InterGen gets 30 % stake in Coral Energy

InterGen, a Shell and Bechtel joint venture, is getting a 30 % stake in Coral Energy, Shell's gas and trading arm. Shell and Bechtel said the two companies have agreed to expand the scope of their InterGen joint venture. Shell's stake in InterGen will increase to 68 %, with Bechtel owning the remaining 32 %.
The majority of Shell's Coral Energy affiliate's natural gas pipeline, storage and power generation US assets will be transferred to InterGen. The companies said in a release that InterGen's acquisition of the ownership interest in Coral Energy was "to strengthen the alignment of assets with marketing and trading in North America." Coral is the region's largest natural gas marketer and twentieth largest power supplier, according to the company.
Approximately 230 Coral employees, primarily related to Texas-based assets, will join InterGen. The new alignment is designed to enable InterGen to globally leverage Shell's strengths in both fuel supply and power marketing and trading. Bechtel will continue to be InterGen's preferred provider of power generation engineering, procurement and construction services world-wide.
The move is intended to respond to a need to have globally aligned marketing, trading and asset components, Linda Cook, CEO of Shell Gas & Power, said in a statement. Cook said InterGen plans to build a sizeable power generation portfolio in the US, working closely with Coral to pursue investment decisions that make the most commercial sense.

Specific assets to be transferred from Coral to InterGen include the following:
--Four thousand miles of major intrastate gas pipeline in Texas, extending from south Texas near the border with Mexico to the Texas-Louisiana border, and north from Houston to producing areas in east Texas.
--The West Clear Lake Storage Facility, a natural gas storage reservoir located near the Houston Ship Channel, and leasehold interests in the Stratton Ridge storage facility.
--Coral's interest, totalling over 500 MW, in four power plants,one in operation and three under construction, all subject to equity and regulatory approvals.

InterGen is operating or building 11 power stations, representing 7,985 MW. It has an additional 7,040 MW in what the company termed advanced development.