Northland Power agrees to buy Canadian offshore wind project
Canadian energy company Northland Power has agreed to buy the NaiKun offshore wind farm project from compatriot NaiKun Wind Energy Group.
The NaiKun offshore wind farm is located in the Hecate Strait between Haida Gwaii and Prince Rupert on the British Columbia mainland. The project is in the early stages of development.
Upon successful completion of the acquisition, NaiKun will no longer be involved with the development and operations of the project and Northland will be responsible for all aspects of the project moving forward.
The transaction will occur by way of NaiKun Wind Energy Group selling Northland a 100% interest in its wholly-owned subsidiary, NaiKun Wind Development Inc.
The deal is anticipated to close in mid-2020, subject to the satisfaction of certain customary conditions, including but not limited to NaiKun obtaining the applicable regulatory approvals and approval of the transaction by way of a special resolution of the company’s shareholders.
Pursuant to the terms of the agreement, NaiKun will receive a payment based on the size of the developed project upon Northland reaching the financial close.
Once the wind farm is operational, NaiKun will receive future payments consisting of an annual cash distribution from the project after the operating costs and specified return on equity have been recovered by Northland.
Subject to the financial close of the project, NaiKun will also have an option to purchase up to a 10% interest in Northland’s interest in the wind farm.
Northland said that it will work closely with the Haida Nation to explore the project details and potential involvement in the project.
“Northland can apply both its global offshore wind experience and long track record developing Canadian power projects to this Project,” said Mike Crawley, President and Chief Executive Officer of Northland Power.
“However, before anything else happens we will be reaching out to the Haida Nation to discuss the Project and how it could potentially move forward.”