Origin Energy, an Australian gas and electricity utility, has agreed to sell the Stockyard Hill wind farm development project to Chinese wind turbine manufacturer Goldwind International for A$110 million ($81.6 million; €74.4 million).
Goldwind said it will inject another A$335 million to help develop the 527.5MW project, which is expected to become the largest wind farm in the Southern hemisphere once complete.
Located in the state of Victoria, about 140km west of Melbourne, the Stockyard Hill wind farm will use 149 wind turbines supplied by Goldwind to deliver an annual energy output of approximately 2,000GWh.
Now in the final stages of development, the project is scheduled to begin business operations by end of 2019. Goldwind has been cleared by Australia’s Foreign Investment Review Board to acquire full ownership of the scheme.
“This was a complex transaction as it was essentially a reverse auction process. Origin allowed proponents to bid offtake arrangements from renewable energy projects other than Stockyard Hill. As a result, Origin received offers from a wide range of wind and solar projects in Australia,” said David Ryan, a partner at Herbert Smith Freehills, which advises Origin on this transaction.
“A key aspect of the transaction was the offtake agreement under which Origin Energy will acquire all energy and green rights created in respect of the project from commissioning until the end of the Renewable Energy Target in 2030,” the law firm added. “Bidders for the project were effectively bidding an acquisition price for Stockyard Hill and, more importantly, a long-term price to Origin Energy for the offtake arrangement.”
For Origin, the exit is part of an A$800 million asset divestment programme announced in 2015. The company sold its first asset – an operating transmission station in Victoria – for A$110 million in February 2016. Last week, it completed the divestment of the 110MW Darling Downs solar farm to APA Group, a local natural gas business, for A$200 million.
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