Dong Energy and Vancouver-based NaiKun Wind Energy Group have signed a letter of intent to develop a 300MW-400MW offshore wind farm in British Columbia.
“This agreement takes us one major step closer to developing the first-ever offshore wind project in Canada,” said NaiKun board chairman Philip Hughes.
The project is planned for the Hecate Strait between the Haida Gwaii archipelago and Prince Rupert on British Columbia’s mainland. The 550-square-kilometre site has some of the world’s strongest and most consistent winds, according to Dong.
“We have a world-class wind resource,” NaiKun chief executive Michael O’Connor told Infrastructure Investor. “We now have a world-class developer and operator in Dong.”
The project will be built in shallow water and feature bottom-fixed structures, Dong said. Though previously estimated to cost between $1.5 billion and $2 billion to build, O’Connor believes technological advances and the partnership with Dong will drive down costs significantly.
NaiKun, a publicly traded company that now focuses exclusively on the site, has been working for around a decade to develop the project. The firm has been seeking a power purchase agreement for the site before beginning construction and believes the deal with Dong, which gives the Danish firm exclusive rights to negotiate a joint-development agreement, will help with this goal.
Once the project is approved, NaiKun expects it to take around three years to build and commission. The firm believes the Hecate Strait could provide more than 2GW in wind power, developed over several stages.
Dong, whose North American division is headquartered in Boston, owns and operates 22 offshore wind farms in Europe.
“We see this opportunity as a first step to bringing offshore wind power to Canada in what could become a strategic partnership with the nation’s front-runner project,” said Thomas Brostrom, president of Dong Energy Wind Power North America.