Prophecy Power Generation LLC, a wholly owned subsidiary of Prophecy Coal Corp. (TSX:PCY,OTCQX:PRPCF,FWB:1P2), has formally submitted its Power Purchase Agreement proposal to the Mongolian government.
The proposed Power Purchase Agreement (“PPA”) details the terms under which Prophecy Power would be prepared to supply power to Mongolia’s National Transmission Grid Co. Highlights of the PPA include:
• Designated concrete-pour date of April 2013 and 1st phase operational date of Q1 2016*;
• A long term power off take contract to ensure 24/7, uninterrupted dispatch power supply to the Mongolian grid;
• A competitive tariff that is lower than Mongolia’s wind farm tariff;
• Capacity and energy charge components in the tariff to cover fixed and variable costs respectively; •A levelized tariff designed to meet anticipated project debt service; and • Tariff indexation based on US CPI, Mongolia wage index, and oil price index. i.e. a pricing structure that is responsive to changed inputs and which will provide long term project viability.
Prophecy Coal Chairman and CEO John Lee said:
Both Prophecy and the Mongolian government working group have been working hard for several months to reach this point. All of us have high expectations for the Chandgana project. Everyone here at Prophecy and our government counterparts is quite excited.