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Attention Business Editors:
TransCanada Power, L.P. to Purchase Power Plant in New York State
CALGARY, July 6 /CNW/ - TransCanada Power Services Ltd., the
general
partner of TransCanada Power, L.P. (the Partnership), today
announced the
approval of the acquisition of a gas-fired cogeneration facility in
New York
for approximately US$37.5 million. The Partnership, subject to
United States
regulatory approval, will close the acquisition from Cogen Energy
Technology
L.P. on July 7, 1999.
The 66-megawatt facility is located at Castleton-on-Hudson,
N.Y., on the
grounds of its steam host, The Fort Orange Paper Company. The Fort
Orange
Paper Company has a delivery contract, which expires in 2010, to
obtain steam
from the facility. Electricity produced by the plant will be sold
primarily
into the deregulated New York and New England power markets. The
Partnership
will also enter into a nine-year capacity agreement with a
subsidiary of
TransCanada PipeLines Limited (TransCanada). The resulting revenues
and costs
associated with this acquisition are fixed and secured under
long-term
contracts with either third parties, TransCanada or its affiliates.
''The acquisition of TransCanada Power, L.P.'s sixth power plant
and the
related capacity agreement results in a stable cash flow for the
Partnership
that is guaranteed by TransCanada and accretive on a per unit
basis,'' said
Larry Spackman, President, TransCanada Power Services Ltd. ''As
well, this
acquisition will diversify both the Partnership revenue and
operations into
New York, one of the fastest growing markets in North America.''
Concurrent with the approval of the plant acquisition,
TransCanada Power
Services Ltd. approved an increase in the Partnership's credit
facility with
TransCanada to $170 million. The facility is on commercial terms
and no
standby fees are payable on the unused balance. It will provide
financing for
this acquisition and flexibility for future acquisition
opportunities. It is
the intention of the Partnership to repay any facility debt used for
acquisitions with proceeds of Partnership unit offerings.
TransCanada Power, L.P. is a Canadian limited partnership that
offers
investors solid cash flow and growth opportunity. It trades on the
Toronto
and Montréal stock exchanges as TPL.UN. TransCanada currently holds
approximately 40 per cent of the Partnership units participating in
cash
distributions with the remainder held by the public. TransCanada
Energy Ltd.,
a wholly owned subsidiary of TransCanada, manages the operations of
the
partnership.
Note to Editors: To receive a fact sheet for information on the
Partnership plants please call Canada NewsWire at (403) 269-7605.
-0- 07/06/1999
For further information: on the Partnership visit the Internet at
www.transcanada-powerlp.com or contact: Media Inquiries: Gary Davis,
(403) 267-3340, Glenn Herchak, (403) 267-6299 Other Inquiries: Kelly
Holmes, (403) 213-3109, Toll free: (888) 887-7717
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