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VARIABLE INTEREST ENTITY

12 Months Ended

Dec. 31, 2012

10. VARIABLE INTEREST ENTITY

The Fund is an unincorporated open-ended trust established by a trust indenture under the laws of the Province of Alberta and is considered a VIE by virtue of its capital structure. The Company is the primary beneficiary of the Fund through its combined 67.7% (2011 - 69.2%; 2010 - 72%) economic interest, held indirectly through a common investment in ENF, a direct common trust unit investment in the Fund and a preferred unit investment in a wholly-owned subsidiary of the Fund. Enbridge also serves in the capacity of Manager of ENF, the Fund and its subsidiaries.

The summarized impact of the Company’s interest in the Fund on earnings, cash flows and financial position is presented below. Earnings include the results of operations of certain assets acquired by the Fund from wholly-owned subsidiaries of Enbridge from the dates of acquisition of October 2011 and December 2012 (Note 18). Earnings, cash flows and financial position information exclude the effect of intercompany transactions.

Year ended December 31,	2012		2011		2010
(millions of Canadian dollars)
Revenues	288		146		89
Operating and administrative expense	(83	)	(66	)	(52	)
Depreciation and amortization	(87	)	(47	)	(19	)
Income from equity investments	52		60		60
Interest expense and other	(68	)	(32	)	(13	)
Income taxes	(35	)	(21	)	(17	)
Earnings	67		40		48
(Earnings)/loss attributable to noncontrolling interest	13		7		(11	)
Earnings attributable to Enbridge	80		47		37
Cash flows
Cash provided by operating activities	198		140		29
Cash used in investing activities	(158	)	(98	)	(107	)
Cash provided by financing activities	1,495		381		85
Increase in cash and cash equivalents	1,535		423		7

December 31,	2012		2011
(millions of Canadian dollars)
Current assets	224		109
Property, plant and equipment, net	2,390		1,349
Long-term investments	314		343
Deferred amounts and other assets	179		125
Current liabilities	(250	)	(90	)
Long-term debt	(1,864	)	(675	)
Other long-term liabilities	(22	)	(36	)
Deferred income taxes	(438	)	(403	)
Net assets before noncontrolling interests	533		722