Plutonic to become BC's largest independent renewable power developer
Vancouver, BC and Stamford, Conn. - August 30, 2006 - Plutonic
Power Corporation announced today that it has granted a Canadian
affiliate of GE Energy Financial Services the exclusive right to provide
CAN$100 million of project equity as well as lead a CAN $400 million
debt financing for construction of the East Toba/Montrose Creek
run-of-river hydroelectric project located 190 kilometres northwest of
In return for the CAN $100 million equity investment, Plutonic will
provide GE with a 49% equity and 60% economic interest in the East
Toba/Montrose Project. Following a 35 year term, the economic interests
of GE will convert to 49%. GE will also have the right to match any
equity investment offer that Plutonic receives for a second
hydroelectric project, Rainy River.
The 196 megawatt East Toba River and Montrose Creek Project is located
at the headwaters of the Toba Inlet north of Powell River in British
Columbia and is expected to produce enough electricity to meet the
annual energy needs of over 75,000 homes. The 15 MW Rainy River Project
is located in Howe Sound, 10 km north of Vancouver, and could produce
enough electricity for over 5,000 homes.
Another GE Energy Financial Services affiliate has provided Plutonic
with $2.5 million of credit support for the East Toba River/Montrose
Creek project. In consideration of the credit support, Plutonic has
issued to the Canadian affiliate of GE Energy Financial Services 375,000
two-year common share purchase warrants with an exercise price of $2.50
per share (the "Warrants").
"This agreement with Plutonic helps pave the way for us to achieve our
goal of investing more than $3 billion in renewable energy globally by
2008," said Kevin Walsh, Managing Director and leader of GE Energy
Financial Services' renewable energy team. "In addition, this project
aligns nicely with GE's ecomagination initiative to expand the company's
cleaner energy products and reduce greenhouse gas emissions, and it
reinforces our portfolio in Canada."
The credit support was issued to BC Hydro as part of performance
security aggregating $12.66 million, required to back 35-year Energy
Purchase Agreements for the East Toba/Montrose Creek and Rainy River
projects. To supplement the credit support and its own treasury,
Plutonic has issued debt instruments totaling $9.70 million with a
private group of investors (the "Investors"). The Investors will be
issued 150,000 Warrants per million dollars received. GE and the
Investors will be paid an annual interest rate of 10% for the first
60-day period and 12% thereafter.
"The agreement with GE Energy Financial Services provides Plutonic with a
very strong partner," said Donald McInnes, President of Plutonic Power
Corporation. "It will allow us to focus on the execution of a
fixed-price engineering, procurement and construction contract, and
finalize permitting and First Nation relationships. The agreement also
paves the way to complete a debt package for construction financing of
the East Toba/Montrose Creek project as well as to work towards a debt
and equity package for Rainy River." Plutonic expects to achieve these
milestones this year, allowing for construction to begin in early 2007.
The East Toba River/Montrose Creek and Rainy River projects require an
estimated $550 million in capital (including interest) and will create
more than 300 full-time construction jobs over three years. This
represents the largest single private sector renewable energy investment
in the history of British Columbia, generating enough green electricity
to meet the needs of more than 80,000 homes, along with $60 million -
$70 million annually in revenue.
"Plutonic was the largest capacity bidder in BC Hydro's 2006 request for
proposals for power projects in the province. With the support of
financial partners such as GE, we expect to continue to aggressively
develop our next generation of projects for future BC Hydro tenders,"
Plutonic Power is committed to working cooperatively with First Nations
in their traditional territories to provide jobs, training and economic
benefits not just in the construction phase, but also over the lifetime
of these projects. Discussions with First Nations concerning the
development of the projects are ongoing.
About Plutonic Power Corporation
Plutonic Power is an emerging renewable energy producer in British
Columbia. Its proposed 19 projects have a design capacity of over 870 MW
and the potential to generate approximately 2,900 GWh per annum of
green energy - enough energy to meet the annual energy needs of
approximately 300,000 homes. Included in the 19 projects is the creation
of the Green Power Corridor, a series of non-storage hydroelectric
projects in southwestern BC, which hold the potential to catapult
British Columbia to the forefront of green energy generation in North
America. The completion of the Green Power Corridor would create over
2,400 person-years of employment.
About GE Energy Financial Services
GE Energy Financial Services' 300 experts invest globally with a
long-term view, across the capital spectrum and the energy and water
industries, to help their customers and GE grow. With $13 billion in
assets, GE Energy Financial Services, based in Stamford, Connecticut,
invests more than $3 billion annually in two of the world's most
capital-intensive industries, energy and water. GE Energy Financial
Services has developed a strong record investing in wind, solar,
biomass, hydro and geothermal power, and is growing its portfolio of $1
billion in renewable energy assets.
On behalf of the Board of Directors
PLUTONIC POWER CORPORATION
Donald McInnes, President
For additional information please contact:
Office: 604-669-4999 ext 1034
GE Energy Financial Services
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