Total and Etrion to build world's largest solar merchant in Chile

PARIS, FRANCE & GENEVA, SWITZERLAND: Total S.A. and Etrion Corp. announced the planned construction of Project Salvador, the world's largest solar power project based on spot market electricity revenues.

Project Salvador will be a 70 megawatt-peak photovoltaic power plant in the Atacama region of Chile. Pursuant to the terms of the related purchase agreement, Etrion, Total and Solventus Energías Renovables will own 70 percent, 20 percent, and 10 percent interests, respectively, in the project.

The total project cost of approximately $200 million will be financed 70 percent through non-recourse project debt from the Overseas Private Investment Corp. (OPIC), the US Government's development finance institution. The remaining 30 percent equity portion will be funded by Etrion, Total and Solventus, based on their respective ownership interests.

Project Salvador will be built by Total's affiliate, SunPower Corp., a US solar energy leader offering solutions unmatched in efficiency, reliability and performance. Project Salvador will also enter into a long-term fixed price operation and maintenance agreement with SunPower.

"Project Salvador is an important step in the process of transforming the capabilities of solar power in the world. This merchant project confirms that solar energy is becoming competitive with other conventional energy sources," said Philippe Boisseau, president, Marketing & Services and New Energies and a member of the Executive Committee of Total.

"Solar power is a compelling proposition in Chile due to the amount of solar irradiation received every day in the region. Combined with Chile's high electricity prices, large energy demand and low construction costs, solar can compete with traditional sources of electricity in Chile without government subsidies. As a world leader in the solar industry, we are proud to launch with our partners the largest solar merchant project in the world, and we are pleased to assist Chile in the diversification of its energy mix. We look forward to further developing our solar activities in the country."

Marco A. Northland, Etrion's CEO, said: "This is a very exciting opportunity for Etrion to work alongside Total, SunPower and Solventus in Chile. Project Salvador will demonstrate that solar is a viable and sustainable power solution in Chile given the strong solar irradiation and high electricity prices in the region. This project diversifies our portfolio in terms of geography and contract regime, demonstrates our ability to compete with traditional sources of electricity in a non-subsidy environment and provides a clear platform for growth that will give Etrion the option to declare dividends in the future."

Chile has an investment grade rating and offers attractive investment opportunities for leading financial institutions to provide non-recourse project finance. Project Salvador will be financed 70 percent by OPIC with US dollar-denominated, non-recourse project debt with a 19.5-year tenor. The debt financing was approved by OPIC's Board of Directors on September 19, 2013, with financial close expected in the fourth quarter of this year.