Fortescue sells power station for $300m
Fortescue Metals Group has sold the power station at its Solomon mine in Western Australia’s Pilbara region for $US300 million ($294 million).
The iron ore miner had been negotiating the sale for some time. The sale comes one day after the company announced the deferral of some expansion work and other cost cutting measures in response to significant falls in the iron ore price.
Fortescue today said it would sell the power station to a subsidiary of TransAlta Corporation, a Canadian power company.
As part of the deal, Fortescue has entered into a long-term agreement to purchase power from the station over the life of its Solomon mine.
‘‘It was always our intention to divest the Solomon power station to an established owner and operator of power generation assets,’’ Fortescue chief executive Nev Power said in a statement.
‘‘We are pleased to establish a long-term agreement with TransAlta, a company with more than 15 years of experience operating power stations and transmission and distribution systems to mining operations in WA.
’’The sale remains subject to regulatory approvals, including the Foreign Investment Review Board, but Fortescue says it expects the deal to be completed by the end of September.