Williams to Supply Gas and Market Power for AES Plant
Similar to a deal the two companies made last May involving
three power plants in the Los Angeles Basin, Williams and AES
forged an agreement last week in which Williams will supply the
fuel and market the power produced from an AES-built and -operated
power facility in Pennsylvania. The AES Ironwood plant will be
located in South Lebanon Township and will have a capacity to
produce 700 MW. Financial terms of the transaction were not
"The growing Pennsylvania-New Jersey-Maryland power market
offers an important opportunity for Williams," said Jerry Gollnick,
president of Williams Energy Marketing and Trading Co.
"We're implementing a strategy now that we've been working on
for quite some time. We targeted the [Pennsylvania-New
Jersey-Maryland] market, and this deal represents the beginning of
the implementation phase," said Phil Scalzo, a Williams spokesman.
"Over the next few months, expect to hear more about Williams'
power deals in this market."
AES will begin construction on the Ironwood facility this
quarter. Service is expected to begin in the second quarter of
2001. A Williams spokesperson said the facility will burn 100
The two companies made a similar agreement in May, but were
dealing with already-constructed facilities and much bigger
volumes. Through the first deal, Williams gained access to 4,000 MW
to market and 250 MMcf/d of gas to supply. In 1998, these
facilities burned 50 Bcf.
"As a direct result of the California deal, Williams was put on
the map as a power player," Scalzo said. "Deals in other areas
quintupled as a result of this deal." Williams ranked 14th in NGI's
power marketer rankings for 1998, a position Scalzo said is
directly attributable to Williams' dealings with AES.
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