BW Offshore, a company known for its FPSO leasing business in the oil and gas sector, is looking to diversify by entering the floating offshore wind space and has started talks with floating wind firm Ideol over a potential investment.
The move makes BW Offshore yet another FPSO specialist working to crack into floating wind after SBM Offshore and MODEC.
The floating offshore wind industry - with only around 100MW currently installed worldwide - is still minuscule compared to the installed capacity the conventional, fixed bottom offshore wind industry (29GW at 2019 end). However, floating wind is showing promise and is expected to take off big time by the end of the decade.
While the current installed capacity is small and focused on pilot projects, the potential is there for the floating wind farms to reach and, theoretically, even surpass the installed capacity of the traditional offshore wind turbines, and not by a little, given that there are no water depth limitations for installation.
The Oslo-listed FPSO provider said this week it was in advanced talks over a potential investment in France-based floating offshore wind solutions provider Ideol.
Ideol has so far installed two full-scale demonstration wind turbines based on its patented floater design and is currently building up a pipeline of projects as a co-developer in Japan, Europe, and the US.
"BW Offshore plans to provide more information about its long-term strategy and ambitions for investing in floating offshore wind at the Q4 2020 trading update presentation scheduled for February 19, 2021. BW Offshore will update on the discussions and potential transaction regarding Ideol as and when appropriate," the company said.
According to World Energy Reports, the floating wind installed capacity will reach between 8 to 10 GW by the end of this decade, and next decade WER expects to see more than 60GW of floating wind farms commissioned.
FPSO impairments
In a separate statement this week, BW Offshore said it had decided to record an impairment to the book value of the FPSOs Berge Helene, BW Cidade de São Vicente and Espoir Ivoirien amounting to USD 59.6 million in the fourth quarter of 2020.
"The impairments reflect continued uncertainty around redeployment and extension for certain older units in the fleet. The uncertainty is tied to the current market volatility and future development of oil prices, and also considering increased focus on energy transition," the company said.
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