Eneti Receives First Contract for 2025 for WTIV Building in Korea
As a sign of the continuing strong demand for offshore wind installation capabilities, Eneti announced that it has secured the first contract for its currently under construction vessel two years before it will be delivered. The contract with an unnamed project due to start in early 2025 is for the first of two large installation vessels the former Scorpio Bulker ordered in 2021 that are being built in South Korea.
Scorpio Group headed by Emanuele Lauro announced plans in 2020 to exit its historic business in bulkers and transform into a wind installation company. In May 2021, the company ordered the first of its next-generation installation vessels, designed by GustoMSC, to be built by Daewoo Shipbuilding and Marine Engineering at a cost of $330 million. The vessel will be capable of installing up to 20 MW turbines at depths over 200 feet of water, and it can be adapted to operate on the alternate fuels of LNG or Ammonia. A year ago, the company placed an order for a sister ship also to be built by DSME.
Eneti reports that the first vessel will be named Nessie and that they are expecting it to be delivered by the shipyard during the fourth quarter of 2024. The contract is for the transport and installation of turbines for a project commencing in the first half of 2025. Eneti reports that inclusive of mobilization beginning early in the first quarter of 2025, the engagement is expected to be between 226 and 276 days and generate approximately $63 to $77 million of net revenue after forecasted project costs.
“Securing this charter for our first newbuilding WTIV is an important milestone for the company,” said Emanuele Lauro, CEO of Eneti. “It represents a proof of concept for our newbuildings and reflects the improving fundamentals of the installation market and the expanding capability of our fleet. With open vessel capacity, we are well positioned to contract the fleet in a tightening market and a rising rate environment.”
It is the next major step for the company in its transformation. The second newbuild is due to begin operation early in the second quarter of 2025. In addition, Eneti in 2021 acquired Seajacks and currently has a fleet consisting of five WTIVs. The vessels are also employed in the maintenance of existing offshore wind turbines and the company reports that they are also suitable for employment servicing offshore oil and gas installations.
In addition to the ownership and operation of its fleet, Eneti through one of its wholly-owned subsidiaries, serve in a technical advisory role to Dominion Energy, which is building the first WTIV in the United States under the Jones Act. Eneti had explored building its own Jones Act-compliant installation vessel but in February 2022 discontinued discussions with a shipyard in the United States. The company however said that it believed the U.S. market for offshore wind would offer significant opportunities in the future, leaving the possibility that it might again pursue opportunities in the market.