Geothermal plant developer Ormat Technologies Inc. has signed an agreement has signed an agreement with Northleaf Capital Partners to set up a joint venture for projects.
Under the agreement, Ormat will contribute geothermal and recovered energy generation power plants into a newly established holding company subsidiary. Northleaf will hold 40% equity in the JV. Ormat will make approximately US$175 million from the transaction, which is expected to close in the first quarter of 2015.
The power plants that will be contributed to the JV as part of the transaction include Ormat’s Puna geothermal power plant in Hawaii, the Don A. Campbell geothermal power plant in Nevada, and nine power plant units across three recovered energy generation assets known as OREG 1, OREG 2, and OREG 3. Ormat will continue to consolidate the JV and its assets, and will continue to provide day-to-day management control, operations and maintenance control over the projects.
Also as part of the agreement, any future development of the assets will be undertaken within the JV.