Company: ENBSF
Filing Date: 2025-02-14
Form Type: 10-K
Source: 0000895728-25-000006
Chunk: 175

Company: ENBRIDGE INC
Filing Date: 2025-02-14
Form: 10-K
Item: Item 1
Chunk 175
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 Federal Energy Regulatory Commission (FERC) and is the primary transporter of crude oil and liquid hydrocarbons from western Canada to the US.

Tolling Framework

The Mainline Tolling Settlement (MTS) is a negotiated settlement with a term of seven and a half years through the end of 2028 that covers both the Canadian and US portions of the Mainline, except for Lines 8 and 9 which are tolled on a separate basis. Enbridge filed an application with the CER for approval of the MTS on December 15, 2023 and the CER issued an order on March 4, 2024 approving Enbridge’s application as filed. The MTS provides for a Canadian Local Toll for deliveries within western Canada, as well as an International Joint Tariff (IJT) for crude oil shipments originating in western Canada, on the Canadian Mainline, and delivered into the US, via the Lakehead System, and into eastern Canada. Under the MTS, the Mainline operates as a common carrier system available to all shippers on a monthly nomination basis.

The MTS includes:

•an IJT, for heavy crude oil movements from Hardisty to Chicago, comprised of an initial Canadian Mainline Toll of $1.65 per barrel plus an initial Lakehead System Toll of US$2.57 per barrel, plus the applicable Line 3 Replacement surcharge;

•toll escalation for operation, administration, and power costs tied to US consumer price and US and Canadian power indices;

•tolls that are distance and commodity adjusted, and utilize a dual currency IJT; and

•a financial performance collar that provides incentives for Enbridge to optimize throughput and cost, but also provides downside protection in the event of extreme supply or demand disruptions or unforeseen operating cost exposure. This performance collar is intended to ensure the Mainline earns 11% to 14.5% returns, on a deemed 50% equity capitalization.

Approximately 70% of Mainline deliveries are tolled under this settlement, while approximately 30% of deliveries are tolled on a full path basis to markets downstream of the Mainline. 

Lakehead System Local Tolls

Transportation rates are governed by the FERC for deliveries from the Canada/US border near Neche, North Dakota, Clearbrook, Minnesota and other points to principal delivery points on the Lakehead System. The Lakehead System periodically adjusts these transportation rates as allowed under the FERC’s index methodology and tariff agreements, the main components