SOURCE: Cavallo Energy LLC

December 12, 2008 10:38 ET

Local Houston Energy Company Engages Credit Suisse as Financial Advisor to Build One of the First Independent Electric Transmission Cables From New Jersey to New York City

Cavallo Energy, Developer of Cross Hudson Project, On Track to Bring New Clean Energy Supplies to New York City by 2012

HOUSTON, TX--(Marketwire - December 12, 2008) - Cavallo Energy announced today that one of its affiliated company's plans to build one of the first independent electric transmission cables to New York City, has engaged the financial advisory services of Credit Suisse to assist in capital formation.

"We are excited at the prospect of working with Credit Suisse during this phase of project development," explained Jeff Anon, Chairman of Cavallo Energy. Targeted to be in service by summer 2012, the project will provide over ten percent of New York City daily average power needs. "We are looking to the day when we can see across Manhattan's night-time skyline and know that one of every ten of those lights will be powered by energy coming from our project," continued Anon.

The Cross Hudson Project, a proposed 700 MW independent transmission line bringing energy from New Jersey to New York City, has been under development since 2001. The proposed cable originates in Ridgefield, New Jersey near a generating station owned by PSEG Power LLC. The feed would terminate at the Consolidated Edison Company's substation at West 49th Street in Manhattan, supplying electricity to the New York City market and particularly Manhattan, making a major contribution to supplying New York City's electric supply. Construction will start in January 2010 to support the summer 2012 in service date.

The line will be installed on privately acquired rights of way within New Jersey. It will run under the bed of the Hudson River, and make landfall in Manhattan near Pier 94. It will then run underground in lands owned by the City and State of New York and beneath 12thAvenue into the ConEd W.49thStreet substation. The line will be approximately eight miles in length from the Ridgefield site to West 49th Street, and will be underground for its entire distance. The Cross Hudson cable project has obtained all of its required key permits including a NYSPSC Article VII Certificate, and a U.S. Army Corps of Engineers Clean Water Act section 404/Rivers and Harbors Act section 10 permit. There are over eighty permits involved in this project.

The Project is estimated to cost over six hundred million dollars when completed. Since its inception, almost seventy-five million dollars has been spent to date. Cavallo is the manager of the general partner of the project.

"Since we purchased the project in late 2006 from PSEG, our development team has made tremendous progress in completing engineering, securing rights of way, and progressing on interconnection agreements to the New Jersey and New York electric grids," explained Phillip P. Gennarelli, President of Cavallo Energy LLC. "We are especially proud of the people that we have assembled to work on the project and the positive reception the project has received from the city of New York, future customers, and the financial community," continued Gennarelli. The Credit Suisse capital round launch is targeted for early January 2009. "If the preliminary response is any indicator, we should be on track to close this round by April 1, 2009. It is encouraging that even during these times of market uncertainty, unique, long-life critical infrastructure projects are attracting investor interest," continued Gennarelli.

About Cavallo Energy

Principals of Cavallo Capital Partners LLC, a Houston-based private-equity firm, own Cavallo Energy. The principals and the development team of Cavallo Energy bring over 150 years of combined power industry expertise in development and operation of generation, natural gas pipeline transportation and storage, energy trading, and finance. The project team is based in Linden, New Jersey and is assisted by Cavallo Energy's Houston-based accounting, financial analysis, and administration team. In addition to the Cross Hudson project, Cavallo owns exploration and production assets in Texas and is developing power generation projects in New Jersey and Texas. The company is seeking additional opportunities in power generation, independent transmission, retail gas & electricity distribution and exploration and production. For more information about Cavallo and its subsidiaries, please visit www.cavalloenergy.com.