CALGARY, AB, Aug. 17, 2022 /PRNewswire/ - Enbridge Inc. (Enbridge or the Company) (TSX:ENB) (NYSE:ENB) today announced it has completed a joint venture merger transaction with Phillips 66 (P66) resulting in a single joint venture holding both Enbridge's and P66's indirect ownership interests in Gray Oak Pipeline, LLC (Gray Oak) and DCP Midstream LP (DCP) and an agreement to realign their respective economic and governance interests in the underlying business operations.

Through the surviving joint venture as illustrated below, Enbridge will increase its indirect economic interest in Gray Oak to 58.5% from 22.8%, and the parties have agreed to transfer to Enbridge, from P66, the operatorship of Gray Oak, the long-haul, contracted pipeline which provides critical, low-cost connectivity from the Permian into Corpus Christi and the Houston area. The transfer of operatorship of Gray Oak is planned to occur in the second quarter of 2023. In turn, Enbridge will reduce its indirect economic interest in DCP to 13.2% from 28.3%, further reducing its commodity price exposure and strengthening the Company's low risk pipeline-utility model.

The merger is expected to be immediately accretive to Enbridge's distributable cash flow per share and result in an approximately US$400 million cash payment to the Company from the merged entity. The cash generated from the transaction will create additional financial flexibility and further the Company's capital allocation priorities.

"We're pleased to have reached this new arrangement with P66 to optimize the combined assets and drive operational and financial synergies from both assets," said Al Monaco, President and Chief Executive Officer of Enbridge. "It's another example of our continued focus on optimizing our portfolio and surfacing value for our shareholders, while further building out our already strong U.S. Gulf Coast export position. We look forward to continuing our strong partnership with P66."

Gray Oak Pipeline, in combination with Enbridge's Ingleside Energy Center (EIEC), provides an industry-leading solution to deliver low-cost, long-lived Permian Basin oil to local Gulf Coast and global export markets. The EIEC currently loads nearly 30% of North American oil exports. Through 2030, the Company anticipates that Permian oil supply will grow by an estimated two million barrels per day, enhancing Gray Oak's utilization and driving increased oil exports off the Gulf Coast. Further integration of Gray Oak and the EIEC is expected to support the development of new commercial solutions and future growth potential, unlocking additional value for Enbridge's customers.

Enbridge intends to extend its solar self-power strategy by working with the other Gray Oak owners to develop solar facilities along the Gray Oak right-of-way in support of the Company's net-zero emissions targets, and those of its customers'.

Citi acted as financial advisor to Enbridge and Vinson & Elkins acted as its legal counsel.

Forward-Looking Information

Forward-looking information, or forward-looking statements, have been included in this news release to provide information about Enbridge and its subsidiaries and affiliates, including management's assessment of Enbridge and its subsidiaries' and affiliates' future plans and operations. This information may not be appropriate for other purposes. Forward looking statements are typically identified by words such as ''anticipate'', ''expect'', ''project'', 'estimate'', ''forecast'', ''plan'', ''intend'', ''target'', ''believe'', "likely" and similar words suggesting future outcomes or statements regarding an outlook. Forward-looking information or statements included or incorporated by reference in this document include, but are not limited to, statements with respect to the joint venture merger transaction with Phillips 66 (the "Transaction") and related matters, including expected accretion, operational and financial synergies, and other benefits of the Transaction; expected Permian oil supply; expected Gulf Coast oil exports; expected utilization of Gray Oak; integration of Gray Oak and Enbridge Ingleside Energy Center; future growth opportunities; solar self-power strategy; and net zero emissions targets.

Although Enbridge believes these forward-looking statements are reasonable based on the information available on the date such statements are made and processes used to prepare the information, such statements are not guarantees of future performance and readers are cautioned against placing undue reliance on forward-looking statements. By their nature, these statements involve a variety of assumptions, known and unknown risks and uncertainties and other factors, which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such statements. Material assumptions include assumptions about the following: energy transition, including the drivers and pace thereof; the COVID-19 pandemic and the duration and impact thereof; global economic growth and trade; the expected supply of and demand for crude oil, natural gas, natural gas liquids ("NGL"), liquified natural gas ("LNG") and renewable energy; prices of crude oil, natural gas, NGL, LNG and renewable energy; anticipated utilization of our assets; anticipated cost savings; exchange rates; inflation; interest rates; availability and price of labour and construction materials; the stability of our supply chain; operational reliability and performance; customer, regulatory and stakeholder support and approvals; anticipated construction and in-service dates; weather; announced and potential acquisition, disposition and other corporate transactions and projects and the timing and impact thereof, including the Transaction; expectations about our partners' ability to complete and finance proposed transactions and projects, including the Transaction; governmental legislation; litigation; credit ratings; hedging program; expected EBITDA and expected adjusted EBITDA; expected earnings/(loss) and adjusted earnings/(loss); expected earnings/(loss) or adjusted earnings/(loss) per share; expected future cash flows and expected future distributable cash flow ("DCF") and DCF per share; estimated future dividends; financial strength and flexibility; debt and equity market conditions; and general economic and competitive conditions. Assumptions regarding the expected supply of and demand for crude oil, natural gas, NGL, LNG and renewable energy and the prices of these commodities are material to and underlie all forward-looking statements, as they may impact current and future levels of demand for the Company's services. Similarly, exchange rates, inflation, interest rates and the COVID-19 pandemic impact the economies and business environments in which the Company operates and may impact levels of demand for the Company's services and cost of inputs and are, therefore, inherent in all forward-looking statements. Due to the interdependencies and correlation of these macroeconomic factors, the impact of any one assumption on a forward-looking statement cannot be determined with certainty, particularly with respect to expected DCF and DCF per share amounts.

Enbridge's forward-looking statements are subject to risks and uncertainties pertaining to the realization of anticipated benefits and synergies of projects and transactions, including the Transaction, successful execution of our strategic priorities, operating performance, the Company's dividend policy, regulatory parameters, changes in regulations applicable to the Company's business, litigation, acquisitions and dispositions and other transactions, project approval and support, renewals of rights-of-way, weather, economic and competitive conditions, public opinion, changes in tax laws and tax rates, changes in trade agreements, political decisions, exchange rates, interest rates, commodity prices, supply of and demand for commodities and the COVID-19 pandemic, including but not limited to those risks and uncertainties discussed in this and in the Company's other filings with Canadian and U.S. securities regulators. The impact of any one risk, uncertainty or factor on a particular forward-looking statement is not determinable with certainty, as these are interdependent, and Enbridge's future course of action depends on management's assessment of all information available at the relevant time. Except to the extent required by applicable law, Enbridge assumes no obligation to publicly update or revise any forward-looking statements made in this news release or otherwise, whether as a result of new information, future events or otherwise. All forward-looking statements, whether written or oral, attributable to Enbridge or persons acting on the Company's behalf, are expressly qualified in their entirety by these cautionary statements.

About Enbridge

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 us at Enbridge.com.

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SOURCE Enbridge Inc.

Enbridge Advances its U.S. Gulf Coast Oil Strategy through Increased Ownership in Gray Oak Pipeline