Freeport-McMoRan Copper & Gold Inc., the largest publicly traded copper producer, is selling a stake worth as much as $200 million in a New Mexico power plant that supplies electricity to its local mines, two people familiar with the matter said.
Freeport is working with Wells Fargo & Co. to find buyers for its one-third stake in the Luna Energy Facility, a 600-megawatt natural gas-fired plant that as a whole is worth as much as $700 million, said the people, asking not to be identified as the information is private.
The Phoenix, Arizona-based company wants to take advantage of the strong demand for gas-fired power plants, one person said. Freeport is cutting spending and seeking asset sales to cut debt after buying two oil and gas companies last year for $9 billion.
Eric Kinneberg, a spokesman for Freeport, didn’t return phone calls seeking comment on the sale. Jessica Ong, a Wells Fargo spokeswoman declined to comment.
Energen Corp. is selling its natural gas utility in Alabama, and Teco Energy Inc. last year agreed to buy Continental Energy Systems LLC’s New Mexico gas operation.
Freeport plans to keep buying power from the plant, one person said. The facility supplies the company’s Chino and Tyrone copper mines in New Mexico, according to its annual report. The company acquired Plains Exploration & Production Co. and McMoRan Exploration Co. last year.