U.S. Geothermal Inc. closes $20 million debt financing with Prudential Capital Group
U.S. Geothermal Inc. has announced that its wholly-owned subsidiary, Idaho USG Holdings LLC, closed on a $20 million debt facility from Prudential Capital Group.
Under terms of the financing agreement, USG Holdings has the option, without obligation, to issue additional debt, up to $50 million in aggregate within the next two years. The initial $20 million loan has a fixed interest rate of 5.8% per annum. The loan principal amortizes over twenty years, with a seven-year term. Principal and interest payments are made semi-annually.
The loan is collateralized with USG Holdings' ownership interest in the Neal Hot Springs and Raft River projects. The 22 MW Neal Hot Springs project is owned 60% by the Company and 40% by Enbridge. The 13 MW Raft River project is owned 95% by the Company and 5% by Goldman Sachs.
Proceeds from the loan will be used to fund capital expenditures, payoff an existing 7.0% interest loan of approximately $1 million, increase the output at existing facilities, advance the development of our existing project pipeline, pursue strategic acquisitions, and for general corporate purposes.
Dennis Gilles, CEO of U.S. Geothermal, stated:
"This attractive debt facility strengthens our balance sheet and provides funds to support the development of our project pipeline and other opportunities that may become available in the next few years. We are also pleased to enhance our strategic relationship with Prudential, who is also the lender on our San Emidio project."
Wendy Carlson, Managing Director of Prudential Capital Group's Energy Finance Group - Power, commented:
"U.S. Geothermal has proven itself to be one of the leading developers and operators of geothermal projects. We are excited to provide capital, which will in turn be used to support the Company's growth prospects. This investment reflects our strategy of being a reliable provider of capital to high quality developers with proven track records in the North American power industry."
