Montreal: Boralex Inc. announced the closing December 16 of financing for the company’s Yellow Falls hydroelectric project in Ontario for $74.3 million. The 16 MW Yellow Falls hydroelectric power station is located on the Mattagami River in Yellow Falls near the town of Smooth Rock Falls in Ontario.
Long-term financing is provided by Canada Life Insurance Company, Great West Life Insurance Company and London Life Insurance Company for a total amount of $74.3 million, representing approximately 81% of estimated project costs. The financing consists of a short-term tranche of $9.1 million, which is fully-amortized over 10 years and a long-term tranche of $65.2 million which will begin amortizing over 29 years after the repayment of the shorter tranche. The long-term tranche also includes a bullet repayment feature at the end of the 39 year term. As a whole, the two tranches will bear a fixed average interest rate of approximately 5% over the life of the loans.
The Yellow Falls project will mark Boralex's first hydropower project developed alongside its First Nation partners, the Taykwa Tagamou Nation and the Mattagami First Nation. The two First Nations, together with one of the original developers of the project, have contractual rights to acquire a participation of up to 31.25% of the project.
Construction of the Yellow Falls hydroelectric site is currently underway, with commissioning planned for the end of the second quarter of 2017. The plant will operate under a 39-year power purchase agreement with IESO.