Oslo-listed company Magnora has through its subsidiary Magnora Offshore Wind agreed Heads of Terms (HoT) for cooperation with the Welsh renewable energy developer Hiraeth Energy for the development of two floating offshore wind projects in the Celtic Sea with a total capacity of around 700 MW.
The Crown Estate is planning a leasing process in the area that could see rights awarded during 2023, with projects delivered from 2030 into the early part of the next decade.
"We are progressing the expansion of our pipeline of offshore wind projects, and act on opportunities with strong, committed and competent partners" says Kristin Gjertsen, Managing Director of Magnora Offshore Wind. "Together with Hiraeth Energy we believe that we represent a progressive approach to the development of offshore wind projects, creating long-term value in all project phases."
Joseph Kidd, Partner at Hiraeth Energy said: "The collaboration with Magnora Offshore Wind will help Wales in its ambition to create a zero-carbon economy, whilst clearly demonstrating the benefits of local ownership for the people of Wales. Together, we will develop our projects according to best practice in sustainability and work closely with stakeholders to maximize the benefits of our projects for nature and the people of Wales."
In March 2021, the Crown Estate announced its intention to launch a new leasing opportunity for early commercial-scale floating wind projects in the Celtic Sea, and has published further detailed plans confirming its ambition to unlock up to 4 GW of clean energy capacity in England and Wales. The Crown Estate is working towards awarding Agreements for Lease for early-commercial scale projects of approximately 300-350 MW, and for full-commercial scale projects of up to 1 GW.
Worth noting, Magnora was last week a successful bidder in Scotland's offshore wind leasing round ScotWind, where it has been offered the opportunity to enter into an Option Agreement for area N3. The planned development will have a total capacity of approximately 500 MW which is estimated to produce 2.4 TWh per year.
Oil money for renewables
Magnora, formerly known as Sevan Marine, was formed in 2018 following Sembcorp Marine's acquisition of all of Sevan Marine’s intellectual property and proprietary business, and 95% of shares of HiLoad LNG AS for $39 million.
Sevan Marine was famous for the cylindrical rig and FPSO designs it provided for the offshore oil and gas industry.
Magnora, an "heir" of Sevan Marine, inherited Sevan Marine’s revenue-sharing deals related to two UK North Sea field developments using its cylindrical FPSO design, Dana Petroleum’s Western Isles, and Shell’s Penguin field.
The Western Isles production entitles Magnora to #0.5 per barrel produced and offloaded from the Western Isles FPSO (the “FPSO”) during the lifetime of the FPSO. The Penguins deal with Shell is expected to bring Magnora $16 million.
The Penguins FPSO is currently under construction, and Magnora will receive the amount once the FPSO has produced and offloaded 4 million barrels of oil.
In early 2020, Magnora said it would use the cash obtained from its legacy oil business for investment in renewable energy development projects and companies.