Massive offshore wind farm project now underway in the North Sea
A 120-megawatt electrical wind farm in the North Sea, 23 kilometers (14 miles) off the coast of the Netherlands, was made possible only through a unique financing scheme in which a group of international banks covered all the costs of the project, and will be paid back entirely from its eventual profits.
What you need to know - Conventional View
• The project's $510 million price tag, including construction costs, is being entirely covered by loans from a group of international banks. The financing is described as "non-recourse," meaning that the principal and interest from the loan will be repaid solely from the profit generated by the project.
• This unique financing scheme won the project -- called Q7 -- the highly respected Deal of the Year Award from Euromoney and Project Finance Magazine.
• The wind power station will be owned by Econcern and Energy Investment Holdings, subsidiaries of the Dutch energy company ENECO. It will be operated by Vestas Offshore, a subsidiary of the Danish company Vestas Wind Systems.
• Vestas is building the project in conjunction with the Dutch company Van Oord Dredging and Marine Contractors.
• The wind farm will consist of 60 turbines at a height of 19 to 24 meters (62-79 feet) and is expected to become operational in March 2008.
• Quote: "Q7 demonstrates that limited recourse financing is possible for offshore wind and should help boost the development of similar projects." - Toon Meijers, ENECO Energie
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