TransCanada Sells Indonesian Power Plant Interest
CALGARY, Alberta – June 29, 2005 - (TSE: TRP) (NYSE: TRP) - TransCanada
Corporation (TransCanada) today announced an agreement to sell its approximate 11 per cent interest in PT Paiton Energy Company (Paiton Energy) to subsidiaries of The Tokyo Electric Power Company for approximately US$103 million (approximately CDN$127 million). Paiton Energy owns two 615 megawatt coal-fired power plants in East Java, Indonesia. The transaction is expected to close in the third quarter of 2005, subject to various approvals.
“We’re pleased to have reached an agreement to sell one of our few remaining international assets,” said Hal Kvisle, TransCanada’s CEO. “This is another clear example of TransCanada’s disciplined approach in divesting non-core assets and redeploying the proceeds into our core businesses of gas transmission and power services in North America.”
TransCanada acquired its interest in Paiton Energy in 1996 and has retained that interest until favourable conditions for a sale were available.
Upon closing, TransCanada expects to realize an after tax gain of approximately CDN$115 million. This gain reflects the impact of a provision taken in 1999 against the carrying value of Paiton Energy. At that time, TransCanada announced its plan to make a staged exit from its international business and conducted a divestiture program during 2000 and 2001.
TransCanada is a leading North American energy company. TransCanada is focused on natural gas transmission and power services with employees who are expert in these businesses. TransCanada’s network of approximately 41,000 kilometres (25,600 miles) of pipeline transports the majority of Western Canada’s natural gas production to the fastest growing markets in Canada and the United States. TransCanada owns, controls or is constructing approximately 5,700 megawatts of power generation – an amount of power that can meet the needs of about 5.7 million average households. TransCanada announced in May that it plans to sell its interests in TransCanada Power, L.P., which owns a 744 megawatt power portfolio. The Company’s common shares trade under the symbol TRP on the Toronto and New York stock exchanges.
Note: All financial figures are in Canadian dollars unless otherwise noted.
Certain information in this news release is forward-looking and is subject to important risks and uncertainties. The results or events predicted in this information may differ from actual results or events. Factors which could cause actual results or events to differ materially from current expectations include, among other things, the ability of TransCanada to successfully implement its strategic initiatives and whether such strategic initiatives will yield the expected benefits, the availability and price of energy commodities, regulatory decisions, competitive factors in the pipeline and power industry sectors, and the current economic conditions in North America. For additional information on these and other factors, see the reports filed by TransCanada with Canadian securities regulators and with the United States Securities and Exchange Commission. TransCanada disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
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