Calpine Corp. has agreed to purchase a natural gas-fired power plant near San Antonio for $625 million as it continues to expand its portfolio in Texas.

Houston-based Calpine said the combined-cycle power plant, with a nominal generating capacity of 1,050 MW, will be acquired from MinnTex Power Holdings LLC, a company owned by a private investment fund managed by Wayzata Investment Partners LLC of Minnesota. The facility is on a 110-acre site in Guadalupe County, about 30 miles northeast of San Antonio.

“Guadalupe is an exceptional plant with an outstanding performance record that meets Calpine’s high standards for operational excellence,” said Calpine CEO Jack Fusco. “We strongly believe in the potential of the Texas market as electric demand increases and reserve margins tighten.”

Fusco added that Calpine’s acquisition of a power plant in the south zone of the Electric Reliability Council of Texas (ERCOT) system “furthers our strategic objectives in this key market.”

Calpine said the Guadalupe plant includes two 525 MW generation blocks, each of which contain two GE 7FA combustion turbines, two heat recovery steam generators and one GE steam turbine. The company said the deal also includes rights to develop a 400 MW quick-start, gas-fired peaker if market conditions are favorable.

The company said the deal, which is still subject to conditions and antitrust review, is expected to close in 1Q2014. Calpine said it plans to fund the transaction with cash.

Last year, Calpine purchased an 800 MW gas-fired power plant in central Texas from Bosque Power Co. LLC for $432 million (see Daily GPI,Oct. 5, 2012). Three months later, Fusco told analysts that a national trend was building toward gas-fired power generation (see Daily GPI,Feb. 15).

Calpine owns 13 power plants in Texas with a combined generation capacity of more than 8,000 MW. The company owns 93 power plants, either in operation or under construction, serving 20 states and Canada, with a combined generation capacity of more than 28,000 MW.