its contract to supply 84 monopiles for the Empire Wind 2 offshore wind project in the US has been canceled. This decision follows the termination of the project's power contract for New York by developers Equinor ASA and BP Plc, citing economic challenges. Another supplier for Empire Wind 2, Singapore's Seatrium Ltd, also had its contract for the offshore substation platform terminated.
Sif's contract for 54 monopiles and transition pieces for Empire Wind 1 remains unaffected by the cancellation.
Equinor, a shareholder in Sif, has committed to addressing the gaps in Sif's production schedule resulting from the Empire Wind 2 termination, potentially mitigating cancellation fees owed to Sif. The production for Empire Wind 2 was originally scheduled for the period 2025-2026.
Despite this setback, Sif affirmed its projections for adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for 2025 and 2026. The company also emphasized that its expansion in Rotterdam remains unaffected.
“Empire Wind 1 remains, as originally planned, the launching project for our newly expanded production facility at Maasvlakte 2 with production starting from the end of July 2024. The first steel deliveries for this project are expected in January and February 2024,” stated Sif.
As part of Empire Offshore Wind's advance payments supporting the new factory, an amount of EUR 30.5 million (USD 33.4 million) related to Empire Wind 2 will be converted into a perpetual bond.