Ownership Submission
FORM 4
Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940
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(Print or Type Responses)
1. Name and Address of Reporting Person *
O'Shea Donald C
   2. Issuer Name and Ticker or Trading Symbol
PAA NATURAL GAS STORAGE LP [PNG] 		5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
_____ Director _____ 10% Owner
__X__ Officer (give title below) _____ Other (specify below)
Chief Accounting Officer
(Last)
(First)
(Middle)
333 CLAY STREET, SUITE 1500		 3. Date of Earliest Transaction (Month/Day/Year)
02/02/2012
(Street)

HOUSTON, TX 77002		 4. If Amendment, Date Original Filed(Month/Day/Year)
 6. Individual or Joint/Group Filing(Check Applicable Line)
_X_ Form filed by One Reporting Person
___ Form filed by More than One Reporting Person
(City)
(State)
(Zip)
Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1.Title of Security
(Instr. 3)		 2. Transaction Date (Month/Day/Year) 2A. Deemed Execution Date, if any (Month/Day/Year) 3. Transaction Code
(Instr. 8)		 4. Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4 and 5)		 5. Amount of Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 3 and 4)		 6. Ownership Form: Direct (D) or Indirect (I)
(Instr. 4)		 7. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V Amount (A) or (D) Price

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Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security
(Instr. 3)		 2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (Month/Day/Year) 3A. Deemed Execution Date, if any (Month/Day/Year) 4. Transaction Code
(Instr. 8)		 5. Number of Derivative Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4, and 5)		 6. Date Exercisable and Expiration Date
(Month/Day/Year)		 7. Title and Amount of Underlying Securities
(Instr. 3 and 4)		 8. Price of Derivative Security
(Instr. 5)		 9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 4)		 10. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 4)		 11. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares
Phantom Units (1) (2) 02/02/2012   D     7,500   (3)   (3) Common Units 7,500 $ 0 0 D  
Phantom Units (1) (2) 02/02/2012   A   7,500     (3)   (3) Common Units 7,500 $ 0 7,500 D  
Phantom Units (1) (2) 02/02/2012   D     7,500   (4)   (4) Common Units 7,500 $ 0 0 D  
Phantom Units (1) (2) 02/02/2012   A   7,500     (4)   (4) Common Units 7,500 $ 0 7,500 D  

Reporting Owners

Reporting Owner Name / Address Relationships
 Director  10% Owner  Officer  Other
O'Shea Donald C
333 CLAY STREET, SUITE 1500
HOUSTON, TX 77002		       Chief Accounting Officer  

Signatures

 /s/ Donald C. O'Shea   02/03/2012
**Signature of Reporting Person Date

Explanation of Responses:

* If the form is filed by more than one reporting person, see Instruction 4(b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1) The terms of these outstanding phantom units have been modified, resulting in the deemed cancellation of the original phantom units and a grant of replacement phantom units described below. The original phantom units were granted on November 2, 2010.
(2) One Common Unit is deliverable, upon vesting, for each phantom units that vests.
(3) As modified, these phantom unit awards will vest 30% on the date the Issuer pays an annualized distribution of $1.45 per unit; 30% on the date the Issuer pays an annualized distribution of $1.50 per unit; and 40% on the date the Issuer pays an annualized distribution of $1.55 per unit. Fifty percent of any unvested phantom units that remain outstanding as of the November 2016 distribution date will vest on such date and the remaining 50% will be forfeited.
(4) As modified, 100% of these phantom units will vest upon conversion of the Issuer's Series A Subordinated Units into Common Units. Conversion of the Series A Subordinated Units is subject to certain performance conditions set forth in the Issuer's Second Amended and Restated Agreement of Limited Partnership, as amended.

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