By Geoff Senescall
Canadian energy company TransAlta has put its Wellington gas network business on the block.
About 12 parties from New Zealand and Australia have been invited to bid for the asset, which has a book value of around $55 million.
Among those likely to be interested are Natural Gas Corporation, Fletcher
Energy, and Qest (formerly Enerco) from New Zealand and Australian Gas Light and Boral in Australia.
It is understood that TransAlta wants to have the process wrapped up by March.
For the year ended September 1998 the gas network operation had operating revenue of $11.58 million and earnings before interest and tax of $4.72 million.
The network serves 26,000 customers in Hutt Valley, Porirua and part of Wellington City.
TransAlta New Zealand was formed through the 1996 merger of two Wellington power companies, EnergyDirect and Capital Power. EnergyDirect held the gas assets.
Unlike the electricity industry, there is no Government requirement yet to split the retail operations of gas companies from their network operations.
But TransAlta's focus has been on the service end of the power industry.
It is now the largest retail power company, with more than half a million customers.
It was late last year that TransAlta, 63 per cent owned by TransAlta Canada, made its big move into the retail electricity market by buying the retail client base of Christchurch regional power company Southpower.
It followed that by buying Power New Zealand's retail business. In return, TransAlta sold its lines operations to Power New Zealand, now United Network.
TransAlta is also a leading contender to buy the 40 per cent cornerstone shareholding in state-owned Contact Energy, to be sold this quarter. It has sought Commerce Commission clearance.
