The total purchase amount for the transactions consist of an up-front payment of approximately DKK 100 million and additional payments subject to the parks being constructed. These additional payments have a capitalized value of approximately DKK 150 million. Further DONG Energy will as part of the transactions redeem loans of approximately DKK 70 million to the sellers.
The acquisitions will make DONG Energy the sole owner of Borkum Riffgrund 1 and 2, which are situated in the German part of the North Sea. The full ownership will provide a better opportunity for DONG Energy to continue the development of the two German offshore wind energy projects, in which the company has been involved for a number of years. The acquisition should be seen as a natural part of securing a pipeline of attractive offshore projects.
The German authorities have approved the erection of 77 offshore wind turbines at Borkum Riffgrund 1, and an application in relation to Borkum Riffgrund 2 has been filed. DONG Energy will continue the development of the projects in the years ahead. PNE WIND AG will continue contributing to the development of the two offshore wind farm projects, acting as a service provider for DONG Energy.
No investment decision has been made with respect to the two projects.
DONG Energy withdraws from Greifswald project in Germany
At a board meeting held today, DONG Energy resolved to withdraw from the project exploring the opportunities of building a new power plant near the town of Greifswald in northern Germany.
In November 2006, DONG Energy acquired an ownership interest in a German company that held an option to acquire a site situated near the town of Greifswald in Mecklenburg-Vorpommern which was suited for building a coal-fired power plant. The building of the power plant was subject to approval by the German authorities.
Due to recent indications from the state government of Mecklenburg-Vorpommern, DONG Energy no longer believes that the project has the necessary political backing. In addition, since the initial project application was filed three years ago, the case processing has been making slow progress with no prospects for a decision being made in the near future.
“DONG Energy relies on close collaboration with the local communities that we serve. We have therefore reacted to the perceived lack of necessary political backing for the project from the state government of Mecklenburg-Vorpommern. Consequently, we have resolved to withdraw from the project plans, which will enable us to devote our full efforts to other investment projects in our pipeline,” said Anders Eldrup, Chief Executive Officer.
E.ON and Dong Energy Cancel £100 Million Welsh Windfarm
Plans by E.ON AG (OTC:EONGY) (Dusseldorf, Germany) and Dong Energy (Fredricia, Denmark) to build a £100 million ($163.6 million) offshore windfarm in the Bristol channel off the south coast of Wales have been scrapped. The Scarweather Sands project, five kilometres off the Porthcawl coast, was to occupy a 10-square-kilometre area populated with up to 30 turbines, each standing 120 metres tall. Installed capacity for the windfarm was estimated to be 108 megawatts, which would have generated enough electricity for approximately 82,000 homes. The windfarm was scheduled to be commissioned next year. However, both E.ON and Dong Energy have now claimed that the project is no longer financially viable.