CXA Sundevil Power I Inc., which is buying into a power plant Arizona, on Aug. 26 petitioned the Federal Energy Regulatory Commission for approval to sell power at market-based rates.
The company was recently formed as a special purpose entity to acquire and own one of the four 515-MW (summer rating) natural gas-fired, combined cycle units (Power Block 1) at the Gila River facility, and interests in related common assets including shared interconnection facilities, currently owned by bankrupt Sundevil Power Holdings LLC. The facility is located in Maricopa County, Arizona, and is connected to the Arizona Public Service balancing authority area. Sundevil currently sells capacity, energy, and ancillary services from Power Block 1 at market-based rates.
In July 2012, Sundevil entered into a senior secured credit agreement with Beal Bank USA (BBUSA), pursuant to which BBUSA made available certain loans and credit facilities to finance Sundevil’s ownership and operation of Power Block 1 and Power Block 2. To secure Sundevil’s obligation to repay the loans, Sundevil granted first priority liens and security interests for the benefit of BBUSA over substantially all of Sundevil’s assets and property, including its interests in this facility.
The acquisition of Power Block 1 is a direct result of default by Sundevil in repayment of its loans and exercise by BBUSA of its remedies as a secured creditor with an interest in the facility. On Aug. 11, CXA I submitted a joint application together with its affiliate CXA Sundevil Power II Inc. (CXA II) and Sundevil under Section 203 of the Federal Power Act for CXA I to acquire Power Block 1 from Sundevil and for CXA II to acquire Power Block 2 from Sundevil. CXA 1 and CXA II are a wholly-owned, indirect subsidiaries of BBUSA and its parent corporation, Beal Financial Corp. Beal is a financial institution, which, through its subsidiaries, engages in depository banking, commercial real estate and business lending and financing.
A company contact is: James Erwin, CLMG Corp., 7195 Dallas Parkway Plano, TX 75024, (469) 467-5414, jerwin@clmgcorp.com.
The bankruptcy court for Sundevil Power Holdings on Aug. 23 approved an Asset Purchase and Sale Agreement for these two units. On Feb. 11, Sundevil and related companies filed voluntary petitions for relief under chapter 11 of the Bankruptcy Code.
Tucson Electric Power and UNS Electric collectively own 100% of Power Block 3, and Gila River Power LLC, part of Entegra Power, owns 100% of Power Block 4.
