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Home » Multimillion-Pound Subsea Cable Factory Takes Step Forward With Heads Of Terms Agreed

Multimillion-Pound Subsea Cable Factory Takes Step Forward With Heads Of Terms Agreed

Plans to bring a £923m cable factory to the banks of the Tyne have moved forward with the firm behind them signing heads of terms with the Port of Tyne.

Global Interconnection Group is part of the joint venture with Korea’s LS Group that has ambitions to develop a high voltage direct cable plant south of the river at the Tyne Renewables Quay site. The Amsterdam Stock Exchange-listed firm told investors that its LS Eco Advanced Cables company has agreed and signed the terms with the port operator, giving it an option on a lease at the site.

Once operational, the factory will be run by the joint venture partner which is described as a “world class cable manufacturer”. Design specifications for the facility have already been drawn up and Global Interconnection Group is said to have built strong local and national Government support for the project.

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The partners say they are aiming to secure planning permission for the project later this year, with production earmarked to start in 2027. But they have warned shareholders there are still “considerable risks to overcome” in getting the development off the ground.

The international alliance has previously said the plant aims to feed a growing market for high voltage direct current (HVDC) cables that can be used to transmit power from wind and solar farms. They say there is a severe lack of manufacturing capacity amid the green energy transition, with HVDC cables said to reduce electricity transmission losses by at least 15% compared with AC power equivalents.

Global InterConnection Group is also the holding company of Atlantic SuperConnection (ASC) – the business which is developing a 1,794MW, 1,708km interconnector between Iceland and the UK, which will take geothermal and hydroelectric power from the volcanic island to the UK. The plan is to establish a national grid connection on the east coast of England, near Hull, with North Sea offshore wind power being sent back to Icelandic hydro dams, with pumped storage ‘refuelling’ the dams to create a 1,500 MW ‘clean battery’.

ASC plans to invest £30m into arriving at a final investment decision and thereafter hopes to raise £1.2bn of equity funding towards construction, supported by a £3.5bn “high interested” letter of support from an unnamed investment bank. The business has already listed a series of green bonds due to mature in 2056.

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