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Understanding EEP’s Long-Term Contracts

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Liquids Pipelines contracts

Enbridge Energy Partners’ (EEP) Liquids Pipelines segment’s revenues are backed by low-risk, long-term contracts. The remaining contract life for the segment’s cost-of-service agreements for Lakehead system ranges from 20 to 30 years.

The above chart shows remaining contract life for EEP’s Liquids Pipelines segment. Lakehead system’s base toll, as well as the pipeline toll on the segment’s North Dakota and Mid-Continent systems, is indexed to a PPI (producer price index) of 1.23%. The prior PPI adjustment of 2.65% expired in June 2016.

In the next part of this series, we’ll analyze Enbridge Energy Partners’ leverage position.

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