Norwegian multinational energy company Equinor and Poland's largest private energy group Polenergia have reached financial close for the Baltyk 2 and Baltyk 3 offshore wind farms in the Polish sector of the Baltic Sea.

Project financing packages amounting to €3 billion ( US$3.42 billion ) for Baltyk 2 and €3 billion for Baltyk 3, including ancillary facilities, have been secured.

Santander CIB acted as financial adviser to the project companies. The mandated lead arrangers/senior lenders were Bank of China ( Luxembourg Branch ), Bayerische Landesbank, BBVA, Bank Gospodarstwa Krajowego, BNP Paribas, CaixaBank Spolka Akcyjna Oddział w Polsce, Canadian Imperial Bank of Commerce, Credit Industriel et Commercial, Crédit Agricole CIB, Danske Bank, Deutsche Bank, DZ Bank, Helaba, HSBC Continental Europe, ING Bank Slaski, KBC Bank, KfW IPEX-Bank, LBBW, Nordic Investment Bank, NORD/LB, Bank Pekao, PKO, Santander CIB, SEB, Swedish Export Credit Corporation ( SEK ), SMBC, Société Générale, Standard Chartered Bank, and European Investment Bank.

Baltyk 2 is located 37 kilometres off the Polish coast, while Baltyk 3 is 22 kilometers offshore. The two wind farms are scheduled to go into operation in 2028 and together will produce electricity for around 2 million households. They will each be equipped with 50 Siemens turbines. Their total capacity is 1,440 megawatts.

The projects are a 50:50 joint venture. Equinor is responsible for the construction phase and will operate the two offshore wind farms. Onshore construction work is ongoing, fabrication of key components has started, and marine operations will start next year.

The individual project finance packages will fund the capital investment and the other expenses of each of the projects during the construction process totalling €7.2 billion.

Energy transition

A&O Shearman acted as legal adviser to Baltyk 2 and 3, while Chatham Financial was the financial risk management adviser. For the senior lenders, Clifford Chance acted as legal adviser, CMS Cameron McKenna Nabarro Olswang Posniak i Bejm as regulatory adviser, Willis Towers Watson as insurance adviser, DNV as technical adviser, PricewaterhouseCoopers GmbH Wirtschaftsprüfungsgesellschaft as model auditor, PwC Polska as tax adviser, Environmental Resources Management as environmental and social adviser, and Aurora Energy Research as market adviser.

The offshore wind projects were awarded 25-year contracts for difference ( CfD ) in 2021, with inflation indexation. The wind farms are project-financed with gearing of approximately 80%. Equinor says the projects support its expected double-digit nominal equity rate of return for renewables and low-carbon investments.

After Baltic Power and Baltica 2, these are Poland's third and fourth offshore wind projects. The wind farms are of central importance to the Polish government's goals of reducing greenhouse gas emissions and gradually decommissioning coal-fired power plants, thus making an important contribution to the energy transition in Europe.