CMS Energy and VRA Agree to Build A New 110 Megawatt Gas-Fired Turbine Generator

12:32 p.m. Aug 25, 1999 Eastern

DEARBORN, Mich., Aug. 25 /PRNewswire/ -- CMS Energy Corporation (NYSE: CMS) today announced it has executed definitive agreements with its Ghanaian partner, Volta River Authority (VRA), for the accelerated construction, joint ownership and operation of a second 110 megawatt, natural gas-fueled turbine generator at Unit 2 of VRA's Takoradi Thermal Power Plant near Aboadze, Ghana. The acceleration of the second turbine generator was made at the initiative of Mr. Gilbert Dokyi, Chief Executive of the VRA.

CMS Energy and VRA have formed a joint venture, Takoradi International Company (TICO), to construct and operate Takoradi Unit 2, which will be a 330 megawatt combined cycle unit identical to Takoradi Unit 1, which is currently being commissioned. TICO has extended an engineering, procurement and construction contract, originally awarded last February to Black & Veatch for construction of the first 110 megawatt phase of the Takoradi expansion project to now include installation of a second turbine-generator. Construction on the new frame 9E turbine-generator, supplied by Alstom, will begin this Fall, with completion scheduled by September 2000. The first turbine-generator is scheduled for completion by March 2000. The new simple-cycle gas turbine is currently 90 percent owned by CMS Energy, while VRA holds ten percent, with an option to increase its ownership to 50 percent. The project will sell all of its electric output to the Volta River Authority under a long-term sales agreement.

"We in VRA are pleased with this agreement, because it ensures additional electricity supplies which are very much needed in Ghana," said Mr. Dokyi. "While construction of the first 110 megawatt phase of Takoradi Unit 2 is proceeding on schedule, we foresee the immediate need for additional electricity in Ghana's energy sector, which this new generator will fulfill."

Takoradi Unit 2 will eventually total 330 megawatts through a conversion to combined-cycle operation, and will be fueled by the proposed West African Pipeline from Nigeria. CMS has agreements with VRA to operate and acquire a 50 percent concession for the existing 330 megawatt Unit 1 of Takoradi, now nearing commercial operation.

"This contract represents another step toward our commitment to provide secure electrical energy supplies for economic growth in Ghana," said Joseph P. Tomasik, vice president and managing director of CMS Energy, U.K., Ltd.

Rodney E. Boulanger, president and chief executive officer of CMS Energy's independent power unit, CMS Generation Co., said, "This new phase of Takoradi unit 2 is a continuation of our investment in Ghana's energy infrastructure, and demonstrates our confidence in the energy sector of sub-Saharan Africa over the long term."

The VRA, worth in excess of (U.S.)$2 billion in net assets, is one of Ghana's largest corporations. Its core business involves the generation, transmission and distribution of electric power. It also supplies power to the neighboring countries of Togo and Benin and operates an interconnected network with La Cote d'Ivoire.

CMS Energy Corporation has annual sales of about $6 billion and assets of about $14 billion throughout the U.S. and in 22 countries around the world with businesses in electric and natural gas utility operations; independent power production; natural gas pipelines and storage; oil and gas exploration and production; and energy marketing, services and trading. CMS Energy Corporation's principal subsidiary is Consumers Energy, Michigan's largest utility and America's fourth largest combination gas and electric utility.