Germany’s E.On and Danish utility Dong Energy are joining forces to buy out Shell’s stake in the London Array offshore wind farm, making them 50-50 partners in the flagship project.
The transaction – which is of undisclosed value – will allow the partners to move forward with the project following Shell’s decision in May to pull. The 1000 MW wind farm is the world’s largest offshore wind project and its first phase is expected to be completed by the end of 2012.
E.On says that Shell has committed to leave its staff working on the project until the end of the year to enable a smooth handover. Analysts have attributed Shell’s decision to pull out of the project to soaring costs, which have risen to £2.5 billion from an original estimate of £1.5 billion.
The London Array project will be located some 15 km from the Kent and Essex coasts in southeast England, and may include more than 270 wind turbines. It will form a major part of the UK government’s plans to rapidly increase offshore wind power capacity.
