INTERNATIONAL

International includes earnings from the Company’s 25% interest in Compañia Logistica de Hidrocarburos CLH, S.A. (CLH), Spain’s largest refined products transportation and storage business, and Oleoducto Central, S.A. (OCENSA), a crude oil pipeline in Colombia. Earnings also include fees earned from technology and consulting services provided by Enbridge Technology Inc.

Earnings for the year ended December 31, 2006 were $83.2 million compared with $87.4 million for the year ended December 31, 2005. Earnings from CLH for 2005 included a $7.6 million gain on the sale of land, recorded in the fourth quarter.

Earnings for the year ended December 31, 2005 were $87.4 million compared with $73.6 million for the year ended December 31, 2004. The increase results primarily from the $7.6 million gain on the sale of land in CLH. Operating results at CLH were also improved due to higher volumes and increased average tariffs and storage revenues.

Other includes administration and business development costs and the financial results of Enbridge Technology Inc.

CLH
The primary activity of CLH is the storage and shipment of refined products through a comprehensive distribution network located throughout Spain. Earnings are based on a fee for service tariff, adjusted annually for inflation, and are dependent on throughput volumes and storage levels

CLH is the primary basic logistics distribution network for refined products in Spain and provides services on an open access basis. The system consists of over 3400 kilometres (2,113 miles) of pipelines and 38 storage facilities located throughout the country. CLH provides product distribution to locations not connected to the pipeline system through its own fleet of tanker trucks and chartered tanker ships. CLH also offers secondary distribution services, the most significant being the services provided through CLH Aviation, which handles aviation fuel at airport locations throughout Spain. This business includes the storage of aviation fuel, loading of aircraft refueling units and the refueling of aircraft. New policies issued by the Spanish airport authority (AENA) to promote competition, allow for new non-CLH operators to enter the aircraft-refueling segment of this business. While CLH's share of this segment of the market may reduce over time, its participation in the aviation fuel business will continue. CLH's pipeline facilities are connected to the country's eight crude oil refineries and to major coastal port locations where most imports of crude oil and refined products into Spain are first delivered.

Earnings from CLH are directly impacted by the demand for refined products including gasoline, diesel, jet fuel and other transportation fuels. Economic growth in Spain over the last decade has been among the highest in the European Union, which has led to increasing demand for energy, including refined products. The central region of the country, in and around Madrid, has seen the largest growth in demand. CLH is in the process of expanding its system over the next several years in order to meet the continued growth expected in this region. This expansion, which includes an increase in storage capacity and looping of both the northern and southern main lines, will be constructed in phases to match the expected growth in volumes.

OCENSA/CITCol
The Company owns a 24.7% interest in OCENSA, a cost investment on which the Company earns a fixed return. OCENSA is one of two crude oil export pipelines within Colombia. Through a 100% owned entity, CITCol, the Company manages the pipeline and earns a fee for this service, which includes incentives for operating performance.

Strategy
The Company plans to increase International earnings contribution over the next several years by leveraging its North American operating expertise in midstream energy infrastructure and relationships with existing partners. The Company will pursue investment opportunities in regions or countries with attractive fundamentals of supply and market demand, in which operating and political risks are acceptable to the Company, and in which attractive risk adjusted returns are available.

Business Risks
The International business is subject to risks related to political and economic instability, currency volatility, market and supply volatility, government regulations, foreign investment rules, security of assets and environmental considerations. The Company assesses and monitors international regions and specific countries on an ongoing basis for changes in these risks. Risks are mitigated by a combination of Enbridge’s governance involvement, contractual arrangements, influence in operation of the assets, regular analysis of country risk, as well as foreign currency hedging and insurance programs.