Calpine Completes Sale of Its Interest in 240-Megawatt Gordonsville, VA Power Plant Wednesday November 26, 8:30 am ET
SAN JOSE, Calif., Nov. 26 /PRNewswire-FirstCall/ -- Calpine Corporation (NYSE: CPN - News) has completed the sale of its unconsolidated, 50 percent interest in the 240-megawatt Gordonsville Power Plant to Dominion Virginia Power, an affiliate of Dominion. Under the terms of the transaction, Calpine received a $34.6 million cash payment, which included a $29.1 million payment from Dominion and a separate $5.5 million payment for the return of a debt service reserve. Calpine's 50 percent share of the project's non-recourse debt at closing was approximately $43.9 million. The company has received all regulatory and other third-party approvals. ADVERTISEMENT
The Gordonsville plant sale is part of Calpine's $2.3 billion liquidity-enhancing program for 2003 and represents the fourth capital-raising event involving Calpine's Qualifying Facilities. In addition to this transaction, the company completed the Newark and Parlin financing, and sold equity interests in the King City and Auburndale power plants. To date, Calpine has completed nearly $2.2 billion of liquidity transactions and expects to complete an additional $260 million by year-end.
Calpine acquired its interest in the Gordonsville Power Plant in 1997. Located in Gordonsville, Va., the natural gas-fired facility was commissioned in 1993 and provides electricity to Dominion under power sales agreements ending in 2024. As a cogenerator, the Gordonsville facility also supplies steam to Rapidan Services, the local water authority, under a long-term steam sales agreement.
Calpine Corporation is a leading North American power company dedicated to providing electric power to wholesale and industrial customers from clean, efficient, natural gas-fired and geothermal power facilities. The company generates power at plants it owns or leases in 21 states in the United States, three provinces in Canada and in the United Kingdom. Calpine is also the world's largest producer of renewable geothermal energy, and it owns approximately 900 billion cubic feet equivalent of proved natural gas reserves in Canada and the United States. The company was founded in 1984 and is publicly traded on the New York Stock Exchange under the symbol CPN. For more information about Calpine, visit www.calpine.com.
I like the strategy of selling half interest in a plant to gain long-term contracts and that way they are sure to sell much power to their customer. I just hope they are getting good rates on the sale of the power.