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CALGARY, Alberta, May 3, 2002 -- EPCOR Utilities Inc. and TransAlta Corp. on Thursday announced they signed an agreement to negotiate the purchase by TransAlta of a 50 percent interest in EPCOR's Genesee 3 project.
Also under the Memorandum of Understanding (MOU), they will negotiate an agreement to jointly develop the Keephills 3 & 4 expansion and future expansion of the Genesee plant.
It is expected that due diligence and agreements will be completed by August 2002 with closing upon receipt of applicable regulatory review. Negotiations will also include an option for EPCOR to purchase a 50 per cent interest in TransAlta's Sarnia Regional Cogeneration Plant and the purchase of output from a recent capacity expansion at the Sundance generation facility.
"Given the capital intensive nature of our business, both companies have come to realize that the way to grow in the Alberta market is to do so with partners," says Steve Snyder, TransAlta's President and CEO. "We look forward to achieving efficiencies in plant design and operation, increasingly important factors in today's highly competitive electricity market."
"From the onset, EPCOR has publicly stated we would be interested in a partner that could bring incremental value to not just our Alberta, but our other interests as well," says Don Lowry, EPCOR's President and CEO. "The Sarnia plant fits that need in terms of our 1.3 million Ontario customers. As well, this arrangement makes good customer and commercial sense."
"Projects of this nature are capital intensive and the opportunity to share generation technology and skills between our companies will increase efficiency, lower project costs and benefit customers by creating a long-term, stable electricity supply," says Lowry.
Similar to 'farm-in' arrangements in the oil and gas sector, both companies remain separate entities with joint ownership of selected facilities. In Alberta, each will market its own share of the electricity output from each plant separately. Both companies remain free to pursue other generation development opportunities on their own or with other partners.
EPCOR is one of Canada's top providers of energy and energy-related services and products. EPCOR owns and operates power plants, electrical transmission and distribution networks, builds and operates water and wastewater treatment facilities and infrastructure and provides power, water, natural gas, water heater rental and heating, ventilating and air conditioning services to its expanding customer base.
With over $4 billion in assets and a customer base of 1.9 million, EPCOR is headquartered in Edmonton, Alberta and has operations throughout Alberta, British Columbia, Ontario and the U.S. Pacific Northwest. More information about EPCOR can be found on our Website at www.epcor.ca.
TransAlta Corporation is Canada's largest non-regulated electric generation and marketing company, with more than $8 billion in assets and 9,000 megawatts of capacity either in operation or under construction. As one of North America's lowest-cost operators, our growth is focused on developing coal- and gas-fired generation in Canada, the U.S. and Mexico. TransAlta's Website is www.transalta.com.
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