Aker Offshore Wind: First-Quarter Results 2022
Aker Offshore Wind today published results for the first quarter of 2022, which saw the offshore wind developer reach several key milestones for its portfolio and for the company.
“We have continued to develop our portfolio, obtaining two crucial Electric Business Licenses (EBL) for KF Wind in South Korea whilst progressing our projects in other markets, with a noteworthy entry into Japan,” said Philippe Kavafyan, Chief Executive Officer of Aker Offshore Wind.
“With the proposed merger with Aker Horizons and the announced intention to combine with Mainstream Renewable Power, we will become a stronger offshore wind developer, both from a financial and operational perspective, and will play a leading role in accelerating the deployment of floating wind at scale,” he added.
Operational Highlights
Aker Offshore Wind is currently engaged in prospects and projects in South Korea, Norway, the US, the UK, Sweden, and Japan. The company saw positive advancements across its portfolio in the quarter.
In January, Korea Floating Wind (KF Wind), the joint venture between Ocean Winds and Aker Offshore Wind, obtained its first EBL from the Ministry of Trade, Industry and Energy of the Republic of Korea for a capacity of 870 MW. In March, a second EBL was obtained for 450 MW, where local company Kumyang Co is a partner. KF Wind now holds a total EBL capacity of 1.32 GW, covering the 1.2 GW net capacity target (based on grid limits), representing a key step towards realizing one of the world’s first large scale commercial floating wind farms.
KF Wind has already commenced most of the field studies and is continuing its engagement with key local users of the ocean as required to secure the remaining permits. The permits are expected to be approved during 2023, with the objective of reaching financial close in 2024.
Also in January, the ScotWind leasing round was announced without Aker Offshore Wind securing any project licenses. Aker Offshore Wind remains committed to developing offshore floating wind in the UK, where future opportunities include plans in the Celtic Sea and progressing the Northern Horizons Integrated Energy Project.
In March, Aker Offshore Wind and Mainstream Renewable Power ("Mainstream") closed the transaction which will see them take an initial 50 percent ownership stake in Progression Energy's 800 MW floating offshore wind project in Japan. The project is a well-formed early-stage development opportunity, and the site has been identified as ideal for floating wind. Japan aims to expand offshore wind energy capacity to 10 GW by 2030 and 30-45 GW by 2040, according to the Ministry of Economy, Trade and Industry.
Industry incentives and regulatory frameworks supporting the industrialization of floating wind continued to develop favorably in many markets, notably in the UK, the US and across Europe. In Norway, the government announced at the end of March that the upcoming licensing round for floating offshore wind at Utsira Nord will be based on qualitative criteria, an encouraging step which the industry has been calling for. In the US, further developments were made to support industrialization in California with the California Energy Commission approving a USD 10.5 million grant to help develop the Port of Humboldt into a floating offshore wind hub. Aker Offshore Wind plans to participate in the California auction in the autumn of 2022, where 4.6 GW in total will be put to auction.
Merger plans
On 30 March, Aker Offshore Wind and Aker Horizons announced a merger plan to create a financially and industrially stronger offshore wind developer. The proposed merger will enable a subsequent combination of Aker Offshore Wind and Mainstream, subject to customary conditions, including agreement with Mainstream’s minority shareholders.
Financial Highlights
Revenue for the period was NOK 9 million and earnings before interest, tax, depreciation and amortization (EBITDA) was negative NOK 87 million. The cash balance at the end of the quarter was NOK 67 million.
Aker Offshore Wind has agreed to sell part of its share in Principle Power, Inc. to EDP Renovaveis, S.A. and EDP Ventures SGPS (jointly “EDP”) based on a pre-existing option which EDP have chosen to exercise. The transaction is intended to rebalance the ownership structure and give Aker Offshore Wind and EDP equal equity stakes in Principle Power. The transaction is expected to be concluded in Q2 2022 and will result in a positive cash impact to Aker Offshore Wind of approximately NOK 100 million. Aker Offshore Wind remains a long-term and significant shareholder in Principle Power, Inc.
This information is considered to be inside information pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act.
This stock exchange announcement was published by Maria Lanza Knudsen, Communications Manager, Aker Offshore Wind, on 27 April 2022 at CET 07:00.
For further information, please contact:
Maria Lanza Knudsen, media contact, +47 48 44 24 26, maria.knudsen@akeroffshorewind.com
Christian Yggeseth, investor contact, +47 915 10 000, christian.yggeseth@akerhorizons.com
About Aker Offshore Wind
Aker Offshore Wind is an offshore wind developer focused on assets in deep waters and specialized on floating energy systems. With global operations, the current portfolio consists of development projects and prospects located in Asia, North America and Europe. Aker Offshore Wind effectively deploys cost effective technologies from decades of offshore energy development. The company is majority-owned by Aker Horizons, an investment company dedicated to creating value and reducing emissions from renewable energy and decarbonization technologies. Aker Offshore Wind [AOW-ME] is listed on Euronext Growth in Oslo, Norway.