Energy Minister Chris Bentley says a proposed gas plant cancelled just days before last year's election will be relocated to southwestern Ontario.

He says the relocation of the Greenfield South Power natural gas plant to Ontario Power Generation's Lambton Generating Station site will cost $180 million.

The figure includes a settlement agreement with the financiers of the plant, who are suing the Liberals for $300 million.

The Liberal government cancelled the planned 280-megawatt gas power plant in Mississauga last year, after scrapping another one in nearby Oakville the year before.

The opposition parties have accused the government of cancelling the plants to save Liberal seats, including Citizenship Minister Charles Sousa's and MPP Kevin Flynn's.

Work on the Mississauga plant continued for weeks after the Oct. 6 election, even though the government made it clear the project would have to be located elsewhere.

"Last year, after listening to the community's concerns, our government made a commitment to residents in Mississauga and Etobicoke to relocate the Greenfield South Power natural gas plant," Bentley told a news conference Tuesday.

Bentley said the construction of the plant is expected to create up to 200 jobs over the next two years.

He said the announcement "helps support Ontario's plan to modernize the province's electricity infrastructure, clean up the air we breathe and end the use of coal by 2014."

St. Clair Township Mayor and Lambton County Warden Steve Arnold said he reached out to Bentley in an effort to lure the plant to his region. He said the two spoke on several occasions leading up to the decision.

"We have a tremendous amount of energy production going on in St. Clair Township," Arnold said. "And we would like to provide as much power as we can to the province."

The township already boasts two solar farms and three generating stations, Arnold said. He is excited about the decision.

"It means jobs during the [plant's construction] and it means jobs for the long-term," Arnold said. "Where we are, we’re very used to working with energy producers. This is a great next step for us."