Oil Major Eni Buys Into World's Largest Offshore Wind Farm
In the latest example of oil companies rushing into the offshore wind sector, Italian major Eni is buying a 20 percent stake in the Dogger Bank wind farm project - the largest installation of its kind in the world.
“Entering the offshore wind market in Northern Europe is a great opportunity to gain further skills in the sector thanks to the collaboration with two of the industry’s leading companies,” said Eni CEO Claudio Descalzi in a statement.
The deal will see Dogger Bank's two developers, oil major Equinor and renewables company SSE, each sell a 10 percent share in the first two 1.2 gigawatt phases of the project for $270 million (for a total sale value of about $540 million).
“This is our third offshore wind transaction in less than two years. Once again, we have demonstrated Equinor’s ability to create value from renewables projects,” said Pål Eitrheim, EVP New Energy Solutions at Equinor. “The divestment is in line with our strategy. We access attractive acreage early and at scale, then leverage our technology and experience to mature and de-risk projects.”
Dogger Bank is a massive project, and SSE and Equinor recently closed on a record-setting financing package totaling $7.4 billion to pay for the initial stages of its construction. The deal was ten years in the making, and it was backed by 29 banks.
"This investment will help drive a green recovery from coronavirus through the project’s construction over the next five years, creating jobs and boosting the local economy. Achieving financial close for the first two phases of the world’s largest wind farm is a huge accomplishment," said SSE CEO Alistair Phillips-Davies.
Dogger Bank's first two phases are set to come online in 2026, and a third phase will follow on after their completion.
Equinor also recently sold a 50 percent stake in two U.S. East Coast offshore wind projects to BP for $1.1 billion, reflecting the potential of the new American market. Equinor holds two large wind leases off New York State, and it is bidding to provide New York with up to 2.5 gigawatts of capacity in the state's second bidding round. With its new non-operating equity stake, BP is backing two projects behind this bid, Beacon Wind and Empire Wind Phase 2, along with a previous arrangement for construction of Empire Wind Phase 1.