Alterra Power Corp is to execute US$133 million refinancing of the corporate loans at its Icelandic subsidiary, HS Orka hf, with part of the proceeds to be used to fund construction of the 9.9 MW Brúarvirkjun hydro project.
Other primary uses of loan proceeds include drilling and other field development activities at the Reykjanes geothermal operation, and the retirement of €52 million of currently outstanding loans.
The new loan, provided by Arion Bank, carries an initial term of five years with options for HS Orka to extend the loan's term up to 18 years, subject to meeting certain extension conditions. The loan will be secured by the assets of HS Orka and is non-recourse to Alterra. The loan will fund in tranches upon the fulfillment of certain conditions precedent.
"We are pleased to complete this refinancing, keeping us on track for our planned hydro and geothermal growth in Iceland," said Lynda Freeman, Alterra's CFO. "The new loan will also enable increased dividends to Alterra and HS Orka's other shareholders beginning in 2019."