Mighty River banks $40.5m in iwi sale

Mighty River Power has banked $40.5 million in return for the sale of a further 10 per cent stake in its two geothermal joint ventures with the Tauhara North No 2 Trust, in the central North Island.

The sale reflects an existing agreement with the tribal incorporation, affiliated with the Ngati Tahu iwi, allowing it to buy the additional stake in joint ventures covering ownership of the Rotokawa geothermal steamfield and the 140 Megawatt Nga Awa Purua geothermal power station. The agreement allows Tauhara North to purchase the increased stake for a pre-agreed price, and to raise its stake further if desired, subject to revaluation of the assets.

MRP's share of both joint ventures now sits at 65 per cent.

The joint venture relationship covers the Rotokawa steamfield, which powers the 34MWRotokawa power station, built in 2000, and the 140MW Nga Awa Purua station, which began production in 2010.

An executive officer of the trust, Aroha Campbell, told BusinessDesk the transaction had "nothing to do" with the partial privatisation of MRP, which expected later this year as the government embarks on the sale of minority stakes in four state-owned energy companies. MRP will be first to go to market.

The Auckland-based generator-retailer recently realised $7 million in value from its share of credits under the now-defunct Projects for Reducing Emissions scheme, created by the Nga Awa Purua project.

MRP has also committed to building a fifth geothermal plant to its fleet, the 82MW, $446 million Nga Tamariki project, which it is pursuing alone.

MRP said in its annual report for the year to June 30 that it had total debt facilities of more than $1.3 billion, with available headroom of more than $300 million, and that this had been significant in allowing Nga Tamariki to proceed, while allowing the company also to make its $250 million commitment to the GeoGlobal Energy Fund - an international geothermal energy joint venture.