Developing a Portfolio of Hydro Projects in Panama and ... · Developing a Portfolio of Hydro...
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Developing a Portfolio of Hydro Projects in
Panama and Costa Rica
PLATTS
June 8, 2012
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Identifying the Opportunity
PPH was created in 2007 based on:
• Need for new generation capacity.
• Availability of hydro resources.
• Long term Power Purchase Agreement contracts for firm capacity.
• Attractive economy for new projects.
• Belief in the future of renewable energy.
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Main Participants in Panama’s Electricity Sector
Assets: US$40,000,000,000
Panama: 705 MW
Assets: US$240,000,000,000
Panama: 300 MW
Assets: US$264,000,000,000
Panama: 367 MW
Assets: US$64,000,000,000
Panama: EDEMET & EDECHI
Assets: US$14,000,000,000
Panama: ENSA
Generators
Distributors
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Our Vision for Panama Power
• Portfolio of mini-hydro projects with similar characteristics.
• Accelerated development and construction schedules.
• Advantage of economies of scale.
• Strict adherence to highest standards of environmental resource
management.
• Active participation and support of local communities.
• Flexible capital structure.
• “Open-Book” investor communications.
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Securing the Projects
Panama Power Holdings Inc.
Pedregalito 1 – 20 MW
Río Chico, Chiriquí, Panamá
Pedregalito 2 – 12.5 MW
Río Chico, Chiriquí, Panamá
Cochea – 15.7 MW
Río Cochea, Chiriquí, Panamá
El Alto – 67 MW
Río Chiriquí Viejo, Chiriquí, Panamá
La Esperanza – 6 MW
Río La Esperanza, Alajuela, Costa Rica
Caldera – 5MW
Río Caldera, Chiriquí, Panamá
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Equity Funding
December 2006
Initial Road Show for US$50 million
September 2007
Raised Initial US$83 million (US$10 per share)
March 2010
Raised Additional US$60 million (US$10 per share)
November 2011
Listed in the Panamanian Stock Exchange
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Stock Price - PPHO
Source: Panamanian Stock Exchange
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PPAs –Contracted Energy (excl. Costa Rica)
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*Subject to award of latest licitation
2013 - Excl. El Alto
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Overview of Spot Market
• Demand growth with GDP
• Variable cost of US$145 for most efficient thermal units – May 2012
• Future prices driven by:
New capacity
Demand growth
Fossil fuel prices
Transmission access
Monthly Averages - Last 12 Months (US$/MWh)
Annual Averages (US$/MWh)
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Financing Approach
During Construction:
• Local banks
• Construction loans
• Public bonds as takeout to construction loans
Commercial Operations:
• Refinancing with bullet structure
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Current Debt Profile and Lead Banks
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Construction Contracts
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Civil Works & Electromechanical:
• EPC contracts
• Financial Support: SBLCs
• Contractor: Cobra (ACS Group, Spain)
Tunnel:
• EPC contract
• Financial Support: SBLCs
• Contractor: SELI (Italy)
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Operations
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La Esperanza 6MW
Cochea 15.7MW
El Alto 67MW
P1 & P2 32.5MW
Caldera 5MW
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La Esperanza – Costa Rica
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• Installed capacity 5.8MW
• In operations since 2000
• PPA with Instituto Costarricense de
Electricidad (“ICE”).
- 5.0MW capacity contracted at
US$0.0601
- 15 year tenor, expiring February
of 2015
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Pedregalito 1
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• In operations since April 2011
• Installed capacity:
– 20MW
• Generation:
– 93.5GWh–year
• Equipment:
– Two turbogenerators 10MW capacity each
• Water intake works:
– Run of the river dam with radial gates
• Design flow:
– 40m3/s
• Complimentary works:
– 0.25MW mini-hydro at plant
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Pedregalito 2
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• In operations since October 2011
• Installed capacity:
– 12.5MW
• Generation:
– 55GWh–year
• Equipment:
– Two turbogenerators 6.5MW capacity each
• Water intake works:
– Water discharge from Pedregalito 1
• Design flow:
– 40m3/s
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Cochea
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• Installed capacity:
– 15.7MW
• Generation:
– 58GWh–year
• Equipment:
– Two turbogenerators 7.9MW capacity each
• Water intake works:
– Run of the river with gravity dam
• Design flow:
– 14m3/s
• Operations:
– Mid 2012
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El Alto
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• Installed capacity:
– 67MW
• Generation:
– 270GWh–year
• Equipment:
– 3 turbogenerators 22.3MW capacity each
• Water intake:
– 50m height dam with a reservoir of 1.5M m3
• Design flow:
– 60m3/s
• Operations:
– Mid 2013
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Lessons Learned
• Think Big
• Start with Equity
• Flexible Relationship Based Financing
• Don´t Stress the PPAs
• Pray for Sunshine During Construction and Rain During Operations