Western Wind Energy: Windstar financing update

Vancouver, Canada - Western Wind Energy provides an update on the 120 MW Windstar financing.

Western Wind Energy is receiving considerable inquires regarding the anticipated financial closing date and the perceived implication to the value of Western Wind Energy as a result of such financial close. While management believes the implication to the Western Wind Energy shareholder is significant at financial close, management would like to better explain the process of financial close and therefore, provide greater certainty to the investing public, maintaining full transparency, understanding and clarity.

For greater clarity, the final execution of a Turbine Supply Agreement ("TSA") and final execution of a Balance of Plant Contract from an Engineering Procurement and Construction ("EPC") Contractor occurs before financial close, not after. In fact, most key project components are completed before, or just prior to formal financial close. At formal financial close, the lender will release into an escrow construction account, the funding necessary to construct and commence operations at the wind park.

As previously disclosed, Western Wind Energy has executed a turbine reservation agreement with Gamesa for 60 units of the G8X series - 2 MW wind turbine generators. Western Wind has selected RMT of Madison, Wisconsin, as the EPC contractor for Windstar. RMT is a world class EPC contractor whose parent company is the multi-billion dollar regulated utility, Alliant Energy of Madison, Wisconsin. RMT is currently performing substantial activities on the Windstar project which include geotechnical drilling of all 60 turbine sites, calculations of soil dynamic loadings, seismic refraction surveys, electrical resistivity testing, road design, substation design and transmission interconnection design.

Western Wind Energy, Gamesa and RMT are currently formulating the complex delivery, erection, mechanical completion and commissioning strategy and Western Wind Energy expects this construction strategy to be substantially complete within several weeks. However, Western Wind Energy does not foresee any change to the August, 2010 commencement of formal construction start up and March, 2011, Commercial Operations Date. Western Wind Energy is currently 95% complete on negotiating the completion of the final TSA and such execution will occur just prior to financial close.

Windstar Project financing will leave Western Wind Energy with a full, undivided 100% interest in and to the Windstar Project. Project financing terms and rates will be set at financial close with such terms to be customary and traditional in nature with respect to a wind energy project in the United States. Upon commencement of the Commercial Operations Date, Western Wind Energy will apply to the US Treasury Department for the 30% tax free cash grant available under the American Recovery and Re-Investment Act of 2009. Such tax free cash grant is anticipated to be approximately $70 Million USD. Western Wind Energy will make further updates as they become available.

Source: IWR Online, 01 Mar 2010