The Frog Lake First Nation is receiving a $27 million loan guarantee towards sustaining their ownership of the Lindbergh Cogeneration Facility.
The loan guarantee will come from the Alberta Indigenous Opportunities Corporation, and will go towards the cost of ownership of the Lindbergh cogeneration facility at Strathcona Resource Ltd.’s Lindbergh Steam-Assisted Gravity Drainage operation.
The AIOC says this program, in place for the next 15 years, supports the long term, sustainable business partnership between Frog Lake and Strathcona, avoiding any divestment of Frog Lake’s 100 percent ownership stake.
“This project is an example of the Alberta Indigenous Opportunities Corporation’s commitment to driving and preserving Indigenous investment in Alberta’s natural resource sectors,” says Alicia Dubois, CEO, AIOC said in a statement. “AIOC is proud to support long-term Indigenous ownership in natural resource projects and in turn, bolster economic prosperity in Indigenous communities across the province.”
Frog Lake originally Lindbergh cogeneration facility with self-funded equity and bank debt that matured on April 1, 2021, with an agreement to lease the facility back to Strathcona on a fixed-rate deal that generates monthly cash flows for Frog Lake.
Without the loan, Frog Lake may have had to face reexamining its ownership stake because of diminished access to capital and the heavy possibility of unfavorable refinancing.
Frog Lake will retain $6.7 million of unlevered equity capital invested in the Lindbergh facility, sharing the equity risk with AIOC.