Plutonic signs $500M hydro construction contract

Vancouver's Plutonic Power (TSX: PCC) announced yesterday that, together with partner GE Energy Financial Services, it signed a fixed-price construction contract for a 196 megawatt run of river hydroelectric project in British Columbia.

 In run of river plants, the natural flow and elevation drop of a river are used to generate electricity.

Omaha's Peter Kiewit Sons will handle the $500 million engineering, procurement and construction of the Toba Montrose plant.

The contract covers the development of two powerhouses with intakes, penstocks and a corresponding transmission line.

Plutonic hired Kiewit in July 2007 to start work on the initial rejuvenation and construction of forestry roads and bridges to the powerhouse site.

"Execution of the EPC contract is a significant milestone for the Toba Montrose General Partnership as it provides price, date and performance certainty for our lenders, stakeholders and members of the community," said Donald McInnes, president of Plutonic Power.

"Kiewit has an exceptional reputation in building utility scale run of river projects at environmentally sensitive sites," said McInnes.

Plutonic said finalization of the complete financing package from lenders for this project is scheduled for mid to late October. Commercial operation of the Toba site is expected by mid 2010 and Montrose by late 2010.

"This investment expands our renewable energy portfolio with one of the most environmentally friendly energy technologies, aligns with GE's ecomagination initiative, and helps Plutonic and its customers achieve their sustainability and economic goals," said Mark Tonner, managing director at GE Energy Financial Services in Canada.

Plutonic has 34 proposed development projects with a total capacity of 1,700 MW.