On December 5 (Reuters) – BASF (BASFn.DE) has entered into an agreement with Swedish company Vattenfall to purchase a stake in two offshore wind farms in Germany, in the latest step by the German chemical giant to secure fossil fuel-free energy and reduce its carbon footprint in production.
Company Summary
The two companies signed a memorandum of understanding on Tuesday for BASF to acquire 49% of the shares in a project that includes the Nordlicht 1 and 2 offshore wind farms. Financial terms were not disclosed.
Use of Production
BASF will receive nearly half of the electricity produced at the sites and will use it to supply its chemical production sites across Europe, especially in Ludwigshafen in western Germany. Vattenfall will use its share of fossil fuel-free electricity to serve its customers in Germany.
Signing the Deal
The deal is expected to be signed in the first half of 2024, with a final investment decision anticipated the following year. The wind farms are scheduled to be fully operational by 2028 and will have a total capacity of 1.6 gigawatts (GW), according to the two companies.
Expected Production
The Nordlicht wind farms, located north of the German island of Borkum, are expected to reach a community production of around 6 terawatt-hours (TWh) annually when fully operational, equivalent to the electricity consumption of 1.6 million German homes. BASF’s share in this production will account for about half of the electricity used at its Ludwigshafen site. However, due to the transition to climate-neutral production operations, the group’s electricity needs are expected to increase significantly in the future.
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Report by Patricia Weiss, writing by Linda Pasquini, editing by Rachel Mor and Mark Potter
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