30 March 2023
Petrofac and Hitachi Energy secure landmark offshore wind framework worth approximately 13 billion euros
- Petrofac and Hitachi Energy have been awarded a multi-year Framework Agreement by TenneT as it works to expand offshore wind capacity in the Dutch-German North Sea
- The Framework Agreement, which represents the largest in Petrofac’s history, covers six projects. Each project comprises the EPCI of an offshore HVDC transmission station, onshore converter station and associated infrastructure
- Each project will be executed under a standalone contract valued at over 2 billion euros, split approximately equally between Petrofac’s and Hitachi Energy’s scopes. The first of these contracts has been awarded alongside the Framework
Petrofac, a leading international service provider to the energy industry, and Hitachi Energy, a global technology leader, have been selected by TenneT, the Dutch-German Transmission System Operator, to supply multiple offshore platforms and onshore converter stations to accelerate the integration of bulk renewables into European power grids.
Petrofac and Hitachi Energy were awarded the multi-year Framework Agreement as part of TenneT’s ambitious 2 gigawatt1 (2GW) high voltage direct current (HVDC) offshore wind programme.
The agreement includes an initial commitment to deploy six record-breaking renewable integration systems, five of which will connect offshore wind farms to the Dutch grid and the sixth to the German grid. Each of these connection systems has a capacity of 2GW and a voltage level of 525 kilovolt – a world-first for offshore wind.
The landmark Framework Agreement represents the largest in Petrofac’s history. It enables Petrofac and Hitachi Energy to plan in advance, secure the required resources and yard space, as well as capturing synergies between successive projects to meet in-service dates.
Petrofac will undertake the Engineering, Procurement, Construction and Installation (EPCI) of the offshore platforms and elements of the onshore converter stations. Hitachi Energy will supply its HVDC Light® converter stations, which convert AC to DC power offshore and DC to AC onshore.
The first contract under the Framework, for the Ijmuiden Ver Alpha project, was awarded with immediate effect. The second, Nederwiek 1, is expected to be awarded later in the year. The Framework also includes projects Doordewind 1, Doordewind 2, Nederwiek 3 and LanWin5, expected to be awarded over a 2024 – 2026 timeframe.
Sami Iskander, Petrofac’s Group Chief Executive, said:
“Today’s announcement represents an exciting next step in Petrofac and Hitachi Energy’s collaboration. We have already secured key resource and the yard capacity required to expedite the first two projects in TenneT’s ground-breaking programme. By combining Petrofac’s industry-leading EPCI expertise and Hitachi Energy’s well proven technology, we look forward to supporting TenneT to connect larger, more effective wind farms to deliver affordable clean energy for millions of European homes.”
Tareq Kawash, who takes over from Sami Iskander as Petrofac’s Group Chief Executive on 1 April, added:
“Today’s award demonstrates the significant new growth horizon presented by the Energy Transition, and the role companies like Petrofac will play. I will be very proud to support Petrofac’s collaboration with Hitachi Energy and delivery of our role on TenneT’s 2GW programme over the coming years.”
Niklas Persson, Managing Director at Hitachi Energy’s Grid Integration business said:
“This innovative business model will set the course for the integration of a huge amount of offshore wind power and gives visibility of the future. In fact, we are already hiring to expand our global delivery capacity and effectively fulfill these and other orders. We’re proud to be part of this journey and, along with our partner Petrofac, we are setting the benchmark for deploying offshore HVDC technology at scale and with speed.”
Marco Kuijpers, Director Large Projects Offshore TenneT said:
“The new long term approach goes hand in hand with a fundamental change in values towards a strong partnership. This approach enables both sides with more flexibility, technological progress, and planning security. This benefits all parties and secures employment, growth, and the strengthening of supply chains. We can already see that our partners invest in extra resources and facilities.”
Petrofac and Hitachi Energy began working together in June 2022, to provide joint grid integration and associated infrastructure solutions to support TenneT’s 2GW Programme2.
In the same year, Germany, the Netherlands, Denmark and Belgium agreed to install at least 65 gigawatts of offshore wind energy combined by 2030, as announced with the inter-governmental Esbjerg Declaration3. At 40 gigawatts, almost two-thirds of this capacity is accounted for by TenneT, with 20 gigawatts each in the German and Dutch North Sea sectors.
1 TenneT’s 2GW Programme
2 Hitachi Energy and Petrofac to collaborate in growing offshore wind market
3 The Esbjerg Declaration