Hello and welcome to the Enbridge Inc. second quarter 2020 financial results conference call. My name is Jonathan and I will be your Operator for today’s call. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question and answer session for the investment community. During the question and answer session, if you have a question, please press star then one on your touchtone telephone. Please note that this conference is being recorded. I would now like to turn the call over to Jonathan Morgan, Vice President, Investor Relations. Jonathan, you may begin.

Thank you. Good morning and welcome to the Enbridge Inc. second quarter 2020 earnings call. Joining me this morning are Al Monaco, President and Chief Executive Officer; Colin Gruending, Executive Vice President and Chief Financial Officer, Vern Yu, Executive Vice President, Liquids Pipelines; and Bill Yardley, Executive Vice President, Gas Transmission and Midstream. As per usual, this call is webcast and I encourage those listening on the phone to follow along with the supporting slides. A replay of the call will be available today and a transcript will be posted on the website shortly thereafter. We’ll try to keep the call to roughly one hour, and in order to answer as many questions as possible, we’ll be limiting questions to one plus a single follow-up as necessary. We’ll be prioritizing calls from the investment community, so if you are a member of the media, please direct your questions to our communications team, who will be happy to respond. As always, our Investor Relations team is available for any detailed follow-up questions after the call. Onto Slide 2, where I’ll remind that we’ll be referring to forward-looking information on today’s call. By its nature, this information contains forecast assumptions and expectations about future outcomes which are subject to risks and uncertainties outlined here and discussed more fully in our public disclosure filings. We’ll also be referring to non-GAAP measures summarized below. With that covered, I’ll turn it over to Al Monaco.

Okay, thanks Jonathan, and good morning everybody. While it’s not much of a secret that the energy space is going through a challenging time, we’ve all seen that through the recent events, so I’m going to start today with how we’re thinking about that and our long term perspectives on energy infrastructure. We’ll then review the usual business update, including perhaps a bit of a deeper dive on crude oil fundamentals that we started last quarter. Colin will take you through the results and full year outlook, and I’ll come back with the midyear checkpoint on the priorities. We’re all acutely aware of how the energy landscape is changing, the long term energy transition for one, opposition to what we do, and the challenging regulatory and permitting environment, to say the least. That’s been compounded of course by a COVID-induced economic contraction that’s severely disrupting energy markets, and that’s going to take some time to work through. But the bigger picture backdrop we’re not losing sight of is that the fundamentals are intact. The fact is that low cost, reliable energy underpins the global economic engine and it’s going to be critical to the recovery. The factors leading to future energy demand increases haven’t changed either - population growth, urbanization, and an expanding middle class. There’s no serious disagreement from any credible forecast on that. North America’s ability to provide low cost energy should drive an increased share of global energy markets, and that means more infrastructure and modernizing energy systems here. When you look at the challenges we’re living through today through the lens of the undeniable need for more energy, we believe that the value of infrastructure and pipe in the ground will increase. Of course, you’re not seeing that reflected today yet, but that’s what the fundamentals…

Thanks Al, and good morning everyone. I’ll take you through our financial results, financial position, and our outlook for the full year. Slide 19 summarizes our results. I want to start by saying that I’m very proud of our performance, all things considered. We’ve worked hard over the years at strengthening our business and in the past few months have taken further actions to bolster the business. It’s consistently been a conservative approach. It’s serving us well, and I think it’s a point of differentiation. As you can see on the slide, second quarter adjusted EBITDA and Dcf were both up year-over-year on strong underlying performance, adjusted EBITDA of $3.3 billion in the quarter and Dcf of 2.4 billion. That’s $1.21 per share Dcf, $0.07 better than last year. What stood out to me during the quarter were the following items. We had strong reliable performance from a number of our businesses - gas, transmission, our utility, and the power business all performed well, materially unaffected by the COVID disruption. I think this is the diversity point. We had growth from recently completed projects, the German offshore wind projects and Gray Oak, so we’re still getting things done. We had a stronger U.S. dollar benefiting our significant U.S. dollar cash flows, and we had also some opportunistic storage profits in our energy services segment. Finally, we also had a little help from delayed maintenance capital related to COVID spend, but I’ll come back to that in a minute. If we drill down to the segment EBITDA performance on Slide 20, we can see that liquids pipelines was down only 1% or $22 million, which is a decent outcome in the conditions. On average, our mainline was approximately 85% utilized during the quarter, delivering 2.44 million barrels per day, and as…

Okay, thanks Colin. If we rewind back to Enbridge Day, you’ll recall we set some priorities for ourselves in 2020, so this is basically a wrap-up with a midyear checkpoint. It’s turned obviously to be a more difficult year for industry than anybody imagined, but if there was ever a time to have a low risk business model, it’s now. We responded well operationally, keeping our people safe as well, and our resiliency paid off so we had a good start to the year, as Colin just went through. To protect against a prolonged and deeper recession, we took some actions on liquidity and completed our funding early for the year, and at the same time capitalized on some good rates in those financings. The well diversified stream of cash flow is helping us mitigate the impact of lower mainline volumes, throughput is coming back, but we’re watching the recovery carefully and we’re certainly not going to get ahead of ourselves. We took action to cut costs and we reaffirmed the guidance, and assuming we can get there, that will be a very good outcome in this kind of year. On Line 3, while the Pollution Control Agency’s contested case has delayed things a bit, I think we’re coming to the end of this process now, so we’re looking forward to that. Finally, we continued to secure new growth for the future. Lastly on the remarks today, and before we get to the Q&A, many of you know John Whelen, our Chief Development Officer and, previous to that, CFO. After 28 years with Enbridge, John has decided to retire. He has been a key leader at Enbridge over many years, bringing his financial expertise and judgment to our growth and our evolution, someone who has really exemplified our values and approach to the business as a company. John has taken a lot of pride in developing people, and as you know, succession planning is a big focus at Enbridge. Matthew Akman, who looks after strategy and power, will report to me, as will Allen Capps leading corporate development and energy services. John has been a friend over this period, and not having him around will be an adjustment for us, but on behalf of Enbridge and I know many of you on the phone as well, we wish John and his family the very best in the future. With that, we’ll turn it over back to the Operator for the Q&A.

[Operator instructions] Our first question comes from the line of Robert Catellier from CIBC. Your question, please?

Hey, good morning, and thank you for your comments this morning. I have a couple questions about capital allocation that you partly touched on in your prepared remarks. Obviously it’s an increasingly difficult environment to get pipeline projects developed, so I’m wondering how that’s impacting your capital allocation strategy. Maybe in your answer, you can specifically address what influence it’s having on hurdle rates and project selection, but also the relative attractiveness of other and perhaps even new parts of the value chain you might consider, or other jurisdictions outside of North America.

Okay, well I’ll go first, Robert. Thanks for the question - it’s a good one in this environment, and then Colin can fill in. I think you know us well in terms of the amount of effort we put into the capital allocation process. We’ve got a pretty in-depth framework here and we’ve put a lot of work into it, and more so even these days. I think if you go to hurdle rates specifically, we’ve always taken the approach of developing those from the bottom up, and they’re very much project specific. I guess maybe if you look at the overall weighted average cost of capital, just intuitively you’d say bond yields are lower, obviously betas have been higher that we’ve seen, so those two factors are at play in either direction. But in terms of what we’re seeing out there today and the risks that you’re pointing to, what we try to do is reflect each one of the risks around project challenges in the hurdle rate, so the simply way to look at it from the way we approach it is we do the basic hurdle rate based on those things I mentioned, but we essentially take adders, if you want to call them that, based on how we see the variability depending on what risk you’re talking about. For example, today if you’re entering a new build, you have to say whether or not you think schedule and costs will come in as you predicted, so we do our best to come up with those estimates and then we run a bunch of scenarios around that to see what happens to the equity return if schedule, say, is delayed and that schedule increases your cost inevitably. When we do that, we can kind of assess what…

That was very helpful. Just a last question related to cost of capital, it doesn’t seem to really be limiting your access to capital at all here, but you’ve seen some ESG trends impacting capital markets with some suppliers deciding not to lend to the fossil fuel related industries, including oil sands. Despite the fact that you still have some pretty good access to capital, how are you addressing the availability of capital from an ESG point of view?

Well, we’ve done some transactions recently, so maybe Colin, you can touch base on how debt investors are looking at that .

Yes, hey Robert, good morning. I think obviously we’re very focused on ESG and want to continue to be a leader in that space. I think that’s well recognized in our outings in the capital markets, and we continue to have access to supply chain fulsomely, including insurance markets and all that stuff, so we feel good about that.

Maybe on the equity side of things, Robert, which I’m not sure if that’s where you were going specifically, but we spent a lot of time on this, and I think you might recall at Enbridge that we sort of went through how we stack up to the rest of the group, and there’s a lot of good work being done, I think, in our industry generally on this front. We’ve, at least according to the independent sources, have been ahead of the game here, but to move back to your other question, obviously ESG and how investors are looking at this comes into the hurdle rate as well, so we’re trying to include that as well in our capital allocation and investment review process. Overall, we’re seeing the trends. If you look at the numbers, we’re pretty good on all of those three markers, so we’ll have to see where we go from here and continue to build on that. I think this area is going to develop further over the next little while, and we should be well positioned relative to the rest of the group.

Okay, thank you for your very fulsome responses.

Okay Robert, thank you.

Thank you. Our next question comes from the line of Jeremy Tonet from JP Morgan. Your question, please?

Hi, good morning. Just wanted to start off with a quick question, and with the caveat being not a legal expert, not in a great position to opine on this, but if for some reason Dakota access pipeline were to be shut down for some period of time, just wanted to see what the reaction could be from you network of pipelines, given you have a lot of assets in that area and potentially things could--Enbridge could do things to help basin egress. Just wondering if you could share any thoughts on that.

Maybe we’ll ask Vern. He’s been doing a lot of thinking about that. Vern?

Good morning. Obviously a shutdown of DAPL would be bad for North Dakota and all the users of that crude oil coming from the Bakken, but as you mentioned, we obviously have a very broad and diverse network of crude oil pipelines. We have a couple ways to get Bakken crude into our system, so we’re doing a lot of work on contingency planning should the courts shut down the DAPL pipeline. I think it’s fair for us to say that we think we can--we will be able to provide more egress than we do today, and we should be able to mitigate a good chunk of any lost revenue or EBITDA coming from DAPL.

I think Jeremy, I think as he’s saying, we can mitigate and we should be in generally good shape, although in a broader sense we’re obviously, as Vern alluded to, concerned about it. Again, as I said around Line 5 for example, it’s easy to talk about shutting down systems, but it really does have a detrimental effect not just to North Dakota, in this case, but consumers and the entire region. It’s a serious issue that we’re watching closely, but at least we’re in pretty good position.

That’s very helpful, thank you. Then maybe shifting gears a little bit, just wanted to touch on Enbridge’s appetite for maybe more green investments over time. It seems hydrogen has been getting more attention, could be later dated at this date, but given your nat-gas pipeline network, I imagine you’d be well positioned to capitalize on that. Then as far as offshore wind is concerned, you guys have been very involved in the European side and the supply chain hasn’t quite stood up as well on the U.S. side, so maybe your expertise could be an advantage there. Just wondering overall appetite for green investments and specifically those two avenues, if you see opportunities there over time.

Okay, I’ll start off and then maybe Bill--I’d like Bill to comment too on this, because the reality is that the renewable side of things in terms of power generation really does link up with natural gas, so maybe he can address that part. Overarching that, though, I think from a strategic point of view, Jeremy, the way we’re looking at the renewable space this year, and as I mentioned, we’ve been gradually building this, we know the supply profile is going to change globally for energy. It’s not going to be a quick transition by any stretch, but slowly renewables will be a bigger portion. At the same time, we’re going to see conventional fuels growing as well, especially natural gas, so we think it makes sense strategically from the point of view of diversifying our capability to have a portion of the assets in renewables, and as I’ve said, we’ve built that slowly. You mentioned hydrogen, and it’s a good question because it’s a quite prominent issue today. I will say that Cynthia and her team in the utility have been doing a very good job in getting ahead of the curve on this, and I think we’re well advanced on a couple of ideas, so we’re going to look forward to looking at that, especially as it relates to natural gas. All of this, of course, again going back to Robert’s question, comes back to the commercial fit and whether or not we can make a good risk-adjusted return. Before I hand it to Bill, you mentioned the supply chain. I think you’re right about that in the U.S. context, and you’ve got to remember here, I think U.S. offshore wind is certainly an attractive opportunity but, as you point out, the supply chains are not as developed yet, and frankly nor are the regulatory environments as developed as Europe. It’s probably the biggest reason why we’re not involved in U.S. offshore yet. Maybe Bill, you can comment on the interaction with natural gas?

Yes, and Jeremy, you’ve probably heard me talk about this once or twice in the past. If you look at the regions that especially our pipelines serve, we have a great partnership with renewables, so today is a great example. I took the opportunity to look on the ISO website while Al was talking, and wind is 30 megawatts, natural gas is 10,200. You could quadruple the amount of wind as they’re projecting and it’s just--on the peak hours, it’s just not there. Nothing else is, either, so we’ve got a really opportunity just with our gas side to be--especially where we operate in the northeast, to be a very good partner for a long time. Then you mentioned hydrogen. I think hydrogen is very interesting, so both our utilities [indiscernible] business and ourselves on the natural gas side, we have been studying this. It’s extremely expensive - you know, is it green hydrogen, is it blue hydrogen, how does it interact with the pipelines and the actual steel in the pipeline, and that takes a lot of engineering to look at. But you’re right - the network, and this is decades from now, would be well positioned if hydrogen transitioned from that shiny object that is potentially a solution to a reality. I don’t know if that’s what you were looking for, Al and Jeremy, but that’s a couple comments there.

Thanks Bill.

That’s helpful, thank you.

Thank you. Our next question comes from the line of Rob Hope from Scotiabank. Your question, please?

Morning everyone, and John, all the best in retirement. First question on the mainline outlook. It looks like Q2 played out a little bit better than we expected, yet you did keep your H2 outlook. Can you just give some puts and takes there, especially given the fact that heavy is fully utilized right now? Are you assuming that you do see some heavy degradation in the back half of the year? Is it all light, or is it looking towards the upper end of your volume outlook there?

Hi Rob, it’s Vern here. I think we’re purposely being a little bit conservative. Obviously the wildcard is whether there’s a second wave of COVID and we continue to see some more demand destruction on the refined product side of things. I think we believe the worst is behind us, but we remain cautiously optimistic on mainline throughput over the rest of the year. Our expectation is if things remain the way they are, that we’ll be fully utilized on the heavy side for the balance of the year.

You know, Rob, we talked about this quite a bit actually. I think this is the appropriate approach, because even if you just look at the last couple of weeks, some of the driving numbers, and you’ve seen these, have sort of stabilized a bit, whereas we were on a big roll before that, and then of course if you look at the diesel numbers which we talked about and certainly jet fuel, they’re just not moving, so I think the appropriate approach here as far as how we look at the rest of the year it to be, I guess, suspect until we see some signposts, which Vern and his team look at pretty carefully. I think that’s the right way to go here.

Appreciate the color. Then secondly, just a follow-up on the capital allocation question. Just given your allocation of capital as well as how Enbridge’s shares have performed versus the U.S. peers, have you reevaluated your view on M&A, whether that’s on the corporate side or using this as an opportunity to acquire single assets that could be contiguous with your system?

Yes, I think on the latter one, I think that’s right. We would certainly not hesitate if we saw something in the single asset category that made sense in either of those three businesses, and I’ll add the power business in there, so I think to the extent that we can see value and how it enhances the existing franchise on single assets, I think that’s probably the prime area. In terms of larger scale M&A, it’s not on the priority list right now. I think we’ve done the repositioning we need to do. We’ve got very good embedded growth and some hoppers that are filling up in each of the businesses. The balance sheet is in very good shape, so we want to make sure we’re not messing with that. It’s true that--maybe this is where you’re going? It’s true that the midstream valuations are, I guess, attractive relative to where they were, but every time we look through those, we run up against our value proposition issue, I’ll call it, where there’s not a pure match with the stability and predictability of our cash flows with some of the others out there. I’m not saying they’re bad, it’s just that they’re different than what we shoot for, so I would say low priority.

All right, thank you.

Thank you. Our next question comes from the line of Praneeth Satish from Wells Fargo. Your question, please?

Good morning. Can you give us an update with your negotiations with the Bad River band reservation with respect to Line 5? I just ask because there is a pipeline in the Bakken that was shut down earlier this month for what seems to be similar circumstances, so just curious on your thoughts there.

Okay, well I’ll take that question. I think job one for us is to continue to operate the line safely and do the work necessary on the reservation to have that happen. Job two for us is to progress the re-route. I think the tribe has really asked us to move the pipeline off of their lands, and we’re in the process of doing that. We’ve filed for all of the environmental permits and the easement permits necessary to do that, and we believe that regulatory process will take about 12 to 18 months to complete. Once we’ve done that, we’ll be able to meet the wishes of the tribe and remove the pipeline from their reservation. We’ve been following that Bakken pipeline situation quite closely. I know at first glance it looks like an analogous fact pattern, but when we really dig deeper into it, the fact patterns are in fact quite different, where we have been in constant negotiation with the [indiscernible] on our easement and we have not seen the Bureau of Indian Affairs get involved in our pipeline situation with the Bad River band, so while at first they may look similar, I think when you really do a deep dive, the fact patterns are quite different.

Okay, thanks. Then in your prepared remarks, you mentioned that you’d push harder on the 1% to 2% embedded growth in the 2022-plus time frame. Can you just elaborate what you mean by that, and some of the levers that you essentially have to pull there?

Hey Praneeth, it’s Colin. Yes, great question, and it’s something we’re actively on. You can see--probably the simplest example is just our cost pursuit. I’m sure everyone in the industry is doing this as well, but we’re all over that. I think that’s a positive vector relative to history in this bucket. I think secondly, you’ve seen us incorporate and push on index rates or inflators in our tariffs - that is continuing and we’ll do more of that. Thirdly, I’d put in this category some of the embedded rate base growth that you see in our utility-esque investments, where--I think Al talked about this, where we’re going to be asked and will proactively look to ourselves to renew and modernize systems, and that is effectively utility-esque, kind of boring growth. I think those are all factors that play into that plus emphasis on the 1% to 2%.

Yes, maybe the only other example, Praneeth, just to give you a feel for it, we talked about this in terms of let’s use the liquids system. The size and scale of it at whatever it’s going to be, I guess over 3 million barrels per day once Line 3 gets done, that sure gives you a lot to work with, and if you can add 50,000 here, 25,000 there of capacity by doing things like adding DRA, for example, then that’s a very low capital intense type of revenue line improvement, so those are the kinds of things. The team already does this, but for example, can we use technology in a different way to further optimize the system or how we move volumes through terminals? For example, we have a massive liquids terminal system, and is there a more efficient way to move volumes around those terminals to get revenue quicker? It’s those kinds of things generally, aside from the things that Colin mentioned.

Thanks.

Thank you. Our next question comes from the line of Robert Kwan from RBC Capital Markets. Your question, please?

Good morning. For Line 5 east leg and DAPL, can you talk about what’s embedded in guidance in terms of downtime or potential downtime, and are you able to provide EBITDA or [indiscernible] sensitivity for potential downtime, say on a monthly basis inclusive of any offsets, such as Bakken volumes coming off of DAPL but flowing onto your wholly owned systems, such as [indiscernible] or Clearbrook?

Hi Robert, it’s Vern. Maybe I’ll start with Line 5. Obviously the west leg is running right now. The stray crossing is a dual pipeline network where for a period of time, one leg can service our requirements downstream of the straights. We expect to have the east leg up and running hopefully within the next few weeks. We’ve obviously been working with our federal regulator to demonstrate that the pipeline is fit for service and the regulator is working through that right now, once that’s complete, we’ll make an application to the court to have the temporary restraining order amended to allow for the start-up of the east leg, which will then provide redundancy on Line 5. I don’t think there’s any real magic there from an EBITDA perspective. On DAPL, prior with the downturn in Bakken volumes, we do have some space on our legacy North Dakota line that runs into Clearbrook, and we also have some space on our Bakken expansion project that runs up from the Bakken back into Canada at Cromer. I think ballpark-wise, we can handle a couple hundred thousand barrels a day of incremental flows very easily, and then we’re working on incremental optimizations to allow us to even move more crude should that be required. I think we’re in pretty good shape to be able to take--to offset a lot of the production coming out of the Bakken. Then obviously as those barrels hit our system, we will then [indiscernible] from the downstream pipeline takeaway throughput that takes those volumes to other markets.

Robert, this is Colin. Just to confirm that, at a high level, I think as Vern was saying, we don’t see any material impact from these in the back half of the year, so that’s what’s embedded in our guidance. I think on Dakota Access pipeline, just high level sensitivity there, on a full year basis DAPL represents about $250 million to $300 million a year of EBITDA, which is about 2% of consolidated EBITDA, and I think as Vern mentioned, while we don’t want to see it out of service, there are avenues to substantially mitigate that on our system.

Thank you. Just to finish, Al, you mentioned the energy transition earlier. There’s been a lot of questions on the call just around your strategy around asset mix and capital allocation, and with the asset mix and sustainable infrastructure, whether it’s right or wrong, you’ve got negativity towards your pipeline business, including at least in some circles gas infrastructure. With that, what are your thoughts on harvesting free cash flow from the pipeline business and accepting less attractive returns in renewable energy, or do you just take the view that your assets are what they are, you do the best you can with sustainability, benchmarking against your peers, and just continue your discipline of investing capital at the highest risk-adjusted returns, regardless of where those opportunities are?

Yes, I think it’s the latter, just given the comments before on capital allocation and how we look at future investment. In terms of the asset mix today, I think when we repositioned the asset mix to almost 50/50, I’m going to call it, between natural gas and the liquids businesses, with a little bit in there for renewables, I think we’re happy with the mix there. There’s certainly energy transition in play here, but in the end it’s going to come down to the competitiveness of assets to each of the key markets, and that’s where I think we’re going to be really strong whether it’s liquids, whether it’s natural gas, utility or transmission. The reason I’m saying that is because in the end, it’s going to come down to the fundamentals, and if you can be the most competitive system into each one of these markets, the transition is happening but it’s certainly not going to happen over a short period of time. So we think we’re pretty solid on each of the businesses for decades to come. If we do see something where we can, I think you called it harvest or sell, then we would look at that, but at this point we’re pretty happy with the asset base. We’ve kind of done the monetizations and sales that we thought were most important, so that’s how we’re looking at this at a high level. If I haven’t gotten to the crux of what you’re getting at, let me know.

No, that’s great. Thank you very much.

Thank you. Our next question comes from the line of Shneur Gershuni from UBS. Your question, please?

Hi, good morning everyone. Happy to hear that everyone is safe and well. Maybe to start off, a broad capex type of question. Line 3 is kind of delayed at this point right now; at the same time, you’ve announced a couple new projects that you’ve secured. How does capex shift around in terms of the delay as well as the announcements? Does capex potentially come down a little bit this year, does it go up next year? How should we think about the total capex number as we think about 2020 and ’21? With respect to the new projects that were added to the backlog, can you confirm that they’re utility-type projects that are tantamount to a rate base type of expansion opportunity, and is that the priority going forward?

Hey Shneur, it’s Colin. Good question. I think on Line 3, I alluded to this in my remarks, we’ve got approximately CAD $2 billion left to spend on Line 3 U.S. here, and we’ve earmarked approximately $1.5 billion of that to next year, we just moved it. As I noted, this year’s capex is lower than guided in December of 2019, so we’ll have a little more next year. But overall, the capex budget is declining as we go forward here, which should help us generate free cash flow. You’re right - I think marrying your question maybe with Robert’s at the beginning, our capital allocation framework and adders, risk premia are indeed channeling us towards lower beta projects, if you like, the in-corridor expansions, extensions, modernizations, executable projects, so indeed--and if you need a list of them, they’re basically outlined in that $11 billion secured project listing that we’ve been carrying.

On that $1 billion, Shneur, $300 million of that, let’s call it conventional utility capital - it’s basically reinforcements, and so that is very much right down the middle of the fairway. The other part is the renewable project that we sanctioned offshore France. I’d have to say that one is at least as good in terms of the risk profile, as I mentioned in my remarks. That one has got this other feature where the wind variability that you typically see in these projects is actually quite limited, because there’s a collar on it. Then in terms of the size of it, remember that project will be project financed in terms of how it’s funded, so we’ll actually put quite a bit less equity into that relative to the overall debt equity split within the company. That’s how--hopefully that answers what you’re getting at.

It does. Really appreciate the color and the detail on that. Maybe as a follow-up question, I know there’s been a lot of questions today about capital allocation and in terms of projects and free cash flow harvesting and so forth. I was wondering if maybe we can pivot a little bit and talk about the balance sheet. Rates out there right now are extremely low. One of your U.S. peers issued debt this week at fairly low levels in terms of rates. You’ve pre-funded--or you’ve funded ’20, you’ve started pre-funding ’21. What are the thoughts around extending the maturity profile as you’re in the market right now to sort of take advantage of and capitalize on the current rate environment?

Shneur, it’s Colin. Thanks for that question. Indeed rates are low and attractive, and indeed we’ve been capitalizing on that trend ourselves. Any time you can issue 10-year debt in the mid-2 range is probably a non-regret move on a tax deductible basis. We have observed this, we’re participating in it, and we have been extending our maturity through this process as well. I think our average maturity is about 17 years now, so we’re happy with that. It matches our long-lived asset base, so it’s a good point. I agree with it.

All right, perfect. Well, thank you very much, guys. Really appreciate all the color today, and have a safe day.

Thanks Shneur.

Thank you. Our next question comes from the line of Linda Ezergailis with TD Securities. Your question, please?

Good morning. Looking at your long term growth beyond 2022, it’s great to see you reaffirming the 5% to 7% Dcf per share growth and providing some visibility on enhancing the 1% to 2% base optimization beyond 2022. Can you help me understand what the possibilities are in terms of magnitude? Could you double that to 3% to 4%, and implicitly should we assume that maybe that’s being done to maintain that 5% to 7% growth rate prospectively, suggesting that the secured growth contribution to growth might decelerate a little bit?

Linda, it’s Al here. First of all, I think you’d expect growth overall to be slowing down in the industry. I mean, that’s just a reality, I think, in this environment when you’ve got a major disruption and specifically you have--and you see the numbers probably better than we do, the economic contraction overall going on is undeniable. I think we’re going to probably be really well positioned in this downturn with respect to continuing growth. We’ll look at other things to do with capital as well in case we can’t find the opportunities that we’ve been focused on and pretty good at. I think, to get to the root of your question, though, I wouldn’t want to specify that distinctly what the first bucket would be. If we can add another percentage to it, I think we’d be pretty happy. The way I look at it is if we can add more there, it certainly would offset some of the things that we might not seeing coming in secured growth beyond 2022. That’s how we’re looking at it. When we see the--you’ll recall back at Enbridge Day, we said to generate that 4% to 5%, we’d probably need to spend roughly $5 billion a year in new project execution. It sounds like a big number, and it is; but when you break it down by business - you know, Bill’s got lots going on, I mentioned over a billion dollars just in GDS, the utility. Power’s got some projects, liquids can optimize, and frankly if we can get more of the growth rate with these low capital intensive optimizations, expansions or modernizations of the system, and Bill’s is a good example of that, Bill’s area, then I think we can see ourselves getting pretty darn close to that. So although generally the market’s less growth-y going forward, I think that’s a reality. I think we should be in good shape to get pretty darn close.

That’s helpful context, thank you. Just as a follow-up, I guess one of the other levers you have is the growth aspirations on a per-share basis. I’m wondering what might trigger consideration of a share buyback, and also to the extent that you don’t need to partner or sell assets to pension funds and other financial investors, I’m just wondering if you were approached with a very compelling offer to do further JVs like you have recently with your offshore wind, is that another lever that you would seriously consider, balancing off, I guess, the complexity associated with that potentially?

Yes, it’s a good observation, and the short answer is yes, because I think if--I mean, we’ve got some great franchises and they’re certainly core to us, so we wouldn’t want to see them necessarily just be sold off, but if somebody is presenting compelling value and you’ve got some good reinvestment opportunities, then we’d have to look at that. We have big businesses so it would obviously be constrained to pieces and JVs, so that’s probably what you’re getting at. I guess linked to that, which was the other part of your question, had to do with buybacks. We’re going to look at that pretty carefully. I think we’ve said before, we will make sure that that’s part of our capital allocation review, and I would say, Linda, at this price it’s a pretty obvious source of growth, if you want to look at that on a per-share basis, like you were mentioning. Other considerations, though, aside from the fact that the assets that we have are core to our growth and they’ve got a lot of embedded growth in them, we already return a boatload of capital through the dividend - I think Colin will correct me, it’s probably in the $6.5 billion range annually. The other thing too, Linda, is we tend to look at these on a full cycle basis, so whereas yes, we can make something accretive by buying back shares, we tend to compare that to not just short term accretion but what are we going to get out of the buyback in the longer term, and so we look at what else we could do with that if we had growth opportunities. I think really this comes down for us to more of a timing thing. We’ll certainly look at buybacks, especially at this price, once we get Line 3. I think until that, we are still in pretty heavy capital investment mode here. I think that’s how to look at it in general terms.

That’s helpful, thank you.

Thank you. Our next question comes from the line of Patrick Kenny from National Bank Financial. Your question, please?

Good morning guys. Just on the mainline contracting, I know it’s still early days, but given the value of pipe in the ground, as you mentioned, Al, and the mounting challenges of getting new pipe capacity built, are you starting to see additional commercial support come in from shippers? It looks like that 70% support number hasn’t changed yet, but if competing projects continue to be challenged, to say the least, could that not alone bring in further support for your mainline offering over the coming quarters, or do you think you’re at the point where you would need to refine the terms in order to achieve a level of support well above 70%?

I’ll make a quick comment and then I’ll turn it to Vern. On your point about additional support, I think at this phase of where we’re at, having filed the application, I wouldn’t see necessarily somebody coming out and saying, we changed our minds. I think while we’re in this application process, we’re probably not going to see much change in that, and the focus would be on making sure that everybody is still with us. I wouldn’t have expected anybody to be added to the list at this point. I don’t know, Vern, if you want to expand a bit on his question?

Okay, I think you’ve hit most of it, Al. I think the only nuance I would make is that we continue to talk to the producing community here in Calgary who are the primary opponents to mainline contracting. Those people are of different views on why this may not be the best thing for them. Some just don’t like the toll, they just believe it’s too high. Others are waiting to see how the competing pipelines play out, and then there’s finally the smaller producers who, quite frankly, are just coming up the learning curve on how this all works, and we focus most of our attention to see if we can get a few more of those people into our camp and we’ll continue to do that as we go through the CER process.

I think the one thing that the application has helped, though, is the question and answer part of it. I think it’s starting to maybe gel a little bit, and this is not an easy thing to really absorb at 100,000 feet. You’ve got to kind of get into what the value drivers are, and I think as I mentioned in here, it really comes down to the predictability of those tolls. That’s really what I think will be the key value driver. But I wouldn’t sell short the fact that having locked in demand from the best market in North America is another key factor along with this concept of the marginal toll economics, that again I think is starting to get some headway with people who are really actually now starting to look at how is this going to affect them. I think it’s easy to say, well, we don’t want to do this or that, but I think people are starting to get a bit of that story.

Okay, I appreciate that color. Then just a quick follow-up on the DAPL situation, if I could. I know you’re not in the driver’s seat there, but can you clarify when you expect that court decision on the pipe being shut down or not? Is clarity by next week before that initial August 5 deadline reasonable, or could this drag on for another few weeks here?

I think that’s for Energy Transfer to comment on how the core proceedings are going to play out. I think that’s all I can say. It’s in front of the U.S. Court of Appeals right now.

Got it, okay. Thanks guys.

Thank you. Our next question comes from the line of Ben Pham from BMO. Your question, please?

Thanks. Good morning. On the U.S. election, if the polls are correct and Biden wins, what do you think the impact is on your business, if any, on your existing U.S. assets, projects under construction, Line 3, anything else - tax rates, that’s worth commenting on?

Well I guess, Ben, it’s a good question. I mean, that’s certainly something on everybody’s mind, I think. Specifically to the last part, there’s nothing different that we expect on Line 3. I think the fundamental there is it’s a state process and we’re right into working with Minnesota, as you know, for quite a while, so I’m not sure that one really plays into the change in administration, if in fact that happens. It’s always something we contemplate and look at whenever you have a potential administration change. I think the point is, frankly, we work pretty well with all administrations, even the previous one on many fronts. I think it’s probably a little too early to tell, honestly Ben, what the policy implications will be and what it means to infrastructure, but certainly we don’t see any major change, and really that’s because in the end, as I said earlier, it’s pretty clear that our assets are going to be critical to the economic growth in North America. A lot of, as I said, what we do falls into that state regulatory and permitting camp, and I guess by the way, Vern, we don’t have any--I guess we’re not seeking any federal cross-border permits at this point, so all in I don’t see it as a big factor. We’re watching it, obviously Ben, but generally we think we’ll be in good shape.

Okay, thanks for that. Maybe a follow-up on the earlier question about hydrogen and the response to your study. It’s still early days, but quite expensive. Are you at the point in the next 12 months to put some dollars into some pilot investments? Then also curious, is the study, is it more to gas utilities [indiscernible] are you also talking with Canadian producers more broadly exporting hydrogen on pipes and more of a broader discussion on studying the hydrogen opportunity?

It’s probably two fronts. I would say the more imminent certainly in the utility - you know, Cynthia and her team are working diligently on this. You heard Bill’s comment about how that might work through the gas transmission side. This is all, I think, in the realm of, call it blue hydrogen, and to answer your question, I think yes, we are at the point where we could certainly see putting in small amounts of capital to prove out our understanding of this. I think we’ve got a pretty good head start on this. People have been working on it in the company for quite a while, and I think we’ll be in good shape so that when we put in some amounts to test things out which I think is appropriate for us, then we’ll have pretty good confidence around that. Not huge amounts, mind you Ben, but yes, I think we can start to do some pilot investing for sure.

All right, that’s great. Thanks Al.

Thank you. We have reached our time limit and are not able to take any further questions at this time. I will now turn the call over to Jonathan Morgan for final remarks.

Thank you, and thanks to everyone for taking the time to join us this morning. As always, we appreciate your continued interest in Enbridge and following the call, Investor Relations is available to address any follow-up questions you may have. Once again thank you, and have a great day.

Thank you. Ladies and gentlemen, we appreciate your participation. This concludes today’s conference. You may now disconnect.