Willie Chiang
About Willie Chiang
Willie Chiang, age 64, is Chairman of the Board and CEO of Plains All American Pipeline (PAA) and will assume the additional role of President effective June 1, 2025; he has served as a director since February 2017, CEO since October 2018, and Chairman since January 2020 . He holds a BS in Mechanical Engineering (South Dakota School of Mines and Technology) and completed the Advanced Management Program at the University of Pennsylvania; he serves on the board of Delta Airlines and is active in industry organizations including AFPM (chair), API, and the National Petroleum Council . Under his leadership, PAA delivered 2024 Adjusted EBITDA of $2.78B (~4% above guidance), Implied DCF per CUE of $2.49 (~2% above guidance), increased annual distributions by $0.20/unit (19%) in 2024 and a further $0.25/unit (20%) in February 2025, exited 2024 with leverage ~3.0x, and achieved Moody’s rating upgrade to Baa2; total returns in 2024 were 21% for PAA and 24% for PAGP .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Plains All American (PAA/PAGP) | EVP & COO (U.S.); EVP & COO; CEO; Chairman | 2015–present | Progressed operational leadership to CEO/Chairman; positioned growth; governance leadership |
| Occidental Petroleum | EVP – Operations | 2012–2015 | Led operations across upstream/downstream footprint |
| ConocoPhillips | Multiple roles incl. SVP – Refining, Marketing, Transportation & Commercial | 1996–2012 | Senior leadership across refining/marketing/transportation; commercial execution |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Delta Airlines | Director | Current | External board perspective; governance and strategy |
| DCP Midstream; Chevron Phillips Chemical | Director (prior) | Prior | Midstream/chemicals governance experience |
| United Way of Greater Houston; Performing Arts Houston | Board member | Current | Community engagement, stakeholder relations |
| Federal Reserve Bank of Dallas | Energy Advisory Council member | Current | Macro/energy policy input |
| AFPM (trade association); API; National Petroleum Council | Chair/member | Current | Industry leadership, policy advocacy |
Fixed Compensation
| Year | Base Salary ($) | Target Bonus (% of Salary) | Target Bonus ($) | Actual Bonus ($) |
|---|---|---|---|---|
| 2024 | 837,500 | 250% | 2,125,000 | 2,995,000 |
| 2023 | 800,000 | 250% | — | 2,975,000 |
| 2022 | 750,000 | 250% | — | 3,600,000 |
Notes:
- 2024 salary reflects a $50,000 increase effective April 1, 2024; table shows blended amount .
- CEO bonus target is 250% of salary per employment agreement framework; committee discretion applies .
Performance Compensation
Annual Incentive (2024)
| Metric | Weight | Target | Actual | Payout % | Weighted Payout % |
|---|---|---|---|---|---|
| Adjusted EBITDA attributable to PAA ($MM) | 40% | 2,675 | 2,779 | 152% | 61% |
| Implied DCF per CUE ($/unit) | 40% | 2.44 | 2.49 | 127% | 51% |
| Safety (TRIR) | 10% | 0.25 | 0.25 | 75% (25bp reduction) | 7.5% |
| Environmental (FRR) | 10% | 15 | 19 | 89% (25bp increase) | 8.9% |
| Company Performance Subtotal | — | — | — | — | 128% |
| Individual Performance (CEO) | 40% | — | — | 160% | — |
| Formulaic Bonus Earned (CEO) | — | — | — | — | 141% |
Highlights: Individual score reflects leadership, investor engagement, capital discipline, and succession planning . Quantitative goals exceeded on EBITDA and DCF; safety met TRIR target; FRR higher in count but lower in release volumes YoY (context for discretionary adjustment) .
Long-Term Incentive Plan (LTIP)
| Grant Year | Units Granted (Total) | Time-Based Units | Performance-Based Units | Key Performance Metrics | Vest Date | DER Treatment |
|---|---|---|---|---|---|---|
| 2024 | 357,750 | 178,875 | 178,875 | 50% Relative TSR (negative TSR modifier); 50% cumulative DCF/CUE $7.75 with leverage modifier | Aug 2027 | Time-based: accrues 1 year, pays Aug 2025 then quarterly; Performance-based: accrues, pays at vest Aug 2027 |
| 2023 | 324,100 | 162,050 | 162,050 | 50% Relative TSR (negative TSR modifier); 50% cumulative DCF/CUE $7.45 with leverage modifier | Aug 2026 | Time-based: accrues 1 year, pays Aug 2024 then quarterly; Performance-based: accrues, pays at vest Aug 2026 |
| 2022 | 440,000 (time+perf) | 220,000 | 220,000 | 50% Relative TSR (negative TSR modifier); 50% cumulative DCF/CUE $7.05 with leverage modifier | Aug 2025 | Time-based: accrues 1 year, pays Aug 2023 then quarterly; Performance-based: accrues, pays at vest Aug 2025 |
| 2018 (legacy) | 500,000 unearned | — | 500,000 | See grant terms; death/disability vesting after year 2 per grant letter | — | — |
Program design: In 2024, CEO LTIP target increased from 600% to 750% of salary; NEO LTIP is 50% performance-based and 50% time-based; performance period is 3 years; payout scaled 0–200% . DERs enhance alignment by mirroring distribution economics during vesting period .
Equity Ownership & Alignment
- Ownership guidelines: CEO must hold securities equal to 6x base salary; hold-until-met requirement on vested units; all executive officers/directors are on track or have met guidelines by compliance dates (CEO compliance date November 2025) .
- Anti-hedging/pledging: Officers and directors prohibited from hedging and pledging; no units were pledged by directors or NEOs as of March 24, 2025 .
Beneficial Ownership Trend (Exclusive of Unvested Awards)
| As of | PAA Units (Total) | PAGP Class A | PAGP Class B | PAGP A+B Total | Combined PAA/PAGP |
|---|---|---|---|---|---|
| Mar 24, 2025 | 846,512 | 378,704 | 353,489 | 732,193 | 1,578,705 |
| Mar 25, 2024 | 592,641 | 378,704 | 353,489 | 732,193 | 1,324,834 |
| Mar 27, 2023 | 331,784 | 241,704 | 353,489 | 595,193 | 926,977 |
Outstanding Equity Awards (Dec 31, 2024)
| Award | Units (Target) | Market/Payout Value ($) at $17.08/unit |
|---|---|---|
| Performance-based phantom units (legacy grant) | 500,000 | 8,540,000 |
| 2022 Time-based phantom units | 220,000 | 3,757,600 |
| 2022 Performance-based phantom units | 220,000 | 3,757,600 |
| 2023 Time-based phantom units | 162,050 | 2,767,814 |
| 2023 Performance-based phantom units | 162,050 | 2,767,814 |
| 2024 Time-based phantom units | 178,875 | 3,055,185 |
| 2024 Performance-based phantom units | 178,875 | 3,055,185 |
Implications: Phantom units vest 1-for-1 into common units at scheduled distribution dates (Aug 2025/2026/2027), potentially increasing tradeable float; hold-until-met guideline and anti-hedging/pledging reduce immediate selling propensity .
Employment Terms
- Agreement: CEO agreement amended/restated at promotion to CEO (Oct 2018); terminable by either party; compensation subject to committee/board adjustment .
- Change-of-control: LTIP grants use “double trigger” (CIC plus qualifying change in status) for accelerated vesting; severance/acceleration terms also apply on death, disability, termination without cause, or board-approved retirement; clawback policy applies to restatements and detrimental conduct .
- Potential payouts (as if terminated on Dec 31, 2023): Death/Disability equity $19,747,571; Company without cause equity $15,158,624; In connection with change-in-control equity $24,657,686 .
- Non-solicitation/confidentiality: Ancillary agreement includes 2-year post-termination confidentiality and non-solicitation provisions .
Board Service, Committees, and Dual-Role Implications
- Role: Chairman and CEO; Class I director (term expiring 2026) .
- Committees: No committee memberships (executive management role) .
- Dual-role governance: Governance documents require a Lead Independent Director when Chair and CEO are combined; responsibilities delineated (executive sessions, agenda-setting, liaison); rotation of Lead Director after ~5 years—John Raymond to become Lead Director effective June 1, 2025 (replacing Bobby Shackouls) .
- Board independence: Majority independent board; all standing committees (Audit, Compensation, Governance, HSES) comprised solely of independent directors; committee charters available; attendance: in 2024, all directors attended all board and committee meetings .
- Compensation Committee: Independent members; utilizes Meridian Compensation Partners; 2023 peer review found CEO total target comp below peer median .
Compensation Structure Analysis
- Pay mix: At target, ~91% of CEO compensation is at-risk; annual bonus 100% formulaic; LTIP 50% performance-based (TSR and DCF/CUE with leverage modifier) and 50% time-based .
- Year-over-year changes: 2024 increased CEO base salary by $50,000 and raised LTIP target from 600% to 750% of salary to align with peer median; bonus targets unchanged .
- Performance metrics: Short-term metrics tied to Adjusted EBITDA, DCF per CUE, safety (TRIR) and environmental (FRR); long-term tied to relative TSR and cumulative DCF per CUE with leverage and TSR modifiers .
- Say-on-pay: ~98% approval at the 2024 annual meeting; 4-year average ~98% .
Performance & Track Record
- 2024 execution: Beat EBITDA and DCF guidance; seven accretive bolt-on acquisitions (~$800MM net); extended Permian long-haul contracts; improved leverage to ~3.0x; Moody’s upgrade to Baa2; increased distributions; strong total returns for PAA/PAGP .
- FCF and capital discipline: Generated ~$1.17B Adjusted FCF (ex changes in A&L), returned ~$1.15B via distributions, invested ~$571MM capex (net) .
- Safety/environment: Achieved TRIR target but experienced two motor vehicle fatalities; FRR count above target though volumes down 54% vs 5-year average .
Equity Ownership & Pledging
- Beneficial ownership increased from ~0.93MM combined units/shares (Mar 2023) to ~1.58MM (Mar 2025); less than 1% of consolidated voting interests; no pledging of company securities by directors/NEOs .
Compensation Peer Group (Benchmarking)
- Primary 2024 comparison peers include ET, EPD, KMI, WMB, MPLX, OKE, TRGP, WES, ENLC, MMP, ETRN, GEL; TSR comparator group includes similar entities plus S&P 500 and Alerian Midstream Energy Index for LTIP benchmarking .
Employment & Contracts – Clawbacks and Risk Controls
- Clawback policy (amended Nov 2023): mandatory recovery on material restatements; discretionary recovery on detrimental conduct causing significant harm (3-year lookback) .
- Compensation risk management: Multi-metric design, leverage modifier, staggered/ delayed vesting mitigate excessive risk-taking .
Investment Implications
- Pay-for-performance alignment is strong: CEO bonus and LTIP metrics directly tied to EBITDA, DCF per CUE, and relative TSR, with governance modifiers, supporting disciplined capital allocation and deleveraging—key drivers for valuation and distribution growth .
- Vesting calendar may create unit supply around distribution dates (Aug 2025/2026/2027) as large phantom unit tranches convert 1-for-1; hold-until-met ownership guidelines and anti-hedging/pledging policies temper near-term selling pressure risk .
- Retention risk appears low: Competitive pay (LTIP target reset to 750% of salary), strong say-on-pay (~98%), double-trigger CIC protections, and meaningful outstanding awards increase opportunity cost of departure .
- Governance mitigates dual-role concerns: Formal Lead Independent Director role, majority independent committees, and active board refreshment/assessment reduce independence risk from combined Chair/CEO structure .
- Performance momentum: Above-plan 2024 results, Permian contract extensions, and rating upgrade support improving cash flow visibility—positive for TSR-linked LTIP outcomes and investor sentiment .