TransCanada selling thermal carbon unit, waste heat plant for $190M
Cancarb Ltd. manufacturing unit, Medicine Hat, Alta., plant sold to Japan-based Tokia Carbon Co., Ltd.
CALGARY—TransCanada Corp. has announced plans to sell its Cancarb Ltd. thermal carbon manufacturing subsidiary to a Japanese firm for $190-million.
The Calgary-based oil and gas giant said it will sell the Cancarb unit, including a waste-heat recovery power generation plant in Medicine Hat, Alta., in southeastern Alberta, to Tokia Carbon Co., Ltd.
Tokai is an international supplier of furnace carbon black and other carbon ceramic-related products.
The sale was made as part of TransCanada’s strategy, which is focused on large-scale pipeline and power generation in Canada, the United States and Mexico.
“Like any company, we regularly evaluate our diverse portfolio of assets to ensure it is maximizing value for our shareholders as we realize our vision of becoming North America’s leading energy infrastructure company,” TransCanada president and CEO Russ Girling said in a statement.
“The proceeds from this sale will help fund TransCanada’s unprecedented capital growth plan that includes $38-billion in new projects to be completed by the end of the decade.”
TransCanada acquired Cancarb in 1981.
Cancarb is the world’s largest producer of thermal carbon black, a specialized form of carbon derived from super-heated natural gas, which is used in a variety of industrial and automotive products including high-grade rubber, insulation and ceramics.
Added in 2001, the 41-megawatt power plant captures large volumes of waste heat from the manufacturing process to produce electricity that is sold into Medicine Hat’s electrical grid.
“Low natural gas prices, combined with Cancarb’s strong performance and global market share for thermal carbon black, made it an attractive investment for prospective buyers,” Girling said.
“Decisions like this are intended to build a stronger company for everyone, and we are committed to ensuring Cancarb’s employees are treated fairly during the transition to new ownership.”
The transaction is expected to close late in the first quarter of 2014.