USA - Western Wind offered $228 million for Windstar Project by major US energy company

Western Wind Energy Corporation ("Western Wind") is pleased to announce that Western Wind is now engaged in negotiations reviewing other offers and is in discussions with major US institutions regarding self-financing initiatives whereby its 120 MW Windstar Project will produce directly, $1.7 billion in revenue over 30 years.

Although Western Wind was offered $228 million for all development rights of its 120 MW Windstar Project including royalty payments pursuant to a land lease, over a 30-year period, Western Wind believes that, given the market for renewable energy, developing its own projects will provide a greater return.

The California energy market is tied to the price of oil and gas and consequently, the new market price referent ("MPR") for 2008 is anticipated to be as high as $115 per Mwh for renewable projects. This price in addition to the Production Tax Credit of $20 per Mwh which offers wind producers, such as Western Wind, the ability to collect an estimated $135 per Mwh in total compensation under long-term contracts.

Combining this price structure with the wind resources at our Mesa site of almost 10 meters per second (22 mph) and our Windstar site of 19 mph allows the production yield margin per MW to be 80% higher than any other jurisdiction in North America. It is through this 80% differential that allows Western Wind to demand a profit of up to $1.0 million per MW of Net Present Value. These are record values for US wind assets.

The dynamics of the project economics call for a direct project cost of between $2.3 - $2.5 million per megawatt with a further project developer profit payable to Western Wind for up to $1.0 million per megawatt or up to $170 million of net present value potential profit payable to Western Wind for Windstar and Mesa only.

In addition, Western Wind has access to 65 further site locations in California for wind energy generation. High cash flow projects such as Western Wind's California wind projects are expected to be 100% financed through debt and/or tax equity once fully operational, which means corporate equity is not required for long-term financing of these projects. The construction phase may also be largely financed through senior and mezzanine debt which minimizes the amount of corporate equity required to complete project development or an interest at the project level can be sold eliminating any need for corporate equity which would mean Western wind could remain dilution free during the capital intensive process.

Western Wind is North America's largest publicly traded non-income trust producer of pure wind energy. Western Wind Energy has the capacity to produce 34.5 MW of clean renewable electrical energy from over 500 wind turbine generators located in Tehachapi (Windridge) and San Gorgonio Pass (Palm Springs), California with annualized energy output capacity of approximately 70 billion watt hours per year.

Western Wind also has over 145 MW of expansion power sales agreements with the associated projects in the late stages of development. In addition, Western Wind Energy has a credible pipeline of over 1,300 MW of site locations in the State of California. During the past two years, Western Wind Energy has executed or acquired over $1 billion of power sales agreements totalling 154 megawatts from the sale of wind energy electrical generation. Western Wind Energy was the first to execute a "wind" PPA in the State of Arizona, and in California, is expanding from management's 27-year continuous operating history in the Tehachapi Pass.

Western Wind is in the business of acquiring exceptional land sites, capital and technology for the production of electricity from wind energy. Western Wind Energy conducts its operations through its wholly owned subsidiaries in Arizona and California. Management of Western Wind Energy includes individuals involved in the operations and ownership of utility scale wind energy facilities in California since 1981.