Letter to the editor: Nation should stand behind tribal entity Navajo Transitional Energy Company
As a Navajo in business financing, coming from Chinle, Arizona but living in Albuquerque I want to state a couple of things to the tribe, as I follow NTEC.
Navajo Transitional Energy Company (NTEC) is doing what many startup companies could only wish. This all in regards to financing tribal energy projects. New ground has been broken for tribal energy entities like NTEC. As NTEC positions itself in the energy markets outside corporations fear the worse. They know someday they could be coming back to the tribe (Navajo) for power sales. A competitor like Navajo Nation could become their dreaded competition in Energy. They fear this because tribes own the land, water, ROW and leases, exempt from federal taxes and have tribal sovereignty.
But going up against corporate giants is not easy. These corporations have deep pockets that can pay for the best lawyers, engineers and finance personnel. Corporations can pressure the best for deals that favors them. Years of practice have made these big corporations who they are today. They are not use to having tribal nations or their entities tell them what a deal structure should look like.
In 2013 Navajo Nations NTEC took on corporate giant BHP Billiton and APS when they were shutting down and prevailed. Global corporations like Peabody and SRP bow to no one except their share holders and the executives they report to. They protect their shareholders and senior executives to give them the maximum benefits. These big corporations (SRP) take care of their own. They could care less about the Navajo Nation. Corporations always want the deal to favor them.
We Navajos must remember after 50 years of not controlling Navajos natural resource the tribe is starting to take back control. Navajos shareholders are the Navajo people. Navajos executives are the tribe.
Therefore, it’s important for Navajo Nation to continue to support its tribal entity. NTEC has shown the tribe what it can do. If you are not familiar with corporate financing of big acquisitions it can be hard to understand. Unless you could sit in those negotiating rooms the average person has little idea how brutal the negotiations can be. The bonds and guarantees are what finance these big projects. Little NTEC has stepped up into this world of global energy financing.
I was impressed with how NTEC structured their first financing. Taking their coal supply agreement to banks with little credit and convincing them to finance them was impressive. Then paying off their loan in three years is almost unheard of. This all done holding a credit revolver to finance their capital expenditures during start up. Remember this all coming from a Navajo tribal entity that not once came to the Nation asking for funding.
Navajo Nation stand behind your tribal entity (NTEC). They stepped up to the plate and showed the Nation how it is done. It’s important. Thank you.
John H. Begay