Reports: Footprint secures financing, issues construction start notice for Salem Harbor

Footprint Power Salem Harbor Development LP has obtained the financing necessary to complete the construction of the repowered Salem Harbor Station, said reports on Jan. 9.

The financial close caps off a month of major milestones for the project, including execution and unanimous approval by the Salem City Council of a long-term property-tax-payment agreement and a community benefits agreement, and the execution of an engineering, procurement and construction contract, said a report in the Swampscott Reporter.

Highstar Capital IV LP and its affiliated funds managed by Oaktree Capital Management LP will invest 87.5% of the equity necessary for construction of the project. An affiliate of Toyota Tsusho Corp. will invest the remaining 12.5%. Project developer Footprint Power LLC will retain an equity interest in the project and will remain active in the ongoing management of the project.

Simultaneously with the equity commitments of Highstar IV and Toyota Tsusho, the company said it closed on debt financing for the project. A consortium of lenders led by Coordinating Lead Arrangers MUFG Union Bank, GE Energy Financial Services and BNP Paribas has committed a total of $600m in construction financing in addition to a $130m letter-of-credit facility.

With the closing of the financing Friday, the project has issued a Final Notice to Proceed to its EPC contractor, Iberdrola Energy Projects.

“We are pleased to partner with a team with Highstar’s strength,” said Peter Furniss, Footprint’s CEO. “The Highstar team has extensive experience in energy and infrastructure investment. With their investment, the city of Salem, the Commonwealth and the environment will see the full benefits and potential of this state-of-the-art facility. We are also grateful to Toyota Tsusho, whose longstanding and continued support has been critical to the success of the project.”

Iberdrola USA said Dec. 12 that its sister company, Iberdrola Engineering and Construction, has been hired by Footprint Power to build this combined-cycle gas turbine (CCGT) electric generating plant in Salem, Massachusetts. Iberdrola Engineering will build the new 674-MW facility on a small portion of a 65-acre waterfront site now occupied by the decommissioned coal-and-oil-fired Salem Harbor Station. Iberdrola Engineering will be responsible for all engineering, construction, commissioning, and site work for the new facility.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.