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TXU is preparing to roll over a $1.4 billion, 364-day revolver that expires in April. Tim Hogan, an investor relations official in Dallas, says finance staffers are still determining the size of the facility and who will lead the deal. He was unable to provide further details. One banker says he had heard the revolver might be sliced down to $1 billion. With a strong bank following, the deal will probably place quickly. "Anytime someone is reducing size a little is a good thing, and TXU is a strong name as well," the banker says. He adds that the deal might also provide a chance for bankers to get the company's take on the state of deregulation in the Texas market.

Sioux Falls, S.D.-based NorthWestern tapped the bond market last week with $720 million in senior notes and plans to use the bulk of the proceeds to repay a $600 million bridge loan it arranged to fund the cash portion of its $1.1 billion acquisition of Montana Power. The bridge comes due next February.

Kansai Electric Power Co. and Kyushu Electric Power Co. are separately considering entering their first weather derivatives contracts to hedge against a cold summer reducing the revenue they generate from powering air conditioning units, according to officials familiar with the companies' plans.

Xcel Energy is planning to put affiliate NRG Energy's entire 5.4 GW international plant portfolio and trading operations up for sale once their merger is approved and is in the process of selecting banks to advise on the process.

Ireland's state-owned electric utility, the Electricity Supply Board, is currently reviewing five requests for proposals submitted by prequalified project lenders to finance the construction of an 800 MW combined-cycle gas-turbine fired power plant in the Basque region of northern Spain. A banker who bid for the mandate says the RFPs were due two weeks back and that ESB is looking to make a selection in short order and have financing in place by year-end.

A surprising 60% of project finance banks in the U.S. say they are willing to commit to new merchant power deals, despite weak spot power prices and the bearish attitude to non-contracted risk shown in the syndication of recent deals, according to a recent survey conducted bySociété Générale. However, the bears still have a strong constituency, according to the survey, with 31.5% of respondents saying they have committed to merchant deals in the past and are now firmly on the sidelines.

*InterGen 's linked--but separate--$430 million Magnolia, $558.8 million Redbud and $550 million Cottonwood deals split opinion. While some bankers gripe about a less than smooth syndication process for some of the deals, other officials have nothing but admiration for West Griffin, the ex-cfo, who is widely credited with formulating the structure. Banks pitching for a lead slot had to agree to commit to the two deals they didn't get, with the result that each deal had six banks already locked in before syndication was launched.

RWE is looking to acquire an independent power producer in the U.S. and plans to target four of the biggest names in the industry: Calpine, AES, Reliant Resources and Mirant, says a New York banker. He adds that RWE has been examining such an acquisition for some time, but is now looking to swoop to take advantage of low valuations in the IPP sector. He says Germany's RWE has retained Morgan Stanley and Merrill Lynch to advise on its expansion plans.

TransAlta, Canada's largest unregulated generation concern, has hired Bank of America to arrange $150 million in project financing for the construction of a 259 MW gas-fired facility in Chihuahua, Mexico. A New York financier familiar with the matter says that since the non-recourse deal is at a preliminary stage, the details of the transaction have yet to be determined. Bankers at BofA and officials at Calgary, Alberta-based TransAlta did not return phone calls.

Leads bankers are targeting next week for a bank meeting to unveil the $2 billion credit line for San Jose, Calif.-based Calpine. The package consists of a $1 billion 364-day revolver, a $400 million one-year line and a $600 million B loan.