PKN ORLEN finalises its strategic partnership with Northland Power on Baltic Power project
After fulfilment of the conditions precedent - including obtaining merger clearance - stipulated in the joint venture agreement signed in January 2021, NP Baltic Wind B.V. a subsidiary of Northland Power has subscribed for the shares in Baltic Power. The joint venture agreement provides for joint development and operation of the Baltic Power offshore wind farm, whose construction is scheduled for launch in 2023.
“As the cooperation between PKN ORLEN and Northland Power has fully come into being, we are opening a new chapter in the development of offshore wind power generation in the Baltic Sea. By 2026, we will begin to supply Polish homes with clean energy from the sea, yet the experience and know-how we will have gained while implementing the project are no less important to us. In line with the ORLEN2030 strategy, we aspire to become a regional leader in energy transition within the next decade,” said Daniel Obajtek, President of the PKN ORLEN Management Board.
PKN ORLEN is joining forces with Northland Power to execute the project to develop the Baltic Power offshore wind farm. The parties will jointly develop and operate a wind farm with a total capacity of up to 1.2 GW, which is expected to be supported by a 25-year Contract for Difference (CfD).
Under the joint venture agreement, the first of an intended series of capital increases at Baltic Power has been carried out to grant shares to its new shareholder. As assumed by the parties in the agreement, Northland Power will ultimately acquire a 49% equity interest in the company through the share capital increases. The remaining 51% will be retained by PKN ORLEN. With the execution of the agreement, NP Baltic Wind B.V., a 100% indirect subsidiary of Northland Power Inc., is able to become a direct shareholder in Baltic Power.
Northland Power Inc. is a Canadian company with over 30 years of experience in designing, implementing and managing power infrastructure projects. Its low- and zero-carbon power assets situated across four continents comprise a total of 2.6 GW of operating generation capacity and 1.4 GW of capacity under construction or at an advanced planning stage.
Development of the offshore wind farm in the Baltic Sea is one of PKN ORLEN’s key growth projects aligned with the Company’s strategy to develop low- and zero-carbon power generation sources.
By the end of the decade, the Company will have spent PLN 47bn on projects supporting climate neutrality goals.
The construction work on Baltic Power is scheduled to commence in 2023 and end in 2026. The project site, with an area of approximately 131 square kilometres, is located approximately 23 kilometres north of the Baltic Sea coastline, in the vicinity of Choczewo and Łeba.