Outer Dowsing · UK public procurement notice

NO NEW CONTRACT IS BEING AWARDED.

For the avoidance of doubt, this notice is being published on a voluntary basis as no new contract is being awarded. This notice relates to the modification of a concession contract for the award of seabed rights for the development, construction and operation of an offshore wind farm which was entered into by The Crown Estate and GT R4 Limited on 17 January 2023, following the completion of The Crown Estate’s Offshore Wind Leasing Round 4 process.

The modifications to the contract which are the subject of this notice are that for a period up to the expiration of the option in the Agreement for Lease,

(i) developers will pay pro rata monthly, rather than annual, option fee payments with a balancing payment due on completion of the Lease pursuant to the Agreement for Lease. That balancing payment will be equal to the annual Option Fee which would have been payable in respect of the relevant year less the monthly payments actually made in that year; and

(ii) the Agreement for Lease may be terminated without payment of the break payment, and with no Option Fee balancing payment.

The Crown Estate considers that these changes are required due to circumstances which it was not possible to foresee at the time of the original award. The contract therefore needs to be modified due to circumstances which The Crown Estate could not have foreseen and is being modified in accordance with the requirements of regulation 43(1)(c) of the Concession Contracts Regulations 2016.

The modifications were made necessary by the following unforeseeable circumstances:

(a) Grid connection reforms that required late location changes to grid connection and cable routing requiring significant new work and upfront cost.

(b) Elevated development expenditure beyond normal market expectation, arising from factors including grid delays, late changes to cable routes, and site investigation cost increases.

(c) The significant increase in main equipment package procurement lead times, resulting from factors including supply chain pressures, deterioration of supplier risk appetite, and contraction of Wind Turbine Generator (WTG) Original Equipment Manufacturer (OEM) market.

The first limb of the unforeseeable circumstances test is therefore met.

The second limb of the unforeseeable circumstances test is satisfied as there is no alteration to the overall nature of the contract, which will remain a public services concession. The object and purpose of the contract will remain the same under the modifications.

The third limb of the unforeseeable circumstances test is also satisfied as the modifications will not exceed 50% of the value of the original concession contract