Enbridge Announces $9 Billion in New Projects, Advancements in Fourth-Quarter 2012

---

Researched by Industrial Info Resources (Sugar Land, Texas)--Leading energy transportation company Enbridge Incorporated (NYSE:ENB) (Calgary, Alberta), which operates the world's longest crude oil and liquids transportation system, reported solid growth in its Liquids Pipelines segment in 2012 as the company continued to advance major projects, including the Seaway Crude Pipeline System. Net earnings were reported to be $182 million for the quarter, an 8.98% increase from fourth-quarter 2011, and $715 million for the year, a 14.17% decrease from 2011.

Total revenues stood at $7.17 billion for the quarter, a 1.86% decrease from the same period in 2011, and $25.31 billion for the year, a 6.46% decrease from 2011. The Liquids Pipelines segment reported record earnings for the year, attributed to the 10-year Competitive Toll Settlement that went into effect in July 2011 and applies to the Canadian portion of the mainline system. In its first full year operating under the settlement, the segment saw solid increases in sales volumes and income from tolls. Liquids Pipelines also benefited from higher volumes in the Spearhead Pipeline and the Seaway Pipeline, with the latter entering an initial reversal phase in mid-2012. For more information, see February 14, 2013, article - Seaway Crude Oil Pipeline Temporarily Constrained, but Major Progress Continues with Pump Stations.

Enbridge Gas Distribution, which is Canada's largest gas distribution utility, benefited from strong customer growth, rate changes and improved pipeline capacity optimization. The Aux Sable natural gas processing plant was a bright light in the Gas Pipelines, Processing and Energy Services segment, as natural gas liquids (NGL) prices that were locked in during 2011 proved beneficial. However, lower NGL and natural gas prices had a detrimental effect on Enbridge Energy Partners LP's (NYSE:EEP) (Houston, Texas) gathering and processing assets.

Industrial Info is tracking more than $13.8 billion in active projects involving Enbridge, including Enbridge Energy Partners' $500 million construction of 165 miles of pipeline as part of the Walker Ridge project. The pipeline will run at depths of 7,000 feet to transport up to 100 billion standard cubic feet per day of natural gas from the Eugene Island Oilfield Production Platform off the Louisiana Coast to the Big Foot Deepwater Development Oilfield Platform operated by Chevron Corporation (NYSE:CVX) (San Ramon, California). It then will connect to Enbridge Energy Partners' existing Manta Ray and Nautilus Pipeline System in the Gulf of Mexico.

"We have $27 billion of [Enbridge's $35 billion growth capital program] secured, coming in service between now and 2016," said J. Richard Bird, the executive vice president and chief financial officer of Enbridge Incorporated, in a conference call. "We made great headway in securing most of these projects that were identified in what we call the 'highly probable unsecured' category since we introduced that concept last year."

Of Enbridge Incorporated's four major segments, the only to report a decline in consolidated earnings for the year was the Gas Pipelines, Processing and Energy Services segment, which was hit hard by an asset impairment loss in its offshore business and changes in the fair value of unrealized derivative financial instruments:

• The Liquids Pipelines segment reported consolidated earnings of $136 million for the quarter, a 33% decrease from fourth-quarter 2011, and $726 million for the year, a 43.76% increase.
• The Gas Distribution segment reported consolidated earnings of $127 million for the quarter, compared with a loss of $226 million in the same period in 2011, and consolidated earnings of $207 million for the year, compared with a loss of $88 million in 2011.
• The Gas Pipelines, Processing and Energy Services segment reported a consolidated loss of $52 million for the quarter, compared with earnings of $156 million in fourth-quarter 2011, and a consolidated loss of $478 million for the year, compared with earnings of $305 million in 2011.
• The Sponsored Investments segment reported consolidated earnings of $71 million for the quarter, a 20.22% decrease from the same period in 2011, and $282 million for the year, a 4.83% increase from 2011.

Al Monaco, the president and chief executive officer of Enbridge Incorporated, said that the company is continuing to enhance its control centre operation, leak detection capability, and environmental protection, and since 2011 has been conducting what he calls "the most extensive integrity program in the history of the North American pipeline industry." Starting in fourth-quarter 2012, the company has announced investments of more than $9 billion in new, commercially secured expansion projects and advancements in previously announced projects.

Among these projects was the Heidelberg Lateral Pipeline, a crude oil pipeline in the Gulf of Mexico that will connect the proposed Heidelberg development, operated by Anadarko Petroleum Corporation (NYSE:APC), to an existing third-party system. Enbridge will build, own and operate the $100 million pipeline, which is expected to be operational by 2016. Enbridge also recently announced an agreement with Energy Transfer Partners LP (NYSE:ETP) (Dallas, Texas) for joint development of the first pipeline transportation option for transportation of crude oil from the U.S. Midwest to the eastern Gulf Coast. The project will involve the conversion a pipeline in Energy Transfer Partner's Trunkline system from natural gas transmission service to crude oil service.

"The magnitude of our Liquids Pipelines growth is substantial at this point, but that doesn't mean we've taken our eye off the ball on other business units," Monaco said in the conference call. "On Gas Distribution, we're undertaking the single-largest capital investment in Enbridge Gas Distribution's history--that's the $600 million GTA [Greater Toronto Area] reinforcement. We also expanded our green energy power footprint, with the Silver State North Solar plant in Nevada and the Massif du Sud Wind Project in Quebec. With these investments, we're nicely diversified across the wind and solar markets in North America."

For more information, visit Industrial Info's North American Oil and Gas Transmission Database.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.