Oneok Capitalizing on Gas With Power Entry
Oneok Inc. plans to enter the electric generation and power
marketing businesses with an Oklahoma generating facility. The
company signed a contract with General Electric to buy four gas
turbine generators with a capacity of 300 MW. A generation facility
encompassing the four units will be constructed and in service by
June 1, 2001.
David Kyle, president of Oneok, said, "Our focus will be to
serve the electric peaking needs with natural gas-fired generation
during those times when consumption is at maximum levels. Owning
natural gas-fired power generation is a natural extension of our
core business and provides the opportunity to expand our growing
power marketing business."
Bill DeWare, vice president of Oneok Power Marketing, said,
"Electric deregulation is opening the door of opportunity. Power
shortages in the eastern part of the United States just last week
certainly indicate the growing need for more electric generation.
We know there is a need right now for more peaking capacity in the
region served by the Southwest Power Pool and we want to move
quickly to establish ourselves and help meet that need. We have
already executed a 15-year letter of intent with the Oklahoma
Municipal Power Authority to purchase approximately 25% of our
total generating capacity starting in mid-2001."
The estimated cost of the four gas turbine generators is $70
million. The new generating facility will be built near Oneok's
West Edmond gas storage facility in Logan County, OK. The location
will give the plant access to Oneok's gas storage and firm electric
"This is a wrap-around strategy. We plan to wrap around our
existing natural gas assets and personnel and operate at the same
address, using our natural gas molecule to produce electricity,"
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