Under the terms of the accord, Calpine will acquire Fore River generating station and related plant inventory for $530m, or approximately $655 per kW, subject to working capital adjustments.
Located in North Weymouth, Massachusetts, 12 miles southeast of Boston, US, the natural gas-fired plant will expand Calpine’s presence in the New England competitive wholesale power market.
Calpine president and chief executive officer Thad Hill said: "With the acquisition of Fore River, we will grow our presence in a region that features favorable fundamentals and a supportive, market-based regulatory philosophy.
"This modern, efficient power plant is dual-fuel capable, making it an excellent fit with our existing, reliable East Region fleet.
"We continue to redeploy our capital to enhance shareholder value through accretive acquisitions and divestitures, organic growth, balance sheet management and return of capital to shareholders through our share repurchase program."
The Fore River Generating Station, built in 2003, comprises two Mitsubishi 501G combustion turbines, two heat recovery steam generators and one Mitsubishi steam turbine.
The dual-fuel capability of the plant allows it to run on either natural gas or fuel oil, depending upon market conditions.
Subject to customary closing conditions and FERC approval, the transaction is likely to be closed in the fourth quarter of 2014.
Image: Calpine also operates Bethlehem combined-cycle power generating plant in Bethlehem, Pennsylvania, US. Photo: © Calpine.
