Syntaris Power

Oil sands, pipeline and coal-power companies now among the biggest players

Several of Canada’s largest energy and resource companies are quietly staking out positions in a sector that seems at odds with their usual extractive activities: the renewable power business.

Oil sands, pipeline and coal-power firms are now among the biggest players in renewables, with portfolios of wind, solar, small hydro power and ethanol production that in some cases outpace the holdings of most “pure” green companies.

Environmentalists and small companies in the sector are sanguine about the competitors; they welcome the big firms as a significant source of clout and capital that can add momentum to the shift to renewable energy.

“It reflects the reality of energy in the 21st century,” said Ian Bruce, a climate change specialist at the David Suzuki Foundation. “A lot of the innovation is happening at the small company level and then is getting [moved] up to larger businesses that have the capital to invest more.”

…Meanwhile, Calgary pipeline operator Fort Chicago Energy Partners recently bought up three small-hydro operations – Swift Power Corp., Pristine Power Inc., and the B.C. hydro assets of Enmax Corp.

…While Suncor plans to add one wind farm a year to its holdings, Mr. Lambert is loath to predict how large a proportion of its business renewables will make up. So much depends on access to power grids, provincial energy rules, and the shape of the still-undefined federal energy strategy.

It makes sense to have a diverse range of companies in the renewable business, he said. “You need to have those entrepreneurial players who are creating new ideas and innovating, then you need the big players for the growth stages of many of these technologies where access to capital is important.”

Small green energy companies agree. “The more that gets done, the better, whether it is by a pure play or by a traditional fossil fuel generator,” said Kent Brown, the former chief executive officer of Canadian Hydro who is now running a startup firm called BluEarth Renewables Inc. “We want to see projects get done and get done successfully.”

Tax break on flow-through shares cuts risk of renewable-energy investments

It’s often argued that money and the environment don’t mix when it comes to investing. While we all may try to love Mother Nature the best that we can, many of us have investment portfolios that tell a different story.

Let’s face it: Many equity-based mutual fund portfolios owned by Canadians are heavily invested in oil and gas and mining, or financial institutions that receive a significant amount of revenue from financing these sectors.

Even the socially responsible investment funds — be it mutual funds or the handful of Canadian exchange-traded funds — are not very focused on up-and-coming green firms.

Then again, it’s tough to blame anyone serious about investment returns for shunning the green-tech and renewable-energy sectors. For the most part, these firms are in their fledgling phases. They have promising ideas, but they lack the funding to get off the ground in many cases because the markets for their products and services are not yet fully developed, either.

“I think there is a lack of knowledge about and of capital for these companies,” says Stephen Whipp, a board member with the Social Investment Organization and investment adviser with Manulife Securities in Victoria.

…”We have a longstanding history in Canada since ’54 of supporting the development of energy and mining with the use of flow-through, but what a lot of people don’t know is we’ve had this green infrastructure since 1996 that investors can participate in the green sectors of energy,” says Sheldon Stier, president of Manitoba exempt market investment dealer Hatch Alternative Investments.

Flow-through share offerings are a way for companies to attract investment by passing on the tax incentive they receive to investors, reducing the amount of invested capital at risk.

On an investment of $10,000, an investor at the highest marginal tax rate would receive about $4,640 back in taxes. Even more tax savings could be realized the following year by investing the credit money into RRSPs, providing an additional tax refund.

Stier says it’s also possible to receive further tax savings after the flow-through shares’ tax deductions have been realized because the shares may become eligible for an RRSP. But investors should seek expert tax advice in this regard to be sure they abide by the rules under the Income Tax Act, he adds.

Tax incentives aside, however, the renewable-energy sector is becoming a viable investment sector, he says.

And unlike conventional resource exploration, in which the firms aim to discover resources that, if found in large enough quantities, can then be sold to another company to develop, renewable energy firms can often quantify the potential upside of their ventures, says Bob Fraser, CEO of Syntaris Power, a B.C.-based green-tech firm that has a flow-through share offering available in Manitoba through Hatch.

Syntaris develops small hydroelectric projects, called run-of-river. These involve diverting a portion of a stream on a steep mountainside. The rerouted water flows into a pipe called a penstock down a precipitous grade to a small wheelhouse at the bottom.

Fraser says the company is able to project its potential output by studying stream-flow outputs over several years.

“For a very small amount of money, we can know what the energy output will be and what the projects will look like,” he says.

Of course, being able to project output is one thing. Having a market to sell the energy to is another.

Because of new legislation to promote renewable energy, Fraser says run-of-river and other green energy projects now have growing markets.

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Deal will increase development portfolio and provide expansion opportunities

NEWS RELEASE
September 24, 2010

Vancouver, British Columbia— Syntaris Power Corp., a private British Columbia company (“Syntaris”), is pleased to announce it has signed a merger agreement with Evergreen Power Corp., a private American-based renewable energy company (“Evergreen”). Management anticipates that the merged entity will boast an impressive development portfolio of 41 projects with an estimated total energy output of 622 megawatts.

“This merger will allow us to expand our business beyond British Columbia and Canada into the United States. We’re very excited about the new opportunity and the added resources it offers,” says Syntaris President and Chief Executive Officer, Robert Fraser. “We believe that this is the right move at the right time in our company’s development.”

In anticipation of closing, Evergreen’s Chief Financial Officer, Robert Abenante, joins Syntaris as Senior Vice President, Corporate Development. Abenante has significant experience in the development of projects in the United States and brings strong relationships with many renewable energy groups such as the American Council on Renewable Energy (“ACORE”) and the National Hydro Association (“NHA”). Abenante has regularly lectured at top tier universities and is currently developing renewable energy curriculum.

“I am pleased to join a team that has the experience, expertise and the potential to become a leader in the renewable energy industry in the Pacific Northwest,” says Abenante. “I look forward to uniting our efforts and developing the company as we move forward.”

Syntaris has engaged a North American-based financial investment company to lead a $50 million capital raise to acquire and develop renewable energy projects in Canada and the United States. Syntaris intends to develop a number of its near term projects through the provincial Standing Offer Program (“SOP”), which grants Energy Purchase Agreement’s to successful projects upon receipt of an environmental certificate and water license. Syntaris currently has 25 projects with an estimated total power output of 263 megawatts in its SOP development portfolio.

The merger, which is expected to close by the end of September, comes as Syntaris has submitted its Development Plan for the 15 megawatt Culliton Creek hydro project located near Squamish, British Columbia. The public process is expected to begin next month. Closing of the merger is subject to several conditions, and management cannot provide any assurance that such conditions will be satisfied or that the merger may close.

About Syntaris Power Corp.
Syntaris Power Corp. is a Vancouver-based green energy company committed to sourcing, developing and operating clean, renewable hydroelectric projects in the Province of British Columbia. The Company’s impressive development portfolio, representing approximately 622 MW of potential projects, can provide socio-economic benefits to First Nations and local communities. Successful development of these projects will help British Columbia achieve its required goal of energy self-sufficiency by 2016 and create a legacy of clean, renewable power for future generations. For more information about Syntaris Power, visit the company website, www.syntaris.com.

Forward Looking Information: The information contained in this news release may contain forward looking statements. Forward looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. Note: This is not legal or tax advice. Individual investor financial circumstances will vary. Independent advice should be sought on the suitability of these types of investments.

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Calgary based company has significant experience in owning, operating energy infrastructure

NEWS RELEASE
September 8, 2010

Vancouver, British Columbia—Syntaris Power Corp. (Syntaris) is pleased to announce Calgary based Fort Chicago Energy Partners L.P. (Fort Chicago) as a partner in the Culliton Creek hydroelectric development located near Squamish, B.C. Fort Chicago acquired an interest in the project as part of its recently announced purchase of a number of renewable energy assets from ENMAX Corporation, the Southern Alberta utility. In these transactions, Fort Chicago acquired a 50 percent ownership interest in the 15 megawatt Culliton Creek hydroelectric project which was awarded a 30-year electricity purchase agreement from BC Hydro on March 31, 2010. Syntaris holds the remaining 50 percent ownership in the Culliton Creek Project. The announcement comes as work on Culliton Creek continues to forge ahead. The company submitted the Development Plan for the project in August and the public process is set to begin in October.

“We are happy to work with Fort Chicago in the further development of this and other possible projects,” says Syntaris Power’s President and CEO Robert Fraser. “The company has significant experience in operating energy infrastructure and is fast becoming a major player in the renewable energy industry in North America. We intend to lever this new relationship to the best advantage of both companies.”

For further information about Fort Chicago, please visit the company’s website, www.fortchicago.com.

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