TVA completes purchase of Magnolia plant

BENTON COUNTY — The Tennessee Valley Authority has completed the $436-million purchase of the Magnolia Combined Cycle Gas Plant in northern Mississippi from Kelson Limited Partnership.

The Magnolia facility becomes the fourth high-efficiency, combined cycle gas plant acquired or signed to a long-term lease by TVA since 2007. A fifth plant being built by TVA at the John Sevier site in East Tennessee is scheduled to come online in 2012.

The deal was approved by the Federal Energy Regulatory Commission Aug.17 and by the TVA board of directors Aug. 18.

Bob Irvin, senior vice president for TVA strategy and planning, said, “At less than half the cost of new construction, the fully permitted Magnolia plant will be a cost-effective addition to the TVA system.”

The three-unit natural gas-fired plant is located on a 374-acre site near Ashland. The plant is inside the TVA territory, is connected to a 500-kilovolt TVA transmission line and has provided power to TVA from time to time since it began operation in 2003.

Kelson Limited Partnership, a wholly owned subsidiary of Columbia, Md.-based Kelson Energy Inc., has owned the plant since 2005.

The Magnolia plant has a capacity of 968 megawatts, which will make it TVA’s largest combined cycle gas plant.

A TVA team will work with the Magnolia contractor workforce during the transition to TVA management. The staff is currently managed under a contract with North American Energy Services Co.