Welcome to Plains All American Pipeline's Third Quarter 2007 Results Conference Call. During today's call, the participants will provide forward-looking comments on the Partnership's outlook as well as a review of the results of the prior period. Accordingly in doing so, they will use words such as beliefs, estimate, expect, anticipate, etcetera. The Partnership intends to avail itself of Safe Harbor provisions that encourage companies to provide this information and directs you to the risks and warnings set forth in Plains All American Pipeline's most recently filed 10-K, 10-Q, 8-K and other current and future filings with the Securities and Exchange Commission. In addition, the Partnership encourages you to visit its website at www.paalp.com. In particular, the section entitled Non-GAAP Reconciliation, which presents certain commonly used non-GAAP financial measures such as EBITDA and EBIT, which maybe used here today in the prepared remarks or in the Q&A session. This section also presents a reconciliation of those non-GAAP financial measures to the most directly comparable GAAP financial measures, and includes a table of selected items that impacts comparability with respect to the Partnership's reported financial information. Any reference during today's call to adjusted EBITDA, adjusted net income and the like, is a reference to the financial measure, excluding the effect of selecting items impacting comparability. Today's conference call will be chaired by Greg L. Armstrong, Chairman and CEO of Plains All American Pipeline. Also participating in the call are Harry Pefanis, Plains All American's President and COO; and Phil Kramer, Plains All American's Executive Vice President and CFO. I will now turn the call over to Mr. Greg Armstrong.

Thank you Jackie and welcome to everyone. This morning we had a little bit of technical difficulties on getting our slides uploaded. If you are listening to the webcast, your slides are available right down the slides. If you are on the phone call, are being uploaded as we speak on the website and should be available momentarily. So if you could, can follow along. As we discussed in our last conference call, our biggest challenge for the second half of the year will be to address the rapid transition of the crude oil market from a contango structure to backwardation. And as indicated in our August 6th guidance we forecast that the transaction and other factors would mostly affect our fourth quarter results. Yesterday, we once again reported strong results that we were at the upper end of our guidance. Although there was some shift of adjusted EBITDA between the third and fourth quarters, we increased the midpoint of our guidance for the full year of 2007 by $7 million and provided preliminary adjusted EBITDA again for 2008. Highlights for the third quarter are summarized on slide three, and I have just been informed that the slides are available now on our website. As noted there, the Partnership reported EBITDA, net income, and net income per diluted unit of a $183 million, $98.4 million and $0.66 per unit, representing percentage increases of 33% and a decrease on net income per unit of 26%, compared to respective third quarter 2006 results of $138.8 million, $95.4 million and $0.89 per unit. Excluding selected items impacting comparability, third quarter adjusted EBITDA was $196.4 million and adjusted net income was a $111.5 million or $0.77 per diluted unit representing percentage changes of 50%, 27% and a negative 19% compared to corresponding results for…

Thanks Greg. In my part of the call, I will review third quarter operating results, address major operational functions for the fourth quarter guidance, and provide an update on our expansion of capital projects and recent acquisitions. Each of our segments performed above the midpoint of the third quarter guidance we provided on August 6, 2007. As shown on slide five, adjusted segment profit for our Transportation segment was $92 million or $0.36 a barrel, with a $1.5 million above the midpoint of our guidance range. Transportation volumes were approximately 2.8 million barrels per day, they were in line with our guidance. Segment profitability was favorably impacted by higher prices received from our pipeline loss allowance sales. Adjusted segment profit for the Facilities segment was $28.9 million or $0.23 a barrel and was about $1.9 million above the midpoint of our guidance range. Volumes were 42.4 million barrels for the quarter and that's about 2.7 million barrels above our guidance, which would, and that difference is primarily due to the acquisitions of Bumstead facility in the third quarter. Adjusted segment profit for the marketing segment was $75 million or $0.98 a barrel. That exceeded the midpoint of our guidance by $7.5 million. Segment volumes were about 833,000 barrels per day during the quarter. That's a little lower than volumes of our guidance. So, even though our lease gathering volumes were little lower, the primary reason for the overall performance was the strong gathering... strong margins we experienced in lease gathering business, which is typically the case when the market transitions from contango to backwardation. In a moment, Phil will discuss our fourth quarter 2007 guidance, and this guidance assumes fourth quarter volumes from Transportation segment of approximately 2.8 million barrels per day. Estimated volumes for each of our larger systems…

Thanks Harry. During my portion of the call, I will view our capitalization and liquidity at the end of the third quarter, then walk through fourth quarter guidance, full year guidance as well as the preliminary guidance for next year. Giving all attention to both the weakness in debt capital markets and the continued high grade trading in the and of the equity capital markets, I'm pleased to report that PAA is well positioned as we ended the third quarter with a strong credit profile, capital structure and excellent liquidity. I've summarized on slide 8, at September 30th PAA's long-term debt outstanding was approximately $2.6 billion. Our book equity was approximately $3.4 billion and as a result our long-term debt to total cap percentage was approximately 43%. Our third quarter adjusted EBITDA and the interest coverage ratio was approximately 5.1 times in using the midpoint of our 2007 adjusted EBITDA range. Our long-term debt to adjusted EBITDA ratios were approximately 3.3 times. In addition our long-term debt has an average tenure of approximately 14.1 years and we have no maturities of long-term debt until mid 2009, when we have a small charge of approximately $175 million maturing. We also have significant liquidity. As of the end of the third quarter, we have approximately $1.5 billion of undrawn committed capacity on our $1.6 billion revolver that's available to meet our working capital needs, and we are currently in the process of renewing our 364-day $1.2 billion uncommitted Contango facility. As shown on slide nine, even with over $5.4 billion in cumulative acquisitions and expansion capital investments since the fourth quarter of 2001, we've been within our targeted 50% of long-term debt-to-total cap percentage ratio in 23 of the past 24 quarters. As we've mentioned in previous calls the foregoing metrics excluded…

Thanks Bill. We're clearly pleased with the third quarter results. Our fourth quarter guidance reflects the delayed impacts of the crude oil market transition effects, such as contango interest associated with profits realized in the third quarter as well as other market-related impacts of the transition. Despite some shift of profit and expenses between quarters, we expect to deliver full year result inline with a slightly ahead of the guidance midpoint we provided, on our second quarter results conference call in August. Although a few months still remain in 2007, we have either achieved or position ourselves to achieve each of the five goals we established at the beginning of the year for 2007. These goals in our current status are summarized on slide 12. We believe PAA is well positioned for the future and we are pleased with the overall increase in baseline operations we are forecasting for 2008. As we noted earlier, the preliminary guidance for 2008 does not include any forecast for a return of the contango market. Our 7% to 9% annual distribution growth target over the next several years is underpinned primarily by our large portfolio of organic growth projects that we expect to complete from 2008 through 2010. Before we open the call up for questions, I also wanted to point out that despite recent disruptions in the debt and MLP equity capital markets, we believe PAA is very well positioned to fund its growth. As a result of PAA disciplined approached to executing its financial growth strategy, we have strong credit metrics, an excellent committed liquidity and we are well positioned to activity on on-track of expansion and acquisition opportunity. That wraps up the items on our agenda. We appreciate your continued support of our partnership and we look forward to discussion of our year-end results in our February call. A complete written transcript of our prepared comments for this call will be posted on our website at www.paalp.com very shortly. You will also have the option to download an audio version of the call. Jackie, at this time, we can open the call up for questions. Question And Answer

Thank you. Ladies and gentlemen we will now be conducting a question and answer session. [Operator Instructions] Our first question is coming from Barret Blaschke with RBC Capital Markets.

Hi guys couple of quick questions. I wondered, we got in to backwardation of little bit on the call. What does that look like for the storage business, I mean where are you in terms of, how full are the tanks basically and how does marketing offer that?

Well, we generally don't disclose how much oil we have in our tanks drawing for an account of our customers. A substantial amount of our tankage is leased to the third party customers. Obviously it doesn't make much economic sense for us to hold crude oil in tanks in a backwardated markets.

Great.

So when the market flips from Contango to backwardation we generally,see, an uptick which was reflected and the third quarter and our fourth quarter guidance out there is probably reflective of a worsened, the normal margin and I think that had about $0.66 of barrel though typical... in a typical market. We'd expect probably more than the $0.66 that's per barrel of our margin from that segment of our businesses. I don't know, if, I, really answered your question but...

Yes, I didn't ask it really well probably. But I guess what I am wondering is what kind of downside protection do you have on the stores side or the contract?

Yes, let me breakdown the Tankage. We've got, right now I mean we are building more tanks. Most of it as Harry pointed is under contract but of the 64 million barrels roughly that we have right now, we only use about 18% to 20% of that for our own purposes at peak during the contango period. So and about half of the 64 is used for servicing the pipeline side and the other part of it is all subject to leases that range anywhere from some 30 days but in most cases its three to five year leases. So we have a fair amount under lease. So it's not as big an impact as you might expect. It's, just when it happens it's very positive and that's why we have always been talking about the baseline level. So I would tell you as a result a combination of factors, increased number of products that have to be handled which we are pushing refineries to find other ways to store the crude if any more than on-time tankage for their refined products in the different varieties they have to carry the increased number and grades accrued and the increased influx of those coming from Canada. There's quite a bit of demand out there just for fundamental tanking or take each for tunneling storage activities just to meet day-to-day needs. So again it's when the contango shows up its really affecting a small number of our tanks and just adds a lot of value when it's there. When you pull that out though the baseline level's very, very solid.

Okay. Thanks Greg.

Thank you. Our next question is coming from Harry Mateer, with Lehman Brothers Incorporated.

Hi guys. Just a question on your credit ratings. It's still a negative outlook at S&P. You have obviously posted some pretty good results here and brought your Contango debt down, could you discuss a little bit A) your discussions with the rating agencies with respect to getting that negative outlook back to stay with S&P, and then further down the line you've spoken previously about your desire to get your credit ratings upgraded. So if you could just update us on that front?

We've got in additional to Philip Kramer we also have Al Swanson here. So I'll turn it over to him and let him address it.

When S&P put us on negative they said that the likely time period was a year to which that year is currently coming up. Just in the normal course did it with the rating agencies, and we agree with you. We would think that that should come off and that's the things that S&P has to see, I think that the company has delivered on since they put us on that watch. With respect to our ratings increased target, I mean that's still a target for us out there. We think that given a normal situation, I think we think that we're a mid BBB company at least. Things haven't been normal and certainly the credit disruptions that occurred in the whole of the summer haven't improved that situation any. So I don't know if that will impact rating agencies with respect to us, but it certainly can't help them to move forward the rating to increase,. Al, do you have anything that...

This is Greg I might just add that with respect to S$P and again trying to predict what rating agencies are going to do is maybe more difficult than trying to predict all prices in market structure, but they did have a one year period - November 15th will be that one year period. We have turned in very strong results, candidly I think the fact that we went from a contango market structure to a backward and that our numbers are not only resilient, but they are basically above where the forecasted baseline and would have been in the absence of those that market chatter. We think good shooting. Could turn into a positive. I think the fact that the debt has come down and as we said it, would have been self liquidating, we have raised more equity. It should all bode well for absolutely reinforcement of our current rating that we believe as Phil said, hopefully pushing them in the right direction to see us continue to go up. We do have a target of being a mid to half BBB. We think the credit statistics that we have support that already and quite... again the fact that the market has reversed to Contango to backwardation we think will give people a chance to see the full cycle benefit of our asset base and business model and that you shouldn't treat the contango numbers as if they are evil when they show up, they are actually incremental profits that go to fund capital and when you peel them out, we got an extremely strong capital structure.

Great thanks, guys.

Thank you. Our next question is coming from John Edwards of Morgan Keegan and Company.

Good morning everybody. Can you hear me?

Yes we can, John.

Okay. Hey, in the past you talked about I think it was about $1.2 billion of capital expansion project opportunities over the next three years. I was wondering if you could confirm it that's still the case and maybe you could provide a little detail on specifics as far as when, how you think those will hit.

I can, the first answer your first question, is it still our belief that we have those, absolutely. As far as giving you a little bit of color, two things to caveat with and then I will answer your question. We are still developing our 2008 capital program and for competitive reasons we are somewhat cautious about being too specific. But having said that, we can reconcile about half of the $1 billion to $1.2 billion that you reference simply by identifying the -- we think already based upon where we are in our capital program for 2008 that we have got probably $250 million to $300 million of projects that we will be implementing in 2008 and again did somewhere in that range we are still developing that and we will shortly give guidance in February as Phil mentioned. None of those projects I think individually account for more than 25% to 30% of that total. So, again you are talking about good spread, good diversification without a whole lot of high concentration risk. In any one. What's not included in that number is Pier 100 which is subject to regulatory approval, but as soon as we get that and we believe that that is more of a when not an if, that's going to add about $350 million to $400 million, somewhere in that range depending for what we spend in preliminary engineering design by the time that approved. So, that alone accounts for in the order of magnitude of half to 60% of that million to $1.2 billion range. And the balance is a project, again we have identified during various stages of development and negotiations with our customers, as to the types of infrastructure that they willing to give us commitments to support or our assets with the markets conditions that we call those to build those irrespective of commitments. But we don't want to be too specific because we are not the only guys out there trying to come up with great ways to build assets and generate returns. Is that...?

Yes that helps and just one follow on to that is has the shift to a backwardated oil market impacted your...how has that impacted your capital expansion plans?

It hasn't. Zero.

Zero. Okay, alright thank you very much.

John I would point out too that back to Barret's question earlier, of the roughly 12 to 14 million barrels that we have used for contango purposes for 2008, while not as attractive levels as we realized when we used them for proprietary, we basically got them either under leases or synthetic leases with market position. So again I think we were actually looking forward to looking back at the end of 2008 and looking forward for 2009 to get people report card on showing what our assets in our business model can do through the other leg of the cycle.

Okay, great. Thanks a lot.

Thank you. Our next question is coming from Ross Payne of Wachovia Securities.

How you are doing guys? First question, cap lines seems to have been up nicely if you just kind a give a little color on what was driving that 26% year-over-year increase?

Well a couple of things has helped cap line. First of all, remember when hurricanes occurred in 2005 it took some of the Gulf of Mexico productions out. So as those platforms have come back on line and I think into south Louisiana, St. James area, so that has helped capline. We signed a agreement last year with one of the refiners on the capline system and that continually increased volume over and above the base level commitment to us. So that could... primarily driven the, increased capline volumes.

Okay. Also on the distribution coverage, were you together in the quarter and what's kind of a range you're looking for over the next 12 months?

Yes. Ross we've been running very high coverage as a result of the Contango contribution that we have always again, that we don't really base our guidance on that, but the coverage for the year for based upon the midpoint of our guidance will come in right in about 120%, the guidance mid-to-high range for the fourth quarter is in the 95 to 104 range it will come on about flat, and if you just look at the midpoint of our 2008 over the current distribution, it's round about 110.

Okay.

Or as we look forward, again we are always going to filter out the market chatter associated with profit that we cannot reliably forecast will occur. As Wall Street Journal quoted, we're not, going to throw just because it's not repeatable but we are going to use it the very cost from our capital programs have to play out an additional equity on that, but I would say, again we've always said that we're comfortable somewhere in the 105 to 112 range, 110 and one that we probably quoted a few times, we base it with the reliability, the predictability of the, about face level operation at a very comfortable level.

Okay, one final question. I mean you have obviously got a lot of growth CapEx currently underway. Can we think about certain kind of EBITDA multiples associated with that CapEx to kind of build in some pro forma, EBITDA on money that's already been spent out the door? That's kind of one way we could look to leverage a little differently as well. But, can you give us a kind of a range of multiples in terms of some of the organic projects you're doing?

I'll give you a range and I'll give you kind of what I think you have to use for a weighted average. But first off, with respect to the guidance we are providing clearly part of the uplift from the base level of 690 that we entered in to 2007 versus the midpoint of our guidance of 785 reflects the benefit of the capital spend or at least part it. As Harry pointed out some of those projects are going to come on in the fourth quarter of this year. Some are coming on throughout the first half of next year and then you've got some that carry over into late '08 or early '09. So trying to use a formula of capital spend in the year divided by a multiple equal adds to the next year is a little bit tricky, depending on whether we come by a 6-month project or and 18-month project. The range of multiples if you will on the capital project, it can vary from some of our best ones look like a two or a three and some of our left power returns can be as high at nine. Probably somewhere in the 6 to 7.5, 6.75 to 7 number is a comfortable range that won't get you in trouble. Over time we think that with value added from our margin activities, we can maybe push that a little bit lower than what I'd guide you to but I would say you're safe in that 6.75 to 7 range.

Very good. Thank you very much.

Thank you. Your next question is coming from Gil Alexander with Darsel Associates?

Good morning

Good morning.

Could you give us some perspective on how much saving is still to come in the Pacific acquisition?

You mean by savings by basic synergies?

Yes sir.

Our synergies came from some cost savings that were immediate, some over time and then some commercial and then capital. We plan some other assets in ours, initially we targeted 30 million for the first year and I think we had a projection that about 2010 that number climbed up to $54 million and our belief is, we are probably running higher than at that part of the uplift that I mentioned in the baseline forecast was associated with increased synergies. We have certainly hit our target first term, and I hope S&P is listening to that and, but we are finding additional values in here to be able to extract value. So, I think we are going to still be harvesting synergies for some time to come. Overall the order of magnitude is probably going to be in the $15 million to $25 million above what we forecast, some will begin. That has not all kind of launch because we take a lot of phase it in. As I mentioned in prior phone call, the one before it, what we did find when we got Pacific, there were probably some near shorter term headaches that we had to handle, we had budget for those, we just didn't know exactly what they would look like. We are pretty much with most of that right now and ultimately that shorter-term headaches generally mean there is more long-term upside and that's what we are finding as we see. Phil you --

Yeah, I do. Yes, the $1.2 billion of CapEx that we were looking at over the next several years also some amount of that's coming from new opportunities associated with Pacific assets as well.

Thank you.

Thank you.

Thank you. Our next question is coming from Yves Siegel from Wachovia Securities.

Thanks. Good morning. First question is, you spoke about the movement from contango to backwardation. Is there a proper opportunity just because you had a step change in the absolute value of crude?

No, not really. Some of our mentioning hearing his comment. We... part of our tariff structure in the pipelines side is we get a fraction of the percentage of the crude oil to be retained for the compensation of fuel and so I wonder if there's immediate spike in the prices of crude. We have some ability to capture but we did not talk about huge volume. What Al said that even and we view it as a natural hedge is, currently the cost of our utilities go up as well and so we try to manage both sides of that equation or let it both flow, depending upon our view on the market. So there is not really a direct impact, our margins aren't really affected by the absolute move in prices. If they were to fall extremely low, theoretically you start to leave volumes from producing that kind of self-fulfilling issue because as soon as you drop it low then all of a sudden demand goes up and by first on the upside. Theoretically, you'd see a large explosion in drilling activity and we have seen some pick up in certain areas because of the high oil prices, but bottom line we have been... most of produces have been trying to run flat out want to clear the $40 a barrel anyway.

Okay and then couple more, with the... looking forward at the potential projects that you have run on the slate, would you...,the return potential there, is it pretty much in the fair way that you answered Ross's question, is it better or worse or pretty much in the fair way and the second part of that would be is it possible to sort of look at that project slate and give a sort of average duration of how long those projects may take to come to fruition, come to the finish line?

The first part of your question will be a little bit, region in the last part.

Okay.

Yes, the rate of return really hasn't moved a lot with the gyration in the market. What do say Harry? I am --

They can be pretty steady, yes.

They are in the 14%, 17% range, and if you average around 14%, that gives you about your 7 multiple. These are very, very long life assets, even though for accounting purposes we are somewhat forced to amortize our tanks over 40 years even though they will be here with my kids' kids' kids graduate such a life. So when we do our rate of return though, we actually look at the beautiful life of the asset but when you get beyond a 100 years, it doesn't cater much to the rate of return. Having said that its somewhat of an inert. The last of the five gets buried by the mix and I would probably tell you that whereas 5 years ago the duration from implementation of the projects, the realization of cash flow may have been in the sixth months to a year, we probably migrated on our probably here in the 12 to 18 capital month range.

that was I would say the bulk of the mark 12 to 18 month [indiscernible]?

For instance to build tanks in Cushing like we do, we started early last year we will have most of them in position early this year, this coming year and so it's in that 12 to 18 month range so it's moved out from but its quite removed by factors 6 months on average.

Okay and the last question related to given the dislocation that we saw in the credit markets earlier no. 1 and number two given the absolute level of commodity prices and the fairly high cost of infrastructure project and then looking North to Canada in terms of what's going on there. Has the opportunity set changed a whole lot for acquisitions?

I would say it's in transition. I think it's clearly the sellers had figured out that when capital was available to every body it's very cheap, very low level and there were hardly any entry barriers to becoming an MLP, they could extract a lot of the value associated with that decline in the cost of capital. We have participated in certainly a number of acquisition efforts and walked away from them. We were told we didn't make the cut because our number weren't high enough. We didn't make the first round because we just fundamentally didn't see it the same way and while we knew returns relative to our cost of capital we also believe there is full cycle issue that tends to get carried away and drawn from the cue level of low interest rate that may not be there forever. We are hearing bad from some of those processes that they haven't closed yet or fellers are rethinking but we haven't posed a whole lot of deals either since the entire play were in transition. I think we won't know probably until the middle of next year just whether this is a pause and then it's going to take off again or whether it's actually going to cause a recalibration of the sellers numbers that will pay the multiple come down. From our perspective that's the best of our world we...our balance sheet's strong, our growth strategy, financial growth strategy is always pretty solid and be ahead of it. So we would actually want to judiciously guard our capital and invest it at the best rates of return, the facts that we have a fundamental business model that allows us to add synergies to assets should give us an ability to follow the different outsize returns. If we do that and actually will, but it does require that markets not calls but that is actually transitioned to a lower level. That doesn't mean we can't make good investments. It just means we'd like to make great investments.

Is Canada a viable option to expand?

We are expanding there. In fact we're still doing the capital budget. But there is a lot of projects there. There is just a lot of demand for infrastructure that help move and if a displacement of crude. Once a new particular crude comes on it causes rotation in other areas, it certainly affects the Rockies quite a bit and as far as you talk about acquisition. The only thing I can tell you is the Canadian capital markets were affected about a year ago, day before yesterday by the change in the income trust, backlog. They have since recovered and while the MLP capital structure or capital supply has disruptions that occurred in early August, but you haven't seen that north of the border because I think most of the capital had already migrated down south back a year ago. So, I think that's when I require selling out crude. Right now, I don't think, they are any screaming bargains up there. But I think over time it can and it should settle out and then of course you have to factor into that, the fact that Canadian dollar has gone from 1.55 ratio 7 or 8 years ago when we first entered Canada, now its 0.95. So, we're doing very well with our investments that we have as our Canadian friends up there remind us and but we have to watch to make sure that our rate of return is taking effect, the currency change issues too.

Thank you.

Thanks Yves.

Thank you. Our next question is coming from Jin Luo of JP Morgan.

Good morning everyone.

Good morning.

I have two questions regarding the GP IPO, who are the starting shareholders of the GP? My second question, as you mentioned that the tax share will be lower. Can you comment on how much?

On the first issue, the selling unit holders the GP we anticipate will be almost profitable if there still some discussions going on. I think all of our owners would like to have a public mark out here but they'd like everybody else to sell it best and be enough willing fellows to do a minimum size deal. We think it will be fairly uniform across, there may be a few holders that choose not to sale. As far as the tax yield, it's fairly complex and we're still calculating it. The last time we calculated I think it's a time people would buy in the public market. I think we were looking for shields in around the 70% to 80% range. And once we get through the transition period that would probably be back in the neighborhood. Phil if you want.

The one think I'll add to that is that it's packed down. The other thing that I'll add to that is that during 2007 and 2006 our unit holders have probably experienced lower shield than they will ordinarily would have anyway, based on the fact that we've generated excess cash flow in that income based on the contango market. So their shield based on historical levels have probably come down as a result of that excess performance because that excess performance has not been distributed out. As Greg pointed out, we use that excess to fund projects. As we look at 2008 with no real contango baked into our forecast, you may actually get an offset because that excess is not fair and you may not notice that big a difference, but as Greg pointed out it is a complicated calculation. At this point we don't really know precisely what is going to happen.

Another question regarding your December 8 guidance. How much CapEx spending you're taking in for 2008 in that guidance?

We are still developing that capital program there but very little of the capital that will be spent in 2008 will have any significant impact on the EBITDA guidance that we gave so I don't expect that to move a lot as a result of our capital program. If anything, it will affect 2009 and 2010 but the neighborhood if you will of capital that we expect is probably around the 250 to 300 range as we sit here today and again we are still trying to finalize that and that would not include we're anticipating that 300 or 400 approval if that happens then that number could move up a little bit, but again that's going to affect other years, not 2008 EBITDA performance.

So the year-over-year increase in estimate from summary from the 2007 spending ?

Correct. And the additional synergies from Pacific that we're realizing and then I will also -- I failed to say this earlier, but it was on one of Bill's slides, we have effectively prefunded our equity our approach is to fund our Cap expansion 50-50 debt and equity and we have already raised position equity to be prefund, certainly a capital program for 2008 and in the order of magnitude of the 250-300 range. But that means you go back to the equity capital market and still has excess leftover for further capital expansion or for acquisition.

Thank you.

Thank you.

[Operator Instructions]. Your next question is coming from Sam Arnold of Credit Suisse.

Hi, good afternoon guys, I guess good morning. Just two things, the first would be Greg, could you talk about, with the crude oil price where they're at, are you seeing an increase in drilling activity in your gathering areas? And then the second question would be, given that the Marathon announcement on Detroit and with Wood River and BP and Whiting and some of these other guys reverting to Canadian heavy, do you try to quantify the impact, if you could see on Capline and Capwood volumes?

Yes. I'll take the first one, we have as crude oil has trended up from it hit I think the beginning of the certain year, price got as low as what 50, 55 and moved on a... it's been fairly active growing in many of our areas in West Texas as there is a predominance of oil out there, while you heard people fall off in own shore drilling activities primarily being gaps, we are sure to see very active producers we're at, it's a little bit early to try and predict what $90, $94, lot of oil is going to do, but I am not too sure that just because the price went up I don't think that there are that many projects that have been waiting for that high fives to be active. I think we will probably see a high level of activity on areas already. Again, I think quite candidly if you go down $30 or $40 and we'd still see a continuation of that. So I don't think there is really a cost related influence with the last price move. Would you agree Phil?

I would, yes.

And you want to address.

As far as Capline is concerned, when you look at the two entities, that you just mentioned, Marathon and BP, each have their own interest in Capline so their volume fluctuation is going to affect our interest in Capline, like we all have our own small pipes within the Capline pipeline system.

Okay, it's not just collective, it's the 20% that they, it would only affect their volumes, not...?

we have our own share of space that says that we own 23% of the Capline which gives us about turn of 50,000 barrels of that capacity, and we can try for and receive all the benefit of that capacity we all share operating expenses proportionately.

Got you. Okay. Alright now, that's good, thanks.

Okay.

Thank you Sam.

Thank you. There are no further questions at this time. I would like to hand the floor over to management for any closing comment.

Thank you, Jackie. Thanks to everybody for attending and again for your continued support of the partnership. We do indeed look forward to updating you in February with the additional results for the fourth quarter and more defined guidance for 2008. Thank you.

This does conclude today's teleconference. Thank you for your participation.