Saskpower buying out partner in Cory power station for $120 million

Saskatchewan’s largest electrical utility is spending approximately $120 million to buy its joint venture partner’s share of a 16-year-old cogeneration station west of Saskatoon, a move its vice-president of power production says is a “very good deal.”

Saskpower’s decision to buy Canadian Utilities Ltd.’s share of the Cory Cogeneration Station gives the Crown corporation total control of the facility and keeps all of its profits in the province, Howard Matthews said Monday.

“We don’t see a whole lot of downside risk,” Matthews said of the facility, which burns natural gas to create steam for Nutrien Ltd.’s Cory potash mine and electrical power that is fed into Saskpower’s transmission grid.

Under its existing contract, Saskpower pays ATCO approximately $20 million per year for electricity generated at the facility. Spokesman Jordan Jackle said it can now avoid that expense and “expects to receive a payback, net of operating expenses, within 10 years.”

Saskpower and Canadian Utilities announced the deal Monday morning, at the same time as the Calgary-based ATCO subsidiary said it had agreed to sell all its Canadian fossil fuel-burning electrical plants for around $835 million.

The plant has 10 employees, six of whom work for ATCO. The remaining four are employed by Saskpower. Matthews said they will be offered the opportunity to continue working at the facility as Saskpower employees.