Plains All American Pipeline's (PAA) recent acquisition of the remaining stake in the EPIC pipeline is expected to improve operational efficiency and expand market access, RBC said in a note emailed Friday.
Plains All American Pipeline plans to invest modest capital into linking assets for better system flexibility and cost savings, the firm added.
The company now controls three pipelines across the Permian and Corpus Christi corridor, giving it room to optimize flows, RBC said.
Following its NGL asset sale and acquisitions, Plains All American Pipeline aims to cut debt and move to the midpoint of its leverage target, according to the note.
RBC said Plains All American Pipeline is also assessing how to better move Canadian crude to the Gulf Coast using its underutilized Capline system, without investing in new long-haul pipelines.
The firm now forecasts 2025 adjusted earnings before interest, taxes, depreciation, and amortization at $2.865 billion, slightly up from $2.846 billion, incorporating EPIC and the NGL exit.
RBC maintained its sector perform rating for Plains All American Pipeline with a $20 price target.
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