Global energy player Total has agreed to buy 51% stake in Seagreen 1 offshore wind farm project from SSE Renewables.
As per the terms of the agreement, Total will make an upfront payment of $88m (£70m) at closing, with additional payments of up to $76m (£60m) earn-outs in aggregate, depending on performance conditions.
The purchase agreement also covers a potential extension opportunity of up to 360MW.
Total chairman and CEO Patrick Pouyanné said: “Total builds up a strong position in the world’s largest offshore wind market, as it becomes a majority stakeholder in the Seagreen 1 project, one of the largest offshore wind farms in the UK North Sea.
“This move represents a major change of scale for Total’s offshore wind activity in line with our strategy of profitable growth in renewables and low carbon electricity.
“As one of the main actors in the UK energy sector, Total will leverage its extensive expertise in offshore operations and maintenance to contribute to the success of the project alongside country’s leading offshore wind developer, SSE Renewables”.
The Seagreen 1 offshore wind farm will have a capacity of 1,140MW, sited 27km from the coastline in Scottish waters of UK North Sea.
It has obtained all the required permits and simultaneously reached final investment decision and financial close.
Construction works at the site began in the first quarter of this year. Upon completion, the wind power facility would be Scotland’s largest offshore wind farm.
Completion of the deal is subject to the approval of public authority’s approval and is expected to be finalised by July 2020.
SSE chief executive Alistair Phillip-Davies said: “We are delighted to be partnering with Total to deliver Scotland’s largest offshore wind farm, Seagreen, which will make a significant contribution to the UK’s green recovery from coronavirus by unlocking £3bn of low carbon investment and generating the low carbon power we need to reach net-zero.
“Today’s announcement is the result of great efforts by both teams to successfully complete this transaction in the current challenging circumstances.
“Total’s extensive global experience in the offshore environment combined with their clear ambition to contribute to the development of renewable energy worldwide is a strong fit with SSE Renewables’ strategic objective to treble our renewable output by 2030.”