Salt River Project Agricultural Improvement and Power District will pay $371 million for Sempra U.S. Gas & Power LLC’s 625-megawatt block of its Mesquite Power natural-gas power plant.

Salt River Project supplies water and electricity to the Phoenix metropolitan area. The asset is made up of two gas turbines and one steam turbine.

Sempra says that it wants to grow its southeast natural gas portfolio and reduce its exposure to merchant power markets. The energy company operates multiple solar, wind and natural gas power plants. The company is a subsidiary of Sempra Energy (NYSE: SRE).

The deal is subject to regulatory approval.

For more on the energy industry, see “Fracking Fuels Energy Deals,” and “Special Report: Energy M&A on Fire in December.” 

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