TORONTO, ONTARIO--(Marketwired - Jan. 12, 2015) - Northland Power Inc. ("Northland" or "the Company") (TSX:NPI) (TSX:NPI.PR.A) (TSX:NPI.PR.C) (TSX:NPI.DB.A) (TSX:NPI.DB.B) today provided an update on developments at certain of its Canadian power projects. Northland continues to be well-positioned to achieve previously issued financial guidance with respect to 2014 EBITDA and payout ratio and 2015 EBITDA. Northland remains focused on delivering growth in shareholder value from its operating, construction and development projects. Additional detail will be made available upon release of Northland's consolidated 2014 results after market close on February 18, 2015.
Kirkland Lake Generating Station (Ontario, 132 MW) - Kirkland Lake Power Corporation ("KLPC"), an affiliate of Northland, has signed a new 20 year contract with the Ontario Power Authority ("OPA", now merged with the Independent Electricity System Operator, "IESO"), for the 30 MW gas peaking portion of the generating station. The existing peaking contract was due to expire in August 2015. The new contract provides stable revenues to KLPC until August 2035. Negotiations are continuing with the Ontario Electricity Financial Corporation ("OEFC") for the baseload, gas-fueled portion of the Kirkland Lake facility, which has pricing provisions expiring August 2015.
Cochrane Generating Station (Ontario, 42 MW) - The OEFC and Cochrane Power Corporation ("CPC"), an affiliate of Northland, have agreed to extend CPC's existing revenue contract to May 2015 from its current expiry in January 2015. The extension provides additional time for CPC to negotiate a new long term contract with the IESO for CPC's natural gas and biomass facility.
Phase III Ground-Mounted Solar Projects (Ontario, 40 MW) - Northland has signed a purchase and sale agreement with Taykwa Tagamou Nation and Wahgoshig First Nation which, once closed, will provide the First Nations with a combined 37.5% equity interest in Northland's four Phase III solar projects located in northern Ontario. The total consideration for the equity interest is approximately $45.6 million, approximately a third of which will be a vendor take-back loan. These are the final four projects in Northland's 13 ground-mounted solar project portfolio that remain under construction. Closing of the sale is contingent on the achievement of certain conditions and receipt of third party approvals. The transaction creates an economic benefit to the First Nations over the long term, is expected to create value for Northland shareholders, and is consistent with Northland's corporate values around local community involvement.
In late December 2014, Northland Power terminated its engineering, procurement and construction contract with H.B. White Canada Corporation related to the construction of the four 10 MW Phase III solar projects. Ganotec Inc, a subsidiary of Peter Kiewit Sons Co. Ltd., has been engaged to assist with the completion of the projects. Northland expects the overall project completion schedule to be met, although the final project costs are being reviewed and may increase from the $246 million previously disclosed. Notwithstanding any potential increase, Northland expects the projects to continue to exceed Northland's return requirements.
Frampton Wind Project (Quebec, 24 MW) - Northland has signed a purchase and sale Agreement to sell Northland's 66.7% interest in the advanced stage development project located in Frampton, Quebec to Boralex Inc. Total consideration for the interest is approximately $11.5 million. Completion of the sale is conditional on the achievement of certain conditions and receipt of third party approvals. Desjardins Capital Markets acted as financial advisor to Northland on the transaction.
The sale will enable Northland to realize the project's economic returns at an earlier stage and focus its resources on other larger scale development and construction projects. Northland remains committed to maintaining a strong presence in Quebec's renewable energy industry.
"Overall, Northland's business strategy continues to proceed according to our expectations," said John Brace, Northland's Chief Executive Officer. "These developments are in line with our focus on delivering projects on time and on budget, and continuing to ensure our operating projects deliver reliable, robust returns, while pursuing additional growth opportunities in Canada and abroad."
ABOUT NORTHLAND
Northland is an independent power producer founded in 1987, and publicly traded since 1997. Northland develops, builds, owns and operates facilities that produce 'clean' (natural gas) and 'green' (wind, solar, and hydro) energy, providing sustainable long-term value to shareholders, stakeholders, and host communities.
The Company owns or has a net economic interest in 1,345 MW of operating generating capacity; 640 MW (400 MW net to Northland) of generating capacity under construction, including a 60% equity stake in Gemini, a 600 MW (360 MW net to Northland) offshore wind project in the North Sea near the Netherlands; and 456 MW (348 MW net to Northland) of projects with awarded power contracts under advanced development, including an 85% equity stake in Nordsee One, a 332 MW (282 MW net to Northland) offshore wind project in the North Sea near Germany. Northland's cash flows are diversified over four geographically separate regions and regulatory jurisdictions in Canada and Europe.
Northland's common shares, Series 1 and Series 3 preferred shares and convertible debentures trade on the Toronto Stock Exchange under the symbols NPI, NPI.PR.A, NPI.PR.C, NPI.DB.A and NPI.DB.B, respectively.
FORWARD-LOOKING STATEMENTS
This release contains certain forward-looking statements which are provided for the purpose of presenting information about management's current expectations and plans. Readers are cautioned that such statements may not be appropriate for other purposes. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as "expects," "anticipates," "plans," "believes," "estimates," "intends," "targets," "projects," "forecasts" or negative versions thereof and other similar expressions, or future or conditional verbs such as "may," "will," "should," "would" and "could." These statements may include, without limitation, statements regarding plans for raising capital and statements regarding the impact of certain events on Northland's financial results and previously issued financial guidance. These statements are based upon certain material factors or assumptions that were applied in developing the forward-looking statements, including management's current plans, its perception of historical trends, current conditions and expected future developments, as well as other factors that are believed to be appropriate in the circumstances. Although these forward-looking statements are based upon management's current reasonable expectations and assumptions, they are subject to numerous risks and uncertainties. Some of the factors that could cause results or events to differ from current expectations include, but are not limited to, operational risks, foreign exchange rates, regulatory risks, and the variability of revenues from generating facilities powered by intermittent renewable resources and the other factors described in the "Risks and Uncertainties" section of Northland's 2013 Annual Report and Annual Information Form, both of which can be found at www.sedar.com under Northland's profile and on Northland's website www.northlandpower.ca. Northland's actual results could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur.
The forward-looking statements contained in this release are based on assumptions that were considered reasonable on January 12, 2015. Other than as specifically required by law, Northland undertakes no obligation to update any forward-looking statements to reflect events or circumstances after such date or to reflect the occurrence of unanticipated events, whether as a result of new information, future events or results, or otherwise.