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Synex secures funding for projects on Vancouver Island

A Vancouver-based small hydropower developer has raised C$ 1.665 million to finance the development of the 4.3 MW Newcastle Creek and the 5 MW McKelvie Creek run-of-river projects on Vancouver Island in British Columbia.

Synex International disclosed on 23 February that it expects the proceeds from the sale of 3.7 million common shares at a price of C$ 0.45 per share, together with future borrowings, will provide it with sufficient capital to complete these projects.

Synex said it has secured water licences and land tenures from the provincial authorities of British Columbia for the McKelvie project, which is located near Tahsis, and the Newcastle Creek scheme, located near the village of Sayward. The company said that its development arm Synex Energy is continuing to advance the regulatory aspects of the projects and is awaiting power purchase agreements (PPAs) from the Province’s utility BC Hydro. The McKelvie Creek project was awarded a PPA in the 2006 Open Call for Power but development was stalled in July 2007 as higher than anticipated costs required for interconnection with the grid pushed capital costs up from C$ 10 million to 15 million. Synex later revealed that it was expecting to receive a new PPA for this project through BC Hydro’s Standing Offer Programme.

The parent company wholly owns or has interests in five operating run-of-river facilities totalling around 12 MW, all but one of which are located on Vancouver Island. The publicly listed company, which was founded in 1987, owns outright the 3.8 MW Mears Creek plant near Gold river, which was commissioned in January 2004, and the nearby 2.8 MW Cypress Creek station, which was commissioned in July 2009. Both sell their output to BC Hydro under long-term PPAs. It also holds 80 per cent of the 4.4 MW Barr Creek plant near Zeballos, which was commissioned in 2012, and minority stakes in the 6.5 MW China Creek plant near Port Alberni, which came online in December 2005 and the 3.3 MW Ptarmigan Creek plant 70 km east of McBride on mainland British Columbia.

In addition, Synex International has made applications for water licences and land tenure on 24 potential hydroelectric sites totalling more than 150 MW. One of these is the 9.5 MW Victoria Lake project, which is planned at a site southeast of Port Alice on Vancouver Island. This project has an estimated capital cost of C$ 18 million and would generate average annual output of 39 GWh.

BC Hydro under the current Standing Offer Programme accepts applications for PPAs for up to 40 years for projects up to 15 MW with a stated goal of acquiring 150 GWh per year. Synex International also comprises Sigma Engineering, a wholly owned engineering subsidiary.

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