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Seraya targets supply demand gap opportunities

Seraya sees offshore wind vessel unit Cyan Renewables as a solution to Asia’s need for vessels

November 23, 2023 at 4:00:00 AM

In the two years since it was founded, Singapore-based fund manager and infrastructure investor Seraya Partners has invested in several markets in which it has identified fast growth and the need to help address a gap between supply and demand. 

With a senior team that has close to two decades of experience, Seraya is targeting middle-market platform investments in next-generation infrastructure, with an initial focus on digital infrastructure and the energy transition, primarily in developed Asian markets.

In Astrid Renew, it invested in charging infrastructure for electric vehicles, and in Empyrion DC, in Asia’s first green data centre operator, which uses renewable energy and hydrogen solutions to power its data centres.

In late 2022, Seraya unveiled the third major market it is targeting, when it launched a US$1Bn investment in the market for offshore wind vessels where, as Seraya Partners managing partner and chief investment officer James Chern explains to OWJ, it also aims to address the needs of a fast-growing market in which certain assets are in short supply.

“We aren’t setting ourselves up in competition with developers and EPC companies,” Mr Chern tells OWJ. “With Cyan Renewables, our purpose is to make investments to own, operate and lease offshore wind vessels of all types, and help fill the gap between supply and demand. 

“There is a growing gap between supply and demand in Europe and other markets, but our primary focus is Asia. If you look at the market for large wind turbine installation vessels, for instance, there are about 20 installation vessels worldwide, but very few of them are based in Asia. Most are in Europe. The same is true when it comes to cable-lay vessels and service operation vessels (SOVs).

“We have been studying the offshore wind market for some time. There is a big pool of capital available to develop offshore windfarms, but for vessel owners and EPC contractors, an installation vessel is a very big-ticket item. Our role is to use capital to build the vessels the industry needs, operate them and lease them to leading players as and when required.” 

Mr Chern says Seraya’s approach is similar to that successfully employed in the aviation sector in recent years, where leasing aircraft instead of purchasing them provides airlines with several advantages, not least increased capacity, flexibility and rapid expansion opportunities. It enables an airline to operate aircraft without taking on the financial burden of buying them and helps to quickly ramp up capacity. 

Cyan Renewables has already signed a letter of intent with COSCO Shipyard for a foundation installation vessel and, working with leading vessel operators, is refining the design of a wind turbine installation vessel. Mr Chern says Cyan Renewables may place an order for a turbine installation vessel early in 2024.

In July, Seraya’s offshore vessel platform also confirmed it had acquired its first SOV, an innovative vessel Groenewind that was built for DEME in Belgium. The ship is on a long-term contract with wind turbine OEM Siemens Gamesa Renewable Energy.

“This vessel is only two years old and operating under a 17-year long-term contract,” Mr Chern explains. “The long-term nature of contracts for vessels of this type – often with inflation and cost pass-through structures – make them ideal core assets of the type that our investors seek.” 

As Mr Chern notes, the acquisition will provide Cyan Renewables with experience of working with industry leaders like Siemens Gamesa and the turbine OEM’s end client, Ørsted. 

“SOVs are another key part of the supply chain in which there is a growing gap between demand and supply,” Mr Chern says. “Acquiring the vessel will enable us to increase our footprint in Europe and gain more operational experience.”

The company also recently agreed a memorandum of understanding with Taiya Renewable Energy, the Taiwanese offshore wind development company, under which Cyan Renewables and Taiya will collaborate to build vessel capacity, including cable-lay vessels and wind turbine installation vessels, and work together on deployment in Taiwan and other markets. 

“In some countries we will go it alone, in others, such as where there is a cabotage market, it makes sense to team up with experienced industry partners to enter a new market,” Mr Chern tells OWJ, noting the Taiya deal is doubly interesting for Cyan Renewables, because the developer recently joined forces with EDF’s renewables business to bid in the country’s latest round of auctions for offshore windfarms. “Exposure to working with EDF is another potential advantage for us,” says Mr Chern. 

Seraya’s strategy isn’t only about vessels, however. It’s also about appointing the right people. In April 2023, it announced it had hired industry veteran Torgeir Ramstad as managing director, foundation installation vessels. Mr Ramstad has many years of experience in the offshore oil and gas and offshore energy sectors, including leadership roles in the offshore wind industry at companies owning, building and operating wind turbine installation vessels and foundation installation vessels. He was executive vice president vessels and offshore resources at Seaway 7 and prior to that, was chief executive at heavy-lift company OHT and managing director at Fred Olsen United.

The company had already appointed Lee Keng Lin as chief executive, bringing more than 20 years of experience managing international businesses and a track record in offshore services, port logistics and maritime ventures, and recently hired Stuart Thornton as director commercial and country manager UK. He also has a wealth of experience covering a wide range of vessel types, operations and manpower provision. Lars Christian Zøhner, who spent 10 years with World Marine Offshore, became chief executive Europe in September 2022. “We plan to double the size of our team in the next 6-12 months,” Mr Chern concludes. “It’s hard finding people with a track record like Torgeir, but we expect to make announcements about further appointments in the near future.” 

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