TransCanada has announced the sale of its power generation assets in the US northeast to fund the acquisition of a North American natural gas transmission business.
Sian Crampsie
Energy giant TransCanada has announced the sale of its power generation assets in the US northeast in order to fund the acquisition of a North American natural gas transmission business.
TransCanada has reached a deal to purchase Houston-based Columbia Pipeline Group, one of the largest regulated natural gas transmission groups in North America. The $13 billion deal will be funded by proceeds from the sale of power plants in New York, Maine, Pennsylvania and Rhode Island as well as the sale of a minority stake in its Mexican natural gas pipeline business.
The plants up for sale include the 778 MW Ironwood natural gas fired power plant in Pennsylvania, the Ravenswood gas- and oil-fired generation plant in New York, hydroelectric power assets in New England, the Kibby wind farm in Maine and the Ocean State Power gas generation facilities in Rhode Island.
"TransCanada intends to fund the acquisition and our significant future growth program in a manner that maintains our strong financial position," said Russ Girling, TransCanada’s president and chief executive officer.
The power plants TransCanada will sell amount to 4400 MW of capacity, equivalent to approximately one-third of TransCanada’s power generation portfolio.
Columbia Pipeline Group operates approximately 24 000 km of natural gas pipelines extending from New York to the Gulf of Mexico. The acquisition "represents a rare opportunity to invest in an extensive, competitively-positioned, growing network of regulated natural gas pipeline and storage assets in the Marcellus and Utica shale gas regions", Girling said.