DONG Energy has entered into an agreement to sell 50% of the 450MW Borkum Riffgrund 2 offshore wind farm project to Global Infrastructure Partners (GIP) for a total consideration of approximately EUR 1.17 billion.
Borkum Riffgrund 2 is currently under construction in the German North Sea and is expected to be fully commissioned in 2019.
The total sales price, payable over a period from 2017 until 2019, includes the purchase price for GIP for its acquisition of 50% of the project and its commitment to fund 50% of the payments under a full-scope EPC – engineering, procurement and construction.
GIP is also the 50% partner in another of DONG Energy’s offshore wind farm in Germany, Gode Wind 1.
The transaction is subject to approval by the competition authorities and is expected to be completed before the end of 2017.
“We’re pleased to be able to build on the partnership we established with GIP in relation to Gode Wind 1 in 2015. That partnership has been a success for all parties, and we’re committed to ensuring a similar success in relation to Borkum Riffgrund 2,” said Samuel Leupold, Executive Vice President and CEO of Wind Power at DONG Energy.
DONG Energy will construct the wind farm under a full-scope EPC agreement. DONG Energy will also provide long-term operations and maintenance services from its O&M base in Norddeich and provide a route to market for the power production from GIP’s 50% share of Borkum Riffgrund 2.
Having entered into the agreement with GIP to divest 50% of Borkum Riffgrund 2, DONG Energy increases its EBITDA guidance for 2017.
Now, the company expects EBITDA of DKK 17-19 billion (EUR 2.3 – 2.6 billion). The company’s expected gross investments remain unchanged at DKK 18-20bn.
Borkum Riffgrund 2 is located within the German Exclusive Economic Zone, approximately 17 kilometres east of the border between Germany and the Netherlands, and some 34km north of the island of Borkum.
The wind farm will consist of 56 MHI Vestas 8MW turbines.