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Net Income Per Limited Partner Unit (Tables)

3 Months Ended

Mar. 31, 2012

Computation of basic and diluted earnings per limited partner unit

	Three Months Ended March 31,
	2012			2011
Numerator for basic and diluted earnings per limited partner unit (1):
Net income attributable to Plains	$	230		$	182
Less: General partner’s incentive distribution	(65		)	(50		)
Less: General partner 2% ownership	(3		)	(3		)
Net income available to limited partners in accordance with the application of the two-class method for MLPs	$	162		$	129

Denominator:
Basic weighted average number of limited partner units outstanding	157			143
Effect of dilutive securities:
Weighted average LTIP units (2)	1			1
Diluted weighted average number of limited partner units outstanding	158			144

Basic net income per limited partner unit	$	1.03		$	0.90

Diluted net income per limited partner unit	$	1.02		$	0.90

(1) We calculate net income available to limited partners based on the distributions pertaining to the current period’s net income. After adjusting for the appropriate period’s distributions, the remaining undistributed earnings or excess distributions over earnings, if any, are allocated to the general partner and limited partners in accordance with the contractual terms of the partnership agreement.

(2) Our LTIP awards that contemplate the issuance of common units are considered dilutive unless (i) vesting occurs only upon the satisfaction of a performance condition and (ii) that performance condition has yet to be satisfied. LTIP awards that are deemed to be dilutive are reduced by a hypothetical unit repurchase based on the remaining unamortized fair value, as prescribed by the treasury stock method in guidance issued by the FASB. See Note 10 to our Consolidated Financial Statements included in Part IV of our 2011 Annual Report on Form 10-K for a complete discussion of our LTIP awards.