South Korea has finalized its financial structure for the 390 MW Shinan Ui offshore wind project, with construction funding set to commence in the second quarter of 2026.
The Financial Services Commission (FSC) announced on April 9 that a project financing agreement is now in place, establishing the lender group and initiating significant capital deployment. This project is one of the first major initiatives supported by the government’s National Growth Fund program, according to the FSC.
The total investment is KRW 3.4 trillion (about EUR 2.3 billion), with KRW 510 billion (approximately EUR 345 million) in equity and KRW 2.89 trillion (around EUR 1.95 billion) in debt.
For the debt component, KRW 2.5 trillion (approximately EUR 1.69 billion) will be issued as senior loans by a consortium of 18 domestic financial entities, including policy banks and major financial groups. KRW 700 billion (about EUR 473 million) will originate from the Advanced Strategic Industries Fund. Additionally, KRW 390 billion (around EUR 264 million) will be structured as subordinated loans, with KRW 340 billion (approximately EUR 230 million) coming from the Future Energy Fund and KRW 50 billion (around EUR 34 million) from the Advanced Strategic Industries Fund. Korea Development Bank and KB Kookmin Bank organized the financing.
Following the financial agreement, subordinated loans, including policy-backed funds, are expected to be disbursed starting in the second quarter of 2026. Loan drawdowns will occur in stages, aligned with construction progress through early 2029.
The Shinan Ui offshore wind project entails the establishment and operation of a 390 MW wind farm off the southern coast of Ui Island in Shinan County, Jeollanam-do. The FSC notes it is the first extensive offshore wind project in the country financed entirely with domestic funds.
Most components, except wind turbines, will be sourced domestically, such as substructures, subsea cables, offshore substations, and installation vessels, supporting South Korea’s offshore wind supply chain.
According to the FSC’s April 9 press release, construction is already in progress, with completion and full operation expected by 2029.
Once operational, the wind farm is set to provide clean electricity to several strategic industry clusters in Jeollanam-do, including an AI data center in Haenam, a vaccine industry cluster in Hwasun, a secondary battery cluster in Gwangyang, a clean hydrogen hub in Yeosu, and a space launch vehicle industrial complex in Goheung.
The FSC stated it will collaborate with relevant ministries and financial institutions to monitor the project, ensure stable funding, and manage risks during construction.
Original Story at www.offshorewind.biz