Ormat Technologies Covers 48-Megawatt Kenyan Geothermal Project with $105 Million European Loan Finance

---

Researched by Industrial Info Resources (Sugar Land, Texas)--After completing Phase II construction at the 48-megawatt (MW) Olkaria III Geothermal Plant in Naivasha, Kenya, Ormat Technologies Incorporated (NYSE:ORA) (Reno, Nevada) has signed loan documents for project financing of up to $105 million to refinance the company's investment from its own resources into the project. The company had financed the initial 13-MW phase and the second 35-MW phase, covering construction and well drilling.

The project loan finance is to be provided by a group of European Development Finance Institutions arranged by Deutsche Investitions - und Entwicklungsgesellschaft (DEG). Other lenders in the group include the Africa Infrastructure Fund, Dutch and French development banks and European Financing Partners. Winfried Polte, Chairman of DEG's management board, said that climate protection was an important business area of DEG, as well as private sector promotion in Africa. She added that Kenya was the focus country for German development cooperation.

The original 13-MW power plant has been in continuous operation since 2001 with availability between 97% and 99%. The second 35-MW phase has been synchronized to the grid, completing the plant's 48-MW base load to the national grid. It is worth noting that this form of geothermal-fed power generation has the sustained characteristics needed for base load power. The expanded power plant will save 120,000 tons of oil imports and mitigate about 200,000 tons of carbon-dioxide emissions per year. The plant's power output will also reduce the average production cost of electricity in Kenya and at the same time reduce dependence on power feed imports.

The clean, base-load geothermal energy generated at Olkaria III will increase the supply to the local transmission, distribution and retail utility Kenya Power and Lighting Company (KPLC). Ormat's green technology meets the highest standards for sound environmental practice and complies with all the relevant local and international regulations covered in the 2001 World Climate Technology Award from the UN Climate Technology Initiative (CTI).

From the earliest stages of the project Olkaria's operations team, managed by a Kenyan engineer Ernest S. Mabwa, has consisted entirely of skilled local employees who have received on-the-job training, competitive wages and indirect benefits. Ormat built and maintains a modern staff village including entertainment facilities, a library and a playground. The company also provides ongoing assistance to the local community in the areas of school development, educational support for needy children, community health and employment.

Ormat Technologies, whose first African project was a solar pump installed in Mali in 1966, claims to be the only vertically integrated company primarily engaged in the geothermal and recovered energy power business. The company's products and systems are covered by 75 patents and it currently has power plants in the U.S., Guatemala, Kenya, Nicaragua and New Zealand. As of September 2008 the company had supplied more than 1,000 MW of geothermal and recovery plants and delivered more than 2,600 power units. It had 158 MW of power under construction and up to 250 MW capacity under development and exploration. Its total product line is represented in 71 countries.

Industrial Info Resources (IIR) is a marketing information service specializing in industrial process, energy and financial related markets with products and services ranging from industry news, analytics, forecasting, plant and project databases, as well as multimedia services.