Plains All American Pipeline, L.P. and Plains GP Holdings have announced the execution of definitive agreements with Keyera Corp. for the sale of substantially all of Plains’ natural gas liquidsbusiness. The transaction, valued at approximately $5.15 billion CAD ($3.75 billion USD), represents a strategic transformation for the midstream energy company.
The deal is expected to close in the first quarter of 2026, subject to customary closing conditions and regulatory approvals. Under the agreement, Plains will divest its Canadian NGL business while retaining substantially all NGL assets in the United States and maintaining all crude oil assets in Canada.
The transaction positions Plains as what executives describe as a premier midstream crude oil “pure play,” designed to drive efficient growth and create streamlining opportunities. The sale is expected to create a more durable cash flow stream by reducing commodity-related EBITDA contribution, seasonality effects, and working capital requirements.
The purchase price represents approximately 13 times Plains’ expected 2025 Distributable Cash Flow, which the company characterizes as an attractive valuation. Post-transaction, the pro-forma business is expected to generate a higher percentage of “excess cash flow” with proportionally lower capital investments and tax obligations.
Willie Chiang, chairman and CEO, described the announcement as “a win-win transaction for both Plains and Keyera.” He noted that Plains is exiting the Canadian NGL business at an attractive valuation while Keyera receives complementary and critical infrastructure in a strategic market.
“Successful completion of this transformative transaction advances our efficient growth strategy and establishes Plains as the premier pure play crude oil midstream entity with highly strategic assets linking North American supply to key demand centers,” Chiang stated. He emphasized that the transaction enhances the company’s free cash flow profile and reduces both commodity exposure and working capital requirements.
Capital Allocation Strategy
Plains expects to receive approximately $3.0 billion USD in net proceeds after accounting for taxes, transaction expenses, and a potential one-time special distribution. The company has outlined plans for a potential special distribution of approximately $0.35 per unit, intended to offset individual tax liabilities associated with the transaction, though this remains subject to board approval and successful transaction completion.
The company plans to prioritize transaction proceeds toward several strategic initiatives. These include disciplined bolt-on mergers and acquisitions to extend and expand the crude oil-focused portfolio, capital structure optimization including potential repurchases of Series A and Series B preferred units, and opportunistic common unit repurchases.
Following the transaction’s completion, Plains expects its financial framework to be enhanced, with leverage positioned at or below the low end of the company’s target range. This is expected to provide significant financial flexibility while allowing continued optimization of the crude oil-focused asset base and increased returns to unitholders.
For more information visit www.ir.plains.com
