3.2.2005: Calpine Corp.: $100 Million Project Finance Facility
Wednesday February 2, 8:32 am ET
SAN JOSE, Calif., Feb. 2 / Calpine Corporation"s (NYSE: CPN - News) indirect subsidiary Metcalf Energy Center, LLC has obtained a $100 million, non-recourse credit facility for the Metcalf Energy Center (Metcalf) in San Jose, Calif. -- the first single-asset, merchant project financing in California since the energy crisis. Loans extended to Metcalf under the facility will fund the balance of construction activities for the 600-megawatt, natural gas-fired power plant. The project finance facility will mature in July 2008. Pricing is based on LIBOR plus a margin.
According to the California Independent System Operator, the Bay Area is among the most generation-deficient regions in the state. Metcalf, designed to generate enough electricity to supply approximately 500,000 households, will provide substantial reliability benefits to San Jose and the greater Bay Area.
Metcalf is expected to begin commercial operations in June 2005. Calpine"s wholly owned subsidiary Calpine Construction Management Company, Inc. (CCMC) is using its Calpine Construct Plus approach to build the plant. CCMC serves as general contractor and manages all aspects of the project including design, engineering, and equipment procurement through completion. This construction approach allows for maximum flexibility to schedule and manage work to enhance safety and quality as well as improve plant efficiency and reliability.
Calpine will sell the full output from the plant to its wholly owned subsidiary Calpine Energy Services, L.P. (CES). CES will sell power to large wholesale customers and into the daily energy market. It will also manage the purchase and delivery of natural gas used to fuel the facility under a three-year power purchase and fuel supply agreement.
ING Capital LLC and Bayerische Landesbank"s New York operations provided the credit facility. ING Capital served as Lead Arranger, Administrative Agent, Book Runner and Collateral Agent for the transaction with Bayerische Landesbank serving as Arranger and Syndication Agent.
"Calpine is pleased to have closed the first single-asset, merchant project financing in California since the energy crisis," said Calpine Chief Financial Officer Bob Kelly. "This financing structure, which uses Calpine Construct Plus construction approach and a Calpine Energy Services power sales agreement, underscores the strength of Calpine"s commercial facilities. We appreciate the continued support of ING Capital and Bayerische Landesbank in completing this financing and we look forward to working with them on future transactions."
Calpine Corporation is a power company dedicated to providing electric power to wholesale and industrial customers from clean, efficient, natural gas-fired and geothermal power facilities. The company generates power at plants it owns or leases in 21 states in the United States, three provinces in Canada and in the United Kingdom. The company was founded in 1984 and is publicly traded on the New York Stock Exchange under the symbol CPN. For more information about Calpine, visit www.calpine.com.
Source: Calpine Corporation