The Southern California development was commissioned after a 21 month construction period and in its first quarter of operation recorded a world-class availability performance. This operational performance has supported EnergySource in successfully refinancing the project, which has now returned capital back to the equity participants, including the GGE Fund.
“This distribution from the Fund is consistent with our business case and provides the first demonstration of the financial success of Mighty River Power’s international geothermal strategy. In addition to this first substantial distribution, the GGE Fund will be entitled to further returns from the project through its continued direct investment in the project and through its 20% investment in EnergySource LLC,” said Mighty River Power Chief Executive, Doug Heffernan.
Through its investment in EnergySource, the GGE Fund will also have an ownership interest in any further development by EnergySource on the Salton Sea Reservoir, including the proposed 49.9MW Hudson Ranch Power II plant, adjacent to the John L Featherstone plant. Drilling on this project is expected to begin later this year.
The GGE Fund is currently seeking further capital to advance the development of its projects, and Mighty River Power is working with GGE to consider contributing further capital alongside new investors.
Factsheet – International Geothermal:
The GGE Fund is an international geothermal investment fund, through which Mighty River Power’s offshore geothermal investments are developed
In 2008, Mighty River Power made a strategic commitment to international geothermal development and subsequently became the cornerstone investor in, and 99.8% owner of the GGE Fund with a commitment of US$250 million.
- US based GeoGlobal Energy LLC (GGE), acts as manager to the GGE Fund. Mighty River Power owns 29% of GGE and has two Directors on its Board.
- The GGE Fund provided a capital injection of US$92 million into the EnergySource owned John L Featherstone development in May 2010, enabling its construction.
- In May 2010 the GGE Fund purchased a 20% investment in EnergySource, a geothermal development company with access to the significant Salton Sea geothermal resources in Southern California’s Imperial Valley – one of the largest and hottest geothermal resources in the United States.
- As part of the EnergySource transaction, the GGE Fund invested US$92 million into EnergySource’s US$400 million John L Featherstone project originally known as the Hudson Ranch Power project, facilitating commencement of project construction.
- The EnergySource owned 49.9MW John L Featherstone plant was successfully commissioned in March 2012, after a 21 month construction phase and achieved a capacity factor of over 99% in its first quarter of operation.
- This operational performance has supported EnergySource in successfully refinancing the project which has now returned capital back to the equity participants, including the GGE Fund. Under the GGE Fund structure, cash received by the Fund is paid to investors in the Fund, including Mighty River Power as the cornerstone and 99.8% owner.
- The John L Featherstone plant supplies renewable energy under a long-term contract to Salt River Project, an AA credit rated public power utility and water provider serving the greater Phoenix metropolitan area in Arizona.
- Mighty River Power is not able to disclose the detailed financial and economic returns of the EnergySource investment due to confidentiality restrictions between EnergySource and GeoGlobal Energy.
