ENBRIDGE INC. PERFORMANCE STOCK OPTION PLAN (2007)

1.

PURPOSE

(a)

focus Participants on the attainment of the Corporation’s long-term strategy and share price appreciation;

(b)

assist in attracting, retaining, engaging and rewarding senior executives of the Corporation and its Subsidiaries; and

(c)

provide an opportunity for Participants to earn competitive total compensation based on achieving the performance goals set out in this Plan.

2.

DEFINED TERMS

(a)

“ affiliate ” has the meaning ascribed to that term in the Securities Act (Alberta);

(b)

“ associate ” has the meaning ascribed to that term in the Securities Act (Alberta);

(c)

“ Blackout Period ” means a period of time imposed by the Corporation where Participants holding Options may not trade in securities of the Corporation;

(d)

“ Board ” means the Board of Directors of the Corporation;

(e)

“ CEO ” means the Chief Executive Officer of the Corporation;

(f)

“ Change of Control ” means:

(i)

the sale to a person or acquisition by a person not affiliated with the Corporation or its Subsidiaries of assets of the Corporation or its Subsidiaries having a value greater than 50% of the fair market value of the assets of the Corporation and its Subsidiaries determined on a consolidated basis prior to such sale whether such sale or acquisition occurs by way of reconstruction, reorganization, recapitalization, consolidation, amalgamation, arrangement, merger, transfer, sale or otherwise;

(ii)

any change in the holding, direct or indirect, of shares of the Corporation by a person not affiliated with the Corporation as a result of which such person, or a group of persons, or persons acting in concert, or persons associated or affiliated with any such person or group within the meaning of the Securities Act (Alberta), are in a position to exercise effective

control of the Corporation whether such change in the holding of such shares occurs by way of takeover bid, reconstruction, reorganization, recapitalization, consolidation, amalgamation, arrangement, merger, transfer, sale or otherwise; and for the purposes of this Plan, a person or group of persons holding shares or other securities in excess of the number which, directly or following conversion thereof, would entitle the holders thereof to cast 20% or more of the votes attaching to all shares of the Corporation which, directly or following conversion of the convertible securities forming part of the holdings of the person or group of persons noted above, may be cast to elect directors of the Corporation shall be deemed, other than a person holding such shares or other securities in the ordinary course of business as an investment manager who is not using such holding to exercise effective control, to be in a position to exercise effective control of the Corporation;

(iii)

any reconstruction, reorganization, recapitalization, consolidation, amalgamation, arrangement, merger, transfer, sale or other transaction involving the Corporation where shareholders of the Corporation immediately prior to such reconstruction, reorganization, recapitalization, consolidation, amalgamation, arrangement, merger, transfer, sale or other transaction hold less than 50% of the shares of the Corporation or of the continuing corporation following completion of such reconstruction, reorganization, recapitalization, consolidation, amalgamation, arrangement, transfer, sale or other transaction;

(iv)

the Corporation ceases to be a distributing corporation as that term is defined in the Canada Business Corporations Act;

(v)

any event or transaction which the Board, in its discretion, deems to be a Change of Control; or

(vi)

Incumbent Directors ceasing to be a majority of the Board;

(i)

any transaction whereby shares held by shareholders of the Corporation are transferred or exchanged for units or securities of a trust, partnership or other entity which trust, partnership or other entity continues to own directly or indirectly all of the shares of the Corporation previously owned by the shareholders of the Corporation and the former shareholders of the Corporation continue to be beneficial holders of such units or securities in the same proportions following the transaction as they were beneficial holders of shares of the Corporation prior to the transaction will be deemed not to constitute a change of control; and

(ii)

any change of control initiated or commenced by the Board (and whether or not such transaction was initiated or commenced by the Board shall be conclusively determined by the Board) will not constitute a change of control for purposes of this Plan;

(g)

“ Code ” means the United States Internal Revenue Code of 1986, as amended;

(h)

“ constructive dismissal ” means, unless consented to by the Participant, any action that constitutes constructive dismissal of the Participant, including without limiting the generality of the foregoing:

(i)

where the Participant ceases to be an officer of the Corporation, unless the Participant is appointed as an officer of a successor to a material portion of the assets of the Corporation;

(ii)

a material decrease in the title, position, responsibilities, powers or reporting relationships of the Participant;

(iii)

a reduction in the base salary (excluding any annual incentive bonus) of the Participant; or

(iv)

any material reduction in the value of the Participant’s employee benefits, plans and programs (other than any annual incentive bonus);

(i)

“ Corporation ” means Enbridge Inc., and includes any successor entity thereto;

(j)

“ Director ” means a director of the Corporation;

(k)

“ Fair Market Value ” means, as of a particular day, the weighted average of the board lot trading prices per Share on the Toronto Stock Exchange, or the New York Stock Exchange, for the last five Trading Days immediately prior to such day;

(l)

“ For Cause ” includes “just cause” as defined in the common law and also includes any circumstance in which the Participant shall have been convicted of a criminal act of dishonesty resulting or intending to result directly or indirectly in gain or personal enrichment of the Participant;

(m)

“ Grant Date ” has the meaning set forth in Section 7(c);

(n)

“ Grant Price ” has the meaning set forth in Section 7(c);

(o)

“ HRC Committee ” means the Human Resources & Compensation Committee of the Board, established and duly authorized to act in accordance with the By-Laws of the Corporation;

(p)

“ Incumbent Director ” means any member of the Board who was a member of the Board immediately prior to the occurrence of the transaction, elections or appointments giving rise to a Change of Control and any successor to an Incumbent Director who was recommended for election at a meeting of shareholders of the Corporation, or elected or appointed to succeed any Incumbent Director, by the affirmative vote of the Directors, which affirmative vote includes a majority of the Incumbent Directors then on the Board;

(q)

“ Insider ” means:

(i)

an insider, as defined in the Securities Act (Alberta); and

(ii)

an associate of any person who is an insider by virtue of (i) above;

(r)

“ Notice Period ” means the notice period for termination of employment agreed to between the Corporation (or its Subsidiary) and the Participant, or, in the absence of any such agreement, the notice period required under applicable law;

(s)

“ Option ” means an Option to purchase Shares granted to the Participant in accordance with the terms and conditions of this Plan;

(t)

“ Participant ” means any employee, including an officer, of the Corporation or a Subsidiary who has been designated by the HRC Committee to receive and be granted Options in accordance with Section 5;

(u)

“ Performance Vesting Requirement ” has the meaning ascribed to that term in Section 7(b);

(v)

“ Plan ” means the Performance Stock Option Plan (2007) of the Corporation described in this document, and as the same may be duly amended or varied from time to time in accordance with the provisions of this Plan;

(w)

“ Pro-rated Option ” means a grant of Options where the number of Options subject to the grant has been reduced in accordance with Section 8(a), (b), (d) or (e);

(x)

“ Retirement Plan ” means a pension plan of the Corporation established or in effect from time to time which applies when an employee retires from the employment of the Corporation or any of its Subsidiaries;

(y)

“ Share ” means a common share in the capital of the Corporation;

(z)

“ Share Reserve ” has the meaning ascribed to that term in Section 4;

(aa)

“ Subsidiary ” means:

(i)

any corporation that is a subsidiary (as such term is defined in the Canada Business Corporations Act ) of the Corporation, as such provision is from time to time amended, varied or re-enacted;

(ii)

any partnership or limited partnership that is controlled by the Corporation (the Corporation will be deemed to control a partnership or limited partnership if the Corporation possesses, directly or indirectly, the power to direct or cause the direction of the management or policies of such partnership or limited partnership, whether through the ownership of voting securities, by contract or otherwise); and

(iii)

subject to regulatory approval, any corporation, partnership, limited partnership, trust, limited liability company or other form of business entity that the HRC Committee determines ought to be treated as a subsidiary for purposes of the Plan, provided that the HRC Committee shall have the sole discretion to determine that any such entity has ceased to be a subsidiary for purposes of the Plan;

(bb)

“ Term ” has the meaning ascribed to that term in Section 7;

(cc)

“ Time Vesting Period ” means the aggregate number of months from the Grant Date of the Option to the date that all Time Vesting Requirements have been met;

(dd)

“ Time Vesting Requirement ” has the meaning ascribed to that term in Section 7(b);

(ee)

“ Trading Day ” means any day on which the Toronto Stock Exchange or the New York Stock Exchange, as the case may be, is open for trading; and

(ff)

“ United States Incentive Stock Option ” has the meaning set forth in Section 9(a).

3.

GOVERNANCE

(a)

Subject to any determinations or approvals required to be made by the Board, the HRC Committee will administer the Plan in its sole discretion. The HRC Committee shall have the full power and sole responsibility to interpret the provisions of the Plan and to make regulations and formulate administrative provisions for its implementation, and to make such changes in the regulations and administrative procedures as, from time to time, the HRC Committee deems proper and in the best interests of the Corporation. Such regulations and provisions may include the delegation to any Director or Directors or any officer or officers of the Corporation or its Subsidiaries of such administrative duties and powers of the HRC Committee as it may, in its sole discretion, deem fit. The determinations of the HRC Committee in the administration of the Plan shall be final and conclusive.

(b)

Prior to the CEO requesting any grants under the Plan, the CEO will recommend to the HRC Committee for its approval the performance measures and the levels of achievement for 100% of the Options to vest and the level below which no Options will vest. The HRC Committee is authorized to approve, for each Option granted under the plan, the terms for vesting any Option granted under the Plan. The HRC Committee shall also have the authority to approve any amendments to such performance measures and the expected levels of performance.

(c)

Subject to Section 13, the HRC Committee may waive any restrictions with respect to participation in the Plan or vesting with respect to any specific Participants where, in the opinion of the HRC Committee, it is reasonable to do so and such waiver does not prejudice the rights of the Participant under the Plan.

(d)

Subject to Section 13, the HRC Committee may amend the Plan for any general administrative matters, correct, remedy or reconcile any errors, inconsistencies or ambiguities, cashless exercise, vesting or termination provisions or any performance measures and recommend to the Board for its approval any other amendments.

(e)

Grants to Participants will be made in the sole discretion of the HRC Committee.

4.

SHARES AND SHARE RESERVE

5.

PARTICIPATION AND GRANT OF OPTIONS

(a)

The CEO may from time to time recommend to the HRC Committee employees of the Corporation or its Subsidiaries, for participation in the Plan, the extent and terms of their participation and the performance measures applicable thereto. The HRC Committee shall consider such recommendations and may approve such recommended employees for participation in the Plan, the extent and terms of their participation and the performance measures applicable thereto, subject to the following:

(i)

the total number of Shares reserved for issuance to any one Participant pursuant to all security based compensation arrangements of the Corporation shall not exceed in the aggregate 5% of the number of Shares outstanding at the time of reservation;

(ii)

the total number of Shares reserved for issuance to Insiders pursuant to all security based compensation arrangements of the Corporation shall not exce