Western GeoPower Corp.

Western GeoPower Corp.

September 05, 2007 09:00 ET

Western GeoPower Closes $18.6 Million Financing

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 5, 2007) - Western GeoPower Corp. (TSX VENTURE:WGP) (FRANKFURT:WE6), a renewable energy development company, today announced that it has closed a non-brokered private placement announced July 27, 2007 along with the warrant incentive program announced July 18, 2007 to raise a total of $18.6 million.

The entire private placement of 25,000,000 shares of Western GeoPower at $0.25 per share for proceeds of $6,250,000 has been purchased by one strategic investor, Iceland-based geothermal developer, Geysir Green Energy. The shares will be subject to a four month hold period ending December 30, 2007. No commissions were paid with respect to the private placement. Following this transaction, Geysir owns 34,333,334 common shares of Western GeoPower, representing approximately 18.8 per cent of Western GeoPower's outstanding common shares, and 9,333,334 warrants exercisable to purchase one common share of Western GeoPower at $0.35 per share.

Geysir Green Energy was formed in early 2007 with a mission to become a leading investor in geothermal power projects. Geysir is pursuing expansion through mergers and acquisitions and the development of new projects. Well capitalized to realize on its goals, Geysir has a suite of directors, management and technical staff with considerable experience in geothermal funding, development and operations. Geysir is investing in the development and construction of geothermal plants, acquiring interests in geothermal plants currently owned by power utilities and participating in the privatization of energy companies in various parts of the world.

"Our purchase of an equity interest in Western GeoPower fits perfectly with our plan to be a participant in the largest energy market in the world - the United States," said Mr. Margeirsson. "We look forward to assisting Western GeoPower in expanding its capacity to acquire and develop additional projects."

Glitnir, a Nordic bank with a global niche focus on geothermal energy, has substituted its previously announced subscription for 5,000,000 private placement shares by purchasing shares through the open market. Glitnir's center of excellence of geothermal energy is based in Iceland, but the bank's teams work on geothermal projects globally. In its recent report on the U.S. Geothermal Market, Glitnir estimates that around 7,000 Megawatts of capacity could be added in California by 2025, providing up to 20% of the state's electricity. "California will be at the forefront for geothermal development in the U.S. and we believe Western GeoPower will be a significant player in the years to come", said Arni Magnusson, who heads Glitnir's Global Sustainable Energy team.

"We regard the increased equity participation by Geysir Green Energy and Glitnir as further validation of the Company's decision to make a strategic entry into the extremely dynamic market for renewable energy in California," said Kenneth MacLeod, Western GeoPower's President and CEO. "That market is responding to State legislation that requires California utilities to produce 20% of their electricity product from renewable energy sources such as geothermal by the year 2010 - with an increase to a 33% target now under consideration. With our Power Purchase Agreement with Pacific Gas & Electric now awaiting approval by the California Public Utilities Commission, we are both well placed and well financed to proceed with project development."

A total of 46,964,668 warrants were exercised at a price of $0.25 per share for proceeds of $11,741,167. Of this amount, 16,433,334 free-trading shares were issued to some subscribers and 30,531,334 units (the "Units") were issued to other subscribers pursuant to the warrant exercise incentive program announced June 29, and July 18, 2007. The Units comprise one common share at $0.25 and one new warrant which will allow the holder to acquire one common share of Western GeoPower at $0.35 per share until December 30, 2008. The warrants are subject to an acceleration provision, which provides that, if the Company's shares trade at $0.50 or more for ten consecutive trading days, it will trigger a 30 day timeframe within which to exercise the warrants or they will expire. The Units are subject to a four-month hold, expiring on November 28, 2007.

Dundee Securities exercised 4,170,416 Agents options at $0.15 for proceeds of $652,562 pursuant to an Agent Option agreement dated December 2005. Under the terms of the Agent Option agreement, Dundee also received 4,170,416 warrants to acquire one common share of Western GeoPower at $0.25 per share until December 30, 2008.

Corporate Overview

Western GeoPower Corp. is a renewable energy company dedicated to the development of geothermal energy projects for the delivery of clean, baseload electricity generation. The Company is developing a 25.5 Megawatt (net) geothermal power plant at The Geysers Geothermal Field in Sonoma County, California, United States. Western GeoPower is also developing the South Meager Geothermal Project in British Columbia, Canada.

On behalf of Western GeoPower Corp.

Kenneth MacLeod, President & CEO

Cautionary Note Regarding Forward-Looking Statements

Statements in this release that are forward-looking are subject to various risks and uncertainties concerning the specific factors identified above that reflect the Company's expectations and projections about its future results. The Company has tried whenever possible to identify these forward-looking statements which include but are not limited to, words such as "anticipates," believes," "estimates," "expects," "plans," "intends," "potential," and similar expressions. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. The Company disclaims any obligation or intention to update or to revise any forward-looking statement, whether as a result of new information, future events or otherwise. Such information contained herein represents management's best judgment as of the date hereof based on information currently available. This news release is not for dissemination in the United States of America or to United States of America news services.

About Glitnir

The financial group Glitnir offers universal banking and financial services with the Nordic region as home base. Glitnir is a leading niche player in three global industry segments; seafood/food, sustainable energy, and offshore services vessels. The group's services include retail, corporate and investment banking, stock trade/brokerage and capital management. Glitnir considers Iceland and Norway its home markets. The Glitnir group has operations in Iceland, Norway, Sweden, Denmark, Finland, the UK, Luxembourg, Russia, Canada and China. Glitnir Capital Corporation opens a US office in New York on 5 September 2007. Glitnir is listed on the Icelandic Stock Exchange. For more information: www.glitnirbank.com.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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