Optim’s Twin Oaks coal plant headed to Aug. 4 auction

The bankruptcy court for Optim Energy LLC on July 3 ordered an Aug. 4 auction date for the assets associated with the coal-fired Twin Oaks power plant in Texas, with a new party approved at the last-minute as the “stalking horse” bidder for these assets.

The new stalking horse is Twin Oaks Power LLC, an affiliate of energy investor ArcLight Capital Partners LLC. Its offer price is $82m in cash. An Aug. 7 sale hearing date has been set where the judge will look at the auction results.

On Feb. 12, Optim Energy and its debtor affiliates commenced voluntary cases under Chapter 11 at the U.S. Bankruptcy Court for the District of Delaware. Optim identified the 305-MW Twin Oaks plant and its burdensome lignite coal supply contract as key reasons it had to seek bankruptcy protection.

The original stalking horse bid, for $60m in cash, was filed with the court on June 13 and was with Major Oak Power LLC, an affiliate of The Blackstone Group LP.

The contact for the new stalking horse is: Twin Oaks Power LLC, c/o ArcLight Capital Partners LLC, 200 Clarendon Street, 55th Floor, Boston, MA 02117, Attention: General Counsel, Email: tburke@arclightcapital.com.

Twin Oaks is a two-unit lignite-fired plant located in Robertson County, Texas. Twin Oaks sells its generated power into the market regulated by the Electric Reliability Council of Texas (ERCOT). Twin Oaks purchases the vast majority of the coal necessary to operate the facility from Walnut Creek Mining under an executory long-term fuel supply agreement (FSA) executed in 1987.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.