Lauren Krugel, THE CANADIAN PRESS

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CALGARY - In a market beset by faltering commodity prices and scarce credit, pipeline operator Enbridge Inc. (TSX:ENB) offered some rare good news to investors Wednesday: higher expected earnings in 2009 and a boost in dividends.

The Calgary-based company is now estimating its earnings next year will be between $2.18 and $2.32 per share - a 20 per cent increase from its 2008 guidance range.

Enbridge will increase its quarterly dividend by 12 per cent to 37 cents from 33 cents per share. The next dividend will be payable March 1, 2009.

"This can be primarily attributed to strong earnings growth in our core business operations, which have been largely unaffected by the crisis in financial markets and the recent slump in energy prices," chief executive Pat Daniel told an analyst conference call Wednesday.

The firm will also benefit next year from a stronger U.S. dollar after increasing its ownership stake in Enbridge Energy Partners L.P. (NYSE:EEP), which operates oil and natural gas pipelines in the United States.

And Enbridge will have a minimal need for equity next year because the Fort Hills oilsands project has been delayed.

Enbridge is to build a pipeline from the proposed oilsands mine to its accompanying upgrader near Edmonton.

But a final investment decision on the mining aspect by the Fort Hills partners - Petro-Canada (TSX:PCA), Teck Cominco Ltd. (TSX:TCK.B) and UTS Energy Corp. (TSX:UTS) - has been pushed into next year and the upgrader has been delayed indefinitely.

Enbridge plans to spend $12 billion in a first wave of pipeline expansions through to 2012, which includes Fort Hills.

Chief financial officer Richard Bird said he does not expect that figure to change.

"It does, however, flatten out the peak we previously had in 2009. With Fort Hills expenditures moving further out into the period when our internal cash flow is much stronger and when we will be less reliant on external funding," he said.

Nor does it affect Enbridge's predicted earnings growth rate of 10 per cent or more through to 2012, said Daniel.

"In fact, even if the Fort Hills project did not proceed at all, we would at most only remove the plus from our 10-plus per cent growth outlook," said Daniel.

Enbridge is working on lowering its costs for the Fort Hills partners, he said.

"We fully expect that we will be able to improve the pricing on that because of the tightening up of the labour market in Alberta."

Enbridge says it has more than enough liquidity to go ahead with projects it has already committed to.

"However, with a number of attractive investment opportunities potentially available to us, we will look to opportunistically bolster our equity base through asset sales and monetizations and potentially common equity," Daniel said.

One possibility could be for Canada's No. 1 crude oil shipper to turn more of a focus to natural gas pipelines.

"We feel that there will be significant new gas infrastructure developments over the next five to 10 years in North America," Daniel said.

But Enbridge has no plans to get into power generation "in a big way," he added.

"We're pretty confident with our model of crude oil pipelines and gas distribution and gas pipelines as being the key value drivers for us going forward."

UBS Investment Research analyst Grant Hofer said Enbridge's dividend increase is "slightly better" than his expectations, and set a price target for Enbridge of $46. The company's shares closed at $37.43 on the Toronto Stock Exchange Wednesday.

Pipeline companies like Enbridge and TransCanada Corp. (TSX:TRP) are largely seen as providing a safe haven for investors, as their revenues do not fluctuate with commodity prices.

Last month, Enbridge raised $500 million in corporate debt to finance a host of growth projects set to be built through to 2012.

A few days earlier TransCanada said it raised $1 billion by selling shares as means to fund its pipeline expansions.