Terry McGill
President
“Financially, we had a solid year
in 2008. Adjusted operating
income from the Liquids
segment was $342.2 million,
an increase of $135.1 million
from 2007. In our Natural Gas
unit, adjusted operating income
was $178.3 million, an increase
of $28.1 million from 2007.”
In this time of great uncertainty, one of the key distinguishing characteristics of
the Partnership is the support from our ultimate general partner, Enbridge Inc. The
Partnership is a key strategic investment for Enbridge Inc. and important to its future.
The interests of Enbridge Inc. remain aligned with those of our limited partners.
The Partnership’s underlying business fundamentals remain strong. Financially, we had
a solid year in 2008. Adjusted operating income from the Liquids segment was $342.2
million, an increase of $135.1 million from 2007. In our Natural Gas unit, adjusted
operating income was $178.3 million, an increase of $28.1 million from 2007. Our
gathering and processing assets are strategically positioned to benefit from two of the
three booming U.S. natural gas production plays: the Barnett and Haynesville Shales.
The Partnership’s liquids pipelines business, which includes some of the premier
liquids pipelines in North America, also is well positioned for growth. The Partnership
has a clear, low-risk business model based on viable, long-term supply and demand
fundamentals for liquids and natural gas. We stand behind our value proposition –
safety, growth and income – and continue to believe that they will hold up even in
these difficult times.
Looking Back
In 2008, the Partnership continued building on the progress made in
2007. We solidly advanced our multi-year organic growth programs in both the natural
gas and the liquids business units. Completed stages of our expansion programs underpinned
our distribution increase in the second quarter of 2008 from $0.95 to $0.99 per
unit per quarter. We continue to make steady progress towards the completion of two
of our main projects: Southern Access Expansion and Alberta Clipper, which should
be completed in early 2009 and mid-2010, respectively. The first stage of the Southern
Access Expansion project was completed in April 2008 and already is contributing to
cash flow and earnings.
Construction was completed on our Clarity natural gas system, which is providing an
additional 700 MMcf/d of capacity to our East Texas System. We also completed
construction of a 25-mile pipeline supply lateral, complementary to our East Texas
System, which will gather additional production being developed in the Haynesville
Shale in eastern Texas.