Aquila Inc. on Tuesday completed the sale its natural gas storage assets in the United Kingdom to an undisclosed energy trader based there for US$34.9 million, bringing its already announced asset sales that are closed or pending to $911 million total.

The Kansas City, MO-based utility has a goal to sell $1 billion in assets, and already has completed $731 million of the sales. The UK assets consist mostly of Hole House Farm, a gas storage facility located near Crewe, Cheshire, England. It has one operational salt cavern linked to the Transco gas transmission system and a second cavern about to be brought into operation. The two caverns together will provide 10 million therms, or 1 Bcf of quick-cycle working gas capacity.

As of Oct. 11, Aquila has either closed or has pending seven sets of assets, as well as a group of what it describes as “other businesses.” The names and net proceeds include the Lockport power project, $37.5 million; natural gas pipeline and processing assets, $265 million; UnitedNetworks, $362 million; UK gas storage assets, $34.9 million; Texas gas storage assets (pending), $180 million; Quanta stock (open market and private sales), $13.8 million; corporate aircraft, $15.4 million; and other businesses, $2.4 million.

On Tuesday, Standard & Poor’s Ratings Services (S&P) noted that a sale last week of its 70% ownership in UnitedNetworks Ltd. of New Zealand would not immediately affect its current ratings our its outlook on the company (see Daily GPI, Oct. 14). “Aquila’s share of the net proceeds, estimated to be about $362 million, will be used to retire debt related to its acquisition of UnitedNetworks and other utilities in Australia, Canada and the United Kingdom. The sale is a positive step toward reducing the company’s debt and is part of Aquila’s continuing plan of asset divestiture. However, the company still maintains an aggressive debt profile.”

S&P said Aquila needs to “further reduce business and financial risk through asset sales and improvements in its utility operations to stabilize its credit.”

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