(OE) Dutch offshore wind foundation maker Sif this week said it would build the world’s largest monopile foundation manufacturing plant in Rotterdam, the Netherlands, with an estimated investment of around €328 million.
The plant will be built at the 62 hectare Maasvlakte 2 site in Rotterdam, the Netherlands, as an extension of the existing facilities
Sif said that the plant would significantly increase the total combined capacity of Sif to 500 kilotons a year and upgrade its capabilities to manufacture the equivalent of 200 XXXL, 11-meter-diameter, 2,500-ton reference monopile foundations a year.
The construction of the facility is set to start in April 2023, with the first manufacturing operations scheduled to start in the second half of 2024.
“Once the expanded manufacturing plant is fully ramped-up, which is expected in the first half of 2025, the company projects EBITDA of €135 million in 2025 and of at least €160 million per annum from 2026 onwards. This results in a payback period of 3-4 years,” Sif said.
Two launching clients, one of them being Ecowende (a joint venture of Shell and Eneco), together have committed to 348 kilotons of production bringing the present total orderbook to 662 kilotons, Sif said.
Hugo Buijs (Shell) and Cees de Haan (Eneco), on behalf of Ecowende said”There are major ambitions for offshore wind in the Netherlands. Acceleration is needed in a way that contributes to nature both above and below the water. With the expansion of Sif as the monopile foundations solutions provider, we can take another big step in accelerating the largescale roll out of offshore wind in the Netherlands and beyond. Shell and Eneco already have a longstanding relationship with Sif through the windfarms Borssele III/IV and Hollandse Kust Noord.
“We are thrilled to be one of the launching customers and to be contributing in this way to the expansion of Sif’s manufacturing plant. Sif will also be important in enabling offshore windfarms with a net positive impact on nature in the future. They will accommodate and contribute to the implementation of some of the ecology measures we’ve put forward in our bid. We are looking forward to building the windfarm at Hollandse Kust (West) lot VI with Sif, as well as to future collaborations.”
Also, a long-term capacity reservation framework agreement with Equinor is in place while a second
long-term capacity reservation framework agreement is currently being negotiated.
Pål Eitrheim, executive vice president for Renewables in Equinor:”With this agreement, we are securing strategic capacity in a key supplier market for our renewables business. Large monopile structures will be needed to develop future offshore wind projects, contributing to Equinor’s corporate strategy. We have an ambition to be a leader in the energy transition, and with this investment we are helping to establish additional supplier capacity in the green economy, while gaining access to an important sourcing option.”
Funding for the construction of the facility will be secured through a combination of €100 million advanced factory payments from the launching customers, €50 million preferred equity from Equinor, €50 million common equity to be raised through a rights offering, which is fully underwritten by the company’s largest shareholder Egeria at €11.50 per share, €40 million in operational leases and €81 million in term loans to be provided by Invest-NL and a consortium of commercial banks, with the remainder being funded through cash and cash equivalents.
Monopile – Foundation of choice for Offshore Wind
Providing its take on the offshore foundation market, Sif said: “Underpinned by increasing political and societal support for the energy transition, the offshore wind market is growing at an ever-increasing pace. Extensive market studies have shown that monopile foundations will remain the foundation of choice for offshore wind turbines from a reliability, manufacturing volume and cost perspective.
“As confirmed by tenders in the market and discussions with our customers and engineering firms, most wind farms will require monopile foundations with diameters ranging between 9 – 11.5 meters from 2025 onwards.
“With a track record of more than 2,500 monopile foundations manufactured and installed over the past two decades, supporting almost 12GW of operational offshore wind, Sif is a critical supplier in the offshore wind value chain with an undisputed reputation. Based on this experience and knowledge, Sif is well positioned to assess the potential as well as the operational challenges related to the fast-growing product dimensions and the dynamic market environment.”