Algonquin Power & Utilities Corp. (APUC) has announced that an entity owned by Algonquin Power Co. (APCo), APUC's renewable power generation subsidiary, has completed the acquisition of an interest in the Sandy Ridge wind project. The project is the first of four that make up a 480 MW portfolio of wind power facilities under construction by Gamesa Corporacion Tecnolagica SA.
Phase I of the acquisition originally contemplated obtaining interest in both the Pocahontas Prairie (80 MW) and Sandy Ridge (50 MW) facilities in Iowa and Pennsylvania, respectively. Although the interest in Sandy Ridge has now been acquired, APCo and Gamesa have agreed to defer the acquisition of any interest in Pocahontas Prairie until Gamesa satisfactorily contracts the output of the facility on terms that meet APCo's risk-return profile, according to the company.
Sandy Ridge, which achieved commercial operation in February, consists of 25 Gamesa G9X 2 MW wind turbines and has a 10-year power sales contract with J.P. Morgan Ventures Energy Corp.
Total consideration paid for the acquisition of the interest in Sandy Ridge is approximately $29.7 million. The interest in Sandy Ridge is being acquired through a partnership whose members include APCo's subsidiary (holding a 51% controlling interest) and Gamesa (holding a 49% interest).
APCo will fund its subsidiary's portion of the acquisition with approximately 40% debt and 60% equity, with the equity portion primarily funded through proceeds of $15 million from 2.614 million subscription receipts previously issued to Emera Inc.
Closing of the interest in the 200 MW Minonk and 150 MW Senate facilities in Illinois and Texas, respectively, is expected to occur following the commencement of commercial operation of these projects. This milestone is targeted for the fourth quarter.
