ENBRIDGE 2000 ANNU AL REPORT 25 The Company owns a 24.7% interest in OCENSA, which includes an additional 7.2% equity interest acquired in the third quarter of 2000. The acquisition also included the purchase of the remaining 50% interest in CITCOL, the company that operates OCENSA through the provision of technical and managerial services. Enbridge is now the sole operator of the OCENSA pipeline, tankage and marine loading system that transports 500,000 barrels per day of crude oil from the Cusiana and Cupiagua oilfields in the central interior of Colombia to the Port of Coveñas on the Caribbean coast. Enbridge earns a fixed rate of return on its OCENSA investment, plus operating and incentive fees. The $6.3 million increase in OCENSA earnings is the result of the higher ownership interest. The fees earned to operate the Jose Terminal decreased in 2000, compared with 1999, due  to a change in the interim operating agreement in late 1999. Consulting and technical advisory service fees are lower in 2000 due to the completion of a significant contract in Mexico in 1999 and the development of new services. The 1999 earnings are consistent with 1998 with the exception of operating fees from the Jose Terminal, which commenced in 1999. The International business will continue to focus on select countries in key regions based on global trends in supply and demand. Specifically, focus will be placed on Latin America, which will continue to be the key area of interest. OCENSA continues to be the core international holding. In addition, Enbridge reached a term sheet agreement with PDVSA, the Venezuelan state oil company, that provides for the continuation  of the operation of the Jose Terminal by the Company and its partners for a 10-year term ending in 2011. International has focused on “grass roots” infrastructure projects. Increased international asset rationalization and the changing corporate strategies of multinationals are also expected to present investment and acquisition opportunities that fit the Company’s investment criteria. The technology and consulting business is expected to provide support in connection with identification and development of equity participation projects, while increasing the revenue contribution through new technology and consulting applications. The Corporate and Other segment includes new business development activities and financing costs. Corporate and Other costs increased by $8.0 million to $55.6 million in 2000, before the impact of tax rate reductions and the loss on foreign exchange contracts. Financing costs increased due to increased average debt and preferred securities required to fund the Company’s business growth and investments. These costs are not allocated back to the specific business operations. When 1999 is compared with 1998, Corporate and Other costs increased by $17.4 million, also related to financing expansion of business operations. In December 2000, the federal government substantially enacted a 6% reduction in corporate tax rates. This reduction, combined with previous federal and provincial reductions, has resulted in certain of the Company’s anticipated U.S. dollar cash flows being overhedged for accounting purposes. The derivative financial instruments related to the overhedged position, primarily long-term forward foreign exchange contracts, must be valued at market prices and any gain or loss charged to income for accounting purposes. Accordingly, a $15.6 million loss (after tax) was recorded in the fourth quarter of 2000. The International business is subject to risks related to political and economic instability, currency volatility, market volatility, government regulations, foreign investment rules, security of assets, and environmental considerations. The Company assesses and monitors international regions and specific countries on an ongoing basis for changes in these risks. Risks are mitigated by Enbridge’s contractual arrangements to operate the assets, regular analysis of country risk and foreign currency hedging and insurance programs. Business Risks Outlook CORPORATE AND OTHER (millions of dollars) 2000 1999 1998 Corporate Financing (65.2) (49.9) (36.9) Other 9.6 2.3 6.7 Loss on foreign  exchange contracts (15.6) — — Tax rate reductions (21.5) — — (92.7) (47.6) (30.2)