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Malaysian offshore contractor Sapura Energy and subsidiary Sapura Offshore have been served with a $54m arbitration claim from Yunneng Wind Power, developer of a wind farm offshore Taiwan.
Sapura won a contract to transport and install monopiles at the Yunlin offshore wind farm in March 2019 but terminated it in February 2022, citing unresolved technical and operational issues.
Following the termination notice, Sapura Energy said it would pursue its claims via the dispute resolution process prescribed in the contract, namely arbitration under the German Institution of Arbitration in Bremen, Germany. The UAE-based National Petroleum Construction Company (NPCC), part of National Marine Dredging Company (NMDC), later picked up the contract.
However, Yunneng, a subsidiary of Skyborn Renewables and a portfolio company of Global Infrastructure Partners (GIP) which asset management giant BlackRock recently agreed to buy for $12.5bn, has provisionally claimed €50m ($54.2m), alleging certain breaches of the contract Sapura terminated.
Sapura said in a stock exchange filing that the arbitration request aims to suspend the statute of limitations under German law and aligns with the ongoing schemes of arrangement for the company and its subsidiary. The duo is seeking legal advice on the strength and merits of the claims, with responses due by March 7, 2024.
The Yunlin offshore wind project is located in the Taiwan Strait, between 8 and 17 km off the west coast of Taiwan. The 82 sq km project area will comprise 80 wind turbines with a total capacity of 640 MW. It was initially expected to be completed in September 2020, but faced multiple delays due to technical issues and covid.
Earlier this year, Yunlin’s developers firmed up financing to complete the wind farm’s construction. Electricity from the project is provided to Taipower under two 20-year power purchase agreements. Once completed, the wind farm will be one of the largest in Taiwan, producing enough power to serve the energy needs of more than 600,000 Taiwanese households.
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