SAN JOSE, Calif., July 11 /PRNewswire-FirstCall/ -- Calpine Corporation
(NYSE: CPN) has completed the sale of its 50-percent interest in the
175-megawatt Grays Ferry Cogeneration Facility to an affiliate of Thermal
North America, Inc. (TNAI) for $37.4 million. Calpine announced plans for the
sale of Grays Ferry and three additional non-strategic power plants in June as
part of the company's program to reduce debt, increase cash flow and optimize
its power plant portfolio. Calpine expects to use net proceeds from the sale
for corporate purposes, including the repurchase of existing Calpine debt.
"This transaction represents another non-strategic asset sale and advances
our initiative to de-lever Calpine's balance sheet, strengthen cash flow and
enhance the long-term value of our power plant portfolio," stated Calpine
Chief Financial Officer Bob Kelly. "At $425 per kilowatt, we believe this
asset sale represents a very good value for Calpine's 50% interest in Gray's
Ferry. And, while this is non-strategic asset for Calpine, it provides TNAI
with an opportunity to own a 100% interest in the plant."
The asset sale also eliminates Calpine's 50% share of the cogeneration
facility's debt, representing a reduction of approximately $21.6 million of
Calpine's unconsolidated, non-recourse project debt as of March 31, 2005. The
company expects to record a loss on the sale of Grays Ferry totaling
approximately $20 million in the quarter ended June 30, 2005.
Grays Ferry entered operations in 1996 and delivers electricity to PECO
Energy Company under a long-term contract that expires in 2017. As a
cogeneration plant, it is contracted to supply steam for Trigen-Philadelphia
through 2022. Calpine acquired its 50% interest in Grays Ferry in 1999.
A major power company, Calpine Corporation supplies customers and
communities with electricity from clean, efficient, natural gas-fired and
geothermal power plants. Calpine owns, leases and operates integrated systems
of plants in 21 U.S. states, three Canadian provinces and in the United
Kingdom. Its customized products and services include wholesale and retail
electricity, natural gas, gas turbine components and services, energy
management, and a wide range of power plant engineering, construction and
operations services. Calpine was founded in 1984. It is included in the S&P
500 Index and is publicly traded on the New York Stock Exchange under the
symbol CPN. For more information, visit www.calpine.com.
This news release discusses certain matters that may be considered
"forward-looking" statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended, including statements regarding the intent, belief or
current expectations of Calpine Corporation ("the Company") and its
management. Prospective investors are cautioned that any such forward-looking
statements are not guarantees of future performance and involve a number of
risks and uncertainties that could materially affect actual results such as,
but not limited to, (i) the timing and extent of deregulation of energy
markets and the rules and regulations adopted on a transitional basis with
respect thereto; (ii) the timing and extent of changes in commodity prices for
energy, particularly natural gas and electricity; (iii) unscheduled outages of
operating plants; (iv) a competitor's development of lower cost generating
gas-fired power plants; (v) risks associated with marketing and selling power
from power plants in the newly-competitive energy market; and (vi) other risks
identified from time-to-time in the Company's reports and registration
statements filed with the SEC, including the risk factors identified in its
Annual Report on Form 10-K for the year ended December 31, 2004 , and in its
Quarterly Report on Form 10-Q for the three months ended March 31, 2005, which
can be found on the Company's website at www.calpine.com. All information set
forth in this news release is as of today's date, and the Company undertakes
no duty to update this information.
SOURCE Calpine Corporation
07/11/2005
CONTACT: media, Bill Highlander, +1-408-995-5115, ext. 1244, or
investors, Rick Barraza, +1-408-995-5115, ext. 1125, both of Calpine
Corporation
Web site: http://www.calpine.com
