Etrion Corporation(“Etrion” or the “Company”) (TSX: ETX) (OMX: ETX) announces it has entered into a letter of intent (the “Letter of Intent”) with Atacama Minerals Chile S.C.M. (“Atacama Minerals”) to provide electricity to its Aguas Blancas iodine mine in Chile (the “Aguas Blancas Mine”). The Letter of Intent marks the first project supporting the Company’s new strategy to move beyond government subsidies.
Aguas Blancas Solar Park (up to 8.8 MW)
Etrion has entered into the Letter of Intent outlining the principal commercial terms of a long-term take-or-pay power purchase agreement (“PPA”) to sell electricity to the Aguas Blancas Mine located in the north of Chile. The Company plans to build, own and operate a solar park with a capacity of up to 8.8 MW (the “Aguas Blancas Solar Park”) that is expected to be operational in the second quarter of 2014. The parties expect to sign a definitive PPA by the end of March 2013. The total project cost, including costs related to the licences, permits, development and construction, is estimated to be less than US$20 million, a portion of which is expected to be financed through non-recourse project financing, with the remaining equity portion to be funded by Etrion.
Construction of the Aguas Blancas Solar Project is subject to a definitive PPA between the parties and Etrion arranging the necessary debt and equity financing as well as other conditions customary for transactions of this nature, including all necessary regulatory approvals.
Management Comments
Marco A. Northland, the Company’s Chief Executive Officer, commented: “I am very excited that Atacama Minerals has selected Etrion as its energy provider. Our focus on Chile is beginning to pay off and we are well positioned to serve the mining sector given our proven track record of building and operating 17 power plants in Europe, combined with our understanding of the Latin American region. This project validates our strategy to move beyond government subsidies into markets with high solar irradiation and demonstrates that solar can compete with traditional sources of electricity today. Energy is a key concern for mining companies in Chile and our solution brings a sustainable power solution into Chile’s energy mix. 2013 will be an exciting year for us as we intend to secure additional projects and increase our installed capacity.”