(Alliance News) - Eni Spa on Friday announce it has acquired a 20% in the UK Dogger Bank A and B project from SSE PLC and Equinor ASA, entering the UK offshore wind market.
Perth, Scotland-based utility SSE is selling a 10% stake to Italian energy company Eni for GBP202.5 million. It said it plans to use the proceeds to help with delivery of its low carbon growth plans.
"Divesting this stake in Dogger Bank wind farm is in line with SSE's stated intention to partner to capitalise on its significant growth opportunities related to net zero," SSE said.
Eni will buy the other 10% stake from Equinor, also for GBP202.5 million. Once the deal completes, expected to be early 2021, the overall shareholding in Dogger Bank A and Dogger Bank B - the first two phases of the project - will be SSE 40%, Equinor 40%, and Eni 20%.
There has been no change in the ownership of the third phase, Dogger Bank C, in which SSE and state-owned Norwegian energy firm Equinor both have a 50% stake.
The Dogger Bank project involves installing 190 turbines in the North Sea around 80 miles off the east coast of Yorkshire, each with a 13 megawatt capacity, giving a total capacity of 2.4 gigawatts. At full 3.6 gigawatt capacity, including Dogger Bank C, the wind farm will be the world's largest project of its kind and will generate around 5% of UK demand for renewable electricity.
In total, construction of Dogger Bank A and B is expected to cost GBP6 billion in two stages, the first by 2023 and the second by 2024.
SSE subsidiary SSE Renewables will keep leading development and construction of the wind farm, while Equinor is to operate the asset once complete.
In its November half-year results, SSE said it was expecting its financial 2021 adjusted earnings per share to be in the 75 pence to 85p range, including the gain on disposal of an equity stake in Dogger Bank.
Following completion of the deal, it now expects to post and adjusted EPS figure of between 85p and 90p, including around 19p from the gain on sale after transaction costs.
This prediction assumes normal weather conditions for the rest of its year, as well as a coronavirus impact in the middle of the GBP150 million to GBP250 million range set out in June, SSE said.
Gregor Alexander, SSE's Finance Director, said: "The sale of a stake in Dogger Bank Wind Farm to Eni is another successful example of SSE's approach to partnering to create and secure value for shareholders. This transaction will enable us to fund further low carbon growth opportunities, helping to deliver governments' net zero ambitions and our own target to treble our renewable output by 2030."
Claudio Descalzi, chief executive officer of Eni, said: "For Eni, entering the offshore wind market in Northern Europe is a great opportunity to gain further skills in the sector thanks to the collaboration with two of the industry's leading companies, and to make a substantial contribution to the 2025 target of 5 [gigawatts] of installed capacity from renewables, an intermediate step towards the more ambitious target of zero net direct and indirect greenhouse gas emissions in Europe by 2050."
Shares in Eni were up 1.95 at EUR8.62 in Milan on Friday while, in London, SSE' shares were up 3.0% at 1,401.50p.
By Anna Farley; annafarley@alliancenews.com
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