'www.environmental-finance.com/
London, 24 July
London, 24 July: The future of the London Array offshore wind farm looks more secure, after E.ON and Dong Energy agreed to buy out Shell's stake in the project.
In May, Shell announced its intention to sell its 33% stake in the £2.4 billion ($4.8 billion) offshore wind project in the Thames Estuary, which it was developing with German and Danish utilities E.ON and Dong Energy. The project is expected to have a capacity of 1,000MW when complete – or enough electricity to power a quarter of homes in Greater London.
Dong Energy and E.ON will each increase their stakes in the project, from 33% each, to become equal partners. The financial details of the deal have not been disclosed. However, Shell has promised to keep its staff in the project until the end of the year, "to enable a smooth transition and handover", according to an E.ON statement.
Paul Golby, chief executive of E.ON UK, said: "We're pleased that, together with Dong Energy, we've been able to secure the future of the project, and we'd also like to thank Shell for their contribution to the project's significant progress to date. "That also means that we hope to be able to keep the project on track and we should be able to complete the first phase by the end of 2012, subject to securing a number of important contracts, such as those for the wind turbines."
In a statement, Dong Energy said it was "pleased to be able to continue with the development of this project in collaboration with E.ON and that a swift solution has been reached with Shell to the benefit of the project". Shell caused some consternation when it pulled out of the project, saying it intended to refocus on onshore wind in the US. This included a rebuke from the UK's Environment Secretary, Hilary Benn, in the House of Commons, who questioned why the oil giant withdrew in the same week it announced record profits.
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