Freeport, Texas, October 26, 2010 – Toyota Tsusho Corp., is entering the U.S. market in natural gas-fired power plants by acquiring an indirect ownership stake from GE Energy Financial Services in a Texas cogeneration facility.
GE Energy Financial Services, a unit of GE, will hold a 5 percent stake in the 424-MW combined cycle co-generation facility, located inside a Dow Chemical petrochemical complex. International Power holds the balance of ownership in the plant.
The transaction’s closing is anticipated in the first quarter of 2011 after receipt of remaining consents and regulatory approvals in the U.S.
The plant sells the majority of its power and all of its steam to Dow under a fixed term contract. The balance of the capacity of the project is merchant and is sold under a shorter-term contract.
The power generation market in North America is important for Toyota Tsusho. Toyota Tsusho acquired equity in the Goreway Power Plant Project in Canada in September 2009.
The Oyster Creek Cogeneration Plant is the company’s first investment in a natural gas-fired power generation facility in the U.S. These investments contribute to the diversification of Toyota Tsusho’s power portfolio.
The Oyster Creek transaction marks the first partnership between Toyota Tsusho and GE Energy Financial Services in thermal power assets. The collaboration is consistent with GE Energy Financial Services’ strategy of attracting new cost-competitive capital from partners, offering its origination and portfolio management expertise.
Toyota Tsusho intends to continue enhancing its overseas power generation business by seeking investments in projects that provide long-term and stable revenue promote energy-efficient power, and are environmentally friendly. Key elements of this strategy are investments in natural gas-fired and renewable energy projects.