Duke Energy, Sumitomo Secure $353M In Financing For Kansas Wind Farms

Posted by NAW Staff on April 26, 2012 No Comments
Categories : Projects & Contracts

Duke Energy Renewables and Sumitomo Corp. of America (the U.S. subsidiary of Japan-based Sumitomo Corp.) say they have finalized their 50-50 ownership arrangement for two Kansas wind farms and secured approximately $353 million in financing for construction and operating costs.

Duke Energy Renewables, a commercial business unit of Duke Energy, announced plans last month to sell a 50% stake in the 131 MW Cimarron II Windpower Project in Gray County, as well as the 168 MW Ironwood Windpower Project in Ford County, to Sumitomo. The companies will complete construction of both wind farms later this year.

The financing consists of a construction and term loan facility of approximately $330 million and a letter of credit facility totaling roughly $23 million. The lenders involved in the deal were Sumitomo Mitsui Banking Corp., Mizuho Corporate Bank Ltd. and Bank of Tokyo-Mitsubishi UFJ Ltd.

Vinson & Elkins and Kirkland & Ellis provided legal counsel to Duke Energy Renewables and Sumitomo, respectively, during the formation of the joint venture. Chadbourne & Parke represented the joint-venture partners in the financing effort. Milbank, Tweed, Hadley and McCloy acted as legal counsel to the lenders.

Both the Cimarron II and Ironwood projects have long-term contracts in place to sell the electricity they generate. Kansas City Power & Light will purchase all of the electricity and associated renewable energy credits (RECs) produced by Cimarron II under the terms of a 20-year agreement. Westar Energy will buy all the power and RECs produced by the Ironwood wind farm through a 20-year agreement.

Leave a Comment