UPDATE 1-Plutonic says wind power fits with growth strategy

By Allan Dowd

VANCOUVER, British Columbia, June 1 (Reuters) - Plutonic Power Corp (PCC.TO), a Canadian hydro-electric producer, is being "opportunistic" in its proposed takeover of a distressed wind farm project, its chief executive said on Monday.

Plutonic has formed a joint venture with General Electric Co. (GE.N) to purchase the uncompleted 300-megawatt Dokie Ridge project near Chetwynd, British Columbia, whose owner EarthFirst Canada (EF.TO) filed for creditor protection last year.

It marks Plutonic's first venture into wind power, but CEO Donald McInnes said the company was always looking for growth opportunities in the green energy sector even though its current focus is hydro facilities.

"Our advancement into wind should not be thought of as a deviation from our very well-thought-out strategy of developing green hydro-electric assets in British Columbia," McInnes said.

Plutonic's shares in Toronto closed up 59 Canadian cents at C$3.70 per share on Monday.

Although a final price for the deal has not be reached, it would include paying off the C$26 million EarthFirst owes to a secured creditor and the cost of completing the facility which would begin production next year.

EarthFirst estimated completing the project would cost about C$250 million, including unpaid bills, but McInnes said Plutonic and General Electric are still reviewing those figures.

"Given that EarthFirst has already spent over C$100 million on the project, we viewed this as very opportunistic," he said,

The purchase is also subject to several conditions including renegotiating contracts with turbine-maker Vestas Wind Systems (VWS.CO) and BC Hydro, which will buy the electricity.

The buyers also want access to Canadian government alternative energy funding that had been promised EarthFirst before its finance's fell apart.

Plutonic had not been interested in buying Dokie Ridge on its own, McInnes said, but the deal made in conjunction with General Electric, which has extensive experience in that area.

The companies already work together on hydro electric projects. Each would have a 50 percent stake in Dokie Ridge.

EarthFirst was forced into creditor protection in November amid the credit crunch that made it impossible to financing rising construction costs.

EarthFirst's shares nearly doubled to 3.5 Canadian cents per share in Toronto on news of the deal on Monday, but McInnes cautioned those shareholders are unlikely ever see any money from this transaction.

"Unfortunately for the EarthFirst shareholders that C$100 million is gone," he said.

(Reporting by Allan Dowd, Editing by Frank McGurty)