UAE-based oil rig builder Lamprell has announced that it expects to make a "significant loss" on work for the East Anglia One wind farm project in the British North Sea.
ScottishPower Renewables is investing £2.5 billion in the wind farm which consists of up to 102 turbines and foundations for an overall generating capacity of up to 714 megawatts. About six onshore underground cables, each of 37km in length, will be used to transfer the electricity from landfall to an onshore converter station.
"There were startup costs and inefficiencies in relation to the project and the learning curve has proven to be steeper than anticipated," the company said in a statement.
The company, whose main facilities are at Hamriyyah, Sharjah and Jebel Ali, won a $225 million contract last year from Scottish Power Renewables for the fabrication and supply of 60 jacket foundations and accompanying piles for the project, with delivery due to take place between March and October next year.
"We remain confident of meeting our client's expectations in terms of schedule and quality but we will incur extra costs to achieve this. As a result, we now expect the project to make a significant loss, which will be booked in 2017," the company added.
Despite the problems, Lamprell, which employs more than 5,000 people, said it remained committed to the renewables market in which it sees "significant potential" for growth.
"We are working with our client and supply chain to mitigate the additional costs... While we expect revenue for full year 2017 to be in line with current guidance, we now expect earnings and EBITDA to be materially below current market expectations," the company added.For all the latest energy and oil news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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