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ACQUISITIONS AND DISPOSITIONS | 12 Months Ended
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Dec. 31, 2024
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] |
ACQUISITIONS AND DISPOSITIONS | ACQUISITIONS AND DISPOSITION BUSINESS COMBINATIONS We accounted for each of the acquisitions discussed below using the acquisition method as prescribed by ASC 805 Business Combinations. In accordance with valuation methodologies described in ASC 820 Fair Value Measurement, acquired assets and assumed liabilities are recorded at their estimated fair values as at the date of acquisition. The fair values of regulatory assets and liabilities, which are subject to rate-setting and cost recovery mechanisms under ASC 980 Regulated Operations, are equal to their carrying values at acquisition. The recognition of regulatory assets and liabilities is based on the actions, or expected future actions, of the regulator. To the extent that the regulator's actions differ from our expectations, the timing and amount of recovery or settlement of regulatory balances could differ significantly from those recorded at acquisition. Public Service Company of North Carolina, Incorporated On September 30, 2024, through a wholly-owned US subsidiary, we acquired all of the membership interests of Fall North Carolina Holdco LLC, which owns 100% of PSNC, for cash consideration of $2.7 billion (US$2.0 billion) (the PSNC Acquisition). PSNC is a public utility primarily engaged in the purchase, sale, transportation and distribution of natural gas to residential, commercial and industrial customers in North Carolina. PSNC operates under rates approved by the North Carolina Commission. Subsequent to its acquisition, PSNC conducts business as Enbridge Gas North Carolina. The following table summarizes the estimated preliminary fair values that were assigned to the net assets of PSNC:
| September 30, 2024 1
(millions of Canadian dollars) |
Fair value of net assets acquired: |
Current assets (a) | 303 |
Property, plant and equipment (b) | 4,147 |
Long-term assets (c) | 189 |
Current liabilities | 277 |
Long-term debt (d) | 1,529 |
Other long-term liabilities (e) | 653 |
Deferred income tax liabilities | 365 |
Goodwill (f) | 895 |
Purchase price: |
Cash | 2,710 |
1 In the fourth quarter of 2024, immaterial adjustments were made to the PSNC Acquisition purchase price allocation. a) Current assets consist primarily of cash, trade and other accounts receivable, regulatory assets and inventory. The fair value of trade receivables from customers approximates their carrying value of $70 million due to the short period to maturity. A provision of $2 million for expected credit loss associated with accounts receivable has been recorded. b) PSNC's property, plant and equipment constitutes an integrated system of rate-regulated natural gas transmission, distribution and storage assets. For these rate-regulated assets, fair value was determined using a market participant perspective. Given the regulated nature of, and fixed return on the assets, the fair value of property, plant and equipment acquired is equal to its carrying value. c) Long-term assets consist primarily of $114 million of regulatory assets expected to be recovered from customers in future periods through rates and equity interests in a liquefied natural gas (LNG) storage facility in North Carolina and in an intrastate natural gas pipeline. d) The fair value of long-term debt was determined based on the current underlying US Treasury interest rates on instruments of similar credit risk and tenor, as well as an implied credit spread based on current market conditions. We recorded a fair value adjustment to reduce long-term debt by $156 million with no corresponding regulatory offset. e) Other long-term liabilities consist primarily of regulatory liabilities expected to be refunded to customers in future periods through rates. f) Goodwill is primarily attributable to the existing assembled assets and workforce of PSNC that cannot be duplicated at the same cost by a new entrant and the enhanced scale and geographic diversity of our regulated natural gas distribution business, which provides a platform for future growth and optimization with existing assets. The goodwill balance recognized has been assigned to our Gas Distribution and Storage segment and is not tax deductible. Upon completion of the PSNC Acquisition, we began consolidating PSNC. For the period beginning September 30, 2024 through to December 31, 2024, PSNC generated $284 million of operating revenues and $50 million of earnings attributable to common shareholders. Our supplemental pro forma consolidated financial information for the years ended December 31, 2024 and 2023, including the results of operations for PSNC as if the PSNC Acquisition had been completed on January 1, 2023, is as follows:
Year ended December 31, | 2024 | 2023
(unaudited; millions of Canadian dollars) |  |
Operating revenues | 54,116 |  | 44,614 |
Earnings attributable to common shareholders 1 | 5,149 |  | 5,944 |
1 Includes adjustment for pro forma interest expense on debt financing for the PSNC Acquisition of $48 million (after-tax of $37 million) for the year ended December 31, 2023. Questar Gas Company On May 31, 2024, through a wholly-owned US subsidiary, we acquired all of the membership interests of Fall West Holdco LLC which owns 100% of Questar and Wexpro for cash consideration of $4.1 billion (US$3.0 billion) (the Questar Acquisition). Questar is a public natural gas utility providing distribution, storage and transmission services to residential, commercial and industrial customers in Utah, southwestern Wyoming and southeastern Idaho. The Utah Commission, the Wyoming Commission and the Idaho Commission have granted Questar the necessary regulatory approvals to serve these areas. Wexpro develops and produces cost-of-service gas reserves for Questar and operates under agreements with the states of Utah and Wyoming. Subsequent to its acquisition, Questar conducts business as Enbridge Gas Utah, Enbridge Gas Wyoming and Enbridge Gas Idaho in those respective states. The following table summarizes the estimated preliminary fair values that were assigned to the net assets of Questar and Wexpro:
| May 31, 2024 1
(millions of Canadian dollars) |
Fair value of net assets acquired: |
Current assets (a) | 380 |
Property, plant and equipment (b) | 6,013 |
Long-term assets (c) | 163 |
Current liabilities | 416 |
Long-term debt (d) | 1,343 |
Other long-term liabilities (e) | 919 |
Deferred income tax liabilities | 527 |
Goodwill (f) | 793 |
Purchase price: |
Cash | 4,144 |
1 In the fourth quarter of 2024, immaterial adjustments were made to the Questar Acquisition purchase price allocation. a) Current assets consist primarily of cash, trade and other accounts receivable and inventory. The fair value of trade receivables from customers approximates their carrying value of $202 million due to the short period to maturity. A provision of $9 million for expected credit loss associated with accounts receivable has been recorded. b) Questar's property, plant and equipment constitutes an integrated system of rate-regulated natural gas transmission, distribution and storage assets. Wexpro's property, plant and equipment consists of cost-of-service gas and oil properties developed and produced for Questar. For these rate-regulated assets, fair value was determined using a market participant perspective. Given the regulated nature of, and fixed return on the assets, the fair value of property, plant and equipment acquired is equal to its carrying value. c) Long-term assets consist primarily of funds collected from Questar by Wexpro and held in trust to fund future AROs, as well as regulatory assets expected to be recovered from customers in future periods through rates. d) The fair value of long-term debt was determined based on the current underlying US Treasury interest rates on instruments of similar credit risk and tenor, as well as an implied credit spread based on current market conditions. We recorded a fair value adjustment to reduce long-term debt by $301 million with no corresponding regulatory offset. e) Other long-term liabilities consist primarily of regulatory liabilities, expected to be refunded to customers in future periods through rates, as well as ARO. The fair value of the ARO liability was determined using a discounted cash flow approach. f) Goodwill is primarily attributable to the existing assembled assets and workforce of Questar and Wexpro that cannot be duplicated at the same cost by a new entrant and the enhanced scale and geographic diversity of our regulated natural gas distribution business, which provides a platform for future growth and optimization with existing assets. The goodwill balance recognized has been assigned to our Gas Distribution and Storage segment and is not tax deductible. Upon completion of the Questar Acquisition, we began consolidating Questar and Wexpro. For the period beginning May 31, 2024 through to December 31, 2024, Questar and Wexpro generated $755 million of operating revenues and $75 million of earnings attributable to common shareholders. Our supplemental pro forma consolidated financial information for the years ended December 31, 2024 and 2023, including the results of operations for Questar and Wexpro as if the Questar Acquisition had been completed on January 1, 2023, is as follows:
Year ended December 31, | 2024 | 2023
(unaudited; millions of Canadian dollars) |  |
Operating revenues | 54,698 |  | 45,918 |
Earnings attributable to common shareholders 1 | 5,193 |  | 6,005 |
1 Includes adjustment for pro forma interest expense on debt financing for the Questar Acquisition of $70 million (after-tax of $53 million) for the year ended December 31, 2023. The East Ohio Gas Company On March 6, 2024, through a wholly-owned US subsidiary, we acquired all of the outstanding shares of capital stock of EOG for cash consideration of $5.8 billion (US$4.3 billion) (the EOG Acquisition). EOG is a public natural gas utility providing distribution, storage and transmission services to residential, commercial and industrial customers in Ohio and is regulated by the Ohio Commission. Subsequent to its acquisition, EOG conducts business as Enbridge Gas Ohio. The following table summarizes the estimated preliminary fair values that were assigned to the net assets of EOG:
| March 6, 2024 1
(millions of Canadian dollars) |
Fair value of net assets acquired: |
Current assets (a) | 493 |
Property, plant and equipment (b) | 7,276 |
Long-term assets (c) | 1,689 |
Current liabilities | 551 |
Long-term debt (d) | 2,612 |
Other long-term liabilities (e) | 1,001 |
Deferred income tax liabilities | 1,045 |
Goodwill (f) | 1,603 |
Purchase price: |
Cash | 5,852 |
1 In the fourth quarter of 2024, immaterial adjustments were made to the EOG Acquisition purchase price allocation. a) Current assets consist primarily of trade and other accounts receivable, prepaid expenses, regulatory assets and inventory. The fair value of trade receivables from customers approximates their carrying value of $379 million due to the short period to maturity. A provision of $3 million for expected credit loss associated with accounts receivable has been recorded. b) EOG's property, plant and equipment constitutes an integrated system of rate-regulated natural gas transmission, gathering, distribution and storage assets. For these rate-regulated assets, fair value was determined using a market participant perspective. Given the regulated nature of, and fixed return on the assets, the fair value of property, plant and equipment acquired is equal to its carrying value. c) Long-term assets consist primarily of overfunded pension plan assets of $367 million and $1.2 billion of regulatory assets expected to be recovered from customers in future periods through rates. Pension plan assets attributable to the workforce acquired from EOG were transferred in cash to an Enbridge-sponsored pension plan based on their fair value as at March 6, 2024. The fair value of plan assets was determined using unadjusted quoted market prices for identical investments. d) The fair value of long-term debt was determined based on the current underlying US Treasury interest rates on instruments of similar credit risk and tenor, as well as an implied credit spread based on current market conditions. We recorded a fair value adjustment to reduce long-term debt by $478 million with no corresponding regulatory offset. e) Other long-term liabilities consist primarily of regulatory liabilities expected to be refunded to customers in future periods through rates. f) Goodwill is primarily attributable to the existing assembled assets and workforce of EOG that cannot be duplicated at the same cost by a new entrant and the enhanced scale and geographic diversity of our regulated natural gas distribution business, which provides a platform for future growth and optimization with existing assets. The goodwill balance recognized has been assigned to our Gas Distribution and Storage segment and is not tax deductible. Upon completion of the EOG Acquisition, we began consolidating EOG. For the period beginning March 6, 2024 through to December 31, 2024, EOG generated $1.2 billion of operating revenues and $190 million of earnings attributable to common shareholders. Our supplemental pro forma consolidated financial information for the years ended December 31, 2024 and 2023, including the results of operations for EOG as if the EOG Acquisition had been completed on January 1, 2023, is as follows:
Year ended December 31, | 2024 | 2023
(unaudited; millions of Canadian dollars) |  |
Operating revenues | 53,788 |  | 45,058 |
Earnings attributable to common shareholders 1 | 5,130 |  | 5,961 |
1 Includes adjustment for pro forma interest expense on debt financing for the EOG Acquisition of $100 million (after-tax of $77 million) for the year ended December 31, 2023. The purchase price allocations for the PSNC Acquisition, Questar Acquisition and EOG Acquisition (together, the Acquisitions) were prepared on a preliminary basis and are subject to change as additional information becomes available concerning the fair values of the ARO and regulatory balances and their tax bases. Any adjustments to the purchase price allocations will be made as soon as practicable, but no later than one year from the date of each acquisition. The Acquisitions further diversify, and are complementary to, our existing gas distribution operations. Acquisition of RNG Facilities On January 2, 2024, through a wholly-owned US subsidiary, we acquired six Morrow Renewables operating landfill gas-to-RNG production facilities (Tomorrow RNG) located in Texas and Arkansas for total consideration of $1.3 billion (US$1.0 billion), of which $584 million (US$439 million) was paid at close and an additional deferred consideration is payable within two years with a fair value of $757 million (US$568 million) (the RNG Facilities Acquisition). The acquired assets align with and advance our lower-carbon strategy. The following table summarizes the estimated fair values that were assigned to the net assets of Tomorrow RNG:
| January 2, 2024
(millions of Canadian dollars) |
Fair value of net assets acquired: |
Current assets | 31 |
Intangible assets (a) | 925 |
Property, plant and equipment (b) | 174 |
Current liabilities | 5 |
Goodwill (c) | 223 |
Purchase price: |
Cash | 584 |
Deferred consideration (d): |
Current portion of long-term debt | 550 |
Long-term debt | 207 |
Other adjustments | 7 |
| 1,348 |
a) Intangible assets consist of long-term gas supply agreements with the respective facility's landfill owner. Fair value was determined using an income-based approach, specifically the multi-period excess earnings method, by estimating the present value of the after-tax cash flows attributable to the gas rights. The intangible assets will be amortized on a straight-line basis over the term of the respective agreement, inclusive of extension options, which range from 13 to 42 years (approximately nine years to the next extension period on a weighted-average basis). b) Tomorrow RNG's property, plant and equipment constitutes specialized landfill gas plant and equipment which collects gas produced by waste decomposition, treats and compresses the gas to pipeline specifications. The direct method of replacement cost was used to determine the majority of the fair value of property, plant and equipment. Adjustments were then applied for estimated physical deterioration. c) Goodwill is primarily attributable to expected future returns from a portfolio of both operating and scalable RNG assets, furthering the diversity of our renewable projects portfolio and accelerating progress toward our energy transition goals. The goodwill balance recognized has been assigned to our Gas Transmission segment and is tax deductible over 15 years. d) We entered into six non-interest bearing promissory notes due to Morrow Renewables, the total value of which represents deferred payments of $808 million (US$606 million) due within two years. The first and second payments are due on January 2, 2025 and December 31, 2025, respectively. The $757 million (US$568 million) recognized in the purchase price represents the fair value of deferred consideration at the date of acquisition using the imputed interest rate method over the terms of the notes. Upon completion of the RNG Facilities Acquisition, we began consolidating Tomorrow RNG. For the period beginning January 2, 2024 through to December 31, 2024, operating revenues and earnings attributable to common shareholders generated by Tomorrow RNG were immaterial. The impact to our supplemental pro forma consolidated operating revenues and earnings attributable to common shareholders for the years ended December 31, 2024 and 2023, as if the RNG Facilities Acquisition had been completed on January 1, 2023, was also immaterial. Aitken Creek Gas Storage On November 1, 2023, through a wholly-owned Canadian subsidiary, we acquired a 93.8% interest in Aitken Creek Gas Storage Facility and a 100% interest in Aitken Creek North Gas Storage Facility (collectively, Aitken Creek), located in BC, Canada, for $400 million (the Aitken Creek Acquisition). Aitken Creek is the only underground natural gas storage facility in BC and connects to all major natural gas pipelines in western Canada. The Aitken Creek Acquisition enables us to continue to meet regional energy needs and to support increasing demand for LNG exports. The following table summarizes the estimated fair values that were assigned to the net assets of Aitken Creek:
| November 1, 2023
(millions of Canadian dollars) |
Fair value of net assets acquired: |
Current assets (a) | 105 |
Property, plant and equipment (b) | 466 |
Current liabilities | 20 |
Long-term liabilities (c) | 130 |
Goodwill (d) | 46 |
Purchase price: |
Cash | 397 |
Additional consideration (e) | 70 |
| 467 |
a) Current assets consist primarily of inventory which is short-term in nature and represents natural gas held in storage. Fair value was determined using the market price of natural gas at the date of acquisition. b) Aitken Creek's property, plant and equipment constitutes an integrated system of cavern storage facilities, associated header pipeline, and land and right-of-ways. The depreciated replacement cost approach was adopted as the primary valuation methodology to determine the fair value of property, plant and equipment, excluding the reservoir storage asset. In determining replacement cost, both indirect costing using relevant inflation indices and direct costing using relevant market quotes were utilized. Adjustments were then applied for physical deterioration as well as functional and economic obsolescence. Fair value of the reservoir storage asset was determined using a residual approach whereby the adjusted purchase price was allocated to the fair value of the net tangible assets, excluding the reservoir storage asset, with the remaining value allocated to the reservoir storage asset. The income approach was also utilized to corroborate that the cash flows attributable to the reservoir storage asset support the residual value. c) Long-term liabilities consist primarily of a deferred income tax liability arising from temporary differences between the tax bases of assets and liabilities and their carrying values for accounting purposes at the date of acquisition. d) Goodwill is primarily attributable to the recognition of a deferred income tax liability. The goodwill balance recognized has been assigned to our Gas Transmission segment and is not tax deductible. e) The $70 million of additional consideration recognized in the purchase price represents the fair value of derivative contracts and working gas as at March 31, 2023. Upon completion of the Aitken Creek Acquisition, we began consolidating Aitken Creek. For the period beginning November 1, 2023 through to December 31, 2023, operating revenues and earnings attributable to common shareholders generated by Aitken Creek were immaterial. The impact to our supplemental pro forma consolidated operating revenues and earnings attributable to common shareholders for the years ended December 31, 2023 and 2022, as if the Aitken Creek Acquisition had been completed on January 1, 2022, was also immaterial. Tri Global Energy, LLC On September 27, 2022, through a wholly-owned US subsidiary, we acquired all of the outstanding common units in TGE for cash consideration of $295 million (US$215 million) plus potential contingent payments of up to $72 million (US$53 million) dependent on the achievement of performance milestones by TGE (the TGE Acquisition). TGE is an onshore renewable project developer in the US with a development portfolio of wind and solar projects. The TGE Acquisition enhances Enbridge's renewable power platform and accelerates our North American growth strategy. The following table summarizes the estimated fair values that were assigned to the net assets of TGE:
| September 27, 2022
(millions of Canadian dollars) |
Fair value of net assets acquired: |
Current assets | 5 |
Property, plant and equipment | 3 |
Long-term investments | 8 |
Intangible assets (a) | 117 |
Long-term assets | 3 |
Current liabilities | 61 |
Long-term debt | 18 |
Long-term liabilities (b) | 105 |
Goodwill (c) | 392 |
Purchase price: |
Cash | 295 |
Contingent consideration (d) | 49 |
| 344 |
a) Intangible assets consist of compensation expected to be earned by TGE on existing development contracts once certain project development milestones are met. Fair value was determined using a discounted cash flow method which is an income-based approach to valuation that estimates the present value of future projected benefits from the contracts. The intangible assets will be amortized on a straight-line basis over an expected useful life of three and a half years. b) Long-term liabilities consist primarily of obligations payable to third parties which are contingent on milestones being met for certain projects. Fair value represents the present value of the future cash flow payments at the date of the TGE Acquisition. c) Goodwill is primarily attributable to expected future returns from new opportunities to develop wind and solar projects, as well as enhanced scale and operational diversity of our renewable projects portfolio. The goodwill balance recognized has been assigned to our Renewable Power Generation segment and is tax deductible over 15 years. d) We agreed to pay additional contingent consideration of up to $72 million (US$53 million) to TGE's former common unit holders if performance milestones were met on certain projects. The $49 million (US$36 million) of contingent consideration recognized in the purchase price represents the fair value of contingent consideration at the date of acquisition. The fair value was determined using an income-based approach. Upon completion of the TGE Acquisition, we began consolidating TGE. For the period beginning September 27, 2022 through to December 31, 2022, operating revenues and earnings attributable to common shareholders generated by TGE were immaterial. The impact to our supplemental pro forma consolidated operating revenues and earnings attributable to common shareholders for the years ended December 31, 2022 and 2021, as if the TGE Acquisition had been completed on January 1, 2021, was also immaterial. ASSET ACQUISITION Tres Palacios Holdings LLC On April 3, 2023, we acquired Tres Palacios Holdings LLC (Tres Palacios) for $451 million (US$335 million) of cash. Tres Palacios is a natural gas storage facility located in the US Gulf Coast and its infrastructure serves Texas gas-fired power generation and LNG exports, as well as Mexico pipeline exports. We allocated assets with a fair value of $790 million (US$588 million) to Property, plant and equipment, net, of which $254 million (US$189 million) relates to storage cavern right-of-use assets, and recorded the related lease liabilities of $7 million (US$5 million) and $248 million (US$184 million) to Current portion of long-term debt and Long-term debt, respectively, in the Consolidated Statements of Financial Position. The acquired assets are included in our Gas Transmission segment. DISPOSITION Athabasca Regional Oil Sands System On October 5, 2022, we closed the sale of an 11.6% non-operating interest in seven pipelines in the Athabasca region of northern Alberta from our Regi onal Oil Sands System to Athabasca Indigenous Investments Limited Partnership (Aii), an entity representing 23 First Nation and Métis communities, for total consideration of approximately $1.1 billion. No gain or loss was recognized on the sale and a noncontrolling interest was recorded in our Consolidated Statements of Financial Position beginning in 2022 to reflect the interest held by Aii (Note 19). Subsequent to the sale, we maintained an 88.4% controlling interest in these assets, which are a component of our Liquids Pipelines segment, and continue to manage, operate and provide administrative services to them.

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/805/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 205 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/205-20/tableOfContent + Details
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