Enbridge Announces New Growth Projects and Investments along U.S. Gulf Coast

Enbridge Inc. ("Enbridge" or "the Company") recently provided an update on its strategic priorities and financial outlook, including new growth projects and investments.

Flanagan South Open Season and EHOT construction further export strategy

In support of growth in its Liquids business, Enbridge is progressing negotiations with shippers for incremental contract capacity on the Flanagan South Pipeline system. Enbridge expects to leverage available capacity on FSP to secure up to 95kbpd of commitments through an open season scheduled to be held later this month. Not only would these new volumes increase secured throughput on Flanagan South, they would also secure long-haul demand on the entire Enbridge network out of Western Canada. 

In addition, to facilitate the additional commitments on FSP, along with other FSP shippers, Enbridge has decided to proceed with the construction of the Enbridge Houston Oil Terminal for an initial capital cost of $240 million. The greenfield terminal, located adjacent to the terminus of the Seaway Pipeline, will provide shippers with a premier full-service storage terminal primarily focused on heavy crude. The facility will have access to the Houston region refining complex and export opportunities through the Seaway docks at Freeport and Texas City, as well as future access to Enterprise Products Partner L.P.'s Sea Port Oil Terminal ("SPOT") (subject to that project proceeding). Initial build of EHOT is expected to have 2.5MMbbls of storage, with an ultimate capacity of 15MMbbls once fully built out and will be underpinned by long-term take-or-pay contracts. The terminal will further Enbridge's U.S. Gulf Coast strategy and create additional optionality for Enbridge and its customers, while further strengthening the Mainline/FSP/Seaway value chain.

Enbridge to acquire Tres Palacios Gas Storage, advancing U.S. Gulf Coast strategy

Enbridge has also entered into a definitive agreement with Brookfield Infrastructure Partners and Crestwood Equity Partners LP to acquire Tres Palacios Holdings LLC for US$335 million. The transaction is expected to be accretive in its first full year of ownership.

Tres Palacios is strategically located in the U.S. Gulf Coast region and its critical natural gas infrastructure serves Texas gas-fired power generation and increasing LNG exports, as well as the growing market need in Mexico. Tres Palacios also owns an integrated 62-mile natural gas header pipeline system, with eleven inter and intrastate natural gas pipeline connections, including Enbridge's Texas Eastern Pipeline.

Tres Palacios is comprised of three natural gas storage salt caverns with a total FERC-certificated working gas capacity of approximately 35 Bcf, as well as an expansion project in execution for a fourth cavern that will increase working gas capacity by approximately 6.5 Bcf, which is fully contracted and in the permitting phase.

The transaction is expected to close in the second quarter of 2023, subject to receipt of customary regulatory approvals and closing conditions. 

Enbridge invests in leading RNG company, Divert Inc.

Enbridge is acquiring a 10% stake in Divert Inc, a leading food waste management company expanding into RNG to help major food retailers manage their waste more sustainably, for US$80 million. The agreement includes further investment opportunities to develop wasted-food-to-RNG projects across the US providing line of site to greater than $1 billion of new capital growth which will be underpinned by long-term take-or-pay contracts.

Enbridge expects to close the transaction in March 2023.

Hamilton Growth Project

Enbridge is planning to build a 14km natural gas pipeline to support ArcelorMittal Dofasco's plan to change the way it makes steel, eliminating coal as a fuel for ironmaking. This is the largest GHG emissions reduction project underway in Ontario and is expected to reduce emissions by 60% from today. In 2024, Enbridge plans to file a Leave to Construct application with the Ontario Energy Board.

Commenting on the Company's outlook, Greg Ebel, President and CEO of Enbridge, noted:

"The world continues to navigate the energy trilemma of reliability, sustainability and affordability and our premier franchises across the energy system increasingly play a critical role in balancing these objectives.

"As we look to the future, absolute energy demand of all types is expected to grow for decades. We continue to build on our integrated 'super system' to serve today's and tomorrow's growing domestic and export market demand. Our extensive footprint uniquely positions us to capture ongoing growth in conventional energy infrastructure including renewable power, while also playing a leadership role in New Energy Technology investments and the energy transition.

"With today's announcement of $3.3 billion of new accretive investments, we have further advanced our strategy. This includes expanding our USGC footprint through investments in oil and gas storage and furthering our RNG strategy by investing in Divert Inc., a leading RNG infrastructure company. It also includes another year of modernization on our Gas Transmission systems including the East Tennessee Natural Gas System Alignment Program as well as extending our growth program at our Gas Distribution and Storage business by another year. In combination with the $8 billion of new projects in 2022, our secured backlog now stands at $17 billion across all four businesses and 15 discrete, highly executable projects.

About Enbridge Inc. 

At Enbridge, we safely connect millions of people to the energy they rely on every day, fueling quality of life through our North American natural gas, oil or renewable power networks and our growing European offshore wind portfolio. We're investing in modern energy delivery infrastructure to sustain access to secure, affordable energy and building on two decades of experience in renewable energy to advance new technologies including wind and solar power, hydrogen, renewable natural gas and carbon capture and storage. We're committed to reducing the carbon footprint of the energy we deliver, and to achieving net zero greenhouse gas emissions by 2050. Headquartered in Calgary, Alberta, Enbridge's common shares trade under the symbol ENB on the Toronto (TSX) and New York (NYSE) stock exchanges. To learn more, visit www.enbridge.com.