The Eu860 million ($1.132 billion) first phase of the Borkum West II offshore wind project in Germany closed in Dec­em­ber, through a combination of non-commercial and commercial bank support. The project sponsor, Trianel, is a group that represents 34 municipal utilities from Ger­many, Austria, Holland and Switzerland. Borkum West II is the first German offshore project to be delivered through project financing and the first offshore project to be led by a group of municipal utilities.

The project has been in development for nearly three years, and was originally planned as a 400MW plant consisting of 80 5MW turbines. After the financial crisis, however, Trianel faced difficulty in financing the full amount. The sponsor halved the project’s size in November 2009, with the aim of financing the re­maining 200MW as a second phase. In December that year, the European Commission awarded the project Eu43 million from the European Energy Programme for Recovery (EEPR).

The European Investment Bank (EIB) and the State Bank of North Rhine-Westphalia (NRW Bank) provided the majority of funding. The four initial lead arran­gers, Dexia, Rabobank, KfW and UniCredit, were joined by ASN Bank, SEB, Deutsche Bank, Helaba and NIBC to complete the commercial bank tranche. UniCredit was the documentation and co-ordination bank, Dexia was the modelling bank and KfW was the technical and insurance bank.

The debt facilities for the wind farm total Eu544 million. The development banks are providing Eu456 million of this, through a Eu100 million direct loan and Eu203 million guaranteed facility from the EIB and a Eu153 million guarantee facility from NRW Bank.

The risk guarantees for the EIB facility are Eu50 million from NRW, Eu25 million from Rabobank, Eu24 million each from KfW and UniCredit, Eu22 million from Dexia, Eu18 million each from Deutsche and SEB, Eu15 million from ASN and Eu6.6 million from Helaba. The eight commercial banks also provided the same levels of risk guarantee for the NRW facility.

The commercial tranche is comprised of a Eu16 million term loan, a Eu38.5 million contingent debt facility, Eu14 million letter of credit facility and Eu20 million 3.5-year VAT bridge. The contingent debt facility has Eu5.9 contributions from UniCredit and KfW, Eu5.5 from Dexia, Eu5 million from Rabobank, Eu4.4 million each from Deutsche and SEB, Eu3.9 million from ASN, Eu2 million from NIBC and Eu1.6 million from Helaba. NIBC is providing the term loan, Rabobank the letter of credit facility and KfW the VAT bridge.

The debt has a 15-year tenor with an expected life of 13 years, thanks to the inclusion of cash sweeps. The remaining roughly Eu295 million of the project’s cost is funded with equity from Trianel. Trianel is also offering a limited completion guarantee to the lenders.

The farm’s construction has been contracted to several different entities. Areva has a Eu400 million contract to supply the forty turbines for the project. Dredging En­vironment & Marine Engineering (DEME) will carry out the pre-piling foun­dation works and installation of these turbines under a Eu72 million contract. Seeway Heavy Lifting is carrying out the transport and installation of the substation and the 40 tripod jacket foundations. Weserwind and Erndtebrucker Eisenwerke are providing the tripod foundations, and Norddeutsche Seekabelwerke (NSW) is instal­ling the internal farm cabling.

The turbines will be assembled on land, just south of Bor­kum at Eemshaven, and finished components will be delivered to the site by cargo barge. The turbines will then be erected at sea using cranes.

The wind farm will be located 45km north of the East Fresian island of Bork­um, in an area with a 10-year mean wind speed of 9.92m per second. The farm covers a 56km2 area, making it the largest project in the German North Sea, and is adjacent to Germany’s first offshore wind project, Alpha Ventus. It is the first wind farm to be supplied with Areva’s new M5000 turbines, each with a rotor diameter of 116m. Trial operations will begin in summer 2012, with full operation set to start at the turn of the year 2012/2013. Once this first phase is completed, work will start on the second phase of the project. n

Trianel’s shareholders are ewmr (Energie- und Wasserversorgung Mittleres Ruhrgebiet, 29.47%), STAWAG Stadtwerke Aach­en (14.29%), Stadtwerke Bonn (6.93%), Überlandwerk Fulda (6.49%) Stadtwerke lübeck (6.11%), SWU Energie (4.53%), Stadtwerke Jena-Pößnek (3.57%) Stadt­werke Halle (3.55%), Niederrheinwerke Viersen (3.43%), Salzburg AG für Energie, Verkehr und Telekommunikation (2.1%), enwor (2.04%), Allgäuer Überlandwerk (1.48%), NVB Nordhorner Versorgungs­betriebe (1.42%) Stadtwerke Hamm (1.18%), GSW Gemeinschaftsstadtwerke (0.89%), Regio Energie Solothurn (0.71%), Stadtwerke lünen (0.7%), Energie- und Wasserversorgung Rheine, Energie Wasser Niederrhein GWS Stadtwerke Hameln, Hertener Energiehandelsgesellschaft, Schles­wiger Stadtwerke, Stadtwerke Bad Salzuflen, Stadtwerke Dachau, Stadtwerke Elms­horn Stadtwerke Fröndenberg, Stadt­werke Gronau, Stadtwerke Sindelfingen Stadt­werke Tuttlingen (all 0.59%), Stadtwerke Detmold (0.43%), Stadtwerke Flensburg (0.4%), Stadtwerke Unna (0.39%) Stadt­werke EVB Huntetal (0.36%), Stadt­werke lemgo (0.32%), Stadtwerke Schwäb­isch Hall (0.31%), Stadtwerke Georgs­marienhütte, Stadtwerke Herford, Stadt­werke lengerich, Stadtwerke Soest, Stadt­werke Verden, and Teutoburger Energie Netzwerk (all 0.3%). 

Borkum West II (Phase I)
Status: Closed 17 December 2010
Size: Eu860 million
Location: German North Sea
Description: 200MW offshore wind farm
Sponsor: Trianel
Mandated lead arrangers: UniCredit (Documentation and Co-ordination), Dexia (Modelling), KfW (Technical and Insurance), Rabobank, ASN Bank, SEB, Deutsche Bank, Helaba and NIBC
Non-commercial lenders: EIB and State Bank of North Rhine-Westphalia (NRW Bank)
Sponsor financial adviser: SPF Partners
Sponsor legal adviser: Gorg Rechstanwalte
Commercial lender legal adviser: Linklaters and Hogan Lovells
Multilateral legal adviser: Linklaters
Main contractors: Areva, SHL, NSW, DEME.