September 11 (Renewables Now) - Tilt Renewables Ltd (NZE:TLT) has secured a support agreement with Victoria’s government covering 37% of the output of its 336-MW Dundonnell wind project, the Australian based renewable energy company said Tuesday.
According to the agreement, Tilt Renewables will enter a 15-year contract with the state government to supply power to the grid under a contract for difference price scheme. The deal concerns the production of 29 of the plant’s 80 wind turbines, while the remaining power will be initially sold on a merchant basis until financial close. Tilt Renewables expects to take final investment decision to proceed to financial close late this year and start building the facility early in 2019. It noted it will continue to seek options to contract the remainder of the wind park’s output after financial close has been achieved.
Following a cost update, the Aussie firm estimates the total project cost will be around AUD 560 million (USD 399m/EUR 344m), against the previously announced AUD 600 million. The plant, itself, is expected to bring between AUD 40 million and AUD 50 million of free cash flow after its completion in the middle or late 2020.
Around AUD 300 million of the overall project cost will be financed through a debt package from National Australia Bank Ltd (ASX:NAB) and MUFG Bank Ltd. Tilt Renewables will provide the remaining funds via an equity raising underwritten by Citigroup Global Markets Limited and Forsyth Barr Group Ltd.
(AUD 1.0 = USD 0.712/EUR 0.614)