San Jose, CA-based Calpine Corp. Wednesday said it completed its previously announced sale of oil and gas assets in British Columbia to Calgary-based Pengrowth Corp. for approximately US $243.7 million.

The company said that of the total consideration, which exceeds book value, Calpine received a US$155.3 million cash payment from Pengrowth; the remaining US$88.4 million was paid from the purchase in the open market and tendering of Calpine debt securities by Pengrowth.

The sale is part of an ongoing effort by Calpine to shed more than a half-billion dollars in nonstrategic assets this year to improve its liquidity and cash balance by the start of next year.

“This asset sale provides Calpine an excellent opportunity to improve our balance sheet,” said Bob Kelly, Calpine’s CFO. “With the acquisition of our securities, we will reduce our debt outstanding by $197.4 million, record a gain of approximately $111.1 million and lower our annual interest expense on these securities by approximately $16.6 million.”

Calpine said the cost of $88.4 million to Pengrowth to acquire the securities included a market cost of $82.9 million, accrued interest of $4.5 million and fees of $1 million. The face value of the securities purchased and tendered to Calpine was $197.4 million, consisting of five different senior note securities with varying maturation dates, 2008-2011.

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