Ormat announced today it has signed a binding Memorandum of Understanding to acquire, gradually, 85% of Geothermie Bouillante SA (GB) at a total company enterprise value of up to around €52 million. GB owns and operates a 14.75 MW geothermal power plant and owns two exploration licenses with a total additional potential capacity of up to 30 MW, all located in Guadeloupe Island. Upon closing, Ormat will hold approximately 80% of GB which will be increased to 85% within two years by capital investment agreed upon in the MOU. GB has two Power Purchase Agreements with Électricité de France, the French electric utility. A new 15-year PPA with EDF with improved energy rates is expected to enter into force in January 1, 2016 and replace the current PPAs. Ormat is confident that with its technology and expertise it can optimize the use of the resource and existing facilities and recover its current approximate production of 10 MW to its designed production of 14.75 MW by mid-2017. Additionally, Ormat plans modifications to the existing equipment as well as to further develop the asset, with a potential of reaching a total of 45 MW in phased development, by 2021. Ormat will provide GB with the skills and resources that will make an expansion feasible.
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