Value for Customers Value for Shareholders

Value for customers ENB Value for shareholders 2005 Annual Report * Enbridge Profile 02 Highlights 04 Letter to Shareholders 05 Strategies and Fundamentals 08 Financial Review 22 Awards and Recognition 117 Investor Information 118 * ENBRIDGE, the ENBRIDGE LOGO and the ENBRIDGE ENERGY SPIRAL are trademarks or registered trademarks of Enbridge Inc. in Canada and other countries. At Enbridge, we know that by creating value for our customers we also create value for our shareholders. Patrick D. Daniel President & Chief Executive Officer 01 Enbridge Profile Enbridge Inc. Infrastructure A leader 80 000 in energy delivery kilometres Enbridge Inc., a Canadian company with corporate Enbridge owns or has interests in 80 000 headquarters in Calgary, Alberta, Canada, is a kilometres of pipelines. That includes more leader in energy transportation and distribution in than 25 000 kilometres of crude oil and North America and internationally. The Company liquids pipelines, more than 20 000 kilometres conducts its business through five operating of natural gas gathering and transmission segments: Liquids Pipelines, Gas Pipelines, pipelines, and more than 30 000 kilometres Sponsored Investments (which consist of the of natural gas distribution mains. Company’s investments in Enbridge Energy Partners, L.P.; Enbridge Energy Management, L.L.C.; and Enbridge Income Fund), Gas Distribution and Services, and International. Crude oil deliveries Natural gas distribution 2 million 1.8 million barrels per day customers Enbridge operates, in Canada and the United Enbridge owns and operates Canada’s largest States, the world’s longest crude oil and liquids natural gas distribution company, and delivers pipeline system – the combined Enbridge Pipelines natural gas to 1.8 million customers in Ontario, and Lakehead systems – that delivers 2 million Quebec, New Brunswick and New York State. barrels a day to customers in Canada and the Enbridge Gas Distribution, based in Toronto, United States Midwest, including approximately Ontario, is one of the lowest cost natural gas 10% of total oil imports to the United States. distribution operations in North America, and Current expansion plans will move additional has provided reliable service for more than volumes of Canadian petroleum to these 155 years. markets, as well as farther east and south and to the United States West Coast and Asia-Pacific markets. 02 Enbridge Profile Enbridge Inc. Natural gas pipelines Renewable energy 50% 270 of deepwater Gulf of Mexico megawatts of electricity natural gas production Enbridge has a growing interest in natural gas Enbridge is also investing in renewable energy pipelines in North America. The Company has resources, including wind power and fuel cells. major interests in the Alliance and Vector trans- The Company is currently involved in four wind mission systems, and through Enbridge Energy power projects in Canada – two that are currently Partners has interests in a variety of transmission operating and two being built in 2006 – with a and gathering pipeline systems in the Gulf Coast combined capacity of more than 270 megawatts. and Mid-Continent regions of the United States. That’s enough electricity to meet the power Enbridge Offshore Pipelines transports approxi- requirements of more than 100,000 homes. mately half of the deepwater offshore natural gas production in the Gulf of Mexico, a key region for continental supply growth. Publicly traded Human capital TSX, NYSE: 4,500 ENB stock exchange listings employees Enbridge has been a publicly traded company Enbridge employs approximately 4,500 people – for 53 years – its predecessor company, Inter- knowledgeable and skilled employees – primarily provincial Pipe Line Company, Inc., was listed in Canada and the United States, as well as in on the Toronto and Montreal stock exchanges on Colombia and Spain. February 13, 1953. Enbridge’s common shares now trade on the Toronto Stock Exchange in Canada and on the New York Stock Exchange in the United States under the symbol ENB. Information about Enbridge is available on the Company’s website at www.enbridge.com. 2005 Annual Report Enbridge Profile 03 Highlights 2005 adjusted earnings 2005 dividends $1.59 $1.0375 per common share per common share Financial (millions of Canadian dollars, except per share amounts) 2005 2004 2003 Earnings Applicable to Common Shareholders 556.0 645.3 667.2 Earnings Per Common Share (dollars per share)1 1.65 1.93 2.02 Dividends Per Common Share (dollars per share) 1.0375 0.92 0.83 Common Share Dividends Paid 361.1 315.8 283.9 Return on Average Shareholders’ Equity 13.2% 17.0% 19.0% Debt to Debt Plus Shareholders’ Equity at Year End 68.9% 67.1% 68.7% Operating 2005 2004 2003 Liquids Pipelines 2 Deliveries (thousands of barrels per day) 2,008 2,138 2,189 Barrel miles (billions) 695 757 710 Average haul (miles) 949 970 889 Gas Distribution and Services 3 Volume of gas distributed (billion cubic feet) 438 575 458 Number of active customers (thousands) 1,805 1,756 1,679 Degree day deficiency 4 (degrees Celsius) Actual 3,750 5,052 4,029 Forecast based on normal weather 3,747 4,849 3,565 1 All per share amounts have been restated to reflect the Company’s two-for-one stock split in May 2005. 2 Liquids Pipelines operating highlights include the statistics of the 10.9% owned Lakehead System and wholly owned liquids pipelines operations. 3 In 2004, Enbridge Gas Distribution (EGD) changed its fiscal year end from September 30 to December 31 to be consistent with Enbridge. Consequently, highlights of Gas Distribution and Services for 2004 include the 15-month period ended December 31 for EGD and other gas distribution operations. Gas Distribution and Services volumes and the number of active customers are derived from the aggregate system supply and direct purchase gas supply arrangements. 4 Degree day deficiency is a measure of coldness. It is calculated by accumulating for each day in the period the total number of degrees each day by which the daily mean temperature falls below 18 degrees Celsius. The figures given are those accumulated in the Toronto area. 04 Highlights Enbridge Inc. Letter to Shareholders Patrick D. Daniel David A. Arledge President & Chief Executive Officer Chair of the Board Introductory Remarks In 2005, Enbridge again added significant value for our customers and our shareholders. The progress made on a large number of greenfield crude oil and natural gas pipeline projects will result in improved access to energy supply for consumers, improved markets for our upstream producers, and economic value for our shareholders. A 9.4% growth in adjusted operating earnings in 2005, coupled with a 25.5% total shareholder return (for shareholders trading on the Toronto Stock Exchange), once again provided shareholders with excellent returns. Reported earnings were $556 million, or $1.65 per common share, compared with $645 million, or $1.93 per common share in 2004. However, the decrease was primarily due to unusual gains in 2004. Adjusted operating earnings, which represent earnings applicable to common shareholders adjusted for non-operating factors and variances, reflect Enbridge’s continued steady growth. Adjusted operating earnings were $537 million, or $1.59 per common share in 2005, compared with $491 million, or $1.47 per common share in 2004. We again exited the year with a stronger balance sheet, putting the Company in an excellent position to pursue its “best-ever” slate of greenfield pipeline projects. Based on this excellent outlook going into 2006, our Board of Directors increased the annual dividend by 15% in November 2005, and indicated a higher target payout range of 60% to 70% of adjusted earnings, up from the previous 50% to 60% range. Enbridge dividends have increased every year since 1996. Clearly, our Company is well positioned to continue its history of steady growth, and to pursue the creation of value for customers, which in turn results in creation of value for shareholders. 2005 Annual Report Letter to Shareholders 05 2005 Accomplishments – Working Our Strategies 2005 was also a good year in terms of progress against our four key strategies. Focus on operational excellence: We successfully concluded a new Incentive Tolling Settlement (ITS) with the Canadian Association of Petroleum Producers – the third such five-year agreement between Enbridge and our customers – based on a negotiated incentive model rather than a traditional cost-of-service model. The ITS has as its foundation the National Energy Board’s 2005 multi-pipeline rate of return and provides Enbridge with the opportunity to earn a higher rate of return by achieving certain service and reliability targets, as well as continued achievement of cost savings. Enbridge continues to operate one of the lowest cost crude oil pipeline systems in North America and one of the lowest cost natural gas distribution companies. In 2005, we continued to strengthen reporting on our Corporate Social Responsibility program, including environmental, safety and social performance. In September, Enbridge was named to the Dow Jones Sustainability World Index, and in January 2006 it was announced at the World Economic Forum in Davos, Switzerland, that Enbridge had once again been named to the list of the Global 100 Most Sustainable Corporations in the World. Expand existing core asset platforms: We made excellent progress on numerous pipeline growth opportunities during 2005. T The Spearhead Pipeline was reversed and first crude oil shipments reached the Cushing terminal in March 2006. Enbridge now directly ships Western Canadian crude oil all the way from Alberta to Oklahoma. T In December, we announced that we were proceeding with construction of the Southern Access expansion, to add an additional 400,000 barrels per day of capacity between Superior, Wisconsin and the Chicago, Illinois area by 2009. We are also pursuing commitments for a Southern Access extension to Patoka, Illinois. T In December, based on first customer commitments, we filed an application to build the Waupisoo Pipeline from the Alberta oil sands to a terminal near Edmonton, Alberta.

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