Jul 15, 2002 |
PAA Amends Credit Facility and Enhances Financial Flexibility |
(Houston – July 15, 2002) Plains All American Pipeline, L.P. (NYSE: PAA) announced today that it has executed an amendment with its lenders that further enhances the Partnership’s financial flexibility. The amendment enables PAA to consummate the pending acquisition of certain West Texas assets and accommodate the increased activity level associated with the expanded asset base, while still preserving the Partnership’s ability to pursue additional acquisitions. As a result of this amendment, the Partnership is able to expand the size of its credit facility from $980 million to $1.13 billion. The amendment also allows the Partnership to issue up to $400 million of senior unsecured notes. The pending acquisition is scheduled to close on August 1, 2002. As amended, the Partnership’s $1.13 billion senior secured credit facility consists of revolving credit facilities with a combined capacity of $480 million, a letter of credit and hedged inventory facility of up to $350 million, a $200 million term loan that matures in 2007 and a $100 million term loan that matures in 2006. The Partnership noted that the amendment also (i) eliminated the previous $100 million inventory borrowing sub-limit under the letter of credit and hedged inventory facility and (ii) extended the maturity of the letter of credit and hedged inventory facility to April 2005. Existing lender commitments total approximately $980 million. Phil Kramer, Executive Vice President and Chief Financial Officer of the Partnership, said, “We are extremely pleased that our lenders have once again expressed their confidence in Plains All American and its business strategy.
This amendment provides the Partnership with a heightened level of financial flexibility that is commensurate with the size and scope of the Partnership’s post-acquisition business activities. It also further bolsters the Partnership’s ability to achieve counter-cyclical balance in its business activities as it increases the capacity of the Partnership to undertake contango inventory transactions during periods of weak crude oil markets.” Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements that involve certain risk factors and uncertainties that could cause actual results to differ materially from results anticipated in forward-looking statements. These risks and uncertainties include, among other things, consummation of acquisition transactions, successful integration and future performance of assets acquired, abrupt or severe production declines or production interruptions in outer-continental shelf production located offshore California and transported on the All American Pipeline, availability of third party production volumes for transportation and marketing, demand for various grades of crude oil and resulting changes in pricing conditions, successful third party drilling efforts, regulatory changes, the availability of acquisition opportunities on terms favorable to the Partnership, unanticipated shortages or cost increases in materials and skilled labor, weather interference, and other factors and uncertainties inherent in the marketing, transportation, terminalling, gathering and storage of crude oil and liquefied petroleum gas (“LPG”) discussed in the Partnership’s filings with the Securities and Exchange Commission.
Plains All American Pipeline, L.P. is engaged in interstate and intrastate crude oil transportation, terminalling and storage, as well as crude oil and LPG gathering and marketing activities, primarily in Texas, California, Oklahoma and Louisiana and the Canadian Provinces of Alberta, Saskatchewan and Manitoba. The Partnership’s common units are traded on the New York Stock Exchange under the symbol “PAA.” The Partnership is headquartered in Houston, Texas. |
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