During the first quarter of 2015, COMAX concluded the program to renovate five projects that commenced in 2014. Total capital expenditures related to all five projects in the renovation program were $13.6 million (9.7 million Euro). COMAX secured debt financing of $11.6 million (8.3 million Euro) for the five renovation projects. The terms of the loans were favourable with leverage ranging from 80% to 91% of the project investment and fixed interest rates ranging from 3.0% to 4.5%.
AMENDED AND RESTATED BANK OF MONTREAL ("BMO") CREDIT FACILITY
On May 5, 2015, MAXIM entered into an amended and restated credit agreement with BMO that provides a $40.0 million revolving credit facility in two tranches. Under the first tranche, MAXIM can borrow up to $25.0 million subject to the book value of the Corporation's Canadian accounts receivable balance and property, plant and equipment. Under the second tranche, MAXIM can borrow up to $15.0 million, under the same terms of the first tranche, and subject to twelve month trailing EBITDA being equal to or greater than $15.0 million and MAXIM being in compliance with all financial covenants for a minimum of two consecutive quarters. This facility matures on August 31, 2016. MAXIM will continue to use, as necessary, the revolving credit facility to support existing operations and growth initiatives.
GROWTH INITIATIVES
Milner Expansion 3 ("M3")
On February 12, 2015, the AUC approved MAXIM's application to construct and operate M3. M3 is an expansion project for the HR Milner Generating facility ("M1"), comprised of an 86 MW natural gas-fired cogeneration power plant to be located adjacent to M1. M3 will increase generating capacity at the Milner site while reducing the total greenhouse gases and air emissions.
Exhaust energy from M3's gas turbines will be converted to steam and utilized to generate electricity in the existing M1 steam turbine, displacing coal-sourced steam. M3, before giving effect to the development of Milner Expansion 2 ("M2"), will increase the nameplate capacity at the Milner site from 150 MW to 236 MWs. Total emissions of carbon dioxide, nitrogen oxides, sulfur oxides and particulates at the M1 site will decrease compared to running the existing M1 station.
M2
MAXIM has received the AUC's approval to convert the fuel source for M2 from coal to natural gas and to increase the generating capacity of the proposed expansion from 500 MW to 520 MW. The M2 facility is to be located adjacent to the existing 150 MW M1. The existing infrastructure at the M1 site allows MAXIM to leverage benefits including electrical connection, fuel delivery, water licenses, and a skilled operations team.
Forked River
MAXIM continues to advance an expansion initiative at the Forked River site. Based on studies by the local utility, PJM has confirmed sufficient local infrastructure to support a potential increase of 100MW at the Forked River site. MAXIM has commenced the process of permitting of the project. The configuration, size and timing are being evaluated to ensure the highest value for the expansion project. An expansion of the facility will provide additional capacity to participate in future capacity auctions and realize cost savings because this expansion project will be on the existing Forked River site.
Summit Coal Limited Partnership ("SUMMIT")
SUMMIT is MAXIM's development initiative located north of Grande Cache, Alberta that owns metallurgical coal leases for Mine 14 ("M14") and Mine 16S ("M16S"). Current estimates for M14 are 18.9 million tonnes of low-mid volatile metallurgical coal reserves with a mine life of 17 years based on the NI 43-101 Technical Report filed on SEDAR on March 21, 2013. M16S is located 30 kilometers northwest of M14 and represents 1,792 hectares or 29% of SUMMIT's total area of coal leases. A NI 43-101 Technical Report has not been prepared for M16S.
M14 is permitted for a run-of-mine production rate of up to 1,300,000 tonnes per year. MAXIM has also received approval from the Alberta Energy Regulator to construct and operate a Coal Beneficiation Plant. This Coal Beneficiation Plant, to be located on MAXIM's existing M1 industrial complex, will bifurcate M14's run-of-mine coal into an estimated annual production of 950,000 tonnes of high-quality, low-mid volatile and metallurgical coal for shipment to export markets. These approvals provide SUMMIT with all of the requisite government and regulatory approvals to construct and operate M14. In November 2014, MAXIM received delivery of five pieces of mine equipment including two continuous miners and three shuttle cars. The units are in storage awaiting development of SUMMIT. The Corporation expects that the long-run average price forecast for metallurgical coal will allow for the economically viable development of SUMMIT.
Deerland Peaking Station ("D1")
MAXIM has received regulatory approvals to construct and operate D1. The D1 site is located near Bruderheim in Alberta's Industrial Heartland, and it is in close proximity to the entry point of the proposed Gateway pipeline and adjacent to the existing Deerland high voltage substation.
Buffalo Atlee ("B1")
MAXIM acquired the B1 Power Project, situated near Brooks, Alberta, through an amalgamation with EarthFirst Canada Inc. This project has the potential for development of over 200 MW of wind generation capacity. The addition of wind generation to MAXIM's existing portfolio of assets would diversify MAXIM's generation fuel types and provide the potential to offset the impact of expected new provincial greenhouse gas legislation.
CONFERENCE CALL FOR Q1 2015 RESULTS
MAXIM will host a conference call for analysts and investors on Wednesday, May 6, 2015 at 11:00 am MDT. The call will be hosted by John Bobenic, MAXIM's President and Chief Executive Officer, and by Mike Mayder, Senior Vice President, Finance and Chief Financial Officer. To participate in this conference call please dial (877) 291-4570 or (647) 788-4919 in the Toronto area and refer to MAXIM's Q1 Results call. It is recommended that participants call at least ten minutes prior to start time.
A recording of the conference call will be available from May 6, 2015 to May 13, 2015. To access the replay, dial (800) 585-8367 or (416) 621-4642 followed by the conference ID 41434804. In addition, the recording will be available commencing May 6, 2015 in the Investor Relations section of MAXIM's website at www.maximpowercorp.com.
About MAXIM
Based in Calgary, Alberta, MAXIM is an independent power producer, which acquires or develops, owns and operates innovative and environmentally responsible power and power related projects. MAXIM currently owns and operates 39 power plants in Alberta, the United States and France, having 778 MW of electric generating capacity. MAXIM trades on the TSX under the symbol "MXG". For more information about MAXIM, visit our website at www.maximpowercorp.com.
Statements in this release which describe MAXIM's intentions, expectations or predictions, or which relate to matters that are not historical facts are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties which may cause the actual results, performances or achievements of MAXIM to be materially different from any future results, performances or achievements expressed in or implied by such forward-looking statements. MAXIM may update or revise any forward-looking statements, whether as a result of new information, future events or changing market and business conditions and will update such forward-looking statements as required pursuant to applicable securities laws.
Contacts: John R. Bobenic President and CEO (403) 750-9300 Michael R. Mayder Senior Vice President, Finance and CFO (403) 750-9311
