Enbridge Inc. Q3/17 results in line. ENF credit downgrade throws dividend growth / funding guidance into flux HIGHLIGHTS. The NBF Daily Bulletin

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1 ENB (T/N) Stock Rating: Target: Risk Rating: $47.03; US$36.71 Outperform (Unchanged) Cdn$63.00 (Was $67.00) Above Average (Unchanged) Est. Total Return 39.7% Stock Data: 52-week High-Low (Canada) $ $ week High-Low (U.S.) $ $37.37 Bloomberg/Reuters: Canada ENB CT / ENB.TO Bloomberg/Reuters: U.S. ENB US / ENB (Year-End Dec.31) 2016a 2017e 2018e EBITDA (mln) 6,902 10,401 12,748 Maint. Capex (mln) 671 1,339 1,692 Free-EBITDA (mln) 6,231 9,062 11,056 EV/Free-EBITDA 25.6x 17.6x 14.4x EPS (Basic) $2.29 $1.98 $2.70 P/E 20.5x 23.8x 17.4x AFFO/sh (Basic) $4.09 $3.69 $4.26 P/AFFO 11.5x 12.7x 11.0x Dividend per Share $2.12 $2.39 $2.68 Dividend Yield 4.5% 5.1% 5.7% Adj. Payout Ratio 52% 64% 63% D/EBITDA 6.2x 6.7x 5.6x Financial Data: Shares Outstanding (mln) 1,675.6 Market Capitalization (mln) 78,802 Net Debt (mln) 80,751 Enterprise Value (mln) $159,553 Total Debt/Enterprise Value 51% Total Return 39.7% Industry Rating: Market Weight: Energy Equipment/Services; Oil/Gas/Consumable Fuels Underweight: Chemicals; Utilities (NBF Economic & Strategy Group) November 3, 2017 Enbridge Inc. Q3/17 results in line The NBF Daily Bulletin Pipelines, Utilities & Energy Infrastructure ENF credit downgrade throws dividend growth / funding guidance into flux HIGHLIGHTS Q3/17 results in line, but Enbridge reported Q3 AFFO/sh of $0.82, largely in line with our $0.77 estimate (Street: $0.82), while reiterating 2017 AFFO/sh guidance of $3.60 to $3.90. dividend growth / funding guidance in flux On Oct. 19 th, Moody s downgraded Enbridge Income Fund (ENF) to Baa3 from Baa2 citing very high levels of leverage and ongoing execution risk on the Line 3 Replacement project. With ENF down >10% since the downgrade, ENB was asked on its Q3 call if it still makes sense to issue equity at ENF versus ENB, to which management pointed towards relative valuations in determining where it will be most cost effective i.e., exacerbating the equity overhang on ENB related to potentially backstopping ENF s annual equity raise of ~$700 mln. Meanwhile, when asked to reaffirm its 10-12% annual dividend growth guidance through 2024, management indicated that its dividend growth profile is plan-dependent, which will be covered at Enbridge Days (Dec. 12/13) i.e., is a change in dividend growth policy on the horizon? Target down $4 to $63; Line 3R upside for free! Our target moves down $4 to $63 as we revise our DDM valuation yield to 4.25% from 4.0%, reflecting risk to our linear 10% annual dividend growth forecast through That said, our $63 valuation reflects a long-term average 11.5x multiple of our pro forma Line 3R AFFO/sh (2020e). Excluding Line 3R in our model, the stock is trading <10x our run-rate AFFO/sh of ~$4.75, suggesting free upside of ~$8/sh (>15%) related to Line 3R accretion, underpinning our OP rating. Company Profile: Enbridge Inc. holds energy infrastructure assets within the following business segments: Liquids Pipelines, Gas Distribution, Energy Services, Gas Pipelines & Processing, and Power. The Enbridge System, the Mainline System which represents 60% of the Liquids segment, has a capacity of ~2.5 mmbpd, transporting various grades of crude oil and diluted bitumen from Western Canada to the Chicago area and Eastern Canada. It also owns a 50% interest in the Alliance Pipeline, transporting ~ 1.6 bcf/d of natural gas from Western Canada to the Chicago area. Patrick Kenny, CFA - (403) patrick.kenny@nbc.ca Associates: Dave Nielsen, CFA - (403) dave.nielsen@nbc.ca Chris Chow - (403) chris.chow@nbc.ca Stock Performance (source: Bloomberg) Price ($/sh) $ $ $ $ $ $ $ Nov/16 Jan/17 Mar/17 May/17 Jul/17 Sep/17 Nov/17 Volume (Millions)

2 Q3/17 results in line guidance in check Enbridge reported Q3 AFFO/sh of $0.82, largely in line with our $0.77 estimate (Street: $0.82) on adj. EBITDA of $2,586 mln versus our $2,649 mln estimate (Street: $2,778 mln), with lower contributions from Liquids Pipelines (transient upstream outages) offset by lower maintenance capex. Of note, Q3 Mainline volumes of ~2.5 mmbpd are poised to exceed record levels of 2.6 mmbpd as Fort Hills and other oil sand projects ramp up production through Overall, ENB reiterated its 2017 AFFO/sh guidance of $3.60 to $3.90 (NBF: $3.67). Q AFFO RECONCILIATION Actual Estimate Variance Per Share Segment ($mln) ($mln) ($mln) $/sh Adj. EBITDA by segment Liquids Pipelines 1,353 1,428 (75) -$0.05 Gas Distribution $0.01 Gas Pipelines and Processing $0.01 Green Power and Transmission (20) -$0.01 Energy Services (24) - (24) -$0.01 Eliminations & Other 10 (22) 32 $0.02 Adj. EBITDA 2,586 2,649 (63) -$0.04 Interest expense (728) (685) (43) -$0.03 Cash taxes (22) (32) 10 $0.01 NCI (200) (299) 99 $0.06 Maintenance (360) (423) 63 $0.04 Other (5) $0.00 AFFO 1,334 1, $0.08 AFFO/sh - Basic $0.82 $0.77 Source: Company Report, NBF Estimates Project update - Line 3R advancing + secured growth outlook intact Line 3 Replacement update Recall, construction began this summer to replace select segments of the Line 3 pipeline in Canada and the United States (regulatory permitting in place in Canada, North Dakota and Wisconsin). Hearings are currently taking place in Minnesota with a regulatory decision expected by Q2/18. As part of that process, ENB received the Final Environmental Impact Statement from the Minnesota Department of Commerce in August with the adequacy determination expected from the Minnesota Public Utilities Commission (MPUC) in December and a parallel Certificate of Need and Route Permit. The in-service date remains on track for H2 2019, with a finalized cost estimate of $5.3 bln in Canada + US$2.9 bln in the United States reflecting a 9% increase vs. the original estimate in The revised cost estimate is primarily due to regulatory process delays, scope changes and route modifications. As shown in the following table, by 2019 the WCSB will have 4.0 mmbpd for export (i.e., 4.6 mmbpd production net of 0.6 mmbpd local refining). Assuming average operational capacity

3 at 90% of nameplate capacity, and including +370 mbpd added with the Line 3R project, we calculate total export pipeline capacity utilization of 101% - i.e., confirming the need for at least one more export pipeline (Trans Mountain Expansion or Keystone XL). $31 bln secured program update In Q3/17, ENB brought $3 bln of its $31 bln (unchanged) capital program into service, including the JACOS Hangingstone lateral, Texas Eastern and Algonquin natural gas pipeline expansions, Chapman Ranch wind project (Texas) and Ontario utility projects. ENB / SPECTRA - SECURED GROWTH PROGRAM Projects - values in $blns COD Capex Projects - values in $blns COD Capex 2017 ENB ROSS Optimization (Athabasca Twin) In service ENB Rampion Offshore Wind Q2/ ENB Norlite Diluent Pipeline In service 0.9 ENB Stampede Lateral Q3/ ENB Bakken Pipeline System (1) In service 1.9 ENB EGD Core Capital ENB JACOS / Nexen Hangingstone In service 0.2 ENB Union Gas Core Capital ENB Chapman Ranch Wind Project In service 0.5 Spectra High Pine Q1/ ENB ROSS Optimization (Wood Buffalo) Complete / Q4/ Spectra Wyndwood H ENB EGD Core Capital In service + Q4/ Spectra NEXUS Q3/ ENB Union Gas Core Capital In service + Q4/ Spectra TEAL Q3/ Spectra Sabal Trail In service 2.0 Spectra Valley Crossing Q4/ Spectra Jackfish Lake In service 0.2 Spectra STEP Q4/ Spectra Gulf Markets - Phase II In service 0.1 Spectra PennEast Q4/ Spectra Access South, Adair SW & Lebanon Ext. In service + Q4/ Other Various 0.1 Spectra Atlantic Bridge In service + Q4/ Total 2018 Commercially Secured 7.0 Spectra 2017 Dawn - Parkway In service ENB HoHe See Offshore Wind project H Spectra Panhandle Reinforcement In service 0.3 ENB Line 3 Replacement (US&Canada) H Spectra RAM Q4/17 - Q3/ ENB Southern Access to 1,200 mpd H Spectra High Pine H Spectra Stratton Ridge H Spectra Spruce Ridge Spectra T-South Expansion Total 2017 Commercially Secured 12.0 Total Commercially Secured 13.0 Total Commercially Secured 31.0 Note: F/X assumption of 1.25 USD/CAD. Source: Company Reports Alberta Clipper (Line 67) receives Presidential Permit Subsequent to quarter end, Enbridge received a Presidential Permit for Line 67 on October 16, The Presidential Permit increases allowed capacity on the line to 890 mbpd (originally 450 mbpd), restoring

4 the underutilized cross-border capacity for Line 3R. NEXUS The project received a Notice to Proceed from the FERC on October 11, 2017 and has since commenced construction. Recall, the NEXUS project is a US$1.4 billion pipeline system designed to transport up to 1.5 bcf/d from Spectra s Texas Eastern pipeline system to the Union Gas Dawn hub in Ontario. The in-service date is targeted for Q3/18. Valley Crossing Construction continues on the 2.6 bcf/d, 269 km mainline pipeline. Recall, the project transports gas from the Agua Dulce hub in Texas to an offshore tie-in with the Sur de Texas-Tuxpan project. The project has a capital cost estimate of US$1.5 billion and inservice date of Q4/18. Based on $31 bln of secured growth coming online through 2020, we forecast an AFFO/sh CAGR of 8% (unchanged) through 2020e from 2016 levels. On the leverage front, we continue to forecast D/EBITDA trending down to ~4.0x by 2020e, suggesting sufficient balance sheet capacity to fund >$25 bln of incremental growth from its $45 bln unsecured backlog at 8x-10x EBITDA, remaining below the company s target 5x leverage ratio while boosting AFFO/sh CAGR towards dividend growth guidance of 10%-12% through 2024e. Based on the stock s historical multiple of 11.5x P/AFFO, our pro forma AFFO/sh estimate of ~$5.50 underpins our $63 valuation. Excluding Line 3R and the associated ~$0.75/sh of AFFO accretion, we note the current stock price currently reflects a sub-10x multiple of our run-rate AFFO/sh of ~$4.75 i.e., suggesting free upside of ~$8/sh (>15%) related to Line 3R accretion. D/EBITDA ENB - LEVERAGE & AFFO OUTLOOK 8.0x $ x $ x $ x $ x $ x $ x $ a 2017e 2018e 2019e 2020e D/EBITDA (1) AFFO/sh: 8% CAGR (1) Debt includes 50% preferred equity. Source: NBF Estimates AFFO/sh - FD ENB - P/AFFO (1) OUTLOOK 16x LT Avg. (2) : 11.6x 14x 12x 10x 11.3x 12.7x 11.0x 9.8x 8.5x 8x 6x 2016a 2017e 2018e 2019e 2020e (1) AFFO/sh (basic) = FFO/sh (basic) - Maint. capex (2) Based on consensus CFPS and adjusted for maint. capex. Source: Thomson Reuters, NBF Estimates 6 ENB 2020E AFFO/SH CONTRIBUTION FORECAST 5 4 ($/sh) E (1) Other includes: U.S. GTM (STEP, PennEast, NEXUS, TEAL) and Stampede Lateral Source: NBF estimates Rampion Offshore Estimates largely unchanged Hohe Offshore Valley Wind Crossing / T-South / Spruce Ridge Other (1) Line 3R 2020E Overall, our 2018e AFFO/sh (basic) remains largely unchanged at $4.26 (was $4.24) an AFFO payout ratio of 63% (was 64%), versus the low-payout average of 44%. Meanwhile,

5 2018e D/EBITDA taps up to 5.6x (was 5.5x), versus the low-payout average of 5.2x ESTIMATE CHANGES Previous Revised Change (000's) (000's) (000's) % Adj. EBITDA Liquids Pipelines 6,324,874 6,010, ,693-5% Gas Distribution 1,619,161 1,619, % Gas Pipelines & Processing 4,800,590 4,840,590 40,000 1% Green Power & Transmission 404, , % Eliminations & Other -223, ,133 97,860-44% Total Adj. EBITDA 12,925,051 12,748, ,833-1% Net Financing Expenses -2,804,573-2,789,878 14,695-1% Cash Taxes -207, ,985 4,314-2% Distributions to NCI -1,388,000-1,191, ,000-14% Other 260, , % FFO 8,785,179 8,824,355 39,176 0% Maintenance capex -1,692,000-1,692, % AFFO 7,093,179 7,132,355 39,176 1% per share (Basic) $4.24 $4.26 $0.02 0% per share (FD) $4.22 $4.24 $0.01 0% AFFO payout 64% 63% Net Debt ($mlns) (1) 74,401 74, % D/EBITDA (2) 5.5x 5.6x 0.1x (1) Includes preferred equity. (2) Includes 50% preferred equity. Source: NBF Estimates Target down $4 to $63, reiterate Outperform rating Our target moves down $4 to $63 as we revise our risk-adjusted dividend yield to 4.25% (was 4.0%) applied to our 2018e dividend of $2.68/sh (unchanged). Our target is also based on a 16.0x (unchanged) multiple of our 2018e free-ebitda of $11.2 billion, and our discounted cash flow per share valuation of $64.00 (was $67.50), reflecting a slightly higher cost of funding. ENB - VALUATION SUMMARY Methodology Metric Valuation DDM 4.25% $62.75 EV/Free-EBITDA 16.00x $62.50 DCF Model 5.4% $64.00 Equally Weighted Avg. $63.00 Source: NBF Estimates As shown in the chart below, ENB s dividend yield is currently in unchartered territory, reflecting a spread of 3.0% above the Canada 10-year bond rate (LT-avg.: +0.5%) and a spread of +1.0% above 10-year BBB bond rates (LT-avg.: -1.8%). Combined with a 39.7% 12-month total return opportunity (group avg.: 22.2%), we reiterate our Outperform rating.

6 ENB CREDIT SPREADS 4% 3% 2% ENB vs 10-yr Avg ENB vs 10-yr ENB vs BBB Avg ENB vs BBB 1% 0% -1% -2% -3% -4% -5% -6% Jan 05 Jul 05 Jan 06 Jul 06 Jan 07 Jul 07 Jan 08 Jul 08 Jan 09 Jul 09 Jan 10 Jul 10 Jan 11 Jul 11 Jan 12 Jul 12 Jan 13 Jul 13 Jan 14 Jul 14 Jan 15 Jul 15 Jan 16 Jul 16 Jan 17 Jul 17 Source: NBF, Bloomberg SUMMARY INFORMATION ($mln) ENBRIDGE - SUMMARY TABLE 2017e 2018e Previous Revised Previous Revised Average Shares - Basic (mln) 1,533 1,528 1,687 1,688 Ending Shares - Basic (mln) 1,669 1,669 1,705 1,708 Ending Shares - FD (mln) 1,535 1,533 1,682 1,684 EBITDA 10,527 10,401 12,925 12,748 Liquids Pipelines 5,665 5,423 6,325 6,010 Gas Distribution 1,339 1,333 1,619 1,619 Energy Services Gas Pipelines & Processing 3,394 3,448 4,801 4,841 Green Power & Transmission Eliminations & Other Adj. EBIT 7,251 7,121 9,401 9,242 FFO 6,951 6,914 8,785 8,824 Maintenance Capital 1,402 1,339 1,692 1,692 AFFO 5,549 5,575 7,093 7,132 Dividends 3,556 3,555 4,512 4,515 Growth Capital 6,885 7,001 7,348 7,334 Adj. Free Cash Flow (1) -1,336-1, Equity Issued (net) 1,261 1,193 1,933 1,935 Ending Net Debt (2) 73,018 73,313 74,401 74,645 D / EBITDA (3) 6.6x 6.7x 5.5x 5.6x D / Total Capital (3) 55% 56% 54% 55% CF / D (3) 10% 10% 13% 13% CF / Interest (3) 4.5x 4.1x 6.0x 6.1x PER SHARE AMOUNTS Net Debt EBITDA FFO - Basic FFO - FD AFFO - Basic AFFO - FD Adj. Earnings - Basic Adj. Earnings - FD Dividends AFFO payout ratio 64% 64% 64% 63% Earnings payout ratio 114% 119% 95% 100% DRIP participation 43% 43% 43% 43% (1) AFFO less growth capital. (2) Includes preferred equity. (3) Includes 50% preferred equity. Source: Company Reports, NBF Estimates ENB - CREDIT ANALYSIS $mln Q1 2017e Q2 2017e Q3 2017e Q4 2017e Q1 2018e Q2 2018e Q3 2018e Q4 2018e Adj. EBITDA LTM 7,161 8,100 9,147 10,401 11,721 12,140 12,486 12,748 % change 4% 13% 13% 51% 13% 4% 3% 23% D/EBITDA (1) 9.6x 8.4x 7.5x 6.7x 6.0x 5.9x 5.7x 5.6x Debt/Capital 55% 55% 56% 56% 56% 56% 55% 55% EBITDA/Interest (2) 4.1x 4.1x 4.1x 4.3x 4.5x 4.6x 4.8x 4.8x FFO/Debt 7% 8% 9% 10% 12% 12% 13% 13% FFO/Adj. Debt (1) 7% 8% 9% 10% 12% 12% 12% 13% (1) Debt includes 50% debt treatment for preferred equity. (2) Interest includes preferred dividends. Source: Company Reports, NBF Estimates

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8 NBF quarterly ratings summary and the total ratings by month can be found on our website under Research and Analysis/Equities/About NBF Research/Quarterly Ratings Summary (link attached) The NBF Research Dissemination Policy is available on our website under Legal/Research Policy (link attached) Click on the following link to see the company specific disclosures Click on the following link to see National Bank Financial Markets Statement of Policies If a company specific disclosure is not found herein for a listed company, NBF at this time does not provide research coverage or stock rating for the company in question. Additional company related disclosures for Enbridge Inc (2,3,4,5,6,7) 2 National Bank Financial Inc. has acted as an underwriter with respect to this issuer within the past 12 months. 3 National Bank Financial Inc. has provided investment banking services for this issuer within the past 12 months. 4 National Bank Financial Inc. or an affiliate has managed or co-managed a public offering of securities with respect to this issuer within the past 12 months. 5 National Bank Financial Inc. or an affiliate has received compensation for investment banking services from this issuer within the past 12 months. 6 National Bank Financial Inc. or an a ffiliate has a non-investment banking services related relationship during the past 12 months. 7 The issuer is a client, or was a client, of National Bank Financial Inc. or an affiliate within the past 12 months. Additional company related disclosures for Enbridge Income Fund Holdings (2,3,4,5,6,7) 2 National Bank Financial Inc. has acted as an underwriter with respect to this issuer within the past 12 months. 3 National Bank Financial Inc. has provided investment banking services for this issuer within the past 12 months. 4 National Bank Financial Inc. or an affiliate has managed or co-managed a public offering of securities with respect to this issuer within the past 12 months. 5 National Bank Financial Inc. or an affiliate has received compensation for investment banking services from this issuer within the past 12 months. 6 National Bank Financial Inc. or an affiliate has a non-investment banking services related relationship during the past 12 months. 7 The issuer is a client, or was a client, of National Bank Financial Inc. or an affiliate within the past 12 months.