Ram Power is in discussions with Sprott Resource Lending Partnership, Exploration Capital Partners, and Newberry International Holdings for a corporate credit facility of $50m for its San Jacinto-Tizate geothermal power project in Nevada.
The company is negotiating for a $4m fees and interest and fees payment to be made in kind rather than cash for a period of six months between 1 July to 31December 2012.
Ram Power executive chairman Antony Mitchell said, "I continue to be pleased with the progress being made at the San Jacinto project site, and with our ongoing discussions with the Nicaraguan Government and our Corporate Credit Facility lenders."
The company aims to increase the cash liquidity which can be used as an additional working capital and near-term capital to exploit the pipeline projects at both the Geysers Project in Northern California and the Casita Project in Nicaragua.
Subject to the mutual agreement between the parties and approval from the Toronto Stock Exchange, the payment-in-kind of fees and interest is expected to close within 30 days.
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By GlobalDataThe company has also provided update on the project’s Phase II 36MW expansion which is 75% constructed; It is expected to be complete in the final quarter of 2012 and begin operations in December 2012.
Ram Power Latin America COO Tono Rodriquez said, "With a majority of the engineering and construction completed, the Phase II expansion construction continues at a rapid pace."
Under the Phase II credit facility, GeothermEx, an independent resource consultant for the lenders, has reported the production wells have enough capacity to run the Phase I and II expansions at full output.
Ram Power is in discussions with the project’s power offtaker, Disnorte-Dissur, its parent company Gas Natural Fenosa, and a number of Nicaraguan Government ministries to increase the power sales tariff for the project.
