US power group Calpine Corp has announced a restructuring programme that includes asset sales and debt reduction of 16%, or $3 billion, by the year’s end.

The company plans to cut some $200 million in annual operating costs, close or sell up to eight generation plants and end costly maintenance agreements with GE and Siemens.

The 1,200 MW Saltend station in the UK’s Hull is the largest capacity asset up for disposal and Calpine hopes to improve on the $800 million it paid for it in 2001.

Shares in the company rose at the news, which followed several years of development of its gas-fired generation portfolio. Low profit margins, rising gas prices and heavy construction expenses have led to losses and left it with more than $18 billion in long-term debt.

In another measure aimed at cutting operating costs, Calpine is also said to be close to deals with refiners to supply petroleum coke that the company will use to fire its plants through a gasification process.