Reykjavik Geothermal starts $1.5 billion debt fund raising campaign

Corbetti Caldera, Ethiopia (source: Reykjavik Geothermal)
Alexander Richter 6 Feb 2014

Reykjavik Geothermal, developer of a large scale geothermal power project at Corbetti in Ethiopia, through Ambata Capital is now starting its fund raising campaign for up to $1.5 billion in debt financing.

We reported yesterday that Reykjavik Geothermal (RG) had secured $5.6 million from the East African Geothermal Risk Mitigation Facility. Now it is reported that the company has started a fund raising campaign for up to $1.5 billion in debt financing for its Corbetti geothermal project in Ethiopia.

In an interview, Daniel Zywietz, Managing Director of Investment Fund Ambata Capital Middle East, said that RG has raised a substantial portion of the necessary equity stake for the first tranche of the $4 billion geothermal project.

In October 2013 (as reported by ThinkGeoEnergy) RG signed a power purchase agreement for 1 GW in installed capacity for the project with state-owned utility Ethiopian Electric Power Corporation. RG’s CEO, Gudmundur Thoroddsson then reported that the company already raised $40 million.

Drilling for the project is to start within the next couple of months either late in the first Quarter or second Quarter of 2014. For the equity need of the project, around $200 million has mostly been secured and securing the remaining debt financing is now on the agenda. Given the sheer size of the funding needed, it is likely to involve a number of development banks.

The company is interested in talking to any interested party to participate in the debt financing of this promising project in Ethiopia.

Ambata Capital works as a merchant bank and is a large owner of Reykjavik Geothermal.

Source: Clean Energy Pipeline