SSE to buy Fluor out of 1.5 GW offshore wind project in Scotland
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SSE has announced that it is exercising its pre-emption right to acquire Fluor's 50% share in Seagreen Wind Energy Limited, established to develop offshore wind projects in the Firth of Forth Zone in east-central Scotland.
SSE already holds the other 50% share of the joint venture and will purchase Fluor's share for a single payment of GBP118 million (US$155 million).
Seagreen has been granted rights by Crown Estate Scotland, the public body that manages leasing of Scotland's seabed, to develop offshore wind farms in the Firth of Forth Round 3 Zone. SSE plans to develop the Zone in phases. Phase 1 consists of Project Alpha and Project Bravo.
Seagreen is currently seeking amendments to the existing consent for Alpha and Bravo to take advantage of the advances in offshore wind turbine technology since the original consent was granted back in 2014. The new proposal entails the installation of a maximum of 120 turbines across the two project sites, with a potential capacity of approximately 1,500 MW.
This would provide enough energy to provide enough power for at least 670,000 homes.
SSE intends to enter the Seagreen Phase 1 projects in the next UK contracts for difference auction. In July 2018, the Energy Minister of the UK government announced that the next auction will be open by May 2019 and confirmed GBP557 million (~US$730 million) public funds will be made available to successful projects.
The transaction is subject to approval from Crown Estate Scotland. SSE has stated that it intends to further review the future ownership structure of Seagreen in the coming months with the view to maximising value for shareholders.
This news follows the disclosure earlier this month of SSE's plans to invest between EUR1 and 2 billion (US$1.18 and 2.35 billion) in expanding the 25.2 MW Arklow Bank offshore wind farm, located off the coast of County Wicklow, eastern Ireland, to over 500 MW. Together, these developments indicate a strategic focus on the offshore wind sector.
