EDC Updates on JV Agreement with Alterra
Pasig—(PHStocks)—Following the execution of the Joint Venture Agreement (JVA) dated 20 May 2013 between Energy Development Corporation (PSE: EDC) and Alterra Power Corp. (Alterra) for the exploration and development of geothermal projects in Peru, namely the Tutupaca Norte, Loriscota and Crucero projects (each a Peruvian Project together the Peruvian Projects), and the Mariposa geothermal project in Chile (Mariposa Project), EDC, Alterra and their relevant subsidiaries have executed four Shareholders’ Agreements and other related agreements all with effect on 17 June 2013 for the implementation of the terms of the JVA.
Under the Shareholders’ Agreement for the Mariposa Project, EDC, through its wholly owned subsidiary in Chile, will acquire a 70% interest in Compañía De Energia (ENERCO), an Alterra subsidiary in Chile that owns the Mariposa Project. Alterra will continue to hold a 30% interest in ENERCO through its wholly owned subsidiary Magma Energy Chile Limitada, subject to the terms of the Shareholders’ Agreement for the Mariposa Project.
Under the terms of each Shareholders’ Agreement for a Peruvian Project, a new project company will be incorporated in Peru (Project Company) and that Project Company will be responsible for developing the relevant Peruvian Project. Each Peruvian Project Company will be 70% owned by EDC (through its wholly subsidiary in Peru) and 30% owned by Magma Energia Geotermica Peru S.A., a wholly owned subsidiary of Alterra.
EDC’s continued participation in the Peruvian Projects and the Mariposa Project is subject to EDC’s resource assessment of each of the projects in accordance with the terms of the Project Agreements.