Enbridge Inc. (ENB) Investment Community Presentation September 2019
Enbridge: A North American Bellwether Infrastructure Company 2019 EBITDA Outlook Enterprise Value (North American Midstream Companies) by business unit (US,B, Source: Factset, Sep 2019) 140 Natural 120 100 Gas 13B Liquids…
Three Core Businesses 50% 30% 15% 2019e EBITDA 2019e EBITDA 2019e EBITDA Liquids Pipelines Gas Transmission Gas Utilities Worlds longest and most sophisticated Connects key North American supply Largest natural gas utility in…
Enbridges Low Risk Business Model 2019e EBITDA Resiliency in All Market Conditions Regulated cost of service contracts 14,000 100 WTI Long term contracts 12,000 98% 75 10,000 Interest rate / inflation protection 8,000…
Major 2018 Accomplishments Priorities Actions 1 Deliver strong results Record DCF/share and EPS performance in 2018 2 Focus on low risk pipeline-utility model 8B of non-core asset sales 3 Accelerate de-leveraging 4.7x…
2019 Priorities Priorities YTD Status 1. Achieve 2019 DCF guidance range of 4.30 4.60/share Strong operating performance across the businesses Expect to be around the midpoint of the range Canadian segment to come into service Q4…
Post 2020 Future Growth Opportunities 5-6B annual self-funding capability 2B 2-3B 1B Liquids Gas Gas Pipelines Transmission Utilities Mainline system optimizations USGC market connections Customer additions and enhancements US…
Financial Strength & Flexibility Consolidated DEBT to EBITDA1 Enbridge Inc. Sr. Unsecured Debt Ratings 6.0x 5.5x Standard & Poors BBB+ stable Target Range: 4.5x to 5.0x 5.0x Fitch BBB+ stable 4.5x 4.0x DBRS BBB High…
Growth Outlook Summary Strong organic growth opportunities Low risk business model Post 2020 Through 2020 Self funded equity Prudent leverage levels 10% 5-7% DCF per share Dividend per share growth rate Disciplined capital…
Dividend Growth Track Record 24 years of sustained dividend increases 10% 3 Year CAGR 10% dividend increase declared for 2019 (2018-2020) 10% 3-year dividend CAGR outlook, 2018-2020 11% Target payout ratio of below 65% DCF 24 Year…
Enbridges Value Proposition Leading energy infrastructure position Low-risk pipeline/utility business model Strong investment grade credit profile Long history of consistent dividend growth Attractive outlook for continued cash…
Appendix A Business Details
Liquids Pipelines
Liquids Pipelines System WCSB Oil Supply (kbpd) 70% 6,000 CAPP 2018 Supply Forecast of total oil sands production can be transported on the 5,000 1 Regional system to Edmonton and Hardisty 4,000 Oil sands heavy MMb/d Growth…
Liquids Pipelines - Strategic Growth Prospects Critical link from WCSB to premium Midwest and USGC refining markets Leverage existing footprint to expand crude export capacity and develop integrated USGC platform Mainline toll…
Mainline Contract Offering Mainline Contracting Timeline Key Offering Features Open Season launched on Aug 2 Priority access for contracted volume Offering open for 60 days Contract terms 8 to 20 years Toll discounts for longer terms…
Near-Term Optimizations/Expansions Bakken Pipeline System 2019 Mainline Optimizations Express Pipeline Open Season Open Season BAKKEN Edmonton Hardisty Hardisty 50kbpd Expansion Kerrobert DAPL Regina Cromer Express Wood…
Line 3 Replacement Project Critical energy infrastructure replacement Canadian construction complete and interim Edmonton agreement reached with shippers to bring into Hardisty service in Q4 2019 Kerrobert Wisconsin segment…
Market Access - Downstream Expansion Opportunities Mainline optimizations provide an Hardisty opportunity to increase market access pipelines by up to 350kbpd Flanagan South expansion of 250kbpd along with corresponding Seaway…
USGC - Secured Growth Gray Oak Pipeline 22.8% joint venture interest Partners include P66 and Marathon Crude oil transportation from the Permian and PERMIAN Eagle Ford basins to destinations in Corpus Christi and Freeport Capacity…
USGC - Export Development Opportunity Texas COLT Offshore Loading Terminal Direct full loading of VLCCs from Freeport, TX Superior connectivity to all key North American supply basins via Enbridge systems and others Genoa Strong…
Gas Transmission
Gas Transmission System Natural Gas Demand by Sector (N. America, Bcf/d) Canadian Gas Transmission & Midstream LNG Exports Mexico Exports Other Power Gen Industrial Residential/ Commercial 2018 2020 2025 2030 Source:…
Gas Transmission - Strategic Growth Prospects Premier demand-pull driven asset base serving key regional markets Positioned for significant growth in 4 key regions 1-2% Rate cases per year Western base business System…
Rate Case Proceedings Texas Eastern: East Tennessee: Algonquin: Section 4 Rate Case filed Nov 2018 Filed Section 5 Rate Case settlement Commenced early stage rate discussions, Potential for revenue enhancement with agreement with…
Northeast & New England - Potential Growth Northeast / New England Continued commercial / residential load growth Proven approach to bring affordable natural gas to the region Power Generation Market Incremental demand market will…
Southeast Markets - Potential Growth Southeast Markets GA Generating capacity in Florida is expected MS to grow by 15+% by 2026 AL Majority of this growth is projected to be Power Generation natural gas-fired generation…
Gulf Coast Markets - Potential Growth Exports to Gulf Coast & Mexico Texas Eastern, Brazoria Interconnector MS Gas and Valley Crossing assets well connected to deliver to Gulf Coast LNG and Mexico markets Permian LA Permian TX…
Western Canada - Potential Growth Western Canada T-North Growing supply presents many Montney / Duvernay infrastructure opportunities to support Expansions Montney and Duvernay: Pipeline expansions: T-North, T-South, AB Alliance…
Utilities
Utilities Business Ontario Population Growth Forecast 18.5 14 million million Toronto 1998 2018 2020 2025 2030 2035 2040 Source: Ontario Ministry of Finance Largest volume and fastest growing franchise Infrastructure…
Utilities - Strategic Growth Prospects Largest and fastest growing gas utility franchise in North America Steady annual growth opportunities through new customer additions and system expansions Amalgamation synergies 1-2% Cost…
Utility Growth Outlook Incentive Rate Structure Growth through In-franchise expansion community expansions and modernization 10% Expected range of ONTARIO 0.4B OTTAWA Actual ROE Capital cost Owen Sound (secured) 9%…
Offshore Wind
Offshore Wind Business Update Renewable Power Declining Costs for Aligns with Enbridge Fundamentals (Electricity Capacity, GW) 125 Renewables (/KWh) Value Proposition 6,000 Source: IEA Liquids Offshore Increasingly & Gas Wind…
European Offshore Wind Projects European Fundamentals Growing Asset Footprint (facility est. ISD) Higher barriers to entry Hohe See 3Q19 Few well-capitalized players Expansion 4Q19 Mega-scale projects Saint Nazaire Late 2022…
Appendix B Financial Guidance
Financial Outlook1,2 2019 Distributable Cash Flow (DCF) Consolidated DCF/share (MM, except per share amounts) 2019 Guidance Adjusted EBITDA 13,000 Maintenance capital (1,200) 4.30 - 4.60 4.42 Current income taxes3 (400) 3.68…
Re-affirming 2019 Financial Outlook Q1-Q2 STRENGTH 2019 Distributable Cash Flow (Consolidated DCF/share ) 1 Energy Services Liquids Pipelines 4.42 4.30 4.60 Gas Distribution Q3-Q4 GUIDANCE VARIANCES: 3.68 Line 3 delay GTM…
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