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Debt | 12 Months Ended
--- | ---
Dec. 31, 2017
Debt Disclosure [Abstract] |
Debt | Debt Debt consisted of the following (in millions):
| December 31, 2017 |  | December 31, 2016
SHORT-TERM DEBT |  |  |
Commercial paper notes, bearing a weighted-average interest rate of 2.4% and 1.6%, respectively (1) | $ | — |  |  | $ | 563 |
Senior secured hedged inventory facility, bearing a weighted-average interest rate of 2.6% and 1.8%, respectively (1) | 664 |  |  | 750 |
Senior notes: |  |  |
6.13% senior notes due January 2017 | — |  |  | 400 |
Other | 73 |  |  | 2 |
Total short-term debt (2) | 737 |  |  | 1,715 |
LONG-TERM DEBT |  |  |
Senior notes: |  |  |
6.50% senior notes due May 2018 (3) | — |  |  | 600 |
8.75% senior notes due May 2019 (3) | — |  |  | 350 |
2.60% senior notes due December 2019 | 500 |  |  | 500 |
5.75% senior notes due January 2020 | 500 |  |  | 500 |
5.00% senior notes due February 2021 | 600 |  |  | 600 |
3.65% senior notes due June 2022 | 750 |  |  | 750 |
2.85% senior notes due January 2023 | 400 |  |  | 400 |
3.85% senior notes due October 2023 | 700 |  |  | 700 |
3.60% senior notes due November 2024 | 750 |  |  | 750 |
4.65% senior notes due October 2025 | 1,000 |  |  | 1,000 |
4.50% senior notes due December 2026 | 750 |  |  | 750 |
6.70% senior notes due May 2036 | 250 |  |  | 250 |
6.65% senior notes due January 2037 | 600 |  |  | 600 |
5.15% senior notes due June 2042 | 500 |  |  | 500 |
4.30% senior notes due January 2043 | 350 |  |  | 350 |
4.70% senior notes due June 2044 | 700 |  |  | 700 |
4.90% senior notes due February 2045 | 650 |  |  | 650 |
Unamortized discounts and debt issuance costs | (67 | ) |  | (76 | )
Senior notes, net of unamortized discounts and debt issuance costs | 8,933 |  |  | 9,874 |
Other long-term debt: |  |  |
Commercial paper notes and senior secured hedged inventory facility borrowings (4) | 247 |  |  | 247 |
Other | 3 |  |  | 3 |
Total long-term debt | 9,183 |  |  | 10,124 |
Total debt (5) | $ | 9,920 |  |  | $ | 11,839 |
(1) | We classified these commercial paper notes and credit facility borrowings as short-term as of December 31, 2017 and 2016, as these notes and borrowings were primarily designated as working capital borrowings, were required to be repaid within one year and were primarily for hedged NGL and crude oil inventory and NYMEX and ICE margin deposits.
(2) | As of December 31, 2017 and 2016, balance includes borrowings of $212 million and $410 million, respectively, for cash margin deposits with NYMEX and ICE, which are associated with financial derivatives used for hedging purposes.
(3) | In December 2017, we redeemed our $600 million, 6.50% senior notes due May 2018 and our $350 million, 8.75% senior notes due May 2019. See the “Senior Notes—Senior Note Repayments and Redemptions” section below for further discussion.
(4) | As of December 31, 2017 and 2016, we classified a portion of our commercial paper notes and senior secured hedged inventory facility borrowings as long-term based on our ability and intent to refinance such amounts on a long-term basis.
(5) | Our fixed-rate senior notes (including current maturities) had a face value of approximately $9.0 billion and $10.3 billion as of December 31, 2017 and 2016, respectively. We estimated the aggregate fair value of these notes as of December 31, 2017 and 2016 to be approximately $9.1 billion and $10.4 billion, respectively. Our fixed-rate senior notes are traded among institutions, and these trades are routinely published by a reporting service. Our determination of fair value is based on reported trading activity near year end. We estimate that the carrying value of outstanding borrowings under our credit facilities and commercial paper program approximates fair value as interest rates reflect current market rates. The fair value estimates for our senior notes, credit facilities and commercial paper program are based upon observable market data and are classified in Level 2 of the fair value hierarchy.
Commercial Paper Program We have a commercial paper program under which we may issue (and have outstanding at any time) up to $3.0 billion in the aggregate of privately placed, unsecured commercial paper notes. Such notes are backstopped by our senior unsecured revolving credit facility and our senior secured hedged inventory facility; as such, any borrowings under our commercial paper program reduce the available capacity under these facilities. Credit Facilities Senior secured hedged inventory facility. We have a credit agreement that provides for a senior secured hedged inventory facility with a committed borrowing capacity of $1.4 billion, of which $400 million is available for the issuance of letters of credit. Subject to obtaining additional or increased lender commitments, the committed capacity of the facility may be increased to $1.9 billion. Proceeds from the facility are primarily used to finance purchased or stored hedged inventory, including NYMEX and ICE margin deposits. Such obligations under the committed facility are secured by the financed inventory and the associated accounts receivable and are repaid from the proceeds of the sale of the financed inventory. Borrowings accrue interest based, at our election, on either the Eurocurrency Rate or the Base Rate, in each case plus a margin based on our credit rating at the applicable time. The agreement also provides for one or more one-year extensions, subject to applicable approval. In August 2017, we amended this agreement to, among other things, extend the maturity date of the facility to August 2020 for each extending lender. The maturity date with respect to each non-extending lender (which represent aggregate commitments of approximately $60 million out of total commitments of $1.4 billion from all lenders) remains August 2019. Senior unsecured revolving credit facility. We have a credit agreement that provides for a senior unsecured revolving credit facility with a committed borrowing capacity of $1.6 billion. Subject to obtaining additional or increased lender commitments, the committed capacity may be increased to $2.1 billion. The credit agreement also provides for the issuance of letters of credit. Borrowings accrue interest based, at our election, on the Eurocurrency Rate, the Base Rate or the Canadian Prime Rate, in each case plus a margin based on our credit rating at the applicable time. The agreement also provides for one or more one-year extensions, subject to applicable approval. In August 2017, we amended this agreement to, among other things, extend the maturity date of the facility to August 2022 for each extending lender. The maturity dates with respect to each non-extending lender (which represent aggregate commitments of $120 million out of total commitments of $1.6 billion from all lenders) remain August 2021 or mature one year earlier. Senior unsecured 364-day revolving credit facility. We have a credit agreement that provides for a 364-day senior unsecured revolving credit facility with a borrowing capacity of $1.0 billion. In August 2017, we amended this agreement to extend the maturity date to August 2018. Additionally, a provision was added whereby we may elect to have the entire principal balance of any loans outstanding on the maturity date converted to a non-revolving term loan with a maturity date of August 2019. Borrowings accrue interest based, at our election, on either the Eurocurrency Rate or the Base Rate, as defined in the agreement, in each case plus a margin based on our credit rating at the applicable time. AAP senior secured credit agreement. In connection with the Simplification Transactions, on November 15, 2016, we assumed all of AAP’s then outstanding borrowings under the AAP senior secured credit agreement, and immediately repaid such amounts and canceled the credit agreement. See Note 1 for further discussion of the Simplification Transactions. Senior Notes Our senior notes are co-issued, jointly and severally, by Plains All American Pipeline, L.P. and a 100%-owned consolidated finance subsidiary (neither of which have independent assets or operations) and are unsecured senior obligations of such entities and rank equally in right of payment with existing and future senior indebtedness of the issuers. We may, at our option, redeem any series of senior notes at any time in whole or from time to time in part, prior to maturity, at the redemption prices described in the indentures governing the senior notes. Our senior notes are not guaranteed by any of our subsidiaries. Senior Notes Issuances The table below summarizes our issuances of senior unsecured notes during 2016 and 2015 (in millions):
Year |  | Description |  | Maturity |  | Face Value |  | Interest Payment Dates
2016 |  | 4.50% Senior Notes issued at 99.716% of face value |  | December 2026 |  | $ | 750 |  |  | June 15 and December 15
2015 |  | 4.65% Senior Notes issued at 99.846% of face value |  | October 2025 |  | $ | 1,000 |  |  | April 15 and October 15
We did not issue any senior unsecured notes during the year ended December 31, 2017. Senior Note Repayments and Redemptions Our $400 million, 6.13% senior notes matured and were repaid in January 2017. In December 2017, we redeemed our $600 million, 6.50% senior notes due May 2018 and our $350 million, 8.75% senior notes due May 2019. We utilized cash on hand and available capacity under our commercial paper program and credit facilities to repay these notes. In conjunction with the early redemptions, we recognized a loss of approximately $40 million, recorded to Other income/(expense), net in our Consolidated Statements of Operations. Our $175 million, 5.88% senior notes matured and were repaid in August 2016. We utilized cash on hand and available capacity under our commercial paper program and credit facilities to repay these notes. Our $150 million, 5.25% senior notes and $400 million, 3.95% senior notes matured and were repaid in June 2015 and September 2015, respectively. We utilized cash on hand and available capacity under our commercial paper program to repay these notes. Maturities The weighted average maturity of our long-term debt outstanding at December 31, 2017 was approximately 12 years. The following table presents the aggregate contractually scheduled maturities of such long-term debt for the next five years and thereafter. The amounts presented exclude unamortized discounts and debt issuance costs.
Calendar Year |  | Payment (in millions)
2018 |  | $ | 247 |
2019 |  | 500 |
2020 |  | 500 |
2021 |  | 600 |
2022 |  | 750 |
Thereafter |  | 6,653 |
Covenants and Compliance Our credit agreements (which impact our ability to access our commercial paper program because they provide a financial backstop that supports our short-term credit ratings) and the indentures governing our senior notes contain cross-default provisions. Our credit agreements prohibit declaration or payments of distributions on, or purchases or redemptions of, units if any default or event of default is continuing. In addition, the agreements contain various covenants limiting our ability to, among other things:
• | grant liens on certain property;
• | incur indebtedness, including capital leases;
• | sell substantially all of our assets or enter into a merger or consolidation;
• | engage in certain transactions with affiliates; and
• | enter into certain burdensome agreements.
The credit agreements for our senior unsecured revolving credit facility, senior secured hedged inventory facility and senior unsecured 364-day revolving credit facility treat a change of control as an event of default and also require us to maintain a debt-to-EBITDA coverage ratio that, on a trailing four-quarter basis, will not be greater than 5.00 to 1.00 (or 5.50 to 1.00 on all outstanding debt during an acquisition period (generally, the period consisting of three fiscal quarters following an acquisition greater than $150 million), and/or during the GP Simplification Period (the period beginning on November 15, 2016 and ending on December 31, 2017)). For covenant compliance purposes, Consolidated EBITDA may include certain adjustments, including those for material projects and certain non-recurring expenses. Additionally, letters of credit and borrowings to fund hedged inventory and margin requirements are excluded when calculating the debt coverage ratio. A default under our credit facilities would permit the lenders to accelerate the maturity of the outstanding debt. As long as we are in compliance with our credit agreements, our ability to make distributions of available cash is not restricted. As of December 31, 2017, we were in compliance with the covenants contained in our credit agreements and indentures. Borrowings and Repayments Total borrowings under our credit agreements and commercial paper program for the years ended December 31, 2017, 2016 and 2015 were approximately $60.8 billion, $60.3 billion and $62.2 billion, respectively. Total repayments under our credit agreements and commercial paper program were approximately $61.5 billion, $61.0 billion and $61.3 billion for the years ended December 31, 2017, 2016 and 2015, respectively. The variance in total gross borrowings and repayments is impacted by various business and financial factors including, but not limited to, the timing, average term and method of general partnership borrowing activities. Letters of Credit In connection with our supply and logistics activities, we provide certain suppliers with irrevocable standby letters of credit to secure our obligation for the purchase and transportation of crude oil, NGL and natural gas. These letters of credit are issued under the PAA senior unsecured revolving credit facility and the PAA senior secured hedged inventory facility, and our liabilities with respect to these purchase obligations are recorded in accounts payable on our balance sheet in the month the crude oil, NGL or natural gas is purchased. Generally, these letters of credit are issued for periods of up to seventy days and are terminated upon completion of each transaction. Additionally, we issue letters of credit to support insurance programs, derivative transactions and construction activities. At December 31, 2017 and 2016, we had outstanding letters of credit of $166 million and $73 million, respectively. Debt Issuance Costs Costs incurred in connection with the issuance of senior notes are recorded as a direct deduction from the related debt liability and are amortized using the straight-line method over the term of the related debt. Use of the straight-line method does not differ materially from the “effective interest” method of amortization.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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