TransCanada to Acquire Alberta Power Generation Capacity
CALGARY, Alberta – November 21, 2005 – (TSX: TRP) (NYSE: TRP) – TransCanada Corporation (TransCanada) today announced it has acquired the remaining rights and obligations of the 756-megawatt Sheerness Power Purchase Arrangement (PPA) from the Alberta Balancing Pool for $585 million. The remaining term of the PPA is approximately 15 years. The acquisition is subject to required consents and is expected to close on December 30, 2005.
"The Sheerness PPA is a strong fit with our strategy to grow our power business by acquiring low-cost, base-load capacity in markets where we have a strong presence,” said Hal Kvisle, TransCanada’s chief executive officer.
TransCanada will incorporate the Sheerness supply into its wholesale supply and marketing portfolio from which it sells energy in the Alberta marketplace through a balanced portfolio of sales contracts. The acquisition is expected to be immediately accretive to earnings and cash flow. Upon completion of the purchase, TransCanada will own, control, or be constructing a total of approximately 6,750 megawatts of power across Canada and the northeastern United States.
The Sheerness Power Plant is located approximately 230 kilometres northeast of Calgary, near the town of Hanna, Alberta. The plant consists of two 390 MW coal-fired thermal power generating units. It is co-owned by ATCO subsidiary, Alberta Power (2000) Ltd., who also operates the plant, and TransAlta Cogeneration L.P. Unit 1 was commissioned in 1986 and Unit 2 in 1990.
TransCanada currently holds PPAs in Alberta entitling the company to more than 900 MW of capacity from the Sundance Power Plant near Edmonton.
Note: All dollar amounts are expressed in Canadian funds, unless noted otherwise.
TransCanada is a leader in the responsible development and reliable operation of North American energy infrastructure. TransCanada’s network of approximately 41,000 kilometres (25,600 miles) of pipeline transports the majority of Western Canada’s natural gas production to key Canadian and U.S. markets. A growing independent power producer, TransCanada owns, or has interests in, approximately 6,000 megawatts of power generation in Canada and the United States. TransCanada’s common shares trade on the Toronto and New York stock exchanges under the symbol TRP.
FORWARD LOOKING INFORMATION
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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