Equinor has agreed to acquire an interest in the Lackawanna Energy Center (Lackawanna), a 1,483 MW gas-fired combined cycle power plant (CCGT) in Pennsylvania. The transaction represents a step forward in building an integrated power business in selected markets.
Lackawanna was developed by Invenergy, North America’s largest privately held developer, owner and operator of power infrastructure. Under the definitive agreement, Equinor will acquire 87.71% of the Class A shares in Lackawanna for USD 940 million subject to a potential purchase price reduction at closing of the transaction. The remainder of the Class A shares and 100% of the Class B shares are owned by Invenergy AMPCI Thermal Power LLC.
Invenergy will continue managing and operating Lackawanna, while Equinor and Invenergy will together explore additional collaboration opportunities that leverage Invenergy’s long-standing operating capabilities and position in the existing PJM power market.
“Electricity demand in PJM is growing rapidly, driven by electrification, data centres and industrial activity. This acquisition gives Equinor further access to the largest power market in the US and is located close to our significant Appalachian gas position. It also provides early cash flow and long-term value potential. We look forward to working with Invenergy as an experienced operator and exploring further collaboration,” says Helge Haugane, executive vice president for Power.
The investment structure provides upfront preferred cash flow and visibility on long-term cash generation, supported by investor protection mechanisms. Under the agreement, Equinor will acquire an interest in Lackawanna from funds managed by Global Infrastructure Partners (GIP), a part of BlackRock.
Lackawanna is among the largest and most efficient gas-fired power plants in the PJM power market, the largest wholesale electricity market in the US. PJM serves nearly 70 million consumers across 13 states and is expected to see continued demand growth.
The facility is well positioned through reliable access to abundant, competitively priced natural gas. It is also located near Equinor’s significant gas position in the Appalachian Basin, one of the company’s largest gas assets globally. The non-operated Appalachian Basin asset delivers more than 1.7 billion cubic feet of natural gas per day into the northeastern US.
The transaction builds on Equinor’s long-standing presence in the United States, the company’s largest source of energy production outside Norway. It is in line with Equinor’s approach to develop power positions in selected markets where the company can combine industrial capabilities, market access and existing energy positions.
Closing of the transaction is subject to customary regulatory approvals.
