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Keppel O&M unit bags German offshore wind deal worth S$560m

KEPPEL Corp and Norwegian energy services provider Aibel will design and build converter stations for offshore wind farms in the North Sea, the Singapore conglomerate said on Tuesday.

Keppel FELS, an indirect, wholly-owned subsidiary through Keppel Offshore & Marine, is looking at about S$560 million in its share of the contract with European grid operator TenneT Offshore.

Keppel Corp declined to disclose its shareholding in the consortium with Aibel.

But it described the deal as Keppel Offshore & Marine's "first major project in the renewable energy sector since 2010", when the Keppel unit entered the offshore wind market and built an electrical transformer and maintenance platform for a German offshore wind farm.

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Renewable energy will also be an area of growth for Keppel Offshore & Marine, the parent group said.

Chris Ong, chief executive of Keppel Offshore & Marine, said in a statement that the latest contract "extends our track record in supporting the renewable energy industry".

"We see opportunities in this segment as the offshore renewables market is expected to increase significantly over time with increasing concerns over climate change," he added.

Keppel FELS and Aibel are to produce a 900-megawatt offshore converter station and an onshore converter station in Germany, which will connect offshore wind power plants to the grid.

The partners, along with subcontractor ASEA Brown Bover, will also carry out the installation and start-up operations for the converter stations, which are slated to be finished by 2024.

The contract is not expected to have a material impact on the net tangible assets or earnings per share of Keppel Corp this financial year, the group added.

Separately, Keppel Corp has finished issuing S$150 million in 3 per cent notes due 2024 and S$350 million in 3.66 per cent notes due 2029, which are expected to be listed on Wednesday.

Keppel Corp closed up S$0.17 or 2.6 per cent to S$6.72 on Tuesday before the announcement.