Atlantis has agreed to acquire two projects from ScottishPower Renewables (UK) Limited (SPR) for its Scottish tidal development company, Tidal Power Scotland Limited (TPSL). The transaction is subject to the satisfaction of certain conditions precedent which are expected to be achieved in early 2016.
The consideration payable for the projects, which the company values at £6.6 million (US$9.6 million), is 3,859,703 shares in TPSL, which equates to 6% of the issued share capital. Atlantis owns the remaining 94% of TPSL.
As part of the transaction, TPSL will acquire SPR’s entire tidal power portfolio, comprising the 10 MW Sound of Islay site in western Scotland and the 100 MW Ness of Duncansby site, immediately to the east of Atlantis’s flagship 398 MW MeyGen project in north-eastern Scotland. TPSL already owns 85% of the MeyGen project company, with the remainder held by Scottish Enterprise.
The project assets include agreements for lease with The Crown Estate for both sites, and the Sound of Islay site also has a grid connection offer and construction consents from the Scottish Ministers. The Sound of Islay project has been awarded €20.7 million of grant funding from the European Commission’s NER300 fund by way of capital and revenue support.
Following completion of the acquisition of Marine Current Turbines Limited from Siemens AG in an all share deal earlier this year, the Atlantis group has agreements for lease for two further Scottish tidal sites, at the Mull of Galloway in south-west Scotland and Brough Ness, to the north of the MeyGen and Ness of Duncansby sites in the Pentland Firth. Atlantis is in the process of adding these two projects, with a combined capacity of 130 MW, to the TPSL portfolio.
It is expected that construction will commence on the Sound of Islay project in 2016, alongside the second phase of the MeyGen project, which has also been awarded NER300 funding of €16.8 million. The first 6MW phase of the MeyGen project remains on target to deliver power to the grid in 2016.
Tim Cornelius, CEO of Atlantis, commented:
“This is another step in consolidation of the tidal industry as we pull together with SPR to create what is certainly the largest portfolio of tidal power projects in the UK, if not the world.”
“By 2022, we aim to have almost 650MW of installed tidal power in Scotland alone, generating clean and predictable energy to meet Scotland’s green energy ambitions, and establishing a new export industry for the future which builds on the existing supply chain and expertise of decades of offshore experience.”