Fortescue Metals Group Limited
(ASX:FMG) has sold its Solomon power station in the Pilbara region of Western Australia for $US300 million.
The iron ore miner has sold the asset to Canada’s TransAlta Corporation (TSX:TA, NYSE:TAC) and inked a long term power purchase agreement with the company for all of the power station’s capacity over the life of Fortescue’s Solomon mine, which is currently under construction.
CEO Nev Power says it was always Fortescue’s intention to divest the Solomon power station to an established owner and operator of power generation assets.
The announcement comes just one day after Fortescue outlined plans to cut staff, spending and its expansion as a result of plunging iron ore prices.
Once approvals are granted Fortescue expects the financial close of the sale by the end of September 2012.
Fortescue increased its net profit to $1.5 billion in the 2012 financial year.
