GLASGOW, U.K., June 2, 2004 (PRIMEZONE) -- ScottishPower is pleased to announce the purchase of the 800MW Damhead Creek CCGT power plant and associated contracts, including the benefit of a long-term gas supply agreement, from its creditor banks for approximately GBP317 million in cash.
Taking into account other assets and contracts inherited with the plant, ScottishPower estimates the effective price of the acquisition to be equivalent to a very competitive GBP275/kW of installed capacity, providing an excellent return on invested capital and delivering earnings in the current year.
This purchase compares favourably with recent similar deals taking into account high thermal efficiency, favourable transmission location and station life, and is significantly less than the cost of new build, again underlining ScottishPower's focus on capital discipline.
The acquisition of this modern and efficient natural gas-fired plant, south-east of London, allows ScottishPower to grow its integrated energy business in line with the significant growth in its UK customers. It also further strengthens our diverse generation portfolio.
Charles Berry, Executive Director UK, said: "We are delighted with this purchase which helps meet the needs of our fast-growing customer base. Completed at the right price, right time and right location, it also advances our strategy of adding generation capacity in southern England."
Commissioned in 2001, Damhead Creek has an excellent operational record. Its prime location in Southern England, where ScottishPower now has three CCGT stations, allows us to maximise cost efficiencies. It increases ScottishPower's generating capacity in England and Wales to around 1,800MW.
This information is provided by RNS. The company news service from the London Stock Exchange.