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November 29, 2019updated 17 Jun 2020 2:12pm

Saipem wins two offshore windfarm contracts worth €750m

Italian engineering firm Saipem has been awarded two contracts worth €750m to help build two windfarms off the coasts of Scotland and Taiwan.

By Jack Unwin

Italian engineering firm Saipem has been awarded two contracts worth €750m to help build two windfarms off the coasts of Scotland and Taiwan.

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Wind Power Market seeing increased risk and disruption

The wind power market has grown at a CAGR of 14% between 2010 and 2021 to reach 830 GW by end of 2021. This has largely been possible due to favourable government policies that have provided incentives to the sector. This has led to an increase in the share of wind in the capacity mix, going from a miniscule 4% in 2010 to 10% in 2021. This is further set to rise to 15% by 2030. However, the recent commodity price increase has hit the sector hard, increasing risks for wind turbine manufacturers and project developers, and the Russia-Ukraine crisis has caused further price increase and supply chain disruption. In light of this, GlobalData has identified which countries are expected to add the majority of wind power capacity out to 2030. Get ahead and download this whitepaper for more details on the current state of the Wind Power Market.
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The company will be responsible for the engineering, procurement, construction and installation of steel foundation jackets for the 54 8MW wind turbines at the Neart na Gaoithe offshore windfarm, a £1.4bn project set to be constructed near the Firth of Forth on the east coast of Scotland.

Neart na Gaoithe has a capacity of 450MW and is being developed by EDF Renewables, who reached the financial close on the project on the 28 November.

Saipem will build the same foundation jackets for the offshore electrical substation and will use its Saipem 7000 crane to conduct the installations. It will also construct the same steel foundation jackets for the 32 wind turbines of the Formosa 2 offshore windfarm in Taiwan.

Formosa 2 will have a capacity of 376MW when it is completed, and is owned by Macquarie Capital and Swancor Renewable Energy. Macquarie reached the financial close on the $2.05bn project on 30 October 2019.

Saipem is optimistic that the projects will aid both countries in reaching ambitious offshore wind power targets. Scotland currently produces 915MW of power through its offshore wind farms, and plans to increase this figure by 4.1GW; similarly, Taiwan aims to move from its first offshore installation, completed in 2016, to 5.7GW of production by 2025.

This is the first turnkey contract that Saipem has been awarded in the offshore wind sector. The €750m contract represents 15% of its EPC order intake in 2019, which Saipem stating that the contract consolidates its “position as a global solution provider to the extended energy sector.”

Saipem’s stock price is currently €4.24 on the Borse Italiana, giving the company a market capitalisation value of €4.28bn.

Saipem share price in 2019

Saipem E&C Offshore Division COO Francesco Racheli said: “This EPCI contract awarded by EDF Renewables marks a key milestone in the pursuit of our strategy to become a reference player for large offshore windfarm developments and, more extensively, in the sphere of energy transition.

“This important achievement has been made possible thanks to our capabilities and expertise in engineering, fabrication and installation as well as to our assets, particularly suited to projects of this kind.

“Our collaboration with EDF Renewables and with the entire supply chain will allow us to contribute to the generation of 450 megawatts of green energy, fostering the utilisation of local supply chain and expertise to provide the most competitive solution to our stakeholders and clients and execute a successful project.”

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Free Report
img

Wind Power Market seeing increased risk and disruption

The wind power market has grown at a CAGR of 14% between 2010 and 2021 to reach 830 GW by end of 2021. This has largely been possible due to favourable government policies that have provided incentives to the sector. This has led to an increase in the share of wind in the capacity mix, going from a miniscule 4% in 2010 to 10% in 2021. This is further set to rise to 15% by 2030. However, the recent commodity price increase has hit the sector hard, increasing risks for wind turbine manufacturers and project developers, and the Russia-Ukraine crisis has caused further price increase and supply chain disruption. In light of this, GlobalData has identified which countries are expected to add the majority of wind power capacity out to 2030. Get ahead and download this whitepaper for more details on the current state of the Wind Power Market.
by GlobalData
Enter your details here to receive your free Report.

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