Macquarie Mexican Infrastructure Fund (MMIF) has acquired a 49% interest in a 28.8 MW hydroelectric generation project in Nayarit, Mexico. The Bank of New York Mellon, trustee of MMIT has announced the deal.

The total investment commitment of Ps.465 million (approximately US$37 million) will be used to fund the construction of the Project which is due to commence in August, 2013. MMIF's co-investor in the Project is Troy Energía with a 51% equity interest. Nacional Financiera Banca de Desarrollo, S.N.C., a Mexican development bank, is providing Ps.522 million (approximately US$41 million) of debt financing for the Project.

Jonathan Davis, Chairman of MMIF said:

"We are pleased to announce our first investment in the hydroelectric renewable energy sector. Hydroelectric power generation provides a reliable source of clean energy and we are very supportive of investments of this nature."

Nick O'Neil, Chief Executive Officer of MMIF, added:

"The generation facility will be situated within an existing dam on the Santiago River, the main purpose of which is to regulate the discharge of water from existing CFE hydro infrastructure. The dam's minimum water flows are regulated, which provides for more reliable energy production."

Acciona has been awarded the engineering, procurement and construction contract and will deliver the facility on a turnkey, fixed-price basis. Construction is expected to be completed in late 2015.

The Project will supply power to an AA-rated Mexican corporation under a 15-year power purchase agreement with a 5-year extension option, priced at a discount to CFE tariffs.