Mr. Richard Bird reports

ENBRIDGE PROPOSES TO TRANSFER U.S. $900 MILLION ASSET TO ENBRIDGE ENERGY PARTNERS

Enbridge Inc. has proposed to transfer its 66.7-per-cent interest in the United States segment of the Alberta Clipper pipeline to its affiliate, Enbridge Energy Partners LP, for approximately $900-million (U.S.). EEP is the owner of the other 33.3-per-cent interest. The proposed consideration includes cash of approximately $300-million (U.S.), plus approximately $600-million (U.S.) of Class E equity units to be issued to Enbridge by EEP. The proposed transfer and terms are subject to review and recommendation by an independent committee of the board of directors of Enbridge Energy Management LLC, the delegate of EEP's general partner, and to approval by that board. The transfer is targeted to close by the end of 2014.

The U.S. segment of Alberta Clipper earns a stable cost-of-service return, which is not subject to variations in throughput or operating costs. The transfer will not require any issuance of equity to the public by EEP and is expected to be immediately accretive to distributable cash flow per unit by approximately 3 per cent.

The Class E units to be issued to Enbridge would be entitled to the same distributions as the Class A units held by the public and would be convertible into Class A units on a one-for-one basis at Enbridge's option. The Class E units would be redeemable at EEP's option after 30 years, if not converted by Enbridge. The units would have a liquidation preference equal to their fair value on closing. Enbridge's economic interest in EEP would increase from approximately 34 per cent to approximately 36 per cent as a result of the transfer.

Richard Bird, Enbridge's executive vice-president, chief financial officer and corporate development, commented: "This is the latest in a series of actions which Enbridge has taken to enhance EEP's distributable cash flow and restore its effectiveness as one of the sources of low-cost funding for Enbridge's organic growth opportunities and, through drop-downs such as this one, for Enbridge's broader growth capital program. Following these actions, EEP's valuation has improved to the point where a drop-down is now accretive to both EEP's distributable cash flow and to Enbridge's earnings, and we are able to accelerate this aspect of our financial strategy. This initial drop-down has been intentionally structured to impose no incremental equity funding requirement on EEP given all the other actions taken to put the partnership into a position of requiring minimal additional equity until its growth investments come into service and begin contributing to distributable cash flow. This additional step we've taken should serve to confirm that EEP's effectiveness as a sponsored vehicle has been restored and pave the way for further drop-downs."

The U.S. segment of the Alberta Clipper pipeline is a 36-inch-diameter 325-mile-long crude oil pipeline from the U.S. border near Neche, N.D., to Superior, Wis. The initial capacity of the line is 450,000 barrels per day, and it was constructed under the terms of a joint financing agreement under which Enbridge financed two-thirds of the capital costs in return for a corresponding economic interest in the earnings and cash flow from the investment. The line is being expanded in two phases to a capacity of 800,000 barrels per day through the addition of increased pumping horsepower. The required expansion investments are subject to separate joint financing arrangements between Enbridge and EEP.