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Northland Power's Deutsche Bucht Offshore Wind Farm Reaches Financial Close

Toronto, Canada - Northland Power Inc. announced that the EUR 1.3 billion Deutsche Bucht ("DeBu") project has reached financial close, with all of the equity contributed to the project and all debt required for the project now fully committed by the project lenders.

Northland owns 100% of the 252 MW offshore wind farm which will be located in the German North Sea.

Approximately 75% of the project's required costs will be provided from a EUR 988 million non-recourse construction and term loan and related loan facilities from ten international commercial lenders. Reflecting the strength of Deutsche Bucht, the financing was oversubscribed. The lending group comprises Banco Santander, CIBC, Commerzbank, Helaba, KfW IPEX-Bank, National Bank of Canada, Natixis, Rabobank, Société Générale, and Sumitomo Mitsui Banking Corporation. The total estimated project cost is approximately EUR 1.3 billion (approximately CAD $1.9 billion).

DeBu is Northland's third offshore wind project. It is located 77 km from Northland's other German offshore wind project, Nordsee One. Once completed, DeBu is expected to generate enough sustainable energy to meet the needs of over 178,000 households. It will reduce C02 emissions by over 360,000 tonnes per year, supporting the German government's CO2 reduction targets.

DeBu is entitled to receive a fixed feed-in tariff subsidy for approximately 13 years under the German Renewable Energy Act ("EEG"), equating to approximately EUR 184/MWh for 8 years and EUR 149/MWh for the remainder. The majority of the project returns are expected to be earned during the 13 year feed-in-tariff period, with the remainder of the expected returns earned in the later years from the German wholesale electricity market.

The construction of DeBu is expected to begin shortly, with project completion expected by the end of 2019. Like Northland's 600 MW Gemini project, DeBu will use a two-contract construction strategy. MHI Vestas Offshore Wind ("MHI Vestas") will supply and install the project's 31 V164 8.0 MW wind turbines.

Van Oord, a Dutch marine contractor and the balance of plant contractor for Gemini, has been awarded the balance of plant contract for the project. They will deploy their offshore installation vessel, Aeolus, for the installation of the wind turbine foundations and cable-laying vessel, Nexus, to install the electrical infrastructure.

MHI Vestas will also maintain the wind turbines under a long-term service contract. DeBu will be connected to the 800 MW BorWin Beta offshore converter station which has already been constructed.



Source: IWR Online, 21 Aug 2017

 


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