Enbridge Inc. · TSX:ENB
Enbridge — Investor Day (March 2024)
51 slides from Enbridge's investor day presentation, Mar 6, 2024
Slide 1: Investor Day
Investor Day March 6, 2024 ZENBRIDGE
Slide 2: Legal notice
Legal notice Forward Looking Information This presentation includes certain forward-looking statements and information (FLI) to provide potential investors and shareholders of Enbridge Inc. (Enbridge or the Company) with information about Enbridge and its subsidiaries and affiliates, including manag
Slide 3: Safety moment
Safety moment Building Evacuation Procedures 3
Slide 4: Agenda
Agenda Eastern Time Welcome & Introduction Rebecca Morley 9:30 Strategic Overview & Priorities Greg Ebel 9:35 Liquids Pipelines Colin Gruending 9:55 Gas Transmission & Midstream Cynthia Hansen 10:20 Gas Distribution & Storage Michele Harradence 10:45 Renewable Power Matthew Akman 11:10 Financial Out
Slide 5: Greg Ebel, President & CEO
Investor Greg Ebel President & CEO March 6, 2024 ZENBRIDGE
Slide 6: Today's approach & key takeaways
Today’s approach & key takeaways Fundamentals continue to support all elements of Enbridge’s business Synergistic nature & resilience of portfolio are strong competitive advantages Disciplined capital allocation underpins attractive growth outlook Enbridge is your first-choice investment opportunity
Slide 7: Resilient fundamentals underpin our strategy
Resilient fundamentals underpin our strategy All forms of energy needed to meet growing global energy demand Absolute demand growth Oil | Natural Gas | Renewables | Other3 | • Natural gas & oil remain essential energy for building S&P Inflections Scenario4 the middle class globally • Renewables are
Slide 8: First-choice energy provider
First-choice energy provider Four core franchises offer reliable growth Ireland UK Germany Liquids Largest system in North America France transporting ~30% of crude oil produced Pipelines with 1.6 MMbpd of export terminal capacity Gas Transmission Delivers ~20% of natural gas consumed by >170 MM peo
Slide 9: Unmatched scale and connectivity
Unmatched scale and connectivity Diversification commands premium valuation Committed to a Scale advantages Proof points diversified portfolio Post U.S. gas utility • Deep customer relationships $19B acquisition of three U.S. gas utilities acquisitions in supportive jurisdictions Gas Transmission bu
Slide 10: Interconnectivity drives competitive advantage
Interconnectivity drives competitive advantage Vast incumbent position generates growth from cross-pollination between business units Ontario Integration across Operational overlap our asset footprint ONTARIO • Strategic incumbency generates opportunities DAWN TORONTO at the intersection of HUB L co
Slide 11: Disciplined capital allocation
Disciplined capital allocation Maintaining financial flexibility to grow the business and return capital to shareholders • A strong balance sheet remains a top priority Preserve 85% balance sheet • Complete funding of U.S. gas utilities acquisitions of aggregate utility transaction strength • No cha
Slide 12: Surfacing shareholder value
Surfacing shareholder value Maximizing shareholder value through capital efficient growth Illustrative returns on capital (Enterprise Value / EBITDA1) Near-term focus Opportunistic acquisitions 9-11x 4-11x Value chain extensions Secured capital Enhance growth program 3-6x outlook Revenue & cost Asse
Slide 13: First-choice investment opportunity
First-choice investment opportunity Our strategy has yielded industry leading total shareholder returns over the last 20 years Compelling shareholder returns Share Price | Dividends Diversified low-risk pipeline Stability & utility-like earnings 11+% 11.2% TSR1 CAGR since 2004 Reliable cash flows &
Slide 14: Colin Gruending
Colin Gruending EVP & President, Liquids Pipelines
Slide 15: First Choice for Liquids Delivery
Enbridge’s connectivity to key demand-pull markets First Choice for Liquids Delivery Best liquids system in the world We safely move ~6MMbpd Demand-pull connections to Our crude terminals load Best direct connections to of N.A. crude ~75% ~25% ~30% of N.A.refineries of USGC exports of N.A. supply PA
Slide 16: Reliable free cash flow generation
Reliable free cash flow generation Strong returns generate low-risk free cash flow that supports growth 97% of cash flows underpinned by ~$8B per year of free cash flow long-term settlements or contracts generation3 COS+1 • Funds: Mainline – capital efficient, high return ROS2 Liquids growth – lower
Slide 17: Mainline optimization & expansion potential
Mainline optimization & expansion potential Strong utilization of the Mainline for the foreseeable future Additional pipeline capacity required by 2026 • Reaffirming 2024 Mainline volume (MMbpd) guidance of ~3 MMbpd WCSB pipeline utilization reaches ~99% by 2026 • Assuming TMX in-service in H1’24, m
Slide 18: Mainline EBITDA opportunity
Mainline EBITDA opportunity Agreement sustains incentives and growth opportunities Illustrative Mainline EBITDA under MTS1 EBITDA drivers (C$B) • Demand-pull from refining customers drives high utilization • Capacity optimization & scheduling • Cost management • Toll inflators • Market Access pipeli
Slide 19: Expanding and optimizing our systems
Expanding and optimizing our systems Capital efficient growth opportunities generate attractive returns Canadian and export Operating leverage Expected opportunities: of system to drive build multiples of Regional Oilsands | 250+ kbpd EBITDA growth ~4-6X Ft. McMurray Mainline | 200 kbpd • Utilize un
Slide 20: Building out the light oil super system
Building out the light oil super system Strategically developed asset footprint generates abundance of growth opportunities Strategic execution New Announcements so far… 120 kbpd Gray Oak expansion, subject to Acquired successful open season operatorship and 68.5% interest in 2.5 MMbbls EIEC s
Slide 21: Cynthia Hansen
Cynthia Hansen EVP & President, Gas Transmission and Midstream
Slide 22: First-choice for natural gas delivery in North America
First-choice for $7.2B natural gas delivery in of secured growth in W. Canada North America Highly strategic assets underpinned by low-risk commercial model and robust growth profile L Move Own Serve ~20% of gas consumed ~10% of net working ~25% of USGC LNG in the U.S. storage in N.A. export capacit
Slide 23: Optimizing critical energy infrastructure
Optimizing critical energy infrastructure Highly contracted system connected to demand-pull markets with continued investment in safety and reliability Successful Rate Settlements Modernization Re-contracting Program 2020 Texas Eastern 2024 Contract Levels Contracted Algonquin B.C. Pipeline 100% 100
Slide 24: LNG development strategy
LNG development strategy Pursuing a natural gas super system strategy with last mile connectivity to export markets provides competitive advantages and enhances returns Equity in Pipelines Storage Terminals & Projects ~$5B 112Bcf Ownership in 2.1MTPA1 of net storage of future growth capacity servici
Slide 25: Western Canada natural gas super system
Western Canada natural gas super system Critical infrastructure investment driven by demand-pull projects to support growing Canadian LNG exports Expecting Pipelines 4.5Bcfd of production • $1.2B T-North expansion application filed with regulator $5.2B growth through 2040 secured growth • $4.0B T-So
Slide 26: U.S. Gulf Coast opportunities
U.S. Gulf Coast opportunities Highly competitive asset position drives significant opportunities across the value chain Competitive advantages ENB connected/contracted • Incumbent position and connectivity to growing LNG demand LNG facilities • Strategic footprint drives capital efficient growth ~$9
Slide 27: Renewable Natural Gas
Renewable Natural Gas RNG leader in the midstream space; the fundamentals and financial proof points support recent investments Morrow Investment Highlights • U.S. RNG demand expected to substantially grow through 20401 • Landfills are the largest scale and lowest cost supply source of RNG Up to Acq
Slide 28: Michele Harradence
Michele Harradence EVP & President, Gas Distribution & Storage
Slide 29: First-choice for natural gas distribution in North America
First-choice for natural gas distribution in ONTARIO TORONTO North America DAWN HAMILTON HUB MICHIGAN Hamilton Growth Dawn to Corunna Diversified utility footprint generates predictable returns and reliable growth $3B+ Serving Connected to Peak deliveries of ~20MM people ~7MM ~9.3Bcfd to customers p
Slide 30: Natural Gas is the most cost-effective energy source
Natural Gas is the most cost-effective energy source Continued investment in storage and transmission helps maintain affordability Natural gas affordability1 Storage supports affordability – (% more than natural gas) a key focus of stakeholders 196% • Acts as market balancing mechanism to reduce pri
Slide 31: Premier utility growth platform
Premier utility growth platform Stable long-term investment in critical infrastructure helps deliver reliable, affordable, and sustainable energy to our customers Consolidated Rate Base1 Diversified Growth ($B) U.S. utilities CAD utilities will enhance growth by delivering System & storage enhanceme
Slide 32: Ontario provides stable growth and profitability
Ontario provides stable growth and profitability Strong track record of predictable growth and consistent returns Rate Base Growth drivers ($B) • Added 46k new customers 18.0 in 2023 Predictable • New storage and 16.0 rate base transmission investment growth • Supporting up to 1.5 GW of new 14.0 pow
Slide 33: U.S. utility acquisitions add capital efficient, low-risk growth
U.S. utility acquisitions add capital efficient, low-risk growth Short cycle between capital investment and earnings generation Growth drivers Capital expenditures Predictable Results ($B) • Utility revenue decoupled ~45% from volumes of utility capex Stable Returns $2.0 is rider-eligible • Limited
Slide 34: Matthew Akman
Matthew Akman EVP & President, Power
Slide 35: First-choice for Renewable Power
UK First-choice for ~5.9GW1 Germany Renewable Power of European offshore wind France opportunities Positioned to capitalize on growing renewable energy demand through disciplined investment Up to 5.3GW4 Delivering clean energy to $1.5B in operation or sanctioned across N.A. and Europe ~5.7MM people
Slide 36: Strategic and disciplined investment
Strategic and disciplined investment Solid growth underpinned by strong risk-adjusted returns Focused Portfolio Differentiated Investment Growth ~3.0GW Approach (Cumulative Net GW) of new net 5.0 Onshore In Development capacity under • Take advantage of existing presence development Offshore in mult
Slide 37: Well positioned to grow the business
Well positioned to grow the business Enbridge’s competitive advantages enable the business to overcome sector challenges Industry trends • Labour and capital cost pressures • Supply chain constraints • Complex and elongated permitting processes • Access to capital Competitive positioning • Economies
Slide 38: North American onshore growth outlook
North American onshore growth outlook Strong fundamentals support a robust onshore growth outlook N.A. renewables expected to Under Late-stage Mid-stage grow by Operating Construction Development Development 49 GW3 per year 1,597MW1 22MW1 744MW1 2,072MW1 • 16 wind farms in • Bedford Solar • Cadillac
Slide 39: Onshore development backlog
Onshore development backlog Diversified across technology and geography allowing for strategic execution Targeting Development pipeline (Net GW) Selection criteria Potential FIDs1 ~1.5GW of FID’s in 2024/2025 Solar • Advanced development 2024 - 2025 Project Region MW (Net) Wind • Located in strong m
Slide 40: European offshore wind growth outlook
European offshore wind growth outlook Portfolio leverages top-tier partnerships focused in supportive jurisdictions ~60% offshore EBITDA growth by Under Secured2 Unsecured3 2025 Operating Construction Development Development UK London Germany 526MW1 192MW1 799MW1 662MW1 Paris • Increased • Fécamp •
Slide 41: Pat Murray
Pat Murray EVP & Chief Financial Officer
Slide 42: Reliable capital allocation priorities
Reliable capital allocation priorities Fortifying the balance sheet to optimize shareholder returns remains the top priority Disciplined investment framework • Preserve financial strength and flexibility Protect • Ongoing capital recycling program Comprehensive evaluation balance Various of strategy
Slide 43: Utility-like business risk supports leverage
Utility-like business risk supports leverage Industry leading risk profile warrants a leverage metric closer to utilities 7.0x 6.0x ENB’s Debt/EBITDA1 Target Range: 4.5 - 5.0x 5.0x 4.0x 3.0x 2.0x 1.0x 0.0x Utilities ENB2 U.S. Midstream Excellent Business Risk3 Strong Regulated Returns • Cost Flowthr
Slide 44: Investment capacity outlook
Investment capacity outlook Predictable EBITDA growth generates annual capacity within targeted leverage range Maintains leverage within 4.5x-5.0x1 range $8-9B Leverage Accretive Driven by ~5% $6-7B Base annual EBITDA1 Secured growth growth4 growth program (~4-5%) FCF2 before Additional Total annual
Slide 45: Growth outlook
Growth outlook Utility acquisitions enhance and increase visibility of our growth outlook1 Near-term outlook 1+% ~5% Reiterate 2024 financial guidance Further EBITDA2 opportunities growth 2023-2026 ~1-2% • Deploy investment per year EBITDA2 CAGR: 7%-9% Cost savings/ capacity optimizations EPS2 CAGR:
Slide 46: Optimizing our base business
Optimizing our base business Capital efficient optimizations expected to drive EBITDA growth of ~1-2% per year Asset Built in revenue Cost and productivity optimizations: escalators1 improvements: (% of EBITDA) Regulatory +400 kbpd of Liquids recovery Supply chain efficiencies capacity additions
Slide 47: Delivering attractive shareholder returns
Delivering attractive shareholder returns Sustainably returning capital to shareholders remains a key part of our value proposition Dividend/share Value drivers $3.66 Diversified low-risk Capital pipeline / utility model appreciation + dividend growth Reliable cash flows & ~11% strong balance sheet
Slide 48: Appendix
Slide 49: Secured capital program
Secured capital program Diversified secured capital program with limited cost inflation risk Project Expected ISD Capital ($B) Liquids Pipelines Ingleside Phase VI & VII (Storage) NEW 2024 0.2 USD Executing on Expect to $25B secured Enbridge Houston Oil Terminal 2025 0.2 USD invest Modernization Pro
Slide 50: Closing Remarks
Investor Day Ebel ihe heactcee ZENBRIDGE Closing Remarks
Slide 51: First-choice investment opportunity
First-choice investment opportunity Scale, diversification, and connectivity blends and extends growth Liquids Pipelines Gas Transmission & Midstream High-quality, attractive free cash flow generation Unparalleled asset position with minimal commodity All systems expected to be highly utilized