Netherlands-based oilfield services player SBM Offshore has pinned its hopes of becoming “competitive and relevant” in the fast-growing floating wind market on the successful deployment of its technology in a pilot off southern France.

Located 15km off Marseille in 100 metres of water, EDF’s Provence Grand Large scheme is expected to cost about €200m ($236m) to develop, with the European Infrastructure Bank set to part-fund the project, one of four pilots that France hopes will kick-start large-scale development off its coasts.

Set for deployment in 2022, Provence Grand Large will feature a trio of 830-tonne, 8.4MW Siemens Gamesa turbines installed atop 1,500-tonne tension leg platform (TLP) sub-structures supplied by SBM, with Prysmian handling the power export cable package.

'Significant position in floating wind'

The TLPs will be built at a yard in Port Tellines, some 50km west of Marseille.

Bruno Chabas, chief executive of SBM — a top provider of floating production, storage and offloading vessels to the oil and gas sector — told analysts in a call: “The project will help us validate the technology we have to make progress and allow us to take a significant position in the floating wind market.”

Assuming this technology is proven, he said “it’s pretty easy to bid for a wind farm of 50 to 100 floaters. That’s the idea. This is what’s going to make us competitive and relevant for years to come.”

This is going to make us competitive and relevant.

Speaking after SBM released its third-quarter trading update, Chabas explained how the floating wind market underwent a rapid transformation over the last year from being “extremely quiet” up to the start of 2020, but since then undergoing “an acceleration where there are plenty of (market) opportunities.”

Nevertheless, he described floating wind as a market that “barely exists”, with just 18 floaters in the water, but highlighted how new operators with offshore oil and gas experience are developing an understanding of this market and what it takes to be successful.

Aiming for partnerships

“Today, the installed floating wind capacity is just 120MW, but the expectation by 2030 is that this will increase rapidly to about 6GW.

“Our ambition is to take a significant portion of this market. We’re looking at working in partnership with a number of developers and taking positions in a number of fields.”

The company’s ambition is for 25% of its revenues — which stood at about $1.8bn in the three months to 30 September this year — to be generated from the renewables and gas market by 2030.

Cost is a key issue for floating wind, but SBM believes it can apply lessons learned from its design-one, build-many Fast4ward FPSO strategy which has industrialised the process of constructing these vessels with each iteration driving down costs further.

“We need to reduce costs by somewhere in the range of 20% for every doubling of (power output) capacity,” said Chabas about the floating wind sector.

The most important route to achieving this goal, he explained, “is to tackle the industrialisation of the concept to make it simple, standardised and modularised.”

Reducing engineering and project management cost will also help, but while on oil and gas turkey projects these can account for 10% to 15% of total costs, Chabas said it will be “much lower” for floating wind.

Last month, Paris-based IFP Energies, which has been partnering SBM on the design of the Provence Grand Large project since 2016, said reducing costs is a major challenge, citing data from industry which said operators are aiming at a cost of €80 to €100 per megawatt hour for the first commercial floating wind farms in 2023-2025.

Another driver that will underpin the viability of floating wind farms will be the level of fatigue the turbines and sub-structures can handle and how this affects performance.

IFP has been running computer models on the effects of wave height, direction and period combined with wind speed, turbulence and direction on floating turbines.

A base case model is now being developed to identify what combination of environmental parameters will likely create the most fatigue.

“Optimising the design of floating structures in the face of complex environmental conditions is therefore central to achieving the competitiveness objectives of the industry,” said IFP.

Ebitda guidance upped

Meanwhile, SBM has increased its 2020 directional guidance for earnings before interest, fat, depreciation and amortisation from above $900m to around $950m, while maintaining its revenue guidance at about $2.3bn.

Separately, SBM has awarded UK-based LOC Group marine warranty survey contracts covering its two unnamed FPSOs — one destined for Guyana and the other for Brazil.

LOC said its work will cover transport and installation operations for one of the vessels and topsides for the other unit.

The FPSOs are believed to be Liza Prosperity which will be deployed off Guyana by ExxonMobil and the Sepetiba, which Petrobas will install off Brazil.

This article first appeared in Recharge's sister publication Upstream

Wind

'This will make us competitive and relevant': Oil player SBM pins hopes on floating wind pilot