Panda Power Funds announced it has completed the acquisition and successful financing of Moxie Energy’s planned 829-MW natural gas-fueled, combined-cycle “Patriot” generating station, located in Lycoming County, Pennsylvania. When completed, the Patriot project will be the second new power plant in the Keystone State — after Panda’s “Liberty” power plant — specifically developed to take advantage of its proximity to the Marcellus Shale. Panda will immediately start construction on the 85-acre site and expects commercial operations to begin by the middle of 2016.
Goldman Sachs, Credit Suisse, Ares Capital, Union Bank and Investec acted as joint lead arrangers for the senior debt financing of the plant. Panda Patriot raised debt capital totaling $651.5 million. Panda Liberty, financed in August of this year, raised debt capital totaling $627 million. The Patriot transaction marks the fifth financing of a large-scale power facility by Panda Power Funds in 17 months. The fund is supplying equity for the Patriot project along with a large institutional co-investor.
The Patriot project is Panda Power Fund’s second development acquisition from Moxie Energy in the PJM Interconnection.
“There’s no grass growing under our feet. I’m extremely proud of a Panda team that has closed five deals of this size in 17 months,” said Todd W. Carter, president and senior partner of Panda Power Funds. “I am also pleased to add another Pennsylvania project to our portfolio. Using natural gas from the Marcellus Shale, the Panda Patriot generating station will provide clean, low-cost power to Pennsylvanians for generations to come.
“Moxie Energy is to be commended for developing the right power generation projects in precisely the right place, at the right time.”
“Panda performs exhaustive due diligence, and when it’s time to act, they move quickly,” said Aaron Samson, chief executive officer of Moxie Energy. “We’ve enjoyed working with them through both acquisitions.”
The Panda Patriot project has been strategically sited on the Marcellus Shale, estimated to be the second largest natural gas field in the world. The Marcellus contains up to a projected 330 trillion cubic feet of recoverable natural gas, or the equivalent of 115 years of production at current levels. The Patriot project’s proximity to such a large supply of natural gas is expected to provide a significant operating cost advantage for the power plant.
The Patriot plant will utilize Siemens H-class gas turbines — the world’s first generation technology to achieve combined-cycle net operating efficiencies of greater than 60 percent. The two single shaft power trains will make the Patriot plant one of the cleanest, most efficient natural gas-fueled power plants in the United States. In addition, unlike approximately 95 percent of the nation’s generating facilities, the plant will be cooled with air rather than water. As a result, the Patriot plant will not draw water from, or discharge water into, the Western Branch of the Susquehanna River — eliminating potential impacts to species in the Susquehanna watershed.
The Patriot plant will make a significant economic contribution to the area during construction and the facility’s first 10 years of operation. Approximately 500 jobs will be created to construct the Patriot 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 will serve as the project EPC Contractor and Siemens Energy Inc. will provide the power island package, including the gas turbines, steam turbines and heat recovery steam generators. Gemma-Lane 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 approximately 30 months.
South Jersey Resources Group, a subsidiary of South Jersey Industries, Inc., is the contracted gas supplier for the plant.