In a move to reduce debt and restructure the company, Canada's TransCanada Pipelines Ltd. Friday said it is about 40% along toward its goal of selling some $3 billion (Can.) worth of noncore assets, mostly gas pipelines and processing facilities, by yearend.
"Sales under the divestiture program have been in line with our expectations," said CEO Doug Baldwin. Since December, TransCanada has sold or has agreements to sell about $1.2 billion of assets. Simultaneously, the company has been investing in electricity generating projects in an effort to pursue growth opportunities outside its traditional lines of business.
"In June, we announced plans to construct two new natural gas-fired cogeneration power plants in Alberta,'' Baldwin said in a statement. "We also announced we were acquiring an additional 29.9% of the Ocean State Power plant, bringing our total ownership interest to 100%. These are excellent examples of how we intend to grow and position TransCanada to deliver improved value for our shareholders.''
Baldwin said TransCanada continues to make progress on the divestiture of assets not associated with its core businesses in Canada and the northern tier of the United States
"We remain confident we will reach our goal and that most of the divestitures will be completed by the end of this year, he said.
Some of the assets TransCanada has sold or has agreements to sell under its divestiture program include its interests in:
� The East Australian Pipeline.
� Several Canadian natural gas gathering and processing midstream facilities.
� Northridge Petroleum Marketing Ltd.
� An office tower in downtown Calgary.
� The OCENSA crude oil pipeline in Colombia.
� Several natural gas transmission assets in Argentina, Chile, and Brazil.
Some of the remaining assets to be sold include the rest of the natural gas gathering and processing midstream facilities, the natural gas liquids and extraction business, Cancarb Ltd., and the Express System, the company said. Other assets on the block include TransCanada's international interests in a gas treatment plant and offshore gas producing licenses in the Netherlands, TransGas natural gas pipeline in Colombia, Accroven SRL natural gas liquids extraction facility in Venezuela, GasPacifico natural gas pipeline from Argentina to Chile, and Energia Mayakan natural gas pipeline in Mexico.
Among the company's key objectives is to negotiate a new regulatory framework to level the competitive playing field in Canada and open up opportunities to earn higher returns, Baldwin said