Panda Power Funds said Aug. 22 that it has completed the acquisition and successful financing of Moxie Energy’s planned 829-MW natural gas-fueled, combined-cycle “Liberty” generating station, located in Bradford County, Pa.
When completed, the Liberty project will be the first new power plant in Pennsylvania specifically developed to take advantage of its proximity to the Marcellus Shale gas formation. Panda said it will immediately start construction on the 33-acre site and expects commercial operations to begin by early 2016.
Goldman Sachs, Credit Suisse and Ares Capital arranged the senior debt financing for the plant. Union Bank was the documentation agent.
The transaction marks the fourth financing of a large-scale power facility by Panda Power Funds in 13 months and the first investment of Panda Fund II. The fund is supplying equity for the Liberty project along with a large institutional co-investor.
“Following three successful financings in Texas, it didn’t get any easier,” said Todd Carter, president and senior partner of Panda Power Funds. “I’m really proud of our team for getting this job done in a ‘tough-as-nails’ financial market. I’m also very pleased we landed the Liberty project. After looking at a number of opportunities in PJM, we were impressed with the project and the caliber of work done by Moxie Energy.”
“We found a good dance partner in Panda,” said Moxie Energy CEO Aaron Samson. “They care about the quality of the project and its environmental friendliness, and are committed to being a good corporate citizen of the community.”
Panda was already seeking regulatory permits for its Panda Mattawoman facility in Maryland. The Mattawoman project site is located about 12 miles southeast of Washington, D.C., in Prince George’s County, Md.
The Panda Liberty project has been strategically sited in the PJM Interconnection region, which is considered one of the most attractive and liquid markets for power generators in the U.S., Panda said. Equally important, approximately 20,000 MW of coal-fired capacity retirements have been announced in PJM, setting the stage for tightening reserve margins.
The Liberty plant will utilize Siemens H-class gas turbines — the world’s first generation technology to achieve operating efficiencies of 60%. The two single shaft power trains will make the Liberty plant one of the cleanest, most efficient natural gas-fueled power plants in the U.S. In addition, the plant will be cooled with air rather than water. As a result, the Liberty plant will not draw water from, or discharge water into, the Susquehanna River — eliminating potential impacts to species in the Susquehanna watershed.
The plant will contribute an estimated $1.2bn to the area’s economy during construction and the first 10 years of operation. Approximately 500 jobs will be created to construct the Liberty power plant at peak construction. During operations, the generating station will create an estimated 27 skilled jobs to operate the facility and 45 indirect jobs within the community to support the plant.
Gemma-Lane Liberty Partners will serve as the project engineering, procurement and construction (EPC) contractor and Siemens Energy will provide the power island package including the natural gas turbines, steam turbine and waste heat recovery boilers. Gemma-Lane Liberty Partners will be responsible for installing the power island equipment and for the engineering, procurement and installation of the balance of the plant, and the commissioning of the facility. Construction will take about 30 months.
The generating station will be located in Asylum Township in Bradford County, approximately 45 miles northwest of Scranton, Pa.
Founded in 2010, Panda Power Funds is a private equity firm headquartered in Dallas, Texas, which has the ability to develop, acquire, construct, finance and operate large-scale, natural gas-fueled power generation facilities. Panda’s first fund invested in three combined-cycle power plants currently under construction in Temple and Sherman, Texas (totaling 2,274 MW), and a 20-MW solar project in operation in Pilesgrove, N.J.
The Siemens Energy Sector is the world’s leading supplier of a broad spectrum of products, services and solutions for power generation in thermal power plants and using renewables, power transmission in grids and for the extraction, processing and transport of oil and gas.
Moxie Energy is a private development firm formed in 2009, which has a demonstrated capability to develop large complex power generation projects.
Gemma-Lane Liberty Partners brings together the strengths of two highly experienced construction organizations. Gemma Power Systems is a full service EPC contractor with the proven ability of designing, building and commissioning over 10,000 MW of large-scale clean gas-fired and renewable energy projects. Gemma Power Systems LLC is a wholly owned subsidiary of Argan Inc. (NYSE MKT: AGX) and is one of the largest power contractors in the Northeastern U.S.