Pattern Energy buys controlling interest wind project in Chile

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Pattern Energy Group Inc. announced the acquisition of AEI’s 38.5 percent net ownership interest in the El Arrayán Wind project.

The 115 MW, El Arrayán wind power project, which was completed earlier this month and is now fully operational, is located about 250 miles north of Santiago on the coast of Chile.

The transaction increases Pattern Energy’s ownership in El Arrayán Wind to 70 percent with Antofagasta Minerals SA (AMSA) owning the remaining 30 percent minority stake.

The acquisition:

• Adds 44 MW to the portfolio, bringing Pattern Energy’s owned capacity to 1,479 MW

• Increases ownership to a controlling stake and enhances the platform for future growth in Chile

• Accretive acquisition contributes to Pattern Energy’s target of 10-12 percent average annual growth in cash available for distribution (CAFD) per Class A share over the next three years

• Asset acquired at a 10-11x run rate CAFD multiple

Pattern Energy paid a $45.25 million purchase price to AEI from available cash on hand and assumed certain obligations, consisting principally of AEI’s proportional share of project debt. As of May 31, 2014, AEI’s proportional share of the $224.8 million non-recourse project debt was $87 million.

Pattern Energy operates the project, which sells about 70 percent of its output to Minera Los Pelambres through a long-term fixed-for-floating hedge. The project sells its remaining output into the Chilean spot market at the prevailing market price at the time of sale. In addition to its minority interest in the project, AMSA is the controlling party of Minera Los Pelambres.

El Arrayán connects to the Sistema Interconectado Central's 220 kV transmission system. The project is located on about 15,320 acres of coastal land on a long-term lease with a single landowner.

According to statistics from the International Energy Agency, the World Bank and the U.S. Energy Information Administration, compared to generation from a coal-fired power plant, the electricity produced annually by El Arrayán Wind will offset more than 300,000 metric tons of carbon dioxide, the equivalent to the annual carbon footprint of an estimated 70,000 Chileans, and will conserve enough water to meet the needs of more than 11,000 Chileans.

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