TransAlta completes $318MM Solomon power station acquisition

Source:TransAlta Corporation

TransAlta Corporation (TransAlta) announced today that through its subsidiaries, it has successfully completed the acquisition of the Solomon power station for U.S. $318 million.

"TransAlta has been a valued behind-the-fence generator in Western Australia for the past 15 years and this acquisition fits well with our strategy of expanding in that region," said Dawn Farrell, TransAlta President and CEO. "The Solomon power station is fully contracted and will provide immediate value to our shareholders, adding to both earnings and free cash flow per share."

The Solomon power station is fully contracted with Fortescue Metals Group Ltd. (Fortescue) under a long-term Power Purchase Agreement (PPA) and will support their iron ore mining operations in the Solomon Hub, located in the Pilbara region of Western Australia. The initial term of the PPA is 16 years after which Fortescue has the option to either extend the PPA by an additional five years under the same terms, or to acquire the facility from TransAlta for a value equivalent to the five year extension.

The acquisition is expected to generate unlevered after-tax returns in the low double digits and pre-financing cash flows of approximately $40 million per year. 


Sign up for PennEnergy's eNewsletters
For Email Newsletters you can trust


Whitepapers

Pervasive Governance: Rethinking Traditional Approaches to Information Governance for Oil & Gas

Information is an organization’s most important strategic asset – the “lifeblood” of the organiza...

OSHA 1910.269 Are You Regulation Ready?

Read this Q&A to learn about changes to federal regulations and how to select FR garments for...

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New ...

On the Radar: EMC Supplier Exchange

This report addresses key issues for managers of complex contracts in energy and engineering. Thi...

Webcasts

Transforming the petroleum supply chain with the Internet of Things

The equipment involved in producing, moving, refining and selling petroleum is expensive, and rugged, and comes from hundreds of manufacturers. Enhanced by the Internet of Thing...
( 06/16/2015 / 02:00 PM Eastern Daylight Time / 01:00 PM Central Daylight Time / 11:00 AM Pacific Daylight Time / 18:00 GMT )
Sponsored by

Connected Decision-Making: Improving Asset Operations Through Comprehensive Information Management

Energy asset operators are faced with a paradigm today: increase efficiency and reliability levels while fighting to extend the lifespan of these aging asset. To meet these oppo...
Sponsored by

Turnaround Bolting Optimization

Improving turnaround safety, quality and schedule with innovative bolting methods. Join our speakers as they address the following topics: Improving job-site safety with innov...
Sponsored by

Latest Energy Jobs

View more Job Listings >>