Total buys stake in wind farm project in Scottish North Sea
Total has entered into an agreement with SSE Renewables, to acquire a 51% stake in the Seagreen 1 offshore wind farm project for an upfront payment at closing of 70m£ and earn-outs up to 60m£ in aggregate subject to performance conditions. The 1,140 megawatts (MW) project has reached simultaneously a final investment decision and financial close. The purchase agreement also covers a potential extension opportunity of up to 360 MW.
Located 27 kilometers from the coastline in Scottish waters of UK North Sea, Seagreen 1 has secured all necessary major permits and onshore construction began in Q1 2020. Designed to cover the energy needs of around 1 million homes, the project will start producing renewable electricity from end of 2022. Once completed, it will be Scotland’s largest offshore wind farm. The project represents a global investment of around 3.7 B$. Total has secured close to 70% of external financing for its 51% stake.
“Total builds up a strong position in the world’s largest offshore wind market, as it becomes a majority stakeholder in the Seagreen 1 project, one of the largest offshore wind farms in the UK North Sea. This move represents a major change of scale for Total’s offshore wind activity in line with our strategy of profitable growth in renewables and low carbon electricity,” said Patrick Pouyanné, Chairman & CEO of Total. “As one of the main actors in the UK energy sector, Total will leverage its extensive expertise in offshore operations and maintenance to contribute to the success of the project alongside country’s leading offshore wind developer, SSE Renewables”.
Seagreen 1 benefits from a 15-year CfD (Contract for Difference) awarded by the UK Government for 454 MW, representing 42% of the total project capacity. An additional 30% of the project capacities will also be contracted under a private CfD with the SSE Group. Both contracts contribute to securing project revenues.
The transaction remains subject to conditions precedent, including public authorities approval and should be finalized by July 2020.
Source / More information : Total
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