629 45 — (660) 14 Interest expense ............................................ (195) (1) — — (196) Other income, net.......................................... net 6 26 1 — 33 Income tax expense....................................... expense — (8) — — (8) Net income.................................................... income $ 437 $ 620 $ 40 $ (660) $ 437 Year Ended December 31, 2007 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................ $ — $ 1,271 $ 122 $ — $ 1,393 Field operating costs .................................... — (493) (38) — (531) General and administrative expenses........... — (161) (3) — (164) Depreciation and amortization ..................... (3) (157) (20) — (180) Operating income/(loss)............................... (3) 460 61 — 518 Equity earnings in unconsolidated entities...................................................... 524 66 — (575) 15 Interest expense ........................................... (161) (1) — — (162) Other income, net......................................... 5 5 — — 10 Income tax expense...................................... — (16) — — (16) Net income................................................... $ 365 $ 514 $ 61 $ (575) $ 365437

Environmental Remediation. We currently own or lease, and in the past have owned and leased, properties where hazardous liquids, including hydrocarbons, are or have been handled. These properties and the hazardous liquids or associated wastes disposed thereon may be subject to CERCLA, RCRA and state and Canadian federal and provincial laws and regulations. Under such laws and regulations, we could be required to remove or remediate hazardous liquids or associated wastes (including wastes disposed of or released by prior owners or operators) and to clean up contaminated property (including contaminated groundwater). We maintain insurance of various types with varying levels of coverage that we consider adequate under the circumstances to cover our operations and properties. The insurance policies are subject to deductibles and retention levels that we consider reasonable and not excessive. Consistent with insurance coverage generally available in the industry, in certain circumstances our insurance policies provide limited coverage for losses or liabilities relating to gradual pollution, with broader coverage for sudden and accidental occurrences. In conjunction with our acquisitions, we typically make an assessment of potential environmental exposure and determine whether to negotiate an indemnity, what the terms of any indemnity should be and whether to obtain environmental risk insurance, if available. These contractual indemnifications typically are subject to specific monetary requirements that must be satisfied before indemnification will apply, and have term and total dollar limits. For instance, in connection with the purchase of former Texas New Mexico (“‘‘TNM”’’) pipeline assets from Link in 2004, we identified a number of environmental liabilities for which we received a purchase price reduction from Link and recorded a total environmental reserve of $20 million, of which we agreed in an arrangement with TNM to bear the first $11 million in costs of pre-May 1999 environmental issues. TNM also agreed to pay all costs in excess of $20 million (excluding certain deductibles). TNM’s obligations are guaranteed by Shell Oil Products (“‘‘SOP”’’). As of December 31, 20092008, we had incurred approximately $16 9 million of remediation costs associated with these sites, while SOP’s share has been is approximately $6 5 million. In another example, as a result of our merger with Pacific, we assumed liability for a number of ongoing remediation sites associated with releases from pipeline or storage operations. We have evaluated each of the sites Note 12—Environmental Remediation (Continued) requiring remediation and developed reserve estimates for the Pacific sites, which total approximately $18 million at December 31, 20092008. In connection with the acquisition of certain crude oil transmission and gathering assets from SOP in 2002, SOP purchased an environmental insurance policy covering known and unknown environmental matters associated with operations prior to closing. We are a named beneficiary under the policy, which has a $100,000 deductible per site, an aggregate coverage limit of $70 million, and expires in 2012. Other assets we have acquired or will acquire in the future may have environmental remediation liabilities for which we are not indemnified. We have in the past experienced and in the future likely will experience releases of crude oil into the environment from our pipeline and storage operations. We also may discover environmental impacts from past releases that were previously unidentified. See Note 11 for further environmental discussion. Note 13—Supplemental Condensed Consolidating Financial Information Some but not all of our 100% owned subsidiaries have issued full, unconditional unconditional, and joint and several guarantees of our Senior Notes. Given that certain, but not all, subsidiaries are guarantors of our Senior Notes, we are required to present the following supplemental condensed consolidating financial information. For purposes of the following footnote: • we are referred to as “‘‘Parent;” ’’ • the “‘‘Guarantor Subsidiaries” ’’ are all subsidiaries other than the Non-Guarantor subsidiaries defined below; and • The “‘‘Non-Guarantor Subsidiaries” ’’ as of December 31, 2009 include two California Public Utilities Commission regulated entities2008 include: Pacific Pipeline System, our natural gas storage LLC, Pacific Terminals, LLC, Pacific Energy Management LLC, Pacific Energy GP LP, PEG Canada GP LLC and SLC Pipeline LLC. The changes in non-guarantor subsidiaries during the years ended December 31, 2008, 2007 and other minor subsidiaries2006 were immaterial. The following supplemental condensed consolidating financial information reflects the Parent’s separate accounts, the combined accounts of the Guarantor Subsidiaries, the combined accounts of the Parent’s Non-Guarantor Subsidiaries, the combined consolidating adjustments and eliminations and the Parent’s consolidated accounts for the dates and periods indicated. For purposes of the following condensed consolidating information, the Parent’s investments in its subsidiaries and the Guarantor Note 13—Supplemental Condensed Consolidating Financial Information (Continued) Subsidiaries’ investments in their subsidiaries are accounted for under the equity method of accounting (all amounts in millions): Condensed Consolidating Balance Sheet As of December 31, 2009 2008 Combined Combined Parent Guarantor Subsidiaries Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ..................................... . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,698 $2,789 $ 3,428 $ 3,831 $ 209 $ 110 $(3,8103,001) $ 3,658 Property, 2,596 Property plant and equipment, net ............. — 4,606 1,734 — 6,340 Investment in unconsolidated entities ......... 5,295 1,652 — (6,865) 82 Other assets ................................................. 29 2,342 367 (460) 2,278 Total assets ............................................. $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities ................................ $ 456 $ 6,849 $ 287 $ (3,810) $ 3,782 Long-term debt ........................................... 4,137 15 450 (460) 4,142 Other long-term liabilities ........................... — 271 4 — 275 Total liabilities ....................................... 4,593 7,135 741 (4,270) 8,199 Partners’ capital excluding noncontrolling interest ............................ 4,096 5,233 1,569 (6,802) 4,096 Noncontrolling interest ............................... 63 63 — (63) 63 Total partners’ capital ............................. 4,159 5,296 1,569 (6,865) 4,159 Total liabilities and partners’ capital ........... $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 As of December 31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ...................................... $ 2,698 $ 2,789 $ 110 $ (3,001) $ 2,596 Property, plant and equipment, net .............. . . . . . . . . . . . . . . . . . — 4,410 649 — 5,059 Investment in unconsolidated entities .......... . . . . . . . . . . . . . . . 4,388 895 — (5,026) 257 Other assets.................................................. assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 1,777 316 — 2,120 Total assets .............................................. $ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $7,113 $ $9,871 $ $1,075 $ $(8,027) $ $10,032 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities................................. liabilities . . . . . . . . . . . . . . . . . . . . . . . . . $ 304 $ $5,411 $ 246 $ $(3,001) $ 2,960 Long-term debt ............................................ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,257 2 — — 3,259 Other long-term liabilities............................ liabilities . . . . . . . . . . . . . . . . . . . . . . . — 260 1 — 261 Total liabilities ......................................... . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,561 5,673 247 (3,001) 6,480 Partners’ capital excluding noncontrolling interest ............................. 3,552 4,198 828 (5,026) 3,552 Noncontrolling interest ................................ — — — — — Total partners’ capital .............................. Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,552 4,198 828 (5,026) 3,552 Total liabilities and partners’ capital............ $ capital . . . . . . . . . . . . . . . . $7,113 $ $9,871 $ $1,075 $ $(8,027) $ $10,032 Condensed Consolidating Statements As of Operations Twelve Months Ended December 31, 2009 2007 Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets $2,277 $3,858 $ 91 $(2,553) $3,673 Property plant and equipment, net . . . . . . . . . . . . . . . . . — 3,791 628 — 4,419 Investment in unconsolidated entities 3,881 863 — (4,529) 215 Other assets 22 1,259 318 — 1,599 Total assets $6,180 $9,771 $1,037 $(7,082) $9,906 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . $ 134 $5,911 $ 237 $(2,553) $3,729 Long-term debt 2,622 2 — — 2,624 Other long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . — 128 1 — 129 Total liabilities 2,756 6,041 238 (2,553) 6,482 Partners’ Capital 3,424 3,730 799 (4,529) 3,424 Total liabilities and partners’ capital $6,180 $9,771 $1,037 $(7,082) $9,906 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues(1Note 13—Supplemental Condensed Consolidating Financial Information (Continued) ............................. $ — $ 1,707 $ 157 $ — $ 1,864 Field operating costs .................................... — (589) (49) — (638) General and administrative expenses........... — (196) (15) — (211) Depreciation and amortization ..................... (4) (200) (32) — (236) Operating income/(loss)............................... (4) 722 61 — 779 Equity earnings in unconsolidated entities... 822 64 — (871) 15 Interest income (expense) ............................ (234) 14 (4) — (224) Other income, net......................................... (4) 20 — — 16 Income tax expense...................................... — (6) — — (6) Net income................................................... 580 814 57 (871) 580 Less: Net income attributable to noncontrolling interest ......................... (1) (1) — 1 (1) Net income attributable to Plains ................. $ 579 $ 813 $ 57 $ (870) $ 579 Condensed Consolidating Statements of Operations Year Ended December 31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1revenues(1) ............................. . . . . . . . . . . . . . . . . . . . . . . . $ — $ $1,469 $ $113 $ — $ $1,582 Field operating costs ..................................... . . . . . . . . . . . . . . . . . . . . . . . . . . — (575) (42) — (617) General and administrative expenses............ expenses . . . . . . . . . . . . . . . . — (149) (11) — (160) Depreciation and amortization ...................... . . . . . . . . . . . . . . . . . . . . (3) (187) (21) — (211) Operating income/(loss)................................ (3) 558 39 — 594 Equity earnings in unconsolidated entities.... 629 45 — (660) 14 Interest expense ............................................ (195) (1) — — (196) Other income, net.......................................... 6 26 1 — 33 Income tax expense....................................... — (8) — — (8) Net income.................................................... $ 437 $ 620 $ 40 $ (660) $ 437 Year Ended December 31, 2007 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................ $ — $ 1,271 $ 122 $ — $ 1,393 Field operating costs .................................... — (493) (38) — (531) General and administrative expenses........... — (161) (3) — (164) Depreciation and amortization ..................... (3) (157) (20) — (180) Operating income/(loss)............................... (3) 460 61 — 518 Equity earnings in unconsolidated entities...................................................... 524 66 — (575) 15 Interest expense ........................................... (161) (1) — — (162) Other income, net......................................... 5 5 — — 10 Income tax expense...................................... — (16) — — (16) Net income................................................... $ 365 $ 514 $ 61 $ (575) $ 365

Environmental Remediation. We currently own or lease, and in the past have owned and leased, lease properties where hazardous liquids, including hydrocarbons, are being or have been handled. These properties and the hazardous liquids or associated generated wastes disposed thereon may be subject to CERCLA, RCRA and analogous state and Canadian federal and provincial laws and regulations. Under such laws and regulations, we could be required to remove or remediate hazardous liquids or associated generated wastes (including wastes disposed of or released by prior owners or operators) and ), to clean up contaminated property (including contaminated groundwater)) or to perform remedial operations to prevent future contamination. We maintain insurance of various types with varying levels of coverage that we consider adequate under the circumstances to cover our operations and properties. The insurance policies are subject to deductibles and retention levels that we consider reasonable and not excessive. Consistent with insurance coverage generally available in the industry, in certain circumstances our insurance policies provide limited coverage for losses or liabilities relating to gradual pollution, with broader coverage for sudden and accidental occurrences. In addition, we have entered into indemnification agreements with various counterparties in conjunction with several of our acquisitions. Allocation of environmental liability is an issue negotiated in connection with each of our acquisition transactions. In each case, we typically make an assessment of potential environmental exposure based on available information. Based on that assessment and relevant economic and risk factors, we determine whether to negotiate an indemnity, what the terms of any indemnity should be (for example, minimum thresholds or caps on exposure) and whether to obtain environmental risk insurance, if available. In some cases, we have received contractual protections in the form of environmental indemnifications from several predecessor operators for properties acquired by us that are contaminated as a result of historical operations. These contractual indemnifications typically are subject to specific monetary requirements that must be satisfied before indemnification will apply, apply and have term and total dollar limits. For instance, in connection with the purchase of former Texas New Mexico (“TNM”) pipeline assets from Link in 2004, we identified a number of environmental liabilities for which we received a purchase price reduction from Link and recorded a total environmental reserve of $20 million. A substantial portion of these environmental liabilities are associated with the former Texas New Mexico (“TNM”) pipeline assets. On the effective date of the acquisition, of which we and TNM entered into a cost-sharing agreement whereby, on a tiered basis, we agreed in an arrangement with TNM to bear $11 million of the first $11 20 million in costs of pre-May 1999 environmental issues. We also agreed to bear the first $25,000 per site for new sites which were not identified at the time we entered into the agreement (capped at 100 sites). TNM also agreed to pay all costs in excess of $20 million (excluding certain deductiblesthe deductible for new sites). TNM’s obligations are guaranteed by Shell Oil Products (“SOP”). As of December 31, 20092006, we had incurred approximately $16 7 million of remediation costs associated with these sites, while ; SOP’s share has been is approximately $6 1.5 million. In another example, as a result of our merger with Pacific, we assumed liability for a number of ongoing remediation sites associated with releases from pipeline or storage operations. We have evaluated each of the sites requiring remediation and developed reserve estimates for the Pacific sites, which total approximately $18 million at December 31, 2009. In connection with the acquisition of certain crude oil transmission and gathering assets from SOP in 2002, SOP purchased an environmental insurance policy covering known and unknown environmental matters associated with operations prior to closing. We are a named beneficiary under the policy, which has a $100,000 deductible per site, an aggregate coverage limit of $70 million, and expires in 2012. SOP made a claim against the policy; however, we do not believe that the claim substantially reduced our coverage under the policy. In connection with our 1999 acquisition of Xxxxxxxx Permian LLC from MAP, we were indemnified by MAP for any environmental liabilities attributable to Xxxxxxxx’x business or properties that occurred prior to the date of the closing of the acquisition. Other than with respect to liabilities associated with two Superfund sites at which it is alleged that Xxxxxxxx deposited waste oils, this indemnity has expired or was terminated by agreement. F-50 As a result of our merger with Pacific, we have assumed liability for a number of ongoing remediation sites, associated with releases from pipeline or storage operations. These sites had been managed by Pacific prior to the merger, and in general there is no insurance or indemnification to cover ongoing costs to address these sites (with the exception of the Pyramid Lake crude oil release). We have evaluated each of the sites requiring remediation, through review of technical and regulatory documents, discussions with Pacific, and our experience at investigating and remediating releases from pipeline and storage operations. We have developed reserve estimates for the Pacific sites based on this evaluation, including determination of current and long-term reserve amounts, which total approximately $21.8 million. Other assets we have acquired or will acquire in the future may have environmental remediation liabilities for which we are not indemnified. We have in the past experienced and in the future likely will experience releases of crude oil or petroleum products into the environment from our pipeline and storage operations. We also may discover environmental impacts from past releases that were previously unidentified. See Note 11 Although we maintain an inspection program designed to prevent and, as applicable, to detect and address such releases promptly, damages and liabilities incurred due to any such environmental releases from our assets may substantially affect our business. As we expand our pipeline assets through acquisitions, we typically improve on (decrease) the rate of releases from such assets as we implement our standards and procedures, remove selected assets from service and spend capital to upgrade the assets. In the immediate post-acquisition period, however, the inclusion of additional miles of pipe in our operation may result in an increase in the absolute number of releases company-wide compared to prior periods. We experienced such an increase in connection with the Pacific acquisition, which added approximately 5,000 miles of pipeline to our operations, and in connection with the Link acquisition, which added approximately 7,000 miles of pipeline to our operations. As a result, we have also received an increased number of requests for further environmental discussion. Note 13—Supplemental Condensed Consolidating Financial Information Some but not all information from governmental agencies with respect to such releases of crude oil (such as EPA requests under CleanWater Act Section 308), commensurate with the scale and scope of our 100% owned subsidiaries have issued full, unconditional and joint and several guarantees of our Senior Notespipeline operations. Given that certain, but not all, subsidiaries are guarantors of our Senior Notes, we are required to present the following supplemental condensed consolidating financial information. For purposes of the following footnote: • we are referred to as “Parent;” • the “Guarantor Subsidiaries” are all subsidiaries other than the Non-Guarantor subsidiaries defined below; and • The “Non-Guarantor Subsidiaries” as of At December 31, 2009 include two California Public Utilities Commission regulated entities2006, our natural gas storage subsidiaries and other minor subsidiaries. The following supplemental condensed consolidating financial information reflects the Parent’s separate accounts, the combined accounts reserve for environmental liabilities totaled approximately $39.1 million (approximately $21.8 million of this reserve is related to liabilities assumed as part of the Guarantor SubsidiariesPacific merger, the combined accounts and $10.4 million is related to liabilities assumed as part of the Non-Guarantor Subsidiaries, the combined consolidating adjustments and eliminations and the Parent’s consolidated accounts for the dates and periods indicatedLink acquisition). For purposes Approximately $19.5 million of the following condensed consolidating information, the Parent’s investments in its subsidiaries and the Guarantor Subsidiaries’ investments in their subsidiaries are accounted for under the equity method of accounting our environmental reserve is classified as current (in millions): Condensed Consolidating Balance Sheet As of December 31, 2009 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ..................................... $ 3,428 $ 3,831 $ 209 $ (3,810) $ 3,658 Property, plant and equipment, net ............. — 4,606 1,734 — 6,340 Investment in unconsolidated entities ......... 5,295 1,652 — (6,865) 82 Other assets ................................................. 29 2,342 367 (460) 2,278 Total assets ............................................. $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 LIABILITIES AND PARTNERS’ CAPITAL Total within other current liabilities ................................ $ 456 $ 6,849 $ 287 $ (3,810on our Consolidated Balance Sheets) $ 3,782 Longand $19.6 million is classified as long-term debt ........................................... 4,137 15 450 (460) 4,142 within Other long-term liabilities ........................... — 271 4 — 275 Total liabilities ....................................... 4,593 7,135 741 (4,270) 8,199 Partners’ capital excluding noncontrolling interest ............................ 4,096 5,233 1,569 (6,802) 4,096 Noncontrolling interest ............................... 63 63 — (63) 63 Total partners’ capital ............................. 4,159 5,296 1,569 (6,865) 4,159 Total liabilities and partners’ capital ........... $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 As of deferred credits on our Consolidated Balance Sheets). At December 31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ...................................... $ 2,698 $ 2,789 $ 110 $ 2006, we have recorded receivables totaling approximately $11.6 million for amounts recoverable under insurance and from third parties under indemnification agreements. In some cases, the actual cash expenditures may not occur for three to five years. Our estimates used in these reserves are based on all known facts at the time and our assessment of the ultimate outcome. Among the many uncertainties that impact our estimates are the necessary regulatory approvals for, and potential modification of, our remediation plans, the limited amount of data available upon initial assessment of the impact of soil or water contamination, changes in costs associated with environmental remediation services and equipment and the possibility of existing legal claims giving rise to additional claims. Therefore, although we believe that the reserve is adequate, no assurances can be made that any costs incurred in excess of this reserve or outside of the indemnifications would not have a material adverse effect on our financial condition, results of operations, or cash flows. Note 14 — Quarterly Financial Data (3,001Unaudited): First Second Third Fourth Quarter Quarter Quarter Quarter Total(1) (In millions, except per unit data) 2006 Revenues(2) $ 2,596 Property, plant and equipment, net .............. — 4,410 649 — 5,059 Investment 8,635.1 $ 4,891.9 $ 4,525.6 $ 4,391.8 $ 22,444.4 Gross margin 103.8 124.0 145.8 115.0 488.6 Operating income 72.0 96.6 112.8 73.3 354.7 Cumulative effect of change in unconsolidated entities .......... 4,388 895 — (5,026) 257 Other assets.................................................. 27 1,777 316 — 2,120 Total assets .............................................. $ 7,113 $ 9,871 $ 1,075 $ (8,027) $ 10,032 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities................................. $ 304 $ 5,411 $ 246 $ (3,001) $ 2,960 Long-term debt ............................................ 3,257 2 — — 3,259 Other long-term liabilities............................ — 260 1 — 261 Total liabilities ......................................... 3,561 5,673 247 (3,001) 6,480 Partners’ capital excluding noncontrolling interest ............................. 3,552 4,198 828 (5,026) 3,552 Noncontrolling interest ................................ accounting principle 6.3 — — — — — Total partners’ capital .............................. 3,552 4,198 828 (5,026) 3,552 Total liabilities and partners’ capital............ $ 7,113 $ 9,871 $ 1,075 $ (8,0276.3 Net income 63.4 80.3 95.4 46.0 285.1 Basic net income per limited partner unit 0.73 0.82 0.90 0.37 2.91 Diluted net income per limited partner unit 0.71 0.81 0.89 0.36 2.88 Cash distributions per common unit(3) $ 10,032 Condensed Consolidating Statements of Operations Twelve Months Ended December 31, 2009 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues(10.688 $ 0.708 $ 0.725 $ 0.750 $ 2.87 2005 Revenues(2) ............................. $ — 6,638.3 $ 1,707 7,160.6 $ 157 8,664.2 $ — 8,713.4 $ 1,864 Field operating costs .................................... — (589) (49) — (638) General and administrative expenses........... — (196) (15) — (211) Depreciation and amortization ..................... (4) (200) (32) — (236) 31,176.5 Gross margin 69.2 102.1 111.2 95.5 378.0 Operating income/(loss)............................... (4) 722 61 — 779 Equity earnings in unconsolidated entities... 822 64 — (871) 15 Interest income (expense) ............................ (234) 14 (4) — (224) Other income, net......................................... (4) 20 — — 16 Income tax expense...................................... — (6) — — (6) Net income................................................... 580 814 57 (871) 580 Less: 47.1 75.9 84.7 67.1 274.8 Net income attributable to noncontrolling interest ......................... (1) (1) — 1 (1) Net 32.8 62.3 69.0 53.7 217.8 Basic net income attributable to Plains ................. $ 579 $ 813 $ 57 $ (870per limited partner unit 0.43 0.76 0.81 0.65 2.77 Diluted net income per limited partner unit 0.43 0.74 0.79 0.64 2.72 Cash distributions per common unit(3) $ 579 Year Ended December 31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................. 0.613 $ — 0.638 $ 1,469 0.650 $ 113 0.675 $ — $ 1,582 Field operating costs ..................................... — (575) (42) — (617) General and administrative expenses............ — (149) (11) — (160) Depreciation and amortization ...................... (3) (187) (21) — (211) Operating income/(loss)................................ (3) 558 39 — 594 Equity earnings in unconsolidated entities.... 629 45 — (660) 14 Interest expense ............................................ (195) (1) — — (196) Other income, net.......................................... 6 26 1 — 33 Income tax expense....................................... — (8) — — (8) Net income.................................................... $ 437 $ 620 $ 40 $ (660) $ 437 Year Ended December 31, 2007 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................ $ — $ 1,271 $ 122 $ — $ 1,393 Field operating costs .................................... — (493) (38) — (531) General and administrative expenses........... — (161) (3) — (164) Depreciation and amortization ..................... (3) (157) (20) — (180) Operating income/(loss)............................... (3) 460 61 — 518 Equity earnings in unconsolidated entities...................................................... 524 66 — (575) 15 Interest expense ........................................... (161) (1) — — (162) Other income, net......................................... 5 5 — — 10 Income tax expense...................................... — (16) — — (16) Net income................................................... $ 365 $ 514 $ 61 $ (575) $ 3652.58

Environmental Remediation. We currently own or lease, and in the past have owned and leased, lease properties where hazardous liquids, including hydrocarbons, are being or have been handled. These properties and the hazardous liquids or associated generated wastes disposed thereon may be subject to CERCLA, RCRA and analogous state and Canadian federal and provincial laws and regulationslaws. Under such laws and regulationslaws, we could be required to remove or remediate hazardous liquids or associated generated wastes (including wastes disposed of or released by prior owners or operators) and ), to clean up contaminated property (including contaminated groundwater)) or to perform remedial operations to prevent future contamination. We maintain insurance of various types with varying levels of coverage that we consider adequate under the circumstances to cover our operations and properties. The insurance policies are subject to deductibles and retention levels that we consider reasonable and not excessive. Consistent with insurance coverage generally available in the industry, in certain circumstances our insurance policies provide limited coverage for losses or liabilities relating to gradual pollution, with broader coverage for sudden and accidental occurrences. In addition, we have entered into indemnification agreements with various counterparties in conjunction with several of our acquisitions. Allocation of environmental liability is an issue negotiated in connection with each of our acquisition transactions. In each case, we typically make an assessment of potential environmental exposure based on available information. Based on that assessment and relevant economic and risk factors, we determine whether to negotiate an indemnity, what the terms of any indemnity should be (for example, minimum thresholds or caps on exposure) and whether to obtain environmental risk insurance, if available. In some cases, we have received contractual protections in the form of environmental indemnifications from several predecessor operators for properties acquired by us that are contaminated as a result of historical operations. These contractual indemnifications typically are subject to specific monetary requirements that must be satisfied before indemnification will apply, apply and have term and total dollar limits. The acquisitions we completed in 2005, 2004 and 2003 include a variety of provisions dealing with the allocation of responsibility for environmental costs that range from no or limited indemnities from the sellers to indemnification from sellers with defined limitations on their maximum exposure. We have not obtained insurance for any of the conditions related to our 2005 and 2003 acquisitions, and only in limited circumstances for our 2004 acquisitions. For instance, in connection with the purchase of former Texas New Mexico (“TNM”) pipeline assets from Link in 2004acquisition, we identified a number of environmental liabilities for which we received a purchase price reduction from Link Link. A substantial portion of these environmental liabilities are associated with the former Texas New Mexico (“TNM”) pipeline assets. On the effective date of the acquisition, we and recorded TNM entered into a total environmental reserve of $20 millioncost-sharing agreement whereby, of which on a tiered basis, we agreed in an arrangement with TNM to bear $11 million of the first $11 20 million in costs of pre-May 1999 environmental issues. We also agreed to bear the first $25,000 per site for new sites which were not identified at the time we entered into the agreement (capped at 100 sites). TNM also agreed to pay all costs in excess of $20 million (excluding certain deductiblesthe deductible for new sites). TNM’s obligations are guaranteed by Shell Oil Products (“SOP”). As We recorded a reserve for environmental liabilities of December 31, 2009, we had incurred approximately $16 20.0 million of remediation costs associated in connection with these sites, while SOP’s share has been approximately $6 million. In another example, as a result of our merger with Pacific, we assumed liability for a number of ongoing remediation sites associated with releases from pipeline or storage operations. We have evaluated each of the sites requiring remediation and developed reserve estimates for the Pacific sites, which total approximately $18 million at December 31, 2009Link acquisition. In connection with the acquisition of certain crude oil transmission and gathering assets from SOP in 2002, SOP purchased an environmental insurance policy covering known and unknown environmental matters associated with operations prior to closing. We are a named beneficiary under the policy, which has a $100,000 deductible per site, an aggregate coverage limit of $70 million, and expires in 2012. SOP has made a claim against the policy; however, we do not believe that the claim substantially reduced our coverage under the policy. In connection with our 1999 acquisition of Xxxxxxxx Permian LLC from MAP, we were indemnified by MAP for any environmental liabilities attributable to Xxxxxxxx’x business or properties which occurred prior to the date of the closing of the acquisition. Other than with respect to liabilities associated with two Superfund sites at which it is alleged that Xxxxxxxx deposited waste oils, this indemnity has expired or was terminated by agreement. Other assets we have acquired or will acquire in the future may have environmental remediation liabilities for which we are not indemnified. We have in the past experienced and in the future will likely will experience releases of crude oil into the environment from our pipeline and storage operations. We also may , or discover environmental impacts from past releases that were previously unidentified. See Note 11 for further Although we maintain a program designed to prevent and, as applicable, to detect and address such releases promptly, damages and liabilities incurred due to environmental discussionreleases from our assets may substantially affect our business. Note 13—Supplemental Condensed Consolidating Financial Information Some but not all of our 100% owned subsidiaries have issued full, unconditional and joint and several guarantees of our Senior Notes. Given that certain, but not all, subsidiaries are guarantors of our Senior Notes, we are required to present the following supplemental condensed consolidating financial information. For purposes of the following footnote: • we are referred to as “Parent;” • the “Guarantor Subsidiaries” are all subsidiaries other than the Non-Guarantor subsidiaries defined below; and • The “Non-Guarantor Subsidiaries” as of At December 31, 2009 include two California Public Utilities Commission regulated entities2005, our natural gas storage subsidiaries and other minor subsidiaries. The following supplemental condensed consolidating financial information reflects the Parent’s separate accounts, the combined accounts reserve for environmental liabilities totaled approximately $22.4 million (approximately $14.6 million of this reserve is related to liabilities assumed as part of the Guarantor Subsidiaries, the combined accounts Link acquisition). Approximately $14.4 million of the Nonour environmental reserve is classified as current and $8 million is classified as long-Guarantor Subsidiaries, the combined consolidating adjustments and eliminations and the Parent’s consolidated accounts for the dates and periods indicatedterm. For purposes of the following condensed consolidating information, the Parent’s investments in its subsidiaries and the Guarantor Subsidiaries’ investments in their subsidiaries are accounted for under the equity method of accounting (in millions): Condensed Consolidating Balance Sheet As of At December 31, 2009 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ..................................... $ 3,428 $ 3,831 $ 209 $ 2005, we have recorded receivables totaling approximately $14.2 million (3,810$7.7 million related to estimated future remediation costs) $ 3,658 Propertyfor amounts recoverable under insurance and from third parties under indemnification agreements. In some cases, plant the actual cash expenditures may not occur for three to five years. We believe that this reserve is adequate, and equipmentin conjunction with our indemnification arrangements, net ............. — 4,606 1,734 — 6,340 Investment should prevent remediation costs from having a material adverse effect on our financial condition, results of operations, or cash flows. Our estimates used in unconsolidated entities ......... 5,295 1,652 — these reserves are based on all known facts at the time and our assessment of the ultimate outcome. Among the many uncertainties that impact our estimates are the necessary regulatory approvals for, and potential modification of, our remediation plans, the limited amount of data available upon initial assessment of the impact of soil or water contamination, changes in costs associated with environmental remediation services and equipment and the possibility of existing legal claims giving rise to additional claims. Therefore, no assurances can be made that any costs incurred in excess of this reserve or outside of the indemnifications would not have a material adverse effect on our financial condition, results of operations, or cash flows. Note 12—Quarterly Financial Data (6,865Unaudited): First Second Third Fourth Quarter Quarter Quarter Quarter Total(1) 82 Other assets ................................................. 29 2,342 367 2005 Revenues(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $6,638.5 (460in millio $7,160.7 ns, except per $8,664.4 unit data) 2,278 Total assets ............................................. $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities ................................ $ 456 $ 6,849 $ 287 $ (3,810) $ 3,782 Long-term debt ........................................... 4,137 15 450 (460) 4,142 Other long-term liabilities ........................... — 271 4 — 275 Total liabilities ....................................... 4,593 7,135 741 (4,270) 8,199 Partners’ capital excluding noncontrolling interest ............................ 4,096 5,233 1,569 (6,802) 4,096 Noncontrolling interest ............................... 63 63 — (63) 63 Total partners’ capital ............................. 4,159 5,296 1,569 (6,865) 4,159 Total liabilities and partners’ capital ........... $ 8,752 $ 12,431 $ 2,310 $ (11,135) $ 12,358 As of December 31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Total current assets ...................................... $ 2,698 $ 2,789 $ 110 $ (3,001) $ 2,596 Property, plant and equipment, net .............. — 4,410 649 — 5,059 Investment in unconsolidated entities .......... 4,388 895 — (5,026) 257 Other assets.................................................. 27 1,777 316 — 2,120 Total assets .............................................. $ 7,113 $ 9,871 $ 1,075 $ (8,027) $ 10,032 LIABILITIES AND PARTNERS’ CAPITAL Total current liabilities................................. $ 304 $ 5,411 $ 246 $ (3,001) $ 2,960 Long-term debt ............................................ 3,257 2 — — 3,259 Other long-term liabilities............................ — 260 1 — 261 Total liabilities ......................................... 3,561 5,673 247 (3,001) 6,480 Partners’ capital excluding noncontrolling interest ............................. 3,552 4,198 828 (5,026) 3,552 Noncontrolling interest ................................ — — — — — Total partners’ capital .............................. 3,552 4,198 828 (5,026) 3,552 Total liabilities and partners’ capital............ $ 7,113 $ 9,871 $ 1,075 $ (8,027) $ 10,032 Condensed Consolidating Statements of Operations Twelve Months Ended December 31, 2009 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues(1) ............................. $ — $ 1,707 $ 157 $ — $ 1,864 Field operating costs .................................... — (589) (49) — (638) General and administrative expenses........... — (196) (15) — (211) Depreciation and amortization ..................... (4) (200) (32) — (236) $8,713.7 $31,177.3 Gross margin. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69.4 102.2 111.4 95.8 378.8 Operating income/(loss)............................... (4) 722 61 — 779 Equity earnings in unconsolidated entities... 822 64 — (871) 15 Interest income (expense) ............................ (234) 14 (4) — (224) Other income, net......................................... (4) 20 — — 16 Income tax expense...................................... — (6) — — (6) Net income................................................... 580 814 57 (871) 580 Less: . . . . . . . . . . . . . . . . . . . . . . . . . . . 47.3 76.0 84.9 67.4 275.6 Net income attributable to noncontrolling interest ......................... (1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32.8 62.3 69.0 53.7 217.8 Basic net income per limited partner unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.43 0.76 0.81 0.65 2.77 Diluted net income per limited partner unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.43 0.74 0.79 0.64 Cash distributions per common unit(3) (1. . . . . . . . . . $ 0.61 $ 0.63 $ 0.65 $ 0.67 2.72 $ 2004 Revenues(2) — 1 (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,804.6 $5,131.7 $5,867.0 $6,172.1 $20,975.5 Gross margin. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59.6 64.9 74.5 63.7 262.7 Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . 40.5 45.2 55.1 39.2 180.0 Income before cumulative effect of change in accounting principle . . . . . . . . . . . . . . . . . . . . . . . 31.0 35.7 41.7 24.7 133.1 Net income attributable to Plains ................. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27.9 35.7 41.7 24.7 130.0 Basic and diluted income per limited partner unit before cumulative effect of change in accounting principle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.49 0.54 0.59 0.32 1.94 Basic and diluted income per limited partner unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.44 0.54 0.59 0.32 1.89 Cash distributions per common unit(3) . . . . . . . . . . $ 579 0.56 $ 813 0.56 $ 57 0.57 $ (870) $ 579 Year Ended December 31, 2008 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................. $ — $ 1,469 $ 113 $ — $ 1,582 Field operating costs ..................................... — (575) (42) — (617) General and administrative expenses............ — (149) (11) — (160) Depreciation and amortization ...................... (3) (187) (21) — (211) Operating income/(loss)................................ (3) 558 39 — 594 Equity earnings in unconsolidated entities.... 629 45 — (660) 14 Interest expense ............................................ (195) (1) — — (196) Other income, net.......................................... 6 26 1 — 33 Income tax expense....................................... — (8) — — (8) Net income.................................................... $ 437 $ 620 $ 40 $ (660) $ 437 Year Ended December 31, 2007 Combined Combined Guarantor Non-Guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net operating revenues (1) ............................ $ — $ 1,271 $ 122 $ — $ 1,393 Field operating costs .................................... — (493) (38) — (531) General and administrative expenses........... — (161) (3) — (164) Depreciation and amortization ..................... (3) (157) (20) — (180) Operating income/(loss)............................... (3) 460 61 — 518 Equity earnings in unconsolidated entities...................................................... 524 66 — (575) 15 Interest expense ........................................... (161) (1) — — (162) Other income, net......................................... 5 5 — — 10 Income tax expense...................................... — (16) — — (16) Net income................................................... $ 365 $ 514 $ 61 $ (575) $ 3650.60 $