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Robert Kuok-linked groups tie up to target Taiwan's wind sector

JV between POSH and Kerry TJ Logistics to provide end-to-end and marine services for offshore wind farms

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Mr Shen (left) says Kerry TJ has over 60 years of experience providing logistical solutions out of Taiwan. Mr Lee says about one third or 40 vessels on POSH's current fleet are suited for deployment in offshore wind projects.

Singapore

TWO listed groups linked to Malaysia's richest tycoon Robert Kuok are joining forces to penetrate Taiwan's budding offshore wind sector.

On Thursday, PACC Offshore Services Holdings (POSH) and Kerry TJ Logistics entered into a joint venture (JV) to tap opportunities in Taiwan, the second fastest-growing market for offshore wind in North Asia, just behind China.

Mr Kuok is a controlling shareholder of POSH, a Singapore-listed offshore support vessel owner-operator. The Malaysian tycoon also holds equity interest in Taiwan-based Kerry TJ through Hong Kong-listed Kerry Logistics Network.

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Leveraging the capabilities and assets of both companies, the JV will provide end-to-end services and marine spread to support installation, operations and maintenance of offshore wind farms in Taiwan. The JV has also signed a memorandum of understanding (MoU) with the partnership between Macquarie Capital and Swancor, which has emerged among a handful of developers selected for Taiwan's offshore wind projects. The Business Times understands that Enterprise Singapore, as the agency championing enterprise development, played an instrumental role in connecting POSH-Kerry TJ with Swancor-Macquarie Capital.

The JV was formed and the MoU signed just weeks after Taiwan announced the winners for its first commercial-scale offshore wind projects. The local government there has set aside some US$30 billion through to 2025 to invest in these projects. They are to be executed over two phases to deliver over five gigawatts of wind power to Taiwan's shores.

In an exclusive interview with BT, POSH's deputy CEO Lee Kenglin described Taiwan as "an open market that welcomes contributions from foreign players with good track records in the offshore marine services sector".

Taiwan is also regarded as potentially the most promising export market for offshore wind developers. This has drawn international names, including Denmark's leading player, Orsted, and a consortium comprising Yushan Energy, a subsidiary of Singapore-based Enterprize Energy, to its recently concluded offshore wind auctions.

Enterprise Singapore's director for precision engineering, marine & offshore engineering services, Ho Chi Bao, explained: "Taiwan does not have an offshore wind industry locally. This opens up room for international players to come in." In this respect, he suggested that POSH and other Singapore-based oilfield services players can lean on the good standing the country's offshore and marine (O&M) sector enjoys in Taiwan.

To be clear, however, Taiwan also harbours aspirations to groom offshore wind capabilities locally, with the government having set out to create 20,000 jobs through its planned investment in this sector. The JV between POSH and Kerry TJ thus offers a suitable platform to tap POSH's offshore capabilities and Kerry TJ's network not just to deliver the needed expertise, but also to develop local industries.

Kerry TJ chairman Richard Shen told BT the Taiwan-listed outfit has over 60 years of experience providing logistical solutions out of Taiwan. It boasts an extensive network comprising 82 depots and 11 logistics centres across Taiwan; 21 of these are located in the central region, close to the epicentre of Taiwan's offshore wind activity. Mr Shen said that the JV can tap Kerry TJ's extensive experience and resources to provide, among others, sea and air freight services for importing and transporting large wind turbines and other structures.

POSH, on the other hand, can lend its fleet and know-how in executing offshore work. Mr Lee cited the deployment of tugs or barges to support installation of offshore wind farms as one example. He estimated about one third or 40 vessels on POSH's current fleet are suited for deployment in offshore wind projects.

Mr Lee added that the JV will also look at roping in two other Robert Kuok-owned business units, Paxocean and PACC Line, to complete its offshore wind offering. Paxocean's Batam yard has capacity to build CTVs (crew transfer vessels) and SOVs (service operations vessels) tailored for operations and maintenance work on offshore wind farms. The yard can also take on fabrication of wind farm foundations. PACC Line, a subsidiary of Pacific Carriers Limited, owns and operates vessels capable of transporting offshore wind components and structures, Mr Lee explained.

The JV partners penned a second MoU on Thursday with Rolls-Royce to explore suitable vessel designs to meet the specific needs of offshore wind operations.

The first tenders from Taiwan's selected offshore wind developers are expected to land six months down the road. These contracts are likely to call for work to begin in the second half of 2019.

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