Vulcan Power Company, a Bend, Oregon-based company that is primarily focused on the development and operation of geothermal power plants, announced on July 28th that private equity firm Denham Capital will invest $145 million in newly issued preferred equity securities of Vulcan. In addition, Merrill Lynch Commodity Partners, a principal investment fund of Merrill Lynch, will convert its outstanding notes into Vulcan preferred equity.
Geothermal energy involves drilling for heated water reservoirs, which produce steam that can be used to generate electricity. Vulcan owns one of the largest geothermal property portfolios in the U.S., including properties in California, Nevada, Oregon, and Arizona. Vulcan will use its new funds to continue to develop prime geothermal property with potential to generate 900 to 2,000 megawatts (MW) of natural steam fuel – enough to provide baseload renewable energy for up to two million people.
Steve Munson, President and CEO of Vulcan, said that the company is embarking on an ambitious drilling and project construction program: "This investment by Denham allows the company to move forward aggressively with our business plan of developing steam resources and power projects, and supporting existing long term power purchase agreements. With the strength and energy sector knowledge of our investors, Denham and Merrill Lynch, we stand to become one of the premier independent green energy companies."
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