S.F. Energy to Delist on 6/23; Ministry of Economic Affairs: Taipower's Offshore Wind Phase 2 Unaffected

CNA, Taipei, 14th (Reporter Lai Yu-chen) — Fuwei Energy, a subsidiary of Foxlink's S.F. Energy, incurred severe losses from contracting Taipower's "Offshore Wind Power Project Phase 2 - Wind Farm Asset Procurement with Installation," leading to delisting pressure. The Ministry of Economic Affairs stated today that the current project progress has exceeded 96%, with only about 1/3 of the sea cables and wind turbines yet to be installed. Taipower is also using a "supervised payment" mechanism to ensure other construction teams receive payments on time and achieve the project goals, which will not affect Taipower's Offshore Wind Phase 2.

Fuwei Energy, a subsidiary of S.F. Energy, suffered losses due to inflation, interest rate hikes, and other factors during the procurement and bidding period of Taipower's project, caused by events like the Russo-Ukrainian War. Although Fuwei Energy applied for an additional budget from Taipower, and Taipower recently agreed to pay NT$5,556,933,697, it could not change the fate of the losses. The Taiwan Stock Exchange also announced yesterday that S.F. Energy will be delisted starting June 23.

Amid public concern over whether S.F. Energy's delisting will affect the completion of the Offshore Wind Power Project Phase 2, Deputy Minister of Economic Affairs Lai Chien-hsin stated at a post-Executive Yuan press conference today that after Taipower signed the contract with Fuwei Energy, they have managed risks well with professional teams throughout the contract execution process. They grasped S.F. Energy's financial situation at the earliest opportunity and provided legal advice through legal teams to protect the owner's rights.

Lai said that the project progress of the contract between Fuwei Energy and Taipower has so far exceeded 96%, with only about 1/3 of the sea cables and wind turbines yet to be installed. Taipower, while ensuring the project goals are met, has already utilized the "supervised payment" mechanism within the contract management rules to ensure that other construction teams can receive the necessary funds for construction on time to complete the remaining 3% or so of the progress and achieve the project goals.

Lai emphasized that Taipower's Offshore Wind Phase 2 project is currently not affected by this matter and construction is ongoing. Moreover, other offshore wind projects in Taiwan are proceeding very smoothly this year, and Taipower remains confident in achieving this year's targets. (Editor: Chai Ssu-chia) 1150514