Calpine completes sale of Mexican power plant

San Jose, CA, April 24, 2006 — In an effort to regroup and focus on its core business, bankrupt Calpine Corp. announced that one of its foreign non-debtor affiliates has completed the sale of its 45-percent equity interest in the 525-megawatt Valladolid III Power Plant, located on the Yucatan Peninsula, Mexico, to the two remaining partners in the project, Mitsui & Co. Ltd. and Chubu Electric Power Co. Inc. (together the “buyers”).

The company announced plans to sell its interest in the plant in March 2006. With this sale, Calpine advances its recently announced program to streamline the company, reduce costs, and strengthen Calpine’s overall organization as part of its bankruptcy restructuring.

Calpine received a cash payment of approximately $43 million, less a 10-percent holdback that the buyers will return after one year. With completion of the sale, Calpine has eliminated its 45-percent share of the non-recourse unconsolidated project debt.

In addition, $9.1 million of Calpine funds held in escrow for credit support for the project were released to Calpine. The company expects to record a non-cash impairment charge of approximately $41 million on its investment in the project for the period ending Dec. 31, 2005, which is a component of the impairment charges announced on April 17, 2006.

For related articles on the developing Calpine Corp. story, please read these articles:

Calpine to cut 775 jobs; announces plans to sell non-core power plants

Calpine sells interest in Mexican power plant; general counsel departs

Calpine shifting executive staff to go forward with restructuring plan

Calpine closes $2 billion DIP financing

Calpine declares compensation figures for board; purchases geothermal plants; appoints new board member

Calpine finalizes collateral structure for $2 billion DIP facility

Calpine files to reject two power plant lease agreements

Calpine to eliminate 300 jobs, sell non-core business

Calpine Power Income Fund and its manager in dispute

Default avoided on King City Project: Calpine Power Income Fund; Scott Davido named CFO of Calpine

Calpine receives court approval of $2 billion DIP financing

Calpine announces departure of member of board

Calpine terminates tender offer for outstanding first priority senior secured notes

Calpine receives court approval of first day motions

Calpine files for bankruptcy

Calpine given time to repay debts, but not much

Calpine’s common stock to cease trading on NYSE

Fitch says Calpine exposure does not adversely affect public power sector


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