InfraStrata (INFA ) has signed a Memorandum of Understanding ("MoU”) with Navantia and Windar Renovables to target fixed and floating wind farm projects within the UK.
The Joint Venture (“JV”) between Navantia and Windar commenced in 2015 with both partners collaborating on seven offshore wind projects to date with both companies investing in the new XXL monopile facility in Spain.
The collaboration between InfraStrata and the existing JV will enable the Company's fully owned Harland & Wolff shipyards and fabrication facilities to harness Navantia's extensive experience and adopt their advanced technologies to take better advantage of the offshore wind opportunities set out in the UK Government's Ten Point Plan for a Green Industrial Revolution.
John Wood, Group CEO of commented: "Through this strategic partnership, we will be able to strengthen the scale and footprint of a combined multi-site offering, drive more innovation and efficiency and enable projects to be monetised quicker.”
View from Vox
There is no doubt, the hidden gem for InfraStrata is the Harland & Wolff facilities, which have one of the largest fabrication footprints in the UK with circa 256 acres of land at its disposal and load-out areas across its locations that is ideally suited for large offshore wind structures.
Investors should keep a keen eye as the MoU between the three companies progresses into a formal JV and the ownership structure therein as the companies come together to bid on numerous wind farm projects with appropriate work share arrangements between them based on their respective yard capacities and availability, material handling capabilities and quayside load-out capacities.
Whilst the share price has already begun to recover from lows of 16.8p at the beginning of September, there is clearly much excitement building around the UK Governments plans for renewables in the UK, which should provide numerous positive newsflow opportunities to reinvigorate the Share Price.
Reasons to INFA
InfraStrata is a London-listed firm focused on the development, commercialisation and operation of advanced high-value strategic infrastructure facilities across the globe.
Energy Storage
The group holds a salt cavern gas storage project at Islandmagee in County Antrim, Northern Ireland is a pioneering low-cost fast cycle facility that it believes will provide ‘safe, secure and flexible gas storage that will in time serve the island of Ireland and the UK mainland.’
In May 2020, the company entered into a term sheet with West Face Long Term Opportunities Global Master L.P to acquire Meridian Holdings Co., under which sits the proposed Floating Storage and Regasification Unit Project (“FSRU Project”), located in North West England.
The Project will be the UK’s first to be developed and commercialised. Since more than 30% of the UK’s natural gas supplies arrive via LNG (liquified natural gas) cargoes, the FSRU is positioned to take advantage of LNG arriving in the UK seeking storage and regasification.
The estimated CAPEX for the FSRU Project will be circa £350m-£450m with further CAPEX optimisation planned through value engineering. The CAPEX for the FSRU Project is expected to be funded by putting together a consortium of partners at the project level. Estimated project revenues come to £80-£100mm annually with a 25-30 year project life.
Discussions with key partners have commenced with a consortium consisting of globally recognised companies involved in the development, construction, operations and commercialisation of regasification terminals worldwide will be formed in due course.
Pipeline
The Directors of INFA have identified a potential weighted pipeline of “£2 billion in contract opportunities between now and 2025” and believe there are near term revenue opportunities of £80.5 million and up to £825 million in the medium term.