In October 2010, Infrastructure Capital Group on behalf of EIT acquired a 30% interest in the Kwinana Power Station from ERM Power. The acquisition also included an option for EIT to acquire a further 20% of Kwinana, which was exercised in November, resulting in a 50/50 partnership with Sumitomo Corporation.
Construction of the 320MW CCGT plant was completed in December 2008 and is expected to strengthen EIT’s presence in Western Australia and its relationship with Sumitomo and Synergy, the State’s largest electricity retailer.
Through this acquisition, EIT has achieved one of its original strategic goals of gaining significant equity interests in both Kwinana and Neerabup power stations.
The acquisition increases EIT’s exposure to quality core energy assets, which provides:
- + immediate cash yield;
- + a superior return;
- + low market risk through a long-term off-take contract with a creditworthy counterparty;
- + low fuel risk with a long-term gas supply arrangement in place; and
- + potential for synergistic benefits through EIT’s common ownership in both Kwinana and Neerabup.