NaiKun Wind Energy Group Inc. (TSX VENTURE: NKW) distributed a
quarterly project update to shareholders after the close of markets
yesterday. The content of the update appears below.
NaiKun Wind Quarterly Shareholder Update
Welcome to the NaiKun Wind Quarterly Shareholder Update for
January-March 2010. The previous quarter's Update presented a
comprehensive look at Clean Power Call scheduling, NaiKun Wind's
environmental assessment process, the Haida Nation's plan to
acquire an ownership position in our 396MW project, and renewable
energy development pledges from the B.C. Government. In this issue,
we'll bring you the latest on each of these files, talk about an
important addition to our project team, and also provide some dates
to put on your calendar for potential news on our company and
sector.
Clean Power Call
Given the comprehensive overview of the Clean Power Call
schedule presented in last quarter's Update, we will keep this
section brief. What most shareholders want to know is when contract
awards will be announced. In late December 2009, the British
Columbia Utilities Commission granted BC Hydro's request for an
extension of the deadline by which it must make its Clean Power
Call contract awards to March 31, 2010. While it is disappointing
to learn of a further extension in the Call timeline, it may
actually work to the advantage of proponents such as NaiKun Wind
who have significantly advanced their work on the First Nations and
environmental assessment fronts.
Given this, and the level of due diligence BC Hydro is
conducting on the proposals, it is reasonable to assume that
contract award announcements will begin in the near future.
Environmental Assessment
NaiKun Wind's project is the first of its type in Canada and we
were pleased that British Columbia's Environmental Assessment
Office conducted a thorough review on schedule and granted NaiKun
Wind an Environmental Assessment Certificate on December 10, 2009.
The receipt of our provincial approval puts us in a select group
among the 47 remaining Call proponents, as the number of projects
to have reached this milestone is a handful at best.
We are now waiting for the Federal Government to finalize its
review. Given that the federal agencies took part in the harmonized
federal-provincial review, it should not be long before we receive
word from Ottawa. The Haida Nation has also conducted its own
environmental assessment, much of it paralleling the harmonized
federal-provincial process, though with a greater emphasis on
studies such as the traditional use of the area.
Haida Enterprise Corporation Making Progress with Federal
Government
Haida Enterprise Corporation (HaiCo) and NaiKun Wind signed a
Memorandum of Understanding in August 2009 giving HaiCo the
opportunity to acquire up to 40% of the 396MW project. Since early
September 2009, HaiCo representatives have held a number of
discussions with Federal Government officials, seeking support for
the plan that would see Ottawa assist with the equity participation
by providing a loan guarantee to HaiCo.
This being the largest investment the Haida Nation has ever
considered, the Nation's leadership will be seeking the support of
the Haida people through a general vote. Four information sessions
for the Haida community will be held in advance - two on Haida
Gwaii, plus one each in Prince Rupert and Vancouver. A "Yes" result
would lead to HaiCo making its final approach to Ottawa. It is
anticipated that the vote will take place in February. NaiKun Wind
is supporting the Council of the Haida Nation in its work to ensure
that the Haida people have the information they need to make an
informed decision.
NaiKun Wind believes the investment is an excellent opportunity
for the Haida Nation. Cash flow from the project could, among other
uses, support development in timber, aquaculture and tourism on
Haida Gwaii.
Top Danish Marine Contractor Joins our Team
We are pleased to say that NaiKun Wind signed a Letter of Intent
with Danish firm MT Hojgaard in the fourth quarter covering design,
supply and installation of foundations, inter-array cables and
other key project elements. MT Hojgaard is a leading marine
contractor for offshore wind energy projects in Europe and we will
benefit greatly from their experience. MT Hojgaard will be working
with Siemens and our consulting engineers on the project, giving us
a superb line-up in terms of expertise in offshore wind farm design
and construction.
B.C. Energy Sector Developments
In the previous quarter's Update, we discussed at length efforts
by the Government of British Columbia to follow through on
commitments made in its August 2009 Throne Speech, explaining that
several steps had already been taken, including the formation of a
cabinet-level committee chaired by the Premier to review input from
a newly formed Green Energy Advisory Task Force (comprising four
advisory groups).
These groups submitted their reports in January and the
government is now assessing the recommendations, deciding changes
that need to be made in order to bring greater efficiency to
procurement, First Nations consultation, and other important
processes. The government has also made it clear that B.C.'s
abundant renewable energy potential brings the opportunity to
establish a vibrant electricity export industry that would serve
the province through jobs, skills development and revenue creation
that extend over generations. British Columbia's economy has been
built on the export of goods and services, and power is a
value-added commodity that the province can sell to others after it
has met its own needs. In addition, by exporting locally produced
clean energy, British Columbia can play an important role in
helping to address climate change, including the challenges faced
along the west coast of the continent.
Investors in B.C.'s renewable energy sector have welcomed the
government's stated goals since 2007 but been disappointed by the
follow-through. That might be about to change, though, as we are
now seeing a progression from ideas to action, as evidenced by the
Special Direction on Burrard Thermal and the efficiency displayed
by the Green Energy Task Force. Investors have clear expectations
that the B.C. Government will make hard commitments to specific
changes and actions, followed up with an unyielding focus on
execution....the results must match the words. With leadership at
the Provincial Government level, B.C. definitely has the resources
and ability to become a global leader in clean energy generation
and supply.
We expect that the Provincial Government will move in the coming
weeks with a set of initiatives on the clean energy front.
Specifically, NaiKun Wind expects that the Throne Speech on
February 9 and the Olympics-related Climate Action and Clean Energy
reception on February 15 will be showcase events for the Province
and the Premier to unveil initiatives to regain the impetus on
green energy development. We will ensure that investors are updated
on any announcements that arise from these two important
events.
Conclusion
NaiKun Wind continues to make significant progress in the
development of its offshore wind project, as evidenced by the
recent granting of a provincial Environmental Assessment
Certificate, advancement in welcoming the Haida Nation as a
potential generation company equity partner, and the addition of a
global leading marine contractor to carry out the important
foundation preparatory work in cooperation with Siemens Wind Power,
which will provide the turbines. We are also looking forward to BC
Hydro meeting its commitments on announcing successful proponents
in the Clean Power Call.
We are often asked what our next steps would be following
receipt of an Electricity Purchase Agreement. NaiKun Wind would
move quickly to finalize arrangements with our project co-owners,
sign supplier agreements, finalize project permits and procure
project financing.
I would like to invite investors to watch a currently scheduled
interview in which I will be participating on February 9. It will
be aired on Canada's Business News Network at 10:50 a.m. EST. I
expect the interview to focus on the project's status.
As always, I thank you for your ongoing support of the team and
the project.
Sincerely,
Paul Taylor, President and CEO
NaiKun Wind Energy Group Inc.
Caution Regarding Forward-Looking Statements - This news release
contains certain forward-looking statements, including statements
regarding the business and anticipated financial performance of the
Company. These statements are subject to a number of risks and
uncertainties. Actual results may differ materially from results
contemplated by the forward-looking statements. When relying on
forward-looking statements to make decisions, investors and others
should carefully consider the foregoing factors and other
uncertainties and should not place undue reliance on such
forward-looking statements. The Company does not undertake to
update any forward-looking statements, oral or written, made by
itself or on its behalf.
The TSX Venture Exchange does not accept responsibility for the
adequacy or accuracy of this release.
Contacts: NaiKun Wind Energy Group Inc. - Investor Relations
Enquiries Peter Murray Manager, Investor Relations 604-631-4494
pmurray@naikun.ca NaiKun Wind Energy Group Inc. - Media Enquiries
Doug McClelland Director, Communications 604-631-4487
dmcclelland@naikun.ca
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