Petrofac and Hitachi Energy team up for £11.5bn offshore wind agreement

Petrofac and Hitachi Energy team up for £11.5bn offshore wind agreement

Thursday 30 March 2023 2:46 pm

Petrofac was awarded an £11.5bn framework agreement with Hitachi Energy by Dutch-German electricity grid operator Tennet to supply offshore platforms and onshore converter stations.

The multi-year framework agreement, which the oilfield services provider said represents the largest in its history, is part of TenneT’s 2 gigawatt (2GW) high-voltage direct current (HVDC) offshore wind programme in the North Sea.

TenneT has been engaged to connect about two-thirds of the 65 GW in offshore wind capacity targeted by Germany, the Netherlands, Denmark and Belgium by 2030.

The agreement covers six projects, each of which will be executed under a standalone contract valued at over 2 billion euros, split about equally between Petrofac and Hitachi Energy, Petrofac said.

Petrofac also said it would undertake the engineering, procurement, construction and installation of the offshore platforms and elements of the onshore converter stations, while Hitachi Energy will supply converter stations.

Investment analyst firm Peel Hunt has maintained a buy stance towards Petrofac, with a target price of 100p per share.

Peel Hunt said: “A contract of this size, alongside the framework agreement, should significantly enhance the group’s ability to meet our 2023 estimates and refinance the debt facilities, which are due to expire in the fourth quarter. We reiterate our Buy rating and 100p target price.

Reuters – Nora Buli and Susanna Twidale

City A.M. reporters

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