EP Energy acquires the Helmstedt mining district including the Buschhaus power plant
Through its MIBRAG subsidiary, EP Energy, a.s. (hereinafter “EP Energy”) signed an agreement on the acquisition of the Helmstedt mining district with E.ON today. The new company, over which EP Energy will acquire full control, will be formed by spinning off the Buschhaus power plant and the Schöningen mine from the E.ON Group.
Furthermore, EP Energy will take over the current responsibilities concerning restoration and recultivation in the Helmstedt mining district.
The brown coal-fired Buschhaus power plant has an installed capacity of approximately 390 MW and was put into operation in 1985. According to E.ON’s current plans, the operation of the Buschhaus power plant should be discontinued at the point of time of depletion of coal reserves in the adjacent Schöningen mine as early as 2017. However, EP Energy will continue to operate the power plant supplying it with brown coal from its own mines.
“For EP Energy, this acquisition means a fundamental reinforcement of its vertical integration of coal mining with related electricity generation, and so it helps to eliminate the risks associated with the development of the German energy legislation. This vertical integration not only implies a fundamental extension of the Buschhaus power plant’s lifetime, but it also strengthens MIBRAG’s long-term off-take opportunities, and, therefore, it is excellent news for employees of both companies,” said Jan Špringl, EP Energy Vice-Chairman.
Through the acquisition of the Buschhaus power plant, the aggregate installed capacity of the power plants owned by EP Energy in Germany will exceed 900 MW, approximately the same as the capacity of one block of the nuclear power plant Temelín. The Buschhaus power plant has a higher efficiency than other generating plants operated by EP Energy, which will lead to an overall efficiency increase of the Group’s generating capacities.
The companies are expecting the transaction to be completed by the end of 2013.
The contracting parties have agreed not to disclose the purchase price.