Polaris Infrastructure plans to buy 10-MW HPP project in Panama

Canadian renewables developer Polaris Infrastructure Inc (TSE:PIF) has signed a non-binding memorandum of understanding (MoU) to acquire a 10-MW run-of-river hydropower plant (HPP) project in Panama.

The Toronto-based company will purchase 100% of the equity of the Chuspa HPP, as it is named, from Navitas Holdings Inc, Polaris announced on Tuesday.

Under the terms of the MoU, the buyer has until December 31, 2020 to purchase the equity for a nominal up-front consideration. If Polaris decides to exercise this option, it will be required to invest the necessary capital of between USD 15 million to USD 20 million (EUR 17.7m) to complete the HPP.

Navitas' shareholders are also entitled to certain payments if, upon achieving project completion, Chuspa generates a cash flow over certain minimum defined thresholds.

With contracts secured for 40% to 50% of its output at USD 85 per MWh, Chuspa's commercial operation date (COD) is expected to take place in 12 to 15 months once it breaks ground. The company plans to fund the construction with cash on hand, Polaris stated.

(USD 1 = EUR0.887)

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