Far East Wind Power (FEWP) has entered into a binding letter of intent (LOI) with Taitong Energy to acquire certain rights to a wind farm located in Yunnan Province of China.
As per the LOI, FEWP will fund up to $20m for the development of the wind farm, while Taitong will repay the funding once the wind farm receives financing from a Chinese bank.
The ownership interest of FEWP in the wind farm, to be structured as a sino-foreign joint venture, will be 49%, and Taitong will hold the remaining interest.
FEWP will consolidate all assets, liabilities and results operations under applicable accounting principles due to specific control provisions negotiated into the LOI by it.
The LOI also underlines initial plans for developing a 49.5MW wind farm to potentially generate $11.8m in revenues per annum.
A right of first refusal on remaining 99MW preliminarily approved wind farms controlled by Taitong in Yunnan has been obtained by FEWP.
Once the farms with a total capacity of 148.5MW are fully developed, a potential total revenue of $34.4m is projected from them per annum.