Northland Power to take 55% in 600-MW North Sea wind scheme

Aug 2, 2013 - Canadian thermal and renewable power plant operator Northland Power Inc (TSE:NPI) yesterday said it had agreed to buy a 55% majority stake in Typhoon Offshore's 600-MW wind project in the North Sea.

The buyer will invest about CAD 400 million (USD 387m/EUR 292m) in the project in the form of mezzanine and equity financing. It will also offer nearly CAD 32 million of credit support. The investment is subject to meeting conditions for closing and formal documentation and also needs the thumbs-up from Northland's board.

The Gemini offshore wind scheme, which is currently in an advanced development stage, is situated off the coast of Netherlands in the North Sea. Valued at about CAD 3.8 billion, to be provided with non-recourse project debt, mezzanine financing and equity financing, the project already has the necessary environmental permits and its developer is close to sealing major deals for turbine delivery and balance of plant engineering, construction and procurement.

Following the acquisition, Northland Power plans to actively participate in the development of the project, including construction and operation of the wind power facility.

Construction of the wind farm is scheduled to begin at the end of 2014, with commercial operation planned for 2017. German Siemens (ETR:SIE) will supply equipment for the project, and will also operate and maintain the system, once operational. Dutch dredging company Van Oord will provide wind turbine foundations and transmission infrastructure.

When up and running, the wind farm is estimated to generate about 2.5 TWh of electricity each year, enough to supply over 785,000 homes. Its output will be sold under two 15-year power purchase agreements with the government of the Netherlands.

(CAD 1.0 = USD 0.967/EUR 0.731)

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