TAHLTAN HERITAGE TRUST DISTRIBUTIONS INVEST IN HYDRO ELECTRICITY PROJECTS FOR TAHLTAN NATION

July 19, 2019

The Tahltan Heritage Trust has purchased five percent– from Axium and Manulife – of the Northwest British Columbia Hydro Electric Facilities, on behalf of the Tahltan Nation. The hydro facilities comprise the Forrest Kerr, McLymont Creek and Volcano Creek run-of-river projects located in Tahltan Territory.

This is the largest clean energy investment by a First Nation in British Columbia’s history, and one of the largest clean energy investments by a First Nation in Canadian history. In partnering with Axium Infrastructure Canada, Manulife Financial Corporation and AltaGas Canada Inc., the Tahltan Nation is now part owner of a clean energy asset that is valued well over $2.5 billion.

This $124.3 million investment marks an important milestone for the Tahltan Nation as it continues to move towards its goal of becoming an economically independent and self-sufficient First Nation. In total, $28.5 million of Trust funds were used to make the purchase, with $94.8 million of bond financing and $1 million from our investment in Axium/Manulife. This ownership interest is in addition to the royalties and buy-in rights for up to 20% interest in the Projects in years 20 to 40.

This recent investment builds on a previous $2 million investment the Trust made in the Volcano Creek hydro project in 2014. The Trust purchased a $2.7 percent interest in the project, when it invested $500,000 of Trust funds, which was supplemented with a grant of $1.5 million from the Province of British Columbia’s Green Energy Program.

Collectively, these investments produce income for distribution but do not create any liability for the Trust in the unlikely event the hydro projects incur a loss. These investments are stellar examples of how the Tahltan Heritage Trust is investing and growing funds the Tahltan Nation has received from resource developers and government over the years, and using the funds strategically to create long-term financial returns.

Breakdown Slide from 2019 AGA Presentation:

  • 5% equity purchase price is ~ $29.5 million ($124.3 million purchase price less $94.8 million of bond financing).
  • Agreement provides another $1,000,000 when we made the Investment Decision and this brings our final purchase price down to $28.5 million
  • Agreement also provided an additional $22 million towards the investment which only left $6.5 million that was invested from the original Trust capital pool
  • Decision to purchase 5% was made on June 13th.
  • No extra fees were charged to us (savings of $2 million on our portion of the purchase price.
  • This ownership interest is in addition to the royalties and buy-in rights for up to 20% interest in the Projects in years 20 to 40.