Mesa Power Places World's Largest Single-Site Wind Turbine Purchase Order

Thu May 15, 2008 8:00am EDT

* Reuters is not responsible for the content in this press release.

Purchase is step one in T. Boone Pickens' plans to build world's largest wind
farm near Pampa, Texas

DALLAS, May 15 /PRNewswire/ -- Mesa Power LLP, a company created by
legendary energy executive T. Boone Pickens, has placed an order with General
Electric to purchase 667 wind turbines capable of generating 1,000 megawatts
of electricity, enough to power more than 300,000 average U.S. homes.
    The agreement represents the first phase of the four-phase Pampa Wind
Project that will become the world's largest wind energy project, with more
than 4,000 megawatts of electricity, enough for 1.3 million homes. When all
phases of the project are completed as projected in 2014, the wind farm will
be five times as big as the nation's current largest wind power project, now
producing 736 megawatts.
    Pickens said he expects that first phase of the project will cost about
$2 billion, and that electricity from the project will be on-line by early
2011. When complete, the Pampa Wind Project will cover some 400,000 acres in
the Texas Panhandle.
    "T. Boone Pickens' commitment underscores the ability of wind technology
to help meet the country's need for diverse sources of energy," said Jeffrey
R. Immelt, GE Chairman and CEO. "As America's demand for energy escalates, it
is clear that wind can and will play a bigger part in meeting that need. We're
excited to partner with an energy visionary like T. Boone Pickens to bring our
wind technology to the marketplace."
    GE is to deliver the 1.5-megawatt wind turbines in 2010 and 2011. The GE
1.5-megawatt turbines are among the most widely used wind turbines in their
class.
    In August of 2007, Mesa Power filed documents with the Electric
Reliability Council of Texas (ERCOT) to add the 4,000 megawatts of
wind-generated electricity to the power grid in Texas. ERCOT, which operates
as part of the Texas Public Utility Commission (PUC), manages the state's
power grid. Mesa Power has nominated its wind turbine output to be delivered
by Texas' Competitive Renewable Energy Zones (CREZ) transmission lines. The
CREZ transmission lines will benefit Texas electric users by delivering them
cost effective and reliable electricity generated by renewable energy power
projects.
    Based on extensive testing, Pickens said the project area has some of the
best wind in the nation.  He is also pleased that landowners have been so
supportive of the project.
    "We have had a great response to this project," Pickens said. "We are
making Pampa the wind capital of the world. It's clear that landowners and
local officials understand the economic benefits that this renewable energy
can bring not only to landowners who are involved with the project, but also
in revitalizing an area that has struggled in recent years."
    Pickens envisions that large scale renewable energy projects like his
Pampa Wind Project will permit the United States to become less dependent on
foreign oil.  Large scale renewable energy projects such as this are difficult
to execute because they rely upon the Federal Production Tax Credit, which
provides incentives for development of renewable energy.  However, large scale
renewable energy projects require commitments years in advance, while Congress
has only extended the Production Tax Credit one or two years at a time.
    Mesa Power is hopeful that the Pampa Wind Project will qualify for the
Federal Production Tax Credits in 2010 and 2011 when the project will begin
commercial operations.  "I believe that Congress will recognize that it is
critical not only to this project, but to renewable energy in this country,
that they enact a long-term extension of the Production Tax Credits," Pickens
said.
    "The development of alternative energy projects, especially renewable
resources such as wind power, is critical for the future of the country in the
face of declining world oil resources," he said.
    "You find an oilfield, it peaks and starts declining, and you've got to
find another one to replace it," said Pickens, who once operated one of the
largest independent oil and gas production companies. "It can drive you crazy.
With wind, there's no decline curve."
    The Panhandle, with its wide-open space, low population and steady winds,
is a logical location for wind-generated energy. Studies show the Texas
Panhandle winds are optimal for such a project, blowing much of the time in
the middle of the day when electric demand is at its peak.
    Mesa Power has leased land in Carson, Gray, Hemphill, Roberts and Wheeler
counties, where the landowners will receive annual royalties for the wind
turbines operating on their property.
    Development of the region's wind resources will also create an economic
bonus similar to the boom the three largest wind farms in America have created
around Sweetwater in Nolan County. While other towns in West Texas struggle
with plummeting house prices and job losses, Sweetwater is in the midst of a
construction explosion. Two new companies opened in the past month, one
servicing the blades of the county's 2,000 turbines, another renting out
cranes used in erecting new turbines. Tax revenues from the wind energy
companies are bringing jobs, new roads and houses, and renovating local
schools and hospitals there.
    An Austin-based Resource Inc. economic impact study, commissioned by Mesa
Power, projects that the Mesa Power wind farm will bring significant increases
in jobs and income for the five counties of the project investment zone
(Carson, Gray, Hemphill, Roberts and Wheeler counties).
    The study forecast the project would generate an estimated 1,500 jobs
during the construction phase, and 720 during a typical year of the operation
phase; personal income in the project investment zone will rise by
$68.7 million per year during the construction phase, and $120 million during
the operation phase. The more significant impact during the operation phase is
largely due to lease payments to be made to landowners in the project area
amounting to $65.3 million per year.
    Resource Economics estimates that the total value of economic output in
the region due to the project will be $380 million per year during the
construction phase and $1.6 billion per year during the operation period, and
additions to the tax rolls of school districts in the project investment zone
will amount to $2.4 billion by 2018, assuming the school districts approve an
application to limit appraisal values during the project's first 10 years.
    Unicredit served as financial adviser and Vinson & Elkins as counsel to
Mesa Power in the transaction.
SOURCE  Mesa Power LLP

Jay Rosser of Mesa Power, +1-214-265-4165, jay@bpcap.net; or Kristin Schwarz
of GE, +1-518-385-7343, kristin.schwarz@ge.com
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