Denmark-based power cable-making and installation firm NKT said it would invest around one billion euros in its high-voltage power cable business, including a new high-end cable laying vessel, and a new offshore cable production plant in Sweden.
NKT said the investment was needed so the company can deliver on its recently secured significant order intake, and prepare for the continued strong market outlook, and execute the record-high order backlog.
Since March 2023, NKT has confirmed high-voltage contract awards and booking commitments of more than 5 billion euros.
"The investments include a new, market-leading vessel with record-high power cable-laying capacity compared to vessels in the existing world fleet and a significant extension of the Swedish production site in Karlskrona," NKT said.
In Karlskrona, NKT will build a new factory, including a third 200m extrusion tower adding end-to-end production capacity next to the existing facility. This will turn the site into the world’s largest high-voltage offshore cable production site.
NKT's recently appointed President and CEO Claes Westerlind said: "The order awards and commitments from our customers in recent months highlight our leading position within turnkey solutions, XLPE and high-voltage DC technology. "
"Power cables are key enablers of the transition to renewable energy and current high-voltage production and installation capacity is not sufficient to meet the increasing demand in the market. We are excited to continue growing NKT in line with our strategic ambitions and to continue developing our turnkey power cable offerings to our customers."
NKT said the investments are expected to amount around one billion euros from 2023 to 2026 and would strengthen NKT’s "market leading position significantly" by improving the company’s abilities to meet the growing demand for especially long-length HVDC power cable solutions. The new assets will be operational from 2027.
In 2020, NKT initiated an investment program in its high-voltage factories driven by a record-high order backlog including awards of the German corridor projects and a positive market outlook. A key part of the program was to add a second extrusion tower to the Swedish factory in Karlskrona which has been completed.
Additional investments were announced in 2022 following the continued positive market development.
Driven by the previous investment program, more than 300 new employees have joined the Karlskrona factory since 2020, NKT said.
Now, NKT expects to welcome more than 500 new employees at the Swedish site towards 2027 following the investments.