Enbridge to embark on Bakken, Three Forks pipeline expansion program

Source: Enbridge Inc. and Enbridge Income Fund and Enbridge Energy Partners, L.P.

Enbridge Energy Partners L.P. (NYSE:EEP) (EEP) and Enbridge Income Fund (TSX:ENF.UN) (ENF) announced that they are proceeding, subject to customary regulatory approvals, with a joint project to further expand crude oil pipeline capacity to accommodate growing production from the Bakken and Three Forks formations located in Montana, North Dakota, Manitoba and Saskatchewan. The Bakken Expansion Program will increase takeaway capacity from the Bakken play by 145,000 barrels per day (bpd), which can be readily expanded to 325,000 bpd at low cost. EEP and ENF are affiliates of Enbridge Inc. 

"This latest in a series of expansions will provide shippers with favorable tolls, diverse market alternatives and batch quality maintenance for this high quality light sweet crude. Further, the Bakken and Three Forks formations represent an area of tremendous opportunity for both Enbridge Energy Partners and Enbridge Income Fund," said Stephen J. Wuori, Executive Vice President, Liquids Pipelines, Enbridge Inc. "We anticipate substantial further production growth based on discussions with producers, and our own regional supply analysis. We are well positioned to provide shippers with attractive transportation options based on our extensive existing operations in the region." 

Enbridge's Bakken Expansion Program will involve U.S. projects which will be undertaken by EEP at a cost of approximately US$370 million; and Canadian projects which will be undertaken by ENF at a cost of approximately Cdn $190 million. The expansion program will originate at Beaver Lodge Station near Tioga, North Dakota, in the heart of the Bakken, and will follow existing EEP and ENF rights of way to terminate at and deliver to the Enbridge mainline terminal at Cromer, Manitoba. In addition, EEP has proposed a separate project to expand its pipeline system south of the Missouri River, connecting to Beaver Lodge Station and providing increased access to the expanded North Dakota System. Once on the Enbridge mainline, Bakken production will have access to the multiple markets accessible from the mainline and connected pipeline systems. The Program is a series of pipeline expansion projects that will provide approximately 145,000 bpd of incremental capacity from North Dakota into the Enbridge Mainline at Cromer, Manitoba by Q1 2013. 

EEP and ENF have received sufficient long-term shipping commitments from anchor shippers to enable the Bakken Expansion Program to proceed. A binding Open Season is planned to provide other shippers with the opportunity to make shipping commitments between Berthold and Cromer on the same terms as provided to anchor shippers, as well as to provide an opportunity to commit to capacity on the proposed expansion of EEP's pipeline system in northwestern North Dakota. Details on the Open Season will be announced separately. 

The Bakken Expansion Program follows a series of expansions that have been undertaken by EEP and ENF to economically respond to growing crude oil transport needs from this region. EEP's North Dakota System completed a 51,000 bpd expansion to reach a total annual capacity of 161,500 bpd on January 1, 2010. That capacity was immediately fully utilized, and operational finetuning is being undertaken to further enhance the capacity of this system between North Dakota and the Enbridge mainline system at Clearbrook, Minnesota. ENF's Saskatchewan System is currently undertaking three separate expansions, expected to be in service late this year, that will collectively increase upstream capacity of the gathering systems by 125,000 bpd. Total capacity into Cromer following the current (Phase II) and the previously completed Phase I expansion will be 230,000 bpd. 

"We are confident that this series of expansions will relieve much of the current demand for pipeline capacity out of the Bakken and Three Forks production areas as well as provide the foundation for timely future expansions to meet the needs of the region", said Mr. Wuori. "The suite of projects we're proposing will provide firm access from North Dakota oilfields to the 2 million barrel per day Enbridge Mainline System. Along with ongoing reliable service for existing shippers on EEP's North Dakota System and ENF's Saskatchewan system, the expanded systems optimize segregated light sweet pipeline capacity serving the Great Lakes region of the Upper Midwest and the Midcontinent refinery markets connected to Cushing, Oklahoma. 

"By providing shippers with timely, cost-effective, long-haul and long-term transportation solutions, Enbridge's Bakken Expansion Program will give them the best options and greatest connectivity into North American refinery and marketing hubs."



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