Release: International Power Signs Key Contracts for 830 MW CCGT Elecgas Project in Portugal

International Power Signs Key Contracts for 830 MW CCGT Elecgas Project in Portugal

(London – 5 March 2008) International Power plc is pleased to announce that, together with project partner Endesa, it has signed an offtake (tolling) contract, an  Engineering Procurement and Construction (EPC )  agreement and has successfully completed the financing for the new 830 MW CCGT Elecgas project in Portugal.  This project will be located on a site adjacent to the existing 600 MW Tejo coal fired power plant.

The entire output of the new plant will be sold to Endesa Generacion S.A., a subsidiary of Endesa, under a 25 year tolling contract. The EPC agreement has been signed with Siemens. The plant will be owned and operated on a 50:50 basis by International Power and Endesa.

The total project cost is estimated to be €580 million (£443 million), which will be funded by a mix of debt and equity in an 85:15 ratio. For its 50% share,  International Power’s equity investment will be €44 million (£34 million). The mandated lead arrangers for this financing are Banco Espirito Santo de Investimento, Banco Millennium BCP Investimento, Banco Santander Totta, Caixa Banco de Investimento, Caja Madrid and The Royal Bank of Scotland.

Philip Cox, Chief Executive of International Power, said, “We are pleased to have successfully signed the tolling agreement, the EPC agreement and completed the financing for the Elecgas  project. This project will strengthen our position in the attractive Portuguese market, add to our long term contracted earnings stream and is a good example of how we can deliver and finance organic growth from within our portfolio at attractive terms”.

The Elecgas greenfield development project is expected to be fully operational in 2011. As a result of its close proximity to the existing plant, the plant will benefit from shared services such as cooling water infrastructure.  The facility will be constructed by a consortium led by Siemens under a turnkey EPC contract utilising the SGT5-4000F turbines in combined cycle mode with a targeted efficiency rating of over 58%. Fuel (natural gas) will be supplied by Endesa under the tolling agreement.

Notes to Editors:

An exchange rate of £1:€1.31 has been applied in this announcement.

The existing 600 MW Tejo coal fired power plant is owned by International Power (50%), Endesa (39%) and Energias de Portugal (11%) and operated by a 50:50 joint venture between International Power and Endesa.

Investor Contact:  Aarti Singhal Telephone: +44 (0)20 7320 8681

Media Contact: Beth Akers Telephone: +44 (0)20 7320 8622

About International Power

International Power plc is a leading independent electricity generating company with 30,807 MW gross (18,935 MW net) in operation and 3,054 MW gross (964 MW net) under construction. International Power has power plants in operation or under construction in Australia, the United States of America, the United Kingdom, France, Germany, the Czech Republic, the Netherlands, Italy, Portugal, Spain, Turkey, Bahrain, Oman, Qatar, Saudi Arabia, the UAE, Indonesia, Pakistan, Puerto Rico and Thailand. International Power is listed on the London Stock Exchange with ticker symbol IPR. Company website: www.ipplc.com