Shri R.K Singh, Union Minister for Power and New & Renewable Energy held a meeting today on transmission planning for offshore wind energy projects in India. Shri Alok Kumar, Secretary, Power and Shri Indu Shekhar Chaturvedi, Secretary, Ministry of New & Renewable Energy were present in the meeting.
During the meeting, transmission and evacuation infrastructure required for offshore wind projects of total capacity 10 GW off the coasts of Gujarat and Tamil Nadu, was discussed. A presentation on this was made to the Minister by the Central Transmission Utility (CTU).
After a detailed review, it was decided to bid out offshore wind energy blocks as per the following trajectory:
Bids equivalent to a project capacity of 4.0 GW per year for a period of three years starting with the current FY 22-23 for development off the coast of Tamil Nadu and Gujarat for sale of power through open access / captive / bi-lateral third party sale / merchant sale
Subsequently a project capacity of 5 GW will be bid out every year for a period of five years i.e. up till FY 29-30.
The project capacity of 8 GW bid out in the first two years beginning FY 22-23 will also be able to avail of the benefits of green attributes like carbon credits.
The bidding for the first 12 GW will be conducted on a single stage two envelope model wherein the bidders will be evaluated based on their techno-commercial capabilities and only the technically qualified bidders will proceed to financial evaluation. The financial evaluation will be based on quoted lease fee per sq km of sea bed area. The bidder offering the highest lease fee per sq km of sea bed area would be declared as the winner for allocation of the project.
Evacuation and transmission of power from offshore pooling Substation (PSS) to onshore transmission will be provided free of cost for all offshore wind capacities that will be bid out up to FY 29-30.
The Ministry of New & Renewable Energy through its implementing agency will issue the first bid in the next three – four months for leasing out offshore wind energy blocks equivalent to 4.0 GW capacity off the coast of Tamil Nadu.
Wintermar Offshore Marine (WINS:JK) has announced results for 1Q2022. Total revenue was up 3% YOY to US$10.5 million, with stronger chartering revenues compensating for a drop in Owned Vessel revenue from COVID-19 delays.
Oil prices spiked in 1Q2022 as a result of the war in Ukraine and sanctions against Russian oil and gas. The ensuing oil shortage sparked a rise in investment in oil exploration and a resurgence in drilling programs in Asia.
The Company was impacted quite severely by a spike in Omicron infections on the fleet, which led to prolonged delays in the commencement of operations in international as well as domestic charters in 1Q2022. Owned Vessel revenues declined but this was compensated by a jump in revenues from the Chartering and Other Services Divisions.
Owned Vessel Division
Several vessels were infected with COVID-19 in 1Q2022 and had to be quarantined. Emergency crew changes were arranged, but revenues were penalized due to the resulting delays while higher costs were incurred as vessels had been fully crewed in anticipation of on-hire. Crew salary was flat YOY at US$2.1million, operations and maintenance costs rising by 40%YOY and 23%YOY respectively in preparation for new contracts. Fuel was significantly higher at US$0.67 million due to the one-off cost of international mobilization and demobilization of vessels due to different locations for on- and off-hire. This led to a 21% YOY decline in Owned Vessel revenue to US$6.6 million, while direct costs rose by 10% YOY.
During the quarter, the Company purchased an additional 4 vessels, comprising one PSV, 2 units of 5,000 BHP AHTS and 1 unit of 6,000 BHP AHTS. Two of these vessels are being modified for reactivation while the other two are finishing off existing contracts and providing some charter income. As 4 of the 6 vessels acquired since 4Q2021 were undergoing docking and reactivation in 1Q2022, there are no revenues arising whereas costs have started to incur. All these reasons led to a gross loss of US$0.58 million from the Owned Vessel Division.
Chartering and Other Services
Gross Profit from Chartering jumped by 260% YOY to US$0.37 million with the addition of three new contracts in Brunei, while Other Services Division saw a 49% increase in gross profit to US$0.38 million.
Total Gross Profit for 1Q2022 was US$0.18 million compared to US$2.1 million in 1Q2021.
Indirect Expenses and Operating Profit
The biggest contribution to a rise in Indirect Expenses was a rise in staff salaries which increased by 47% due to the annual discretionary bonuses paid out in March, and an increase in staffing. The Company also readjusted salaries in 2021 to reverse most of the salary reductions volunteered by employees when the COVID-19 started in 2020. With the increase in indirect expenses, the Company recorded an Operating Loss of US$1.18 million.
Other Income, Expenses and Net Attributable profit
Interest expenses fell by 51% YOY to US$0.36 million in line with much lower gearing while the stronger Rupiah also resulted in an FX loss of US$0.03 million. Loss in earnings of associate amounted to US$0.07 million after recording a small profit in 1Q2021 while there was a tax penalty of US$0.15 million in a subsidiary.
Net loss attributable to shareholders for 1Q2022 was US$1.8 million compared to a loss of US$0.34 million in 1Q2021. EBITDA for the quarter was US$1.7 million from US$4.3 million in 1Q2021.
Outlook for Oil and Gas exploration
After the sharp spike, releases of strategic oil reserves by the US and downward revisions to 2022 oil demand arising from COVID-19 lockdowns in China have taken some pressure off oil prices. With Brent crude oil prices settling around the US$100/barrel mark, and sanctions against Russian oil, there is still a huge incentive for oil exploration. In Asia, there is stronger demand for oil services as new drilling projects have been announced. In Indonesia, Pertamina has announced a plan to drill 29 exploration wells and 813 development wells in 2022 while private oil companies are also planning drilling campaigns.
In 2021, global offshore investment in EPC (Exploration, procurement and construction) grew by 200% YOY to US$42 billion and with the Ukraine invasion, 2022 is expected to see further growth. Below is a chart from Westwood Global Energy projecting sustained higher levels of global offshore investment.
Strategy and Outlook
The Company embarked on a capital expenditure plan in 4Q2021 and to date has acquired a total of 6 vessels ranging from 5000BHP AHTS to Platform Supply Vessels. After docking and reactivation, these vessels will be ready for operations in mid 2Q2022, in time for an anticipated pick up in demand as drilling campaigns start by mid 2022.
In Asia, there are projects starting in Thailand, Malaysia, Brunei and India which require higher value support vessels. Charter rates are still constrained in Indonesia due to low budgets set last year, but some projects which were delayed are now expected to commence operations in the coming months. We are optimistic that the long awaited recovery in drilling is underway.
Contracts on hand as at the end March 2022 totalled US$64 million.
About Wintermar Offshore Marine Group
Wintermar Offshore Marine Group (WINS.JK), developed over nearly 50 years with a track record of quality that is both a source of pride and responsibility that we are dedicated to upholding, and sails a fleet of more than 48 Offshore Support Vessels ready for long term as well as spot charters. All vessels are operated by experienced Indonesian crew, tracked by satellite systems and monitored in real-time by shore-based Vessel Teams.
Wintermar is the first shipping company in Indonesia to be certified with an Integrated Management System by Lloyd’s Register Quality Assurance, and is currently certified with ISO 9001:2015 (Quality), ISO14001:2015 (Environment) and OHSAS 18001:2007 (Occupational Health and Safety). For more information, please visit www.wintermar.com.
Ms. Pek Swan Layanto, CFA Investor Relations PT Wintermar Offshore Marine Tbk T: (62-21) 530 5201 Ext 401 E: investor_relations@wintermar.com
DISCLAIMER Certain statements made in this publication involve a number of risks and uncertainties that could cause actual results to differ materially from those projected. Certain statements relating to business and operations of PT Wintermar Offshore Marine Tbk and Subsidiaries (the Company) are based on management’s expectations, estimates and projections. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such statements. The information contained in this release is not intended to qualify, supplement or amend information disclosed under corporate and securities legislation of any jurisdiction applicable to the Company and should not be relied upon for the purpose of making investment decisions concerning any securities of the Company.
Wintermar Offshore Marine (WINS:JK) has announced turnaround results for 9M2021 with a net profit of US$0.49 million following a loss of US$7.44 mil in 9M2020.
Stronger oil prices and measures to streamline the fleet and reduce gearing helped in turning the Company around after several years of heavy losses. In line with the positive outlook for oil prices, utilization also improved to 66% in 9M2021 compared to 63% in 9M2020.
Owned Vessel Division
Owned Vessel Revenue for 9M2021 was reduced by US$0.2 million to US$24.4 million compared to 9M2020. During July and August, the delta variant of COVID-19 hit Indonesia hard and affected our operations in Asia. A few of our vessels were infected while crew change was delayed due to quarantine and travel restrictions, leading to unplanned downtime. This and the completion of some high end vessel contracts led to a lower margin for 3Q2021. However, since September the pandemic has waned significantly in Indonesia and business operations have recovered back to normal.
Despite the disruption from COVID-19, due to a much lower cost base and a smaller fleet, the Company made a US$4.1 mil gross profit this year for 9M2021 compared to a loss of US$2 million in 9M2020 on nearly the same revenue. Fuel costs rose to 37% as some high tier vessels were idle between contracts.
Chartering and Other Services
Contribution from the Chartering Division in 9M2021 jumped by 64% YoY from US$0.4 million to US$0.66 mil while contribution from other services also jumped 85% YOY to US$0.62 million in 9M2021 from US$0.34 million in 9M2020. These reflect the underlying improvements in offshore vessel demand.
Indirect Expenses and Operating Profit
Indirect expenses totaled US$3.92 million in 9M2021, falling 13% YOY from US$4.5 million, reflecting a much leaner organizational structure with lower overheads as compared to 2020. This has resulted from the fleet efficiency exercise over the past couple of years to sell less efficient vessels and reduce overheads. 9M2021 operating profit amounted to US$0.15 million.
Other Income, Expenses and Net Attributable profit
Since January 2021, the Company has sold 3 vessels and has already entered into a MOA to sell another three, registering in a US$2.4 million gain on sale of vessels. The total fleet now stands at 40 vessels. A total of US$9.5 million in vessel loans was repaid, bringing the Company’s net gearing down to 21.7% by end September 2021. Interest expenses for 9M2021 fell by 33% YOY to U$1.66 million in line with lower debt. Associated Companies generated income of US$0.24 million due to better operational results, bringing the other income to US$0.79 million for 9M2021 compared to a loss in 9M2020.
The stronger operational environment has boosted the bottom line, with net income attributable to shareholders of US$0.49 million for 9M2021, as compared to a US$7.44 million loss.
EBITDA for 9M2021 also rose by 13% YOY to US$10.2 million.
Oil & Gas Industry
As expected, the opening up of travel restrictions across the world has led to a spike in oil prices as supply has not been able to keep pace with growing demand for oil and gas. Global oil demand is expected to recover to pre-virus levels in 2H2022 and the 3rd quarter saw Brent crude oil prices breaking above US$85/barrel, levels not seen since 2014. This reflects the optimism in the oil and gas industry which has finally shown a cyclical recovery. In Indonesia, there are tenders for drilling projects due to start in early 2022.
Offshore Vessels
In line with the oil price spike, there has been an increase in purchases of second hand offshore vessels, and prices have turned around as vessels which had been on offer for a while were bought up. The international rig count has also picked up as more investments have commenced. This is in line with our optimistic outlook for the industry in 2022.
Strategy and Outlook
Over the past few months, the Company has stepped up the sale of older and less productive vessels to take advantage of the improvement in second hand OSV prices. The fleet now stands at 40 vessels, and more are planned to be sold in 4Q2021. This strategy to reduce bank debt as well as keep some cash on hand has created a stronger balance sheet. As banks are still reluctant to lend for vessel acquisition, the Company now has the flexibility to acquire assets as and when the opportunity arises without having to wait for bank loan approval.
Contracts on hand as at end September 2021 totalled US$64 million.
About Wintermar Offshore Marine Group
Wintermar Offshore Marine Group (WINS.JK), developed over nearly 50 years with a track record of quality that is both a source of pride and responsibility that we are dedicated to upholding, and sails a fleet of more than 48 Offshore Support Vessels ready for long term as well as spot charters. All vessels are operated by experienced Indonesian crew, tracked by satellite systems and monitored in real-time by shore-based Vessel Teams.
Wintermar is the first shipping company in Indonesia to be certified with an Integrated Management System by Lloyd’s Register Quality Assurance, and is currently certified with ISO 9001:2015 (Quality), ISO14001:2015 (Environment) and OHSAS 18001:2007 (Occupational Health and Safety). For more information, please visit www.wintermar.com.
Ms. Pek Swan Layanto, CFA Investor Relations PT Wintermar Offshore Marine Tbk Tel +62-21 530 5201 Ext 401 Email: investor_relations@wintermar.com
As part of commemorative activities of Azadi ka Amrit Mahotsav, Indian Navy is conducting an Offshore Sailing Regatta from Kochi to Goa under aegis of Indian Naval Sailing Association (INSA). Six Indian Naval Sailing Vessels (INSVs) viz Mhadei, Tarini, Bulbul, Neelkanth, Kadalpura and Hariyal will be participating in this event. The race is scheduled to start on 24 Oct 21 for a tentative duration of five days and would cover an approximate distance of 360 nm between the start point at Naval Base, Kochi to Goa. The expedition is aimed at fostering the spirit of adventure and ocean sailing for the participating crew.
Each of the six INSVs – four 40 footers and two 56 footers, would be manned by six naval personnel drawn from three Commands of Navy, the ANC and IHQ MoD (Navy). In addition, Ocean Yachts from Yachting Association of India (YAI) affiliated civilian clubs would also be participating in the event. The expedition is being organised by HQSNC and Indian Navy’s Ocean Sailing Node (OSN), located at INS Mandovi, Goa. The participants have been practicing for this event over the last one month and have also undergone a Capsule Course at Kochi to hone their skills. Indian Navy participants include Capt Vipul Meherishi, Capt Atool Sinha, Lt Cdr K Pednekar, Lt Cdr Payal Gupta etc, who have won medals in various events at the National level and are representing different Commands.
Two 56 footers participating in this Regatta have already made history in the Indian Navy by participating in circumnavigation. Mhadei has done solo circumnavigation ‘Sagar Parikrama’ with Capt Dilip Donde in 2010 and Cdr Abhilash Tomy in 2013. She has also participated in the Cape Town to Rio de Janeiro races in 2011, 2014 & 2017. Tarini has done circumnavigation of the globe ‘Navika Sagar Parikrama’ in 2017 with all women officers crew.
The OSN holds the Ocean Sailing yachts of Indian Navy. The crew are selected from volunteers with adequate sea sailing experience. Ocean sailing is an extremely tough adventure sport and through this, Indian Navy inculcates the spirit of adventure, enhancing risk taking abilities whilst honing essential seamanship skills including navigation, communication, technical operations of engines and onboard machinery, operation of Inmarsat equipment, logistics planning etc. It also enhances Indian Navy’s ability to project its benign presence across the globe by participating in sailing expeditions like Sagar Parikrama and Cape Town to Rio de Janeiro races, IONS sailing expedition etc.
The Azadi ka Amrit Mahotsav Offshore Race will be flagged off from Kochi by FOC-in-C (South) on 24 Oct 21. The Flagging in ceremony of the race will be presided over by Commandant, Naval War College (NWC) at Goa on 29 Oct 21.
Aker Offshore Wind and global wind and solar company, Mainstream Renewable Power (Mainstream) have together been selected as the preferred bidder to acquire an initial 50 percent stake in Progression Energys 800MW floating offshore wind project in Japan. The project is a well-formed early-stage development asset.
The two companies will now enter into exclusive negotiations with Progression Energy with a view to establishing a special purpose vehicle (SPV) in the coming weeks, to continue collectively developing the project. As a consortium, the three companies bring together unique capabilities and experience through Aker Offshore Winds offshore and floating expertise, Mainstreams global leadership position in offshore wind development and Progression Energys global floating offshore wind development experience and strong position in Japan.
In 2015, Progression recognized that floating offshore wind would become a major segment of the offshore wind industry. Since that time, Progression has originated floating projects in four markets globally, said Chris Swartley, CEO of Progression Energy. Japan has set a goal of zero emissions by 2050 with a strong focus on offshore wind. We are excited to bring Aker Offshore Wind and Mainstream Renewable Power on board and believe the two companies, working in partnership, bring a unique set of strengths that will be vital in helping us advance our project to FID.
Having already developed 20 percent of the UKs offshore wind capacity currently in construction or operation, including the largest operational offshore wind farm in the world today, we are thrilled to be partnering with Aker Offshore Wind and Progression Energy to expand our growing offshore wind footprint in the APAC region, where we believe we can add incremental value through the decarbonisation of power that will have a positive impact on both the local economy and renewables development more broadly, said Cameron Smith, Mainstreams General Manager for APAC and Offshore.
With our 180 years of industrial history and five decades in the offshore industry through the Aker group of companies, we have the capabilities and the competence to scale and industrialize floating wind in a sustainable way. By partnering with Mainstream Renewable Power and Progression Energy, we have a value proposition that is larger than the sum of its parts, which will position us well in our aim to develop offshore wind in Japan, said Tom Selwood, CFO of Aker Offshore Wind.
Japan aims to expand offshore wind energy capacity to 10GW by 2030 and 30-45 GW by 2040, according to the Ministry of Economy, Trade and Industry (METI). Project areas for offshore floating wind will be put to auction for interested companies to submit their proposals.
About Aker Offshore Wind
Aker Offshore Wind Aker Offshore Wind is an offshore wind developer focused on assets in deep waters and specialized on floating energy systems. With global operations, the current portfolio consists of development projects and prospects located in Asia, North America and Europe. Aker Offshore Wind effectively deploys cost effective technologies from decades of offshore energy development. The company is majority-owned by Aker Horizons, an investment company dedicated to creating value and reducing emissions from renewable energy and decarbonization technologies. Aker Offshore Wind [AOW-ME] is listed on Euronext Growth in Oslo, Norway.
www.akeroffshorewind.com
About Mainstream Renewable Power
Mainstream Renewable Power is a leading pure-play renewable energy company with a global footprint. The company is focused on expanding its high-quality pipeline of more than 13 Gigawatts (GW) of wind and solar assets across Latin America, Africa, Asia Pacific as well as the global offshore wind sector. In May 2021, it closed an agreement for Aker Horizons to take a 75% equity stake in the company, enabling Mainstream to accelerate its global expansion plan to bring 5.5 GW of assets to financial close by 2023.
Mainstream has delivered more than 6.5 GW of wind and solar assets to financial close, and currently has over 1.4 GW (net) in construction across Latin America and Africa. In Chile, Mainstreams wholly-owned 1.35 GW of fully contracted wind and solar assets are on track to reach commercial operation from 2021. In Africa, the company has delivered 842 MW of wind and solar assets into commercial operation in South Africa, and further, through its Lekela Power joint venture has 410 MW of wind assets in construction in Senegal and Egypt.
Mainstream is one of the most successful pure-play developers of offshore wind at scale globally. It has successfully consented Hornsea One (1.2 GW), the largest operational offshore wind plant in the world today; and developed the Hornsea 2 project (1.4 GW) before selling these projects and the entire Zone in 2015. Overall, it has developed and later divested projects representing 20% of the UKs offshore wind capacity either in operation or under construction.
Mainstream fully consented the Neart na Gaoithe offshore wind project in Scotland, 450 MW, currently under construction. Mainstreams Soc Trang 1.4 GW offshore wind development in Vietnam is one of South East Asias largest renewable energy developments.
Mainstream has raised more than EUR3.0bn in project finance to date and employs more than 340 staff across five continents.
www.mainstreamrp.com
About Progression Energy
Progression Energy is a floating offshore wind developer with approximately 4GWs of project assets across four markets. Progressions development approach is predicated on its early entry into markets that demonstrate a strong geo-economic need for large-scale floating wind projects, and a relationship-based development approach that initiates relationships with communities and stakeholders well before project development begins, and cultivates these relationships throughout project development, construction and operations.
www.progression-energy.com
This information is considered to be inside information pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements in Regulation EU 596/2014 and the Norwegian Securities Trading Act § 5-12. This stock exchange announcement was published by Ivar Simensen, Communications
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