Taqa eyes $2bn power investment in North America

ENERGY ACQUISITION: Taqa is looking at acquiring 2,000 megawatts of power generation capacity in North America for around $2 billion. (Getty Images)

Abu Dhabi National Energy Company (Taqa) is looking at acquiring 2,000 megawatts of power generation capacity in North America for about $2 billion, the company's chief executive said on Monday.

It is also eyeing about 5,000 megawatts of power projects in Saudi Arabia in a joint venture with Saudi's Zamil Group, Peter Barker-Homek told reporters on the sidelines of an energy event in Qatar's capital Doha.

"We are looking at picking up 2,000 megawatts in North America... if we proceed it will be worth about $2 billion," he said, declining to be more specific.

Taqa is 75% owned by the Abu Dhabi government, which controls over 90% of the oil reserves in the UAE. The UAE is the world's fifth-largest oil exporter and Taqa's expansion is part of the Gulf Arab state's drive to use record oil revenues to diversify.

The projects in Saudi Arabia would be worth "upwards of $5 billion", Barker-Homek said.

With Zamil "together we are looking at developing co-generation plants in industrial cities with up to 5,000 megwatts [of power generation capacity]", he said.

Barker-Homek said Taqa and Zamil would split investment equally in the projects.

The new power plants in Saudi Arabia would have a construction time of three to five years.

Power generation capacity in the world's largest oil exporter needs to grow threefold over the next 25 years to meet future demand, Ibrahim El-Amin, professor at King Fahd University of Petroleum and Minerals in Saudi Arabia, said last month.

Capacity needs to rise to 115,000 megawatts in 2032, from current capacity or around 35,000 megawatts, El-Amin said.

Taqa, which last year agreed on more than $10 billion of acquisitions from Canada to India, plans to triple the value of assets to $60 billion by the end of 2012, a figure Barker-Homek said the company remained on course to amass.

Taqa's acquisition rate has not slowed due to the global credit crisis, and if anything there have been more opportunities for Taqa to evaluate, Barker-Homek said.

"The number of opportunities has gone up tenfold... we are in a good position to pick what we want to infill our portfolio," he said.

The firm had no plans to tap the debt markets in the next couple of months and had a credit facility in place for any upcoming acquisitions, Barker-Homek said.

Taqa said in January it had agreed a $3.1 billion, one-year credit facility with several international lenders.

The firm in January wrapped up its C$5 billion acquisition of Canada's PrimeWest Energy Trust, its third Canadian purchase in less than a year.

Barker-Homek said the firm's oil and gas drilling programme in Canada had achieved a replacement rate of 120 percent.

Taqa produces around 100,000 barrels of oil equivalent per day on its Canadian oil and gas assets, he said. (Reuters)

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