February 22, 2011

BP Plc’s partner in a proposed Australian solar power project said BNP Paribas, Banco Santander SA and National Australia Bank Ltd. are among eight banks that have agreed to help finance the venture.

The 150-megawatt solar project in New South Wales state, one of the developments competing for Australian government funding, may cost as much as A$900 million ($905 million) over its lifetime, Fotowatio Renewable Ventures said.

“Australia is a key market,” Javier Huergo, Fotowatio’s head of business development, said by phone from Sydney. “Our intention is to have a long-term presence here.”

Australia, which set a target of generating 20 percent of its electricity from renewable energy by 2020, has accepted funding applications from projects shortlisted for the government’s A$1.5 billion Solar Flagships program. A decision on the winning projects is due in the middle of 2011.

Australia & New Zealand Banking Group Ltd., Banco Bilbao Vizcaya Argentaria SA, Intesa Sanpaolo SpA, Natixis and WestLB AG are the other banks that have committed to lend money to the proposed development, he said, declining to say how much.

Pacific Hydro is a partner with BP and Fotowatio in the planned venture near Moree, in northwest New South Wales.

Madrid-based Fotowatio has about 230 megawatts of solar power capacity in operation and under construction, and more than 2,200 megawatts under development, it said in a January statement.

Suntech, CLP

Melbourne-based Pacific Hydro has 1,934 megawatts of renewable energy capacity in development and operation in Australia, Chile, Brazil and the Philippines, according to its website.

AGL Energy Ltd. and CLP Holdings Ltd. unit TRUenergy Holdings Pty are also vying for government solar grants, while a joint proposal from Suntech Power Holdings Co. and Infigen Energy is another of the shortlisted ventures aiming to develop projects using photovoltaic panels to turn sunlight into power.

Australia is also choosing between solar thermal projects, which heat water to produce steam. Acciona SA, Spain’s biggest wind farm operator, pulled out of the program, saying it was unable to forecast whether its project would be profitable.

The government expects to select one solar photovoltaic venture and one thermal project in the first round of the program, the energy and resources ministry said in December.

The BP development may start construction in 2012 if it is successful, according to Fotowatio. The cost to build the Australian solar venture may be at least A$600 million, Huergo said in the phone interview yesterday.

Source: Bloomberg: www.bloomberg.com