BP to sell Pattern Indiana project

BP Wind Energy North America has reached an agreement to sell its proposed 150MW Fowler Ridge 4 wind project in western Indiana to US developer Pattern Energy Group, officials from both companies tell Recharge.

They declined to discuss terms of the deal, which will require approval by the Federal Energy Regulatory Commission (FERC), which regulates interstate transmission of electricity, natural gas and oil.

BP Wind Energy North America, a unit of UK oil and gas group BP, has asked FERC for a positive ruling by mid-February to close the deal with Pattern, the officials say.  FERC did not immediately return a phone call seeking comment.

Electricity generated by Fowler Ridge 4 will flow into PJM Interconnection, a regional transmission organization that coordinates the movement of wholesale electricity in all or parts of 13 states and the District of Columbia.

The project will utilize up to 94 wind turbines. Fowler Ridge 1, 2 and 3 contain a combined 355 turbines with 499.8MW nameplate capacity.

Pattern is flush with cash after a successful initial public offering last September when it raised $404.8m. Share closed down 0.2% Tuesday in New York at $29.00 versus the $22.00 IPO price. The company is looking to achieve rapid growth in the Americas.

Pattern has six operating wind farms totaling 1.0f4GW capacity – four in the US, one in Manitoba, Canada, and one in Puerto Rico. Four are in development totaling 716MW – two in Ontario, Canada, one in Texas and one in Chile.

BP confirmed last year that it plans to sell its entire US wind development portfolio comprising 18 projects – but will retain its operating assets. At that time, the company said the proposed sale could occur as a single transaction or multiple ones with buyers that will continue to develop the projects.

The 18 projects represent approximately 3GW of potential wind capacity in various stages of development across the US.

The 16 operational wind farms located in nine US states that have a combined generating capacity of 2.6GW.

The oil giant initially announced the sale of its entire wind business, but reversed its plans last July after failing to secure a bid that met its valuation for the assets. 

When the sale was announced, analysts pointed to the highly attractive nature of much of BP’s wind fleet, but also highlighted several risk factors that potential buyers would have to weigh up before making an offer.

These included a significant presence of Clipper Windpower’s 2.5MW turbine in the BP fleet. The company was the biggest customer of Clipper, which experienced a troubled technical track record and is now in the hands of a US private equity group.