Texas awards first competitive U.S. wind leases

Texas awards first competitive U.S. wind leases

Filed from Houston 10/2/2007 9:27:36 PM GMT

USA/GULF OF MEXICO: The Texas General Land Office today awarded the first four competitively bid leases for offshore wind power in the nation's history.

The leases, awarded to Louisiana-based Wind Energy Systems Technology LLC (W.E.S.T.), allow work to begin immediately on the construction of meteorological testing towers on each of the four tracts. The company already holds the nation's only offshore lease for wind power and is collecting data for a wind farm off the coast of Galveston.

Once the wind farms are operational, W.E.S.T. will pay the state's Permanent School Fund (PSF) a minimum of US$132 million over the 30-year life of the leases, discounted for the present value of the leases. The company's actual dollar commitment to the PSF is US$258 million. Factor in the PSF's minimum gross revenue from the wind farms producing at 250 MW to 300 MW, and that total rises to more than US$231 million, discounted for present value, or US$433 million over the 30-years the leases cover.

Four offshore tracts were offered for wind development as part of the regular oil and gas lease sale held today. The offshore wind energy tracts are near Jefferson, Calhoun, Brazoria and Cameron counties. The four tracts total 73,098 acres in size. The tracts range in size from 12,240.02 to 23,040 acres.

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