Shear Wind gets C$114.52 million of financing for wind power project

By Lisa Kerner

Charlotte, N.C., Oct. 14 - Shear Wind Inc. signed a credit agreement in connection with C$114.52 million of debt financing for its 62.1 megawatt Glen Dhu Wind Energy LP wind power project in Nova Scotia.

The financing includes approximately C$107 million in construction financing, which converts to a term loan with an 18-year term. It has a floating interest rate based on the CDOR rate and an interest rate swap for hedging purposes.

Lenders include Banco Bilbao Vizcaya Argentaria, SA and Instituto de Credito Oficial, a state-owned corporate entity attached to the Ministry of Economy and Finance of the Spanish government, according to a Shear Wind news release.

BBVA and ICO also provided a C$1.55 million letter of credit for security related to Glen Dhu's power purchase agreement with Nova Scotia Power Inc.

In addition, BBVA is providing a C$5.97 million letter of credit for debt reserve.

The Glen Dhu Project, consisting of 27 wind turbines, is expected to be fully operational by March.

"Completing this financing, in addition to our equity contributions, will ensure that the Glen Dhu Project is fully financed," Shear Wind president and chief executive officer Mike Magnus said in the release.

Shear Wind owns approximately 51% of the limited partnership units of Glen Dhu, and Genera Avante Holdings Canada Inc. owns approximately 49% of the remaining units.

Genera Avante owns approximately 62% of Shear Wind on a fully diluted basis, and Spain-based Inveravante Inversiones Universales, SL owns Genera Avante.

Inveravante will provide a C$2.1 million unsecured subordinated loan to Glen Dhu, which is subordinated to the debt financing.

The credit facilities will be secured by a first-priority lien on substantially all of the assets of Glen Dhu, including all of the units owned by Shear Wind and Genera Avante in Glen Dhu and all of the outstanding shares owned by Shear Wind and Genera Avante in Glen Dhu Wind Energy Inc., the general partner of Glen Dhu LP.

Shear Wind, which has headquarters in Halifax, N.S., is engaged in the exploration and development of renewable energy.

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