Toronto-based Northland Power Inc. has completed the acquisition of 100% of the shares of British Wind Energy GmbH, which owns the Deutsche Bucht offshore wind project, from Highland Group Holdings Ltd.
The 252 MW Deutsche Bucht project (DeBu), representing Northland’s third offshore wind project, will be located 95 kilometers northwest of the island of Borkum in the German Exclusive Economic Zone.
The total estimated project cost is approximately EUR 1.3 billion (approximately C$1.9 billion). Northland expects to invest approximately C$400 million of corporate funds, sourced from cash on hand and corporate liquidity. The balance of the project cost will be funded with non-recourse project finance debt and pre-completion revenues. As of the time of the share acquisition, approximately EUR 205 million of Northland’s funds have been irrevocably committed to DeBu; the balance is expected to be committed at financial close.
As previously announced, the project is investigating the development of two additional demonstration turbines using suction bucket foundations. The final investment decision for these two turbines is subject to achieving certain development milestones. If built, they will contribute an additional 17 MW of capacity and bring the total project cost to approximately EUR 1.4 billion (C$2.0 billion). Then, Northland’s investment would increase to approximately C$425 million, funded by cash and corporate debt, with the balance of incremental costs funded by additional project debt.
DeBu is currently in an advanced stage of development. The project remains subject to financial close, which is expected shortly, at which time all debt and equity required for the project is to be committed. Construction is expected to begin shortly after financial close, and project completion is anticipated by the end of 2019.