Enbridge Energy Partners 2009 Annual Report by AnnualReports


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									enbridge energy partners, l.p.
enbridge energy management, l.l.c.
2009 annual review
To Our Unitholders and Shareholders                3
Liquids Business                                   6
Natural Gas Business                              10
Governance and Social Responsibility              14
A Choice of Investments                           15
Financial Highlights                              16

Our Longview plant in Longview, Texas, is one
of 16 treating and processing facilities on our
East Texas System.
                                                                                                     Major PartnershiP and
                                                                                                     affiliated systeMs

                                                                                                     liquids systeMs
                                                                                                             EEP Liquids Pipelines
                                                                                                             ENB Pipelines and Joint Ventures
                                                                                                             EEP Southern Access Expansion
                   Fort McMurray
          OIL SANDS
                                                                                                             EEP/ENB Alberta Clipper Pipeline

                                                                                                     natural gas systeMs
                                                                                                             EEP Natural Gas Pipelines






                                                                             Delavan                                  Buffalo
                                                                             Flanagan               Toledo

                                                                       Wood River




                                      FORT       EAST
                                     WORTH      TEXAS
                                     BASIN      BASIN


To our uNiThoLdErS ANd ShArEhoLdErS

as you may recall, at this time last year,
we said that enbridge energy Partners
(the Partnership) would face challenges
in 2009. and, we did. We also said that we
were committed to maintaining not only
our investment-grade credit rating, but
also our distribution. and, we did.

                               Station pipelines transport product to their designated
                               storage tanks at our Cushing, Okla., storage facility,
                               where some 96 tanks hold as much as 16 million
                               barrels of crude.

                                                                       2009 ANNuAL rEViEw   3
to our unitholders and shareholders

             espite one of the most challenging eco-         90 percent complete as of January 2010, with construction
             nomic environments we have seen, 2009           of the Canadian portion of the Alberta Clipper expansion
             was a very successful year for the Partner-     mechanically complete. We expect that Alberta Clipper
             ship. Through the year, we maintained           will be completed and available for line-fill on April 1,
             our quarterly distribution at $0.99 per         2010, three months ahead of schedule. This will add
             unit and our distribution coverage ratio        significant earnings and cash flow to the Partnership.
remained healthy, ending with coverage of 1.11 times.
                                                             Financially, we had a solid year in 2009. Adjusted oper-
We enhanced our liquidity position, stabilized our credit    ating income from the Liquids business was $443.7
ratings and addressed our financing needs by entering        million, an increase of $101.5 million from 2008. In our
into a joint-funding agreement for the Alberta Clipper       Natural Gas business, adjusted operating income was
project. We sold non-core natural gas pipeline assets and    $154.2 million, a decrease of $16.7 million from 2008.
limited our capital expenditures to those projects that      The Partnership adjusted net income for the year was
were most strategic. We implemented significant cost         $377.1 million, 6 percent higher than 2008. Adjusted
saving measures throughout 2009 and made significant         EBITDA was 15 percent higher than 2008.
progress on our expansion program. We did all the things
we said we were going to do in 2009 and were able to         What’s ahead? Our multi-year, multi-billion-dollar expan-
deliver adjusted net income results that were 18 percent     sion program is largely complete. However, we believe
higher than our expectations at the beginning of the year.   solid, long-term fundamentals in both crude oil and natu-
The unit price for the Partnership was up 111 percent for    ral gas will result in more infrastructure needs; we are well
2009, and the three-year shareholder return was 40 percent   positioned to pursue growth opportunities in both lines of
for the Partnership versus 31 percent for our peers.         business. We do not expect that major expansions to our
                                                             Lakehead System will be required over the next few years.
On the project front, we completed the 400,000 barrels       We do, however, see significant growth potential in our
per day (Bpd) Southern Access Expansion Stage II. In         North Dakota System, where the Bakken Shale is located.
January, 2010 we placed in-service the North Dakota          Production in the Bakken, one of the most promising
Expansion Phase VI, which added 51,000 Bpd of                production areas, is expected to quickly ramp-up over the
additional capacity to our North Dakota System. The          next few years to about 350,000 Bpd. As the full potential
U.S. portion of Alberta Clipper was approximately            of the play is developed, volumes could well exceed that
                                                                  number. The Partnership is well positioned to capital-
                                                                    ize on that growth by providing additional capacity
                                                                      on our North Dakota System, which supplies
                                                                        the Lakehead System and the North Dakota
                                                                           refining market.

                                                                              Our Cushing crude oil storage facilities
                                                                               are attracting significant interest from
                                                                               third parties looking for contract stor-
                                                                               age capacity. Currently, we have close
                                                                               to 16 million barrels of storage capac-
                                                                               ity with additional expansions possible.

                                                                                With respect to natural gas, we con-
                                                                                tinue to see significant growth potential
                                                                                in areas such as the Haynesville Shale
                                                                                and the Anadarko Granite Wash as
                                                                                well as areas where we don’t currently
                                                                                operate such as the Marcellus Shale

                                                                           Steve Letwin          Terry McGill
                                                                           Managing Director     President
ADjuSTeD eArninGS                                               growth initiatives that would add capacity and volumes to
Per unit in dollars                                             our East Texas System in the South Haynesville area of
                        1.92                                    Shelby County, Texas.
                                     2.82                       While 2009 results were solid and the economic environ-
                                           3.15                 ment is improving, we recognize that we will continue
                                    2.75                        to operate under a challenging environment in 2010. The
                                                                Partnership’s strong competitive position in both liquids 2.5
                                                                                          0.0   0.5    1.0     1.5    2.0                   3.0
AnnuAL DiSTribuTiOnS                                            and natural gas provides significant upside potential. We
Per unit in dollars                                             are fortunate to have a strong general partner in Enbridge
                                             3.70               Inc. and a smart, dedicated workforce.
                                            3.725               Our commitment to the environment and our people
                                               3.88             remains strong. One area we always strive to improve is
                                                3.96            safety both for our employees and our neighbors around
                                                                our facilities. We are committed to providing safe, reli-
LiquiDS DeLiverieS                                              able and environmentally responsible energy transporta-
                                                                                       0.0 0.5 1.0 1.5 2.0 2.5                       3.0   3.5     4
Bpd in thousands
                                                                tion options.
                                           1,853                We are deeply saddened by the deaths of two Enbridge
                                             1,877              employees; the first fatality occurred during a hydrogen
                                              1,962             sulfide release at our gas treating plant near Bryans Mill,
                                               2,004            Texas, and the second, a traffic fatality in the Texas Pan-
                                                                handle. We strive every day to achieve a zero-tolerance
nATurAL GAS DeLiverieS                                          safety record and work diligently to meet that goal.
Btu/d in billions
                                                                These incidents reinforce our focus on safety in 2010
                                                                                                            0       500     1000                 150
                           1,613                                and beyond.
                                    2,119                       We are in a much better financial position going into
                                             2,521              2010 and will continue to work diligently to ensure long-
                                         2,400                  term stability of our distribution. Our pledge to you is
                                                                that we will continue to pursue growth opportunities that
                                                                are accretive to our unitholders while maintaining our
                                                                commitment to our sustainable business model that
located in the eastern United States. Early estimates have      provides safe and reliable transportation services to
calculated that the Marcellus Shale contains between an         our customers.
                                                                                                            0         500        1000      1500
estimated 1.9 - 500 trillion cubic feet (Tcf) of natural gas.
Even if only 10 percent of that gas is recovered, it would
be enough to supply the entire U.S. for about two years.
As such, we are closely monitoring potential development
opportunities in areas such as the Marcellus Shale, where
we can replicate the success we have had with our gather-
ing and processing businesses in Texas.

Though volumes decreased on our natural gas systems
                                                                stephen j. j. letwin             terrance l. Mcgill
in 2009, we expect this trend to change in 2010 as rig
                                                                Managing director                President
counts stabilize and horizontal drilling technology             Enbridge Energy Company, inc.    Enbridge Energy Company, inc.
enhances well productivity. We are working on several           February 19, 2010                February 19, 2010

                                                                                                          2009 ANNuAL rEViEw     5


6   LiQuidS BuSiNESS
          ur Liquids business accounted for
          $462.0 million of operating income
          for the year ended December 31, 2009,
          representing an increase of $119.8
million over the same period in 2008. The
favorable results are primarily attributable to
transportation rate increases that went into effect
during 2009, partially offset by higher operating
and administrative costs and depreciation.

Pipeline crew members align joints of the Alberta
Clipper pipeline near rosby, Minn. Construction of the
326-mile Alberta Clipper pipeline began in August
2009 and is on track to wrap up by April 2010, three
months ahead of schedule.

                                       2009 ANNuAL rEViEw   7
liquids Business

We celebrated the 60th anniversary of our Lakehead
System in 2009. The first pipeline in the Lakehead System
was constructed in 1949, and as of 2010, the U.S. right-of-
way will have been expanded to include up to six separate
and parallel crude oil and liquid petroleum pipelines. Not
only is the Lakehead System a common carrier pipeline
that serves as the primary transporter of crude oil and liq-
uid petroleum to the United States from western Canada,
but it also supplies the major refining markets in the U.S.
Great Lakes and upper Midwest as well as in Ontario,
Canada. When combined with the Enbridge Inc. main-
line system in Canada, it is the longest liquid petroleum
pipeline system in the world. In addition, Enbridge Inc.’s
newly expanded Spearhead Pipeline connects with the
Lakehead System near Chicago and offers crude oil ship-
pers increased access to the Mid-Continent and Gulf Coast
markets through the Cushing, Okla., Hub.

In 2009, average system deliveries on the Lakehead
System increased by 1.9 percent, from the same period in
2008 and contributed an additional $9.5 million to operat-
ing revenue. Deliveries on the Lakehead System in 2009
averaged 1.65 million Bpd compared with 1.62 million
Bpd in 2008. The increase is attributed to increases in
crude oil supplies from the continued development of the        Operations technicians Greg bowman, left, and Marty
Alberta oil sands.                                              Gaunder, right, head out past Cushing’s tanks to perform
                                                                a maintenance check on the pipelines.
Canada continues to be the largest source of U.S. crude
oil imports by supplying about 1.2 million Bpd of the U.S.
crude oil imports. Approximately 68 percent of western          The Ozark Pipeline transports crude oil from Cush-
Canadian crude oil exports to the United States in 2009         ing to Wood River, Ill., serving refineries in the U.S.
were shipped via the Lakehead System. Of the total Lake-        Mid-Continent region. In addition, there are 96 storage
head System receipts, some 5 percent are sourced from           tanks, ranging in size from 55,000 to 575,000 barrels,
domestic production, including increasing deliveries from       at our Cushing and El Dorado, Kan., terminals with a
our North Dakota System.                                        total capacity of 15.9 million barrels. In 2009, the Mid-
                                                                Continent System recorded average deliveries of 238,000
Crude oil price volatility in 2008 and 2009 caused some         Bpd. In early 2009, Enbridge Inc. completed a 68,300
producers to cancel or defer projects. This is likely to slow   Bpd expansion of its Spearhead Pipeline to a capacity
the demand for additional capacity on our Lakehead main-        of approximately 193,300 Bpd. The Spearhead Pipeline
line system in the short-term, but the Canadian Associa-        interconnects with our Lakehead System.
tion of Petroleum Producers (CAPP) is forecasting future
production from the Alberta oil sands to grow steadily          nOrTh DAkOTA SySTeM
during the next 10 years with an additional 1.4 million         The Partnership’s North Dakota System continues to
Bpd of incremental supply available by 2019.                    provide a vital transportation route for producers in east-
                                                                ern Montana, North Dakota and southern Saskatchewan
MiD-COnTinenT SySTeM                                            seeking to transport growing, market-constrained supplies
Our Mid-Continent System consists of 480 miles of pipe-         of crude oil sourced from the Bakken Play to refineries
line and includes the Ozark and West Tulsa Pipelines.           in the U.S. Midwest and beyond through deliveries into

8   LiQuidS BuSiNESS
Check	out	Tax	Web	on	enbridgepartners.com
Don’t wait for your K-1 to arrive by the U.S. Postal Service!
As an Enbridge Energy Partners unitholder you can:
	          •	View	your	tax	schedules	for	the	current	year.
	          •	Print	your	tax	package,	including	instructions.
           •		 utomatically	transfer	amounts	from	your	Schedule	K-1	to	IRS	forms
             filed by individuals.
	          •	Download	your	K-1	information	into	TurboTax	software.
	          •	Request	changes	to	incorrect	information.
           •		 ave	this	card	as	a	reminder	to	access	your	K-1	from	our	website
             in late February each year.
NOTE:	Enbridge	Energy	Management,	LLC	shareholders	do	not	receive	K-1s	and	do	not	require	yearly	tax	forms.	
our Lakehead System and into a third-party pipeline at       LOOkinG fOrwArD
Clearbrook, Minn. The North Dakota System comprises          In 2010, we will be proposing increased storage capacity
approximately 240 miles of crude oil gathering and a         at our Cushing terminal, a critical hub in our infrastruc-
730-mile transmission pipeline. The Phase VI expansion       ture. We also will be focused on continued expansion
of the North Dakota System was completed at the end of       of our North Dakota System as producers look to get
2009 and placed into service on Jan. 1, 2010. This expan-    oil sourced from the Bakken play to Midwestern refin-
sion—which included upgrades to pumping stations,            ing markets. With the 2009 completion of our Southern
additional tankage and extensive use of drag reducing        Access Expansion and with the Alberta Clipper project
agents—increased the North Dakota System’s capacity          slated to come online in April 2010, sufficient capacity
from 110,000 Bpd to 161,000 Bpd.                             exists on our mainline system to ensure our ability to
                                                             deliver secure, reliable North American-sourced crude oil
                                                             to U.S. and Canadian markets.

  LAkeheAD SySTeM exPAnSiOn                                  will transport heavy crude oil from Hardisty, Alberta,
  neArinG COMPLeTiOn                                         to Superior. The approximately 330-mile U.S. segment
  We continued to make great progress in 2009 on our         of this new pipeline—from the international border
  Lakehead System expansion, with critical milestones        near Neche, N.D., to Superior—costs an estimated
  met and project completion goals on course for 2010        $1.3 billion and is being jointly funded by us and our
  in-service dates.                                          general partner.

  SOuThern ACCeSS                                            The Alberta Clipper is expected to be placed in service
  We completed Stage 2 of our Southern Access expan-         in early April 2010 and will have an initial capacity of
  sion project—a 42-inch diameter pipeline—in 2009.          450,000 Bpd, expandable to 800,000 Bpd with addi-
  The entire Southern Access Expansion project spans         tional pumping stations.
  454 miles from Superior, Wis., to Flanagan, Ill. In
  2009, we completed the remaining 133 miles of the
                                                             Stacks of pipe await being hauled to the Alberta
  project, from Delevan, Wis., to Flanagan, Ill., and
                                                             Clipper construction route. This pipeyard, located in
  placed that line into service on April 1. The entire       Carlton, Minn., holds enough pipe joints to cover more
  Southern Access Expansion project has increased            than 60 miles.
  capacity on the Lakehead System by 400,000 Bpd
  and also increased revenues with a related transporta-
  tion rate surcharge that went into effect when the line
  was placed into service.

  The capacity of Southern Access pipeline can be
  increased to 1.2 million Bpd through additional pump-
  ing stations to accommodate future deliveries via the
  Alberta Clipper pipeline.

  ALberTA CLiPPer
  On August 20, 2009, we received our final permits to
  allow construction to commence on the United States
  portion of the Alberta Clipper project. Just as the U.S.
  portion of the build was beginning, Enbridge Inc. was
  wrapping up construction on the 670-mile Canadian
  segment. In total, Alberta Clipper is a 1,000-mile, 36-
  inch diameter pipeline project, which, when completed,

                                                                                                       2009 ANNuAL rEViEw   9

natural gas

            e own and operate natural gas
            gathering, treating, processing and
            transportation systems as well as
            trucking, rail and liquids marketing
operations. We purchase and gather natural gas
from the wellhead and deliver it to plants for
treating and/or processing and to intrastate or
interstate pipelines for transmission to wholesale
customers such as power plants, industrial
customers and local distribution companies.

The Longview plant is a cryogenic plant, which begins
with de-methanizing the inlet gas stream coming into
the facility. The Longview plant also separates the
ethane/propane hydrocarbons.

                                       2009 ANNuAL rEViEw   11
natural gas Business

Our three major systems – East Texas, Anadarko and            interconnects to interstate pipelines, intrastate pipelines
North Texas – are located in natural gas production           and wholesale customers. Clarity is positioned for poten-
basins that have experienced active drilling production       tial upstream and downstream expansions to meet the
activities during the last several years. The economic cri-   growing demand for natural gas transportation capacity.
sis combined with more gas supply than expected led to
lower prices and lower drilling rates. However, our natu-     In the second quarter of 2009, we completed a $60 mil-
ral gas assets remain in basins that have the opportunity     lion expansion project to add compression and approxi-
to grow even in a moderate pricing environment, due to        mately 26 miles of 20-inch diameter pipeline within our
existing shale or tight sands formations where horizontal     East Texas System. The completed expansion provides
fractionation technology can be used to improve produc-       an additional 160 million cubic feet per day (MMcf/d)
tivity from the natural gas wells.                            of capacity for this growing region. We are undertaking
                                                              $180 million in expansions to provide gathering, treating
                                                              and transportation services to several producers in coun-
     MAjOr nATurAL GAS SySTeM fACTS                           ties west and south of Carthage, Texas.

     east Texas System
                                                              The Bossier trend, located on the western side of our East
       Length: 3,400 miles of gathering                       Texas System within the East Texas Basin, has seen a
               and transmission pipe                          significant drop in development with production falling
       Plants: 9 treating, 7 processing                       from 2,400 MMcf/d in March 2009 to 1,950 MMcf/d in
                                                              October 2009, partly due to the drop in natural gas prices.
     Anadarko System                                          However, this decreased drilling activity in the Bossier is
       Length: 1,800 miles of gathering                       expected to be more than offset by the increased activity
               and transmission pipe                          focused in and around the Haynesville Shale, a forma-
       Plants: 6 processing                                   tion that runs from western Louisiana and into eastern
                                                              Texas, and has the potential of being one of the largest
     north Texas System                                       natural gas discoveries in the United States. If proven, the
                                                              discovery could create more drilling activity around our
       Length: 4,500 miles of gathering pipe
                                                              East Texas System, increasing the demand for our ser-
       Plants: 9 processing
                                                              vices. The potential natural gas production in this region
                                                              exceeds 1 Bcf/d, primarily from Haynesville wells.
We operate approximately 10,000 miles of natural gas
gathering and transportation pipelines, nine active natural   Our East Texas System comprises approximately 3,400
gas treating plants and 22 active natural gas processing      miles of natural gas gathering and transportation pipe-
plants with a combined capacity of 2.9 billion cubic feet     lines, nine natural gas treating plants and seven natural
per day (Bcf/d). Our focus primarily has been on develop-     gas processing plants, including three hydrocarbon
ing and expanding the service capability of our exist-        dewpoint control facilities, or HCDP plants.
ing pipeline systems. In late 2009, the Partnership sold
non-core natural gas pipeline assets and related treating
facilities in Louisiana, Alabama, Mississippi and Tennes-
see, including two FERC-regulated interstate natural gas
transmission pipeline systems.

In February 2009, we completed construction on our
Orange Texas Compressor Station, the last remaining
facility of our $655 million expansion and extension of
the East Texas System, referred to as the Clarity proj-
ect. The Clarity pipeline enables us to provide service
to major industrial companies in southeast Texas with

The Partnership’s Anadarko System, located
within the Anadarko Basin in the Texas
Panhandle and western Oklahoma, has expe-
rienced considerable growth as a result of the
rapid development of the Granite Wash play
in Hemphill and Wheeler Counties in Texas.
Although rig counts were down by 63 percent
during the first half of 2009, causing a decline
in natural gas production in the region, vol-
ume recently has begun to rise slightly. While
rig counts in early 2010 were still well below
the peak levels of 2008, producers are drilling
considerably more horizontal wells in the
region and the early results have been promis-
ing with high initial production rates. Natural
                                                      Our henderson natural gas processing plant, located in henderson, Texas,
gas in this region has a high content of natu-
                                                      is part of our east Texas System. both a cryogenic processing plant and a
ral gas liquids (NGLs), which enhances the
                                                      propane refrigeration plant are components of the facility.
economics of these wells due to the value of
the natural gas liquids.
                                                                    OTher nATurAL GAS buSineSSeS
Volumes on our Anadarko System are expected to stay                 The Partnership’s natural gas business also includes
level or potentially rise slightly due in part to high prices       trucking, rail and liquids marketing operations through
for NGLs.                                                           our subsidiary Dufour Petroleum that we use to enhance
                                                                    the value of NGLs produced at our processing plants.
The Anadarko System consists of approximately 1,800                 Dufour’s operations include the transportation of NGLs,
miles of natural gas gathering and transportation pipe-             crude oil and other products from wellheads and treat-
lines in southwestern Oklahoma and the Texas Panhandle              ing, processing and fractionation facilities to wholesale
and includes six natural gas processing plants.                     customers, such as distributors, refiners and chemical
                                                                    facilities. Dufour operates a fleet of 210 trucks, 351 trail-
nOrTh TexAS SySTeM                                                  ers and 110 railcars.
A substantial portion of natural gas on our North Texas
System is produced in the Barnett Shale area within the             The Partnership’s natural gas marketing business,
Fort Worth Basin Conglomerate, a mature zone that is                Enbridge Marketing, provides natural gas supply,
experiencing slow production decline. In contrast, the              transportation, balancing, storage and sales services to
Barnett Shale area is one of the most active natural gas            producers and wholesale customers. Our marketing busi-
plays in North America. We anticipate that throughput on            ness’s primary objectives are to maximize the value of
the North Texas System will increase modestly in each               the natural gas purchased by our gathering systems and
of the next several years as a result of continued Barnett          the throughput on our gathering and intrastate wholesale
Shale development. That is, producers will continue to              customer pipelines and to mitigate financial risk. Due
balance the economics of lower commodity prices with                to increased volumes from our gathering assets, our
the prolific drilling opportunities of the Barnett Shale.           marketing business leases third-party pipeline capacity
The North Texas System includes approximately 4,500                 downstream from our natural gas assets under firm trans-
miles of natural gas gathering pipelines and nine natural           portation contracts for various lengths and at rates that
gas processing plants.                                              allow our marketing business to diversify its customer
                                                                    base by expanding its service territory. This transporta-
At the Longview facility, william Mcbride, plant opera-             tion capacity also provides assurance that our natural
tor, left, and Pat Moran, plant supervisor, adjust a flow           gas will not be shut in, which can result from capacity
controller on one of the solar turbines.                            constraints on downstream pipelines.

                                                                                                                2009 ANNuAL rEViEw   13

        t Enbridge Energy Partners, L.P., our com-
        mitment to ethical conduct, social respon-
        sibility and good governance is core to our
        way of doing business. To us, good corporate
governance means ensuring that a comprehensive
system of stewardship and accountability is in place
and functioning among the boards of directors, man-
agement and employees of our general partner and
Enbridge Energy Management, L.L.C. We believe
social responsibility means achieving business suc-
cess in ways that uphold our values and high standard
of ethics and demonstrate respect for people and
the environment. To that end, we believe that social
responsibility and promotion of a sustainable future
go hand-in-hand with the strong financial perfor-
mance our investors expect.

The boards of directors, management team and
skilled employees of our general partner and Enridge
Energy Management, L.L.C. are the backbone of
Enbridge Energy Partners, L.P. The boards, which
function independently of management, provide
                                                           Top: in 2009, we were honored with a natural Gas STAr for Continuing
guidance on our long-range strategic planning and          excellence from the environmental Protection Agency, recognizing the
approve all significant decisions that affect our          Partnership’s five-year participation in the voluntary program to reduce
direction. The governance provided by the experi-          methane emissions. bottom left: we are a proud supporter of Texas Chil-
enced boards and the value of ties with Enbridge           dren’s neurological research institute, the world’s first dedicated pediatric
on mutually beneficial expansions are strengths            neurological research facility. bottom right: enbridge employees across the
that will contribute to future long-term success.          united States participate in united way campaigns, including a Day of
                                                           Caring service project in houston.

MeMBers of the enBridge energy CoMPany, inC. (eeCi) and
enBridge energy ManageMent, l.l.C. (eeq)
Boards of direCtors

Martha o. hesse is chairman of the          stephen j.j. letwin was elected man-      dan Westbrook was elected a
boards effective May 1, 2007 and            aging director and as a member of         director of EECI and EEQ in
is a member of the boards’ Audit,           the boards of directors of EECI and       October 2007 and is a member
Finance and Risk Committees.                EEQ in May 2006.                          of the boards’ Audit, Finance
                                                                                      and Risk Committees.
jeffrey a. Connelly was elected a           terrance l. Mcgill was elected
director of EECI and EEQ in                 president and a director of EECI          stephen j. Wuori was elected a
January 2003 and serves as the              and EEQ in May 2006.                      director in January 2008 and is the
chairman of the boards’ Audit,                                                        executive vice president – Liquids
Finance and Risk Committees.                george K. Petty was elected a             Pipelines for EECI and EEQ.
                                            director of EECI in February 2001
                                            and of EEQ in May 2002 and serves
                                            on the boards’ Audit, Finance and
                                            Risk Committees.


       wo alternatives are available for equity inves-                     The second choice available to equity investors is
       tors wanting to own an interest in our portfolio                    shares of Enbridge Energy Management, L.L.C., which
       of energy transportation assets. The first is via                   is a limited liability company that trades publicly on the
       class A common units representing limited part-                     NYSE under the symbol EEQ. These shares represent
ner ownership interests of Enbridge Energy Partners,                       an indirect investment in Enbridge Energy Partners,
L.P., which are publicly traded on the New York Stock                      L.P. since Enbridge Management’s only investment is
Exchange (NYSE) under the symbol EEP. These units                          its interest in the Partnership. Further, the performance
represent a direct interest in a traditional master lim-                   of Enbridge Management shares is generally expected
ited partnership. An investment in a partnership differs                   to track that of the Partnership, since its shares are
in a number of significant ways from an investment in                      maintained on a one-for-one basis with a specific class
a corporation.                                                             of Enbridge Partners limited partner units. An invest-
                                                                           ment in EEQ shares differs from an investment in EEP
• A unitholder (partner) in a publicly traded partner-                     partnership units in a number of significant ways.
  ship owns units of the partnership rather than shares
  of stock and receives cash distributions rather than                     • Enbridge Management shareholders receive quarterly
  dividends. Cash distributions received generally                           distributions in the form of additional shares. The
  reduce a partner’s tax basis in the partnership. The                       distributions are comparable in value to the quarterly
  cash distributions are not taxable as long as the part-                    cash distributions paid to unitholders of Enbridge
  ner’s tax basis exceeds zero.                                              Partners.
• Typically, a corporation is subject to federal and                       • Enbridge Management distributions are not tax-
  state income taxes, but a partnership is not. All of the                   able when received, and shareholders are not issued
  income, gains, losses and deductions of a partnership                      either a Schedule K-1 or a 1099 tax form. The sale of
  are passed through to its partners, who are required                       Enbridge Management shares is generally subject to
  to show their allocated share of these amounts on                          capital gains treatment, thus providing a tax-efficient
  their income tax returns. Allocated taxable income                         form of investment.
  increases a partner’s tax basis in the partnership.            • These investment attributes result in shares of
• In late February, partners are provided a tax package            Enbridge Management being attractive to many
  (Schedule K-1) required for preparation of their per-            individual investors. In addition, Enbridge Manage-
  sonal income tax returns. By comparison,                                    ment is treated as a corporation for federal
  a corporate stockholder typically receives                                  income tax purposes, making ownership
  a Form 1099 in late January detailing              enBridge inC.            of its shares a more suitable investment for
  required tax data.                                    (nyse:enB)            mutual funds and tax-exempt investors than
                                                                              direct ownership of partnership units.
                                           100% indireCtly oWned

                                                            enBridge energy
                                                             CoMPany, inC.

                                                             100%               17.2%
                                                             voting shares      listed shares
                       general Partner                      enBridge energy
                               interest                     ManageMent, l.l.C.                          PuBliC
                                                                 (nyse:eeq)           82.8%
                                   22.5%                     ManageMent         13.9% liMited Partner
                        liMited Partner                      and Control        interest (i-units)
                                                            enBridge energy           61.6%
                                                             Partners, l.P.                             PuBliC
                                  as of february 24, 2010       (nyse:eeP)

                                                                                                                    2009 ANNuAL rEViEw   15

                                                                                            For the year ended December 31,
                                                                        2009              2008             2007           2006                 2005
financial (dollars in millions)
Operating revenue                                                 $ 5,731.8          $ 9,898.7         $ 7,172.1         $ 6,400.2        $ 6,375.9

Net income                                                              328.0             403.2             249.5            284.9             89.2
Adjusted operating income*                                              614.0             532.7             381.2            326.8            239.6
Adjusted net income*                                                    377.1             355.3             281.1            228.8            143.7

Per unit (In dollars)
Net income                                                               2.24              3.64              2.46              3.62            1.06
Adjusted net income*                                                     2.75              3.15              2.82              2.84            1.92
Cash distributions                                                       3.96              3.88             3.725              3.70            3.70

Deliveries Liquids Segment (Bpd in thousands)
  Lakehead System                                                       1,650             1,620             1,543            1,517            1,339
  North Dakota System                                                     116               111                98               92               87
  Mid-Continent System                                                    238               231               236              244              236
  Total                                                                 2,004             1,962             1,877            1,853            1,662

Deliveries Natural Gas Segment (Btu/d in billions)
  East Texas System                                                     1,443             1,479             1,180            1,019              860
  Anadarko System                                                         570               647               591              582              488
  North Texas System                                                      387               395               348              294              265
  Total                                                                 2,400             2,521             2,119            1,895            1,613
*Adjusted to eliminate certain noncash items and sale of nonstrategic assets. (See reconciliations to GAAP measure below.)
non-GAAP reconciliations: Adjusted income figures are provided to illustrate trends absent certain unusual transactions–such as the occasional
sale of nonstrategic assets–and excluding adjustments that affect earnings, but do not impact cash flow, such as derivative fair value losses and
gains. These noncash losses and gains result from fair market value adjustments for certain financial derivatives used by the Partnership for hedging
purposes that, nevertheless, do not qualify for hedge accounting treatment under the applicable authoritative accounting guidance.

ADjuSTeD finAnCiAL hiGhLiGhTS
                                                                                            For the year ended December 31,
(Unaudited, in millions except per unit amounts)                        2009              2008             2007           2006                 2005
Operating income                                                  $     616.6        $    580.6        $    318.4        $   382.9        $   185.1
Noncash derivative fair value losses (gains)                             15.7             (68.8)             62.8            (64.4)            56.3
Hurricane impact                                                           —               15.1                —                —                —
Expired joint tariff revenues                                           (18.3)               —                 —                —                —
Sale of assets
  Gain on sale of assets                                                   —               —                   —               —             (18.1)
  Settlement of financial instruments                                      —               —                   —               —               16.3
NGL inventory charges                                                      —               —                   —              8.3                —
Project write-offs                                                         —              5.8                  —               —                 —
Adjusted operating income                                               614.0           532.7               381.2           326.8            239.6
Interest expense excluding MTM adjustments                             (230.0)         (180.6)              (98.4)         (110.5)          (107.7)
Other income                                                             13.4             1.9                 4.2             8.4               2.4
Income tax expense                                                       (8.5)           (7.0)               (5.1)             —                 —
Income (loss) from discontinued operations                               (0.4)            8.3                (0.8)            4.1               9.4
Net income attributable to noncontrolling interest                      (11.4)             —                   —               —                 —
Adjusted net income*                                                    377.1           355.3               281.1           228.8            143.7
Allocations to General Partner                                          (57.0)          (48.7)              (37.5)          (29.2)            (24.5)
Adjusted net income allocable to limited partners                 $     320.1        $ 306.6           $    243.6        $ 199.6          $ 119.2
Weighted average units                                                  116.4              97.1              86.3              70.2             62.1
Adjusted net income per unit                                      $      2.75        $     3.15        $     2.82        $     2.84       $     1.92
*Adjusted net income excludes the effect of $64.5 million of losses associated with the disposition of the non-core natural gas assets in 2009 and
 a gain of $32.6 million in 2007 related to the sale of the Kansas Pipeline System.

16   FiNANCiAL hiGhLiGhTS
Company InformatIon

2010 Distribution Dates                                                                                              Stock ExchangE
                                                      Q1                Q2                Q3                Q4       the partnership’s class a common
Payment Date                                      Feb 12            May 14           aug 13             nov 12       units are traded on the nySE under
Record Date                                        Feb 5             May 7            aug 5              nov 4       the symbol EEp. Shares of Enbridge
Ex-Dividend Date                                   Feb 3             May 5            aug 3              nov 2       Energy management, L.L.C. trade
Declaration Date                                  Jan 29            apr 28            Jul 23            oct 27       on the nySE under the symbol EEQ.

All dates are tentative until approved by the board of Enbridge Energy Management, L.L.C. To be                      tranSfEr agEnt
entitled to a declared distribution, investors must have purchased units or shares at least one busi-                and rEgiStrar
ness day in advance of the ex-dividend date. Commencing on the ex-dividend date, units and shares                    Enbridge Energy partners, L.p.
trade without entitlement to the recently declared distribution.                                                     and/or Enbridge Energy
                                                                                                                     management, L.L.C.
ownership                                                                                                            c/o Bny mellon Shareowner Services
                                                                                   As of March 3,                    p. o. Box 358015
(In thousands)                                                     2010              2009                2008        pittsburgh, pa 15252-8015
EEP class A common units                                          97,443            76,089              59,839       telephone: (888) 749-9483
EEP class B common units                                           3,913             3,913               3,913       tDD: (800) 231-5469
EEP class C units                                                     —             20,314              18,415       (Hearing assisted)
EEP i-units/EEQ shares                                            16,700            15,248              13,815       www.mellon.com/mis/investors/
Total                                                            118,056           115,564              95,982
                                                                                                                     ExtErnal auditorS
EEP unitholders (estimate)                                          86,000           87,000             80,000       pricewaterhouseCoopers LLp
EEQ shareholders (estimate)                                         10,000           11,000              9,600       1201 Louisiana, Suite 2900
                                                                                                                     Houston, texas 77002

TRADIng                                                                                                              intErnEt
                                                                          For the year ended December 31,            enbridgepartners.com
                                                                     2009              2008              2007        enbridgemanagement.com
EEP class A common units
 High                                                           $    54.44       $    53.45         $    61.82       tax WEb
 Low                                                                 24.71            22.33              48.25       Investor tax information
 Close                                                               53.69            25.50              50.54       (Schedule K-1) is available on
                                                                                                                     the partnership’s website.
EEQ shares
 High                                                           $    54.32       $    53.99         $    60.16       k-1 call cEntEr
 Low                                                                 23.50            21.88              47.35       (800) 525-3999
 Close                                                               53.12            24.45              52.32       k1@enbridgepartners.com

                                                                                                                     invEStor rElationS
enbriDge energy partners, L.p. (the “Partnership”), headquartered in Houston, is a publicly traded                   (866) 337-4636
master limited partnership (or MLP) engaged in two main businesses: crude oil and natural gas midstream services.    (866) EEp-Info
The Partnership’s major systems serve premium energy basins in north America, which have strong long-term
production profiles.
                                                                                                                     (866) EEQ-Info
    The Partnership’s Class A common units, which trade on the new York Stock Exchange (nYSE) under the              fax: (713) 353-5637
symbol EEP, are held by approximately 86,000 investors. An additional 10,000 investors hold an indirect interest     eep@enbridge.com
in the Partnership through ownership of the shares of Enbridge Energy Management, L.L.C. This limited liability
company, which manages the business and affairs of the Partnership, trades on the nYSE under the symbol EEQ.
    Enbridge Inc. (“Enbridge”), based in Calgary, Alberta, Canada, holds an approximate 27 percent interest in the
Partnership through its U.S. subsidiary, Enbridge Energy Company, Inc. (the general partner of the Partnership).     MEdia inquiriES
Enbridge shares trade on the nYSE and the Toronto Stock Exchange under the symbol EnB.
                                                                                                                     (713) 821-2253
                                                                                                                     fax: (713) 821-2230
enbridge energy partners, l.p.
enbridge energy management, l.l.c.

1100 Louisiana, Suite 3300
Houston, Texas 77002
(888) 650-8900

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