Common use of Financial Assurance Clause in Contracts

Financial Assurance. The State commissioned the final Independent Risk Analysis for the Straits Pipelines (Xxxxxxx, et al., September 15, 2018) (hereinafter “Independent Risk Analysis”) to assess a worst-case discharge from the Dual Pipelines, including the cost of responding to that worst-case discharge. Enbridge strongly disagrees with the methods and conclusions of the Independent Risk Analysis report, and nothing in this Second Agreement shall be construed to constitute Enbridge’s acceptance of those methods and conclusions. Enbridge nonetheless agrees that, so long as it continues to operate the Dual Pipelines, the Enbridge entity or entities that own and operate Line 5, or the parent companies of such Enbridge entity(ies), will maintain in force financial assurance mechanisms that meet or exceed the $1,878,000,000 estimate of Enbridge’s potential total quantifiable response liability for a worst-case discharge from the Dual Pipelines that is identified in the Independent Risk Analysis. To demonstrate compliance with this requirement, on an annual basis Enbridge will file with the State updated financial assurance information in a format similar to that provided in Appendix 3. Enbridge further agrees that, upon the request by the State, it will on an annual basis, make available to the State for inspection and review information regarding the amount, availability, and changes to liability insurance that it maintains. The State agrees that Enbridge’s compliance with the requirements under this Paragraph I.J. satisfies its financial assurance obligations specified under Paragraph J of the Easement.

Financial Assurance. The State commissioned the final Independent Risk Analysis for the Straits Pipelines (Xxxxxxx, et al., September 15, 2018) (hereinafter “Independent Risk Analysis”) to assess a worst-case discharge from the Dual Pipelines, including the cost of responding to that worst-case discharge. Enbridge Xxxxxxxx strongly disagrees with the methods and conclusions of the Independent Risk Analysis report, and nothing in this Second Agreement shall be construed to constitute Enbridge’s acceptance of those methods and conclusions. Enbridge nonetheless agrees that, so long as it continues to operate the Dual Pipelines, the Enbridge entity or entities that own and operate Line 5, or the parent companies of such Enbridge entity(ies), will maintain in force financial assurance mechanisms that meet or exceed the $1,878,000,000 estimate of Enbridge’s potential total quantifiable response liability for a worst-case discharge from the Dual Pipelines that is identified in the Independent Risk Analysis. To demonstrate compliance with this requirement, on an annual basis Enbridge will file with the State updated financial assurance information in a format similar to that provided in Appendix 3. Enbridge Xxxxxxxx further agrees that, upon the request by the State, it will on an annual basis, make available to the State for inspection and review information regarding the amount, availability, and changes to liability insurance that it maintains. The State agrees that EnbridgeXxxxxxxx’s compliance with the requirements under this Paragraph I.J. satisfies its financial assurance obligations specified under Paragraph J of the Easement.