Energy Company Expands Geothermal Holdings

TransAlta Corporation through its wholly owned subsidiary TransAlta USA Inc., has agreed to acquire half of a US generator from El Paso Merchant Energy, a business unit of El Paso Corporation.

Calgary, Alberta, Canada – January 29, 2003 [SolarAccess.com] TransAlta will purchase El Paso’s 50 percent interest in CE Generation LLC, including the right to a 50 percent interest in a geothermal development project. MidAmerican Energy Holdings Company will continue to own the other 50 percent interest of both CE Generation LLC and the geothermal development project. CE Generation holds 820 MW of operating capacity, including 330 MW of geothermal generation in California and 490 MW of gas-fired cogeneration in New York, Texas and Arizona. “These are excellent assets that immediately contribute to earnings and most of the output is backed by long-term contracts,” said Steve Snyder, TransAlta’s president and CEO. “MidAmerican is a first-rate partner with proven local operational experience, to which we will add our marketing expertise.” TransAlta will pay El Paso US$205 million plus approximately US$35 million in working capital, for a total of US$240 million. In addition, should TransAlta decide to participate in building the geothermal development project, TransAlta will compensate El Paso US$30 million for its development work. The transaction gives TransAlta a 50 percent share in 13 existing facilities. Power contracts are in place for all gas-fired facilities and eight of 10 geothermal facilities in the acquisition. TransAlta Power also recently released its financial figures for 2002 revealing net income of CAN$18.7 million for the year, compared to CAN$13.8 million in 2001. Net income for fourth quarter 2002 was CAN$5.5 million, in line with net income in fourth quarter 2001.

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