Business Context and Reporting Period
Company: Ormat Technologies, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: December 16, 2011
Subject: Termination of agreements related to the Carson Lake project.
Key Financial Metrics
This filing does not report standard periodic financial metrics such as revenue, profit, cash flow, or margins. The only specific financial figure disclosed is a one-time termination payment.
- Termination Payment: $1,685,400 paid by ORNI 16 LLC to NV Energy.
- Accounting Treatment: The payment will be recorded as an expense in the fourth quarter financial statements.
Material Changes
On December 16, 2011, Ormat Nevada Inc. and ORNI 16 LLC (subsidiaries of Ormat Technologies, Inc.) entered into a Termination Agreement with Nevada Power Company (d/b/a NV Energy). This agreement resulted in:
- Termination of the long-term firm power purchase agreement (PPA) for the Carson Lake project, originally entered into in August 2006.
- Termination of the joint ownership agreement (JOA) for the Carson Lake project, originally entered into in March 2008.
- Release of both parties from further obligations under the PPA and JOA.
Outlook, Management Commentary, and Risks
Operational Status: Despite the termination of the PPA and JOA, the Company is continuing work at the Carson Lake project.
Forward-Looking Statements: The filing includes a Safe Harbor Statement noting that expectations and forecasts are subject to risks and uncertainties. Investors are directed to the "Risk Factors" section of the Annual Report on Form 10-K filed on February 28, 2011, for a discussion of these risks.
Key Facts for Investor Verification
- Verify the impact of the $1,685,400 termination expense on the Company's Q4 2011 earnings.
- Confirm the current status and future revenue potential of the Carson Lake project following the loss of the NV Energy PPA.
- Review the Form 10-K filed on February 28, 2011, for detailed risk factors affecting future operations.