Q1 2025 Northland Power Inc Earnings Call
Yes.
Speaker Change: Welcome to the Northland Power conference call to discuss the first quarter 2025 results.
Speaker Change: As a reminder, this conference is being recorded on Wednesday May 14, 2025 at 10 a M eastern.
Speaker Change: Conducting this call for Northland power are Christine Healy, President and CEO, Jeff Hart, Chief Financial Officer, and Adam Beaumont, Senior Vice President of capital markets.
Speaker Change: Before we begin endorsements management has asked me to remind listeners that all figures presented are in Canadian dollars and to caution that certain information presented and responses to questions may contain forward looking statements that include assumptions and are subject to various risks.
Speaker Change: Actual results may differ materially from management's expected or forecasted results.
Speaker Change: Please read the forward looking statements section in yesterday's news release.
Speaker Change: Northland Power's results and be guided by its contents, when making investment decisions or recommendations.
Speaker Change: The release is available at Www Dot Northland power Dot com.
I will now turn the call over to MS. Christine Healy.
Speaker Change: Thank you very much Hello, everyone. Thank you for joining today's call. So I'll start off today by providing an update on our business and the progress. We've made on construction are then Jeff is going to walk us through our Q1 results and following our prepared remarks, we will take questions, but before I do.
Speaker Change: Get into that I want to take a moment and welcome Jeff Hart, who joined US on May the first as Northland Power's newly appointed Chief Financial Officer.
Speaker Change: Jeff brings over 20 years of financial leadership experience and deep experience in the energy industry. Yeah. He's previously been CFO at two large publicly traded Canadian energy companies Husky energy and Synovus energy.
Speaker Change: Jeff joining the team we have completed the formation of our strong executive leadership team and we think we're well positioned now to drive north bonds long term growth deliver on our mission and vision and deliver value to shareholders.
Speaker Change: So welcome Jeff.
So now to jump into the update here on Q1.
Speaker Change: I wanted to start with health and health and safety and health and safety remains a top priority across our business.
Speaker Change: I mentioned in our last call that I've been visiting sites across Northland Power's portfolio and meeting the operational teams and I mentioned last call and I can reiterate that that the the trend continues. The teams are committed theyre focused there's a high commitment to safety and operational excellence. So these teams are committed.
Speaker Change: Keeping everyone on our projects and at our operating facilities safe and I do want to take a moment to you may have had missed the news about it but I'm just to further demonstrate our commitment and performance on safety. This quarter are I'd say utility in Colombia received the onerous Ccs award for innovation and safety.
Speaker Change: From the Colombian Safety Council. This was a recognition of an innovative online tool created in.
Speaker Change: That's part of our business streamlining safe work processes and permit to work for field stops. So what this innovation by the team and the recognition of that image innovation I wanted to call out here because it highlights the company wide commitment to developing innovative solutions and enhancing safety and our business.
Speaker Change: I also now want to turn more to operations and construction. So you may have seen that a we had a very happy event recently that we announced commercial operations for the Oneida battery storage project.
Speaker Change: That project was completed ahead of schedule and under budget. It is the largest energy storage project in Canada. It is a clear reflection of Northland capability and expertise in safely and successfully delivering large scale infrastructure projects.
Speaker Change: At the local level the project created over 180 jobs during peak construction.
Speaker Change: And the project delivered more than 300000 work hours without a single lost time injury. So Oneida is now part of the grid here in Ontario, and its generating revenue Canada's largest battery energy storage facility one of the largest in the world and its operational as we speak it's a great accomplishment.
Speaker Change: For the team and for the partners in the project I'd like to extend my sincere congratulations to the joint teams on a job well done and I'm looking forward to our teams applying their expertise in the next wave of battery storage projects, including our Jurassic storage project in Alberta.
So we also have our two other offshore wind construction projects ongoing high long and Baltic power and together that represents approximately $15 billion in gross investment and a 2.2 gigawatts of capacity shared between north wind down of our partners.
Speaker Change: At high long project in Taiwan, We've made strong progress against several key fronts and I'll take you through those.
Speaker Change: In April we completed installation of the first turbine. This is a major milestone for any offshore project and we were happy to see that milestone accomplished we have now completed the fourth the turbine installation and construction continues to advance steadily and safely.
Speaker Change: On the manufacturing side, all the pin pile foundations are complete and the jacket Foundation fabrication is progressing with several jackets in the final stage of production.
Speaker Change: We're also making solid progress on turbine components with about half of the generators and blades manufactured and good momentum on the sell in tower production as well.
Speaker Change: So if we move then to installation all the pin pile foundations for high long to our in place over 50% of the high long three pin pile foundations have also been installed.
Speaker Change: Our offshore substation foundations are fully installed one top side is in place and cold commissioning is complete so overall high long remains on track to achieve full commercial operations by 2027.
Speaker Change: Turning to Poland.
Speaker Change: Our one one gigawatt Baltic power offshore wind project is also progressing as expected.
Speaker Change: Fabrication of all 76 mono pile foundations is complete manufacturing of the inter array cables as substantially finished and blade nacelle and tower fabrication has begun.
Speaker Change: On the installation side, both offshore substation main foundations have been installed the topside structure is mechanically complete and electrical outfitting is underway.
Speaker Change: In the water 13, mono pile foundations and two offshore substation mono piles have been installed.
Speaker Change: Additionally, all of the horizontal drilling work for the export cables is complete secure and all four cable connections between offshore and onshore substations.
Speaker Change: So as you can tell we've had successful completion of Oneida and continued progress on the offshore wind projects. So we are actively advancing our development pipeline and so we of course are also at the same time developing new opportunities in our core markets.
Speaker Change: And as part of this pipeline, we've secured funding and began construction on the Jurassic battery energy storage project, our seconds battery energy storage project in Canada.
Speaker Change: With the experience gained from Oneida, we're confident in our ability to deliver Jurassic best on time and on budget.
Speaker Change: In terms of other activities happening now to develop the pipeline and Ontario, we are engaged in the upcoming L. T. Two procurement process and we are evaluating opportunities within that process.
Speaker Change: Our early stage Scott wind offshore wind project is also progressing and we're continuing to explore attractive investment opportunities in key markets like the Baltic region, where we see a strong commitment from governments to ramp up support for renewable development.
We are also working on other exciting growth opportunities, which I hope to share with you later in the year and I'm sure you are all eagerly anticipating our investor day.
Speaker Change: So before I hand things over to Jeff to review the financial results I do briefly want to comment on our first quarter performance.
Speaker Change: As you see our results were impacted by a historically low offshore wind resource in the North Sea. The wind was the lowest we've seen across our time invested in those Europe offshore wind assets.
Speaker Change: And that needs to be held in contrast to what was record high wind performance in the same quarter last year. So when we're comparing we are comparing record high two unusual low.
Speaker Change: And despite this though our operational performance was strong fleet ability its fleet availability stood at above 95% in the first quarter.
Speaker Change: And here in North mine, we're very focused on being good at the things within our control. So our teams were available and had the wind resource been stronger we would've been able to monetize that.
Speaker Change: I will also note that the teams did react to the low wind conditions.
Speaker Change: They brought our planned maintenance forward. So our planned maintenance is ahead of schedule on the year and this is an example of our operational teams in action with the lower wind resource we could do more of that maintenance earlier in the year. So that when the wind does blow we are ready to take advantage of that through the remainder of the year. So our.
Speaker Change: Operating record is solid and we're maintaining our assets in good condition to ensure we can fully capitalized on favorable wind conditions when they occur.
Speaker Change: And I will also add I'm sure. It's not lost on anyone that has high long and Baltic come on stream and as Oneida has come on stream. The diversity first of all the geographic diversification and the technology diversification the benefit of that shines through our strategy is to execute on projects in different geographies.
Speaker Change: Fees and those different geographies improve the balance of our production and we will see the benefit of that coming over time as these projects are delivering results.
Speaker Change: So I will add that even with the low end of this quarter. We remain on track to meet the financial guidance, we set out earlier this year.
Speaker Change: I'm also just going to take a quick moment to touch on recent macroeconomic questions related to U S tariffs and impact that they may have on our business.
Speaker Change: I can advise that today tariffs have minimal impact on our business here in north on power.
Speaker Change: None of the power that we sell is subject to tariffs and in terms of the development and construction our supply agreements for our offshore wind construction projects and Jurassic battery project are locked or have robust provisions to provide protection from tariff costs.
Speaker Change: So across our portfolio we are in a good position in terms of dealing with this particular set of circumstances.
Speaker Change: So 'twenty and so before I continue on and I will just say I'd.
Speaker Change: I'd ask all of you to harken back to our fundamentals here, we do see that globally. The demand for energy is growing and then demand for renewables and natural gas is strong and.
Speaker Change: And we at Northland are well positioned to meet this demand with our capabilities across technologies with solar onshore and offshore wind gas and now batteries and important new components, a new tool in the toolkit.
Speaker Change: Plus we have the capability to deliver in Canada in Europe and in Asia and these are capabilities that I think are key differentiators for Northland power into the future.
Speaker Change: 2025 is a year of milestones for Northland and our long term value proposition remains strong.
Speaker Change: We have the scale and the platform to pursue and execute large scale power projects.
Speaker Change: We have technological diversification, including the ability to develop construct and operate offshore wind onshore solar and wind battery storage and natural gas power infrastructure.
Speaker Change: And the global diversification will be further enhanced when our two offshore projects are completed.
Speaker Change: We also have strong people our team has the capability to originate developed construct finance and operate infrastructure projects globally.
Speaker Change: So overall, we see that the picture is strong for Northland heading into the future investment in renewables. It is accelerating renewable sources account today for just over 30% of global electricity generation and that's projected to rise to 46% by 2030. According to the IEA So again Northland.
Speaker Change: Well positioned to capitalize on this shift and help meet the world's evolving energy needs and deliver value to shareholders. So with that I'm going to turn things over to Jeff to give us a more detailed update on the financials.
Jeff Hart: Thank you Christine and good morning, everyone.
Speaker Change: I'm delighted to be here today, as a newly appointed Chief financial Officer of Northland Power <unk>.
Speaker Change: Joining the Northland team on me first has been exciting and I'm eager to contribute to the company's success and growth and have been impressed with the passion and dedication of our people.
Speaker Change: I look forward to working closely with Christine and the rest of the Northland team to build and an exciting future that will create shareholder value.
Speaker Change: With a strong balance sheet and talented team, we are well positioned for our construction program and future developments.
Speaker Change: Now I will turn to our first quarter results.
Speaker Change: During the first quarter, we generated adjusted EBITDA of $361 million.
Speaker Change: Which represents a 20% decrease compared to the same quarter of 2024.
Christine Healy: And this is predominantly due to the low offshore winds that Christine noted earlier <unk>.
Speaker Change: Fight the week wins, our operations have performed well driving strong availability.
As demonstrated by our achievement of 95% commercial availability in the offshore wind business.
Speaker Change: Low offshore wins were partially offset with the higher rate base and customer growth at <unk>.
Speaker Change: And this combined with strong performance across the onshore fleet, where we achieved availability of 97%, we offset some of those low wind impacts.
Speaker Change: During the first quarter, we generated free cash flow of $157 million, which was 30% lower than the same quarter of last year.
Speaker Change: On a per share basis free cash flow in the first quarter of this year was 60.
Speaker Change: Here's to 88 in the first quarter of 'twenty four.
Speaker Change: Despite the low offshore wins in Q1, we expect to maintain our financial guidance.
I do want to highlight that we have made some changes to our non-GAAP measures.
Speaker Change: Going forward, we will not be reporting two cash flow metrics, but will rather have a single cash flow measure that will be more aligned with our peer group.
Speaker Change: Which provides more a more appropriate run rate measure.
Speaker Change: Our new free cash flow metric as reported in our results is the same as our adjusted free cash flow metric that we previously reported this metric we believe represents north Benz ability to generate cash flow from the operating business before any investment related decisions are made.
Speaker Change: Speaking of investment decisions I'll turn to our three construction projects.
Speaker Change: We successfully completed the Oneida battery storage project ahead of schedule and below budget.
Speaker Change: At the high long and Baltic power offshore wind projects as of the end of the first quarter. The projects I've spent $8 billion to date with remaining gross capital expenditures for the projects expected to be $7 billion.
Speaker Change: We've spent more than 50% on these two offshore wind projects, which demonstrates significant progress towards the achievement of commercial operation is expected in 'twenty six 'twenty seven.
Speaker Change: These accomplishments highlight Northland its commitment to delivering high quality energy infrastructure, and our readiness to capitalize on growth opportunities in global energy markets.
Speaker Change: We have $1.1 billion of available corporate liquidity and have multiple funding tools to deliver on a disciplined growth strategy in our core markets.
Speaker Change: And we will share more details on our strategy and financial framework with you as part of our Investor day expected to be scheduled later this year.
Jeff Hart: Thank you Jeff.
Jeff Hart: So as you can see we're excited about the future of Northland.
Jeff Hart: Our global technological diversification focus on long term contracted profile and financial stability. These position the company well for growth for many years to come and to help withstand any short term political or regulatory shocks that might occur Northland power is growing and we're delivering value for communities.
Jeff Hart: Stakeholders and more importantly for shareholders. So this concludes our prepared remarks, and I'll turn the call over to the operator, operator can you. Please open the line for questions.
Speaker Change: Thank you to ask a question. Please press star one one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one one again, please stand by while we compile the Q&A roster.
Speaker Change: And our first question comes from Nelson <unk> of RBC capital markets. Your line is open.
Speaker Change: Great. Thanks, Good morning, everyone and Jeff Congrats on your role as CFO.
Speaker Change: Hey, I just wanted to start with I just wanted to start with the Oneida So just to clarify with cost being $100 million below budget.
Speaker Change: Does that directly reduce the equity funding requirement on a one for one basis or is it on a pro rata debt and equity.
Speaker Change: Yeah, that's what I can take that one so it's not one to one others a couple of things.
Speaker Change: <unk> the Dutch service that it sees that kind of get.
Mixing together, so it's not a one to one.
Speaker Change: Reduction in equity.
Speaker Change: Okay. Thanks.
Speaker Change: And then also on an idea I know, it's still early days, but have there been any.
Speaker Change: Changes to your EBIT or cash flow outlooks since starting with a project two years ago.
Speaker Change: I think about 60% of their revenues are from capacity payments. So there there is a variable component.
Speaker Change: But obviously theres been a number of changes in terms of more rfps and also.
Speaker Change: Power demand growth expectations in Ontario.
Jeff Hart: So it's Jeff here all in.
Adam Beaumont: Adam can add on some color but.
Adam Beaumont: We expect ultimately the economics to be within the range of what we what we promised and delivered and Youre right on the 60% there and so we're pleased with with where it sits and how it's going to fit in our portfolio and it will deliver what our expectations were.
Adam Beaumont: Okay.
Adam Beaumont: Great.
Adam Beaumont: And then just one last one.
Speaker Change: One last thing in terms of upcoming bids I know Christine mentioned, the Ontario bid later this year.
Adam Beaumont: But kind of looking further out any can you talk about.
Adam Beaumont: Other areas of focus in terms of whether it's wind or solar in Quebec or any other opportunities in DC or are the U K.
Nelson: So Nelson Thanks for the question I'm really happy to hear some questions oriented towards future growth. That's a really nice signal to me. So thanks for that.
Nelson: We are looking at all of that we're looking at a large number of opportunities across the market and the organic opportunities and inorganic opportunities I would say at the same message that I had when we when we spoke in the last quarter update internally in Northland power, we have a competition for capital. So all of these opportunity.
Nelson: These have to compete and show that they are the best way for us to deploy our capital and deliver value. So I would say Canadian opportunities go into the next opportunities in Europe to go into the mix and we determined then where the best deployment of that capital is to drive value. So that that is ongoing and I think that's part of my job everyday.
Nelson: Hey.
Nelson: Great. Thanks, I'll get back in the queue.
Nelson: Thank you.
Sean Stewart: And our next question comes from Sean Stewart of TD Cowen Your line is open.
Sean Stewart: Thank you good morning, welcome aboard Jeff.
Speaker Change: Thank you a couple of questions.
Speaker Change: Of the three Gigawatts that you.
Speaker Change: You're showing in the prospective pipeline that is onshore how much of that three gigawatts would you qualify as late stage and then I guess Kristine more broadly as you think about advancing growth opportunities.
Speaker Change: Do you think about the cadence of that presumably there's going to be a focus on lowering the payout ratio here after a busy construction period for the company.
Speaker Change:
Speaker Change: The cadence and advancing those types of projects, while managing the payout ratio how do you think about that.
Speaker Change: Thanks, Sean I appreciate the question so with respect to the pipeline I will refer you to our Investor Day again I do think it's a really positive sign people are asking about growth. So that's I'm happy for that but we're doing work now on the pipeline and the sequencing of that in order to.
Speaker Change: Again, see which way we deliver the best value. So that's a that's a work in progress and the nice news is that we have optionality. There. So we're we're considering how best to approach that.
Speaker Change: So in terms of then what we do with capital allocation going forward I think that's also a burning question that we intend to answer at our Investor day. It is something that we're looking at very carefully.
Speaker Change: We see that there's a massive growth in demand for what we do and so we want to be able to deliver into that growth, but we also want to be able to manage the capital allocation mix. So that's very much on my mind, and we will give more color on that at Investor day.
Speaker Change: Okay, and maybe I'm front running the Investor day with his question as well but.
Speaker Change: Prospective on gas fired power growth.
Speaker Change: Lots of reports soon.
Rapidly expanding wait times for turbines and cost inflation for for that technology.
Speaker Change: Uh huh.
Speaker Change: How are you thinking about growth potential for gas fired power or whether it's in Canada or elsewhere and does M&A potentially factor into the decision process as well.
Speaker Change: So I think I've mentioned before Sean, but I like gas fired power I think it's an important part of the energy mix and in the work that I've done in my career in most in many geographies around the world, it's very difficult to see how we can get to a reliable green affordable grid without using natural gas so I see it as a as an.
Speaker Change: And part of the energy mix globally now. The question is it is it better to a build or buy I think that's an active question for everyone in the space.
Speaker Change: Our points on supply chain I would say, we've had a slightly different experience and that we have some good relationship with our supply chain and we see that we have some good options available to us should we choose to proceed with projects.
Speaker Change: So I guess I would have a bit of a different perspective on that but we watch it carefully because with increasing interest in our natural gas generation space, then there could be upward pressure on that but for us we see that the things that we're looking at we don't have a supply chain constraints right now.
Speaker Change: Okay.
Speaker Change: Thank you very much for that detail.
Speaker Change: Back in queue.
Speaker Change: Thank you.
Mark Jarvi: And our next question comes from Mark Jarvi of CIBC. Your line is open.
Mark Jarvi: Yeah. Thanks, Good morning, everyone and welcome Jeff.
Mark Jarvi: Maybe on the last topic about pursuit of natural gas investments or is that more focused on brownfields or is that greenfield and I think just to pick up on your point Cristina vote, having some options are you implying that you would have access to gas turbines. If you wanted to do Greenfield.
Mark Jarvi: So mark Thanks for the question I think our set of solutions, maybe is different than some others, who are considering developments. So we have experienced teams have been operating natural gas fired power for a very long time and so they they have some.
Mark Jarvi: The different options in terms of development. So we've been looking at that internally and as we're assessing things that we might want to pursue so there is a mix I would say as a greenfield and brownfield, but there is a mix of our own development pipeline and acquisition opportunities out there in the world and those things we look at again.
Mark Jarvi: We evaluate against one against them and against other alternatives in the portfolio. So I will say supply chain wise I think that there are some pockets where you can still make things happen I think if you have a very fixed approach for how your development is going to go there is some tightness in parts of the supply chain that that will be a process on that if that's your <unk>.
Mark Jarvi: <unk> mode, but for US we've shown a good flexibility and agility to adapt to that so I think it's again one of the things that I like about how we do business here at Northland.
Mark Jarvi: Just in terms of the development activities that all focus in Canada or have you broadened outside of Canada and with M&A include everything across North America, Canada. The U S.
So mark I do think that there's an interesting opportunity right now in Canada, because Canada has underinvested in my opinion and natural gas fired power in the country and we have won a globally one of the greenest grids in the world here in Canada, and natural gas is a really great ability to provide a lot of services for a stabilized.
Mark Jarvi: And enhancing the capability of that grid. So I think there's a real opportunity for natural gas in Canada. So we're having a really close look at that in a number of the areas in Canada, because as you know Canada has a lot of separate markets. So we're looking very closely at that.
Mark Jarvi: I think we do see some opportunities internationally. So I will just but right now those are much too early to talk about so I'm just going to leave it there.
Speaker Change: And then last week or last week, we saw worst had to step away from the Hornsea four project over in Europe talking about higher cost and execution risk do you share the same views of that in terms of challenges to advance future offshore wind projects and I guess ultimately the viability of skull wind into South Korea projects, how do you see them framing up right now.
Speaker Change: Yeah. So I think you know I was like everyone. I think I was sad to see that news, it's always difficult when projects don't meet the Mark and I'm sure. It Couldnt have been an easy decision for our study.
Speaker Change: For us our projects are developing within the parameters that we expected and delivering the returns that we expect to see so.
Speaker Change: We do see that we're continuing to scan the other projects that are out there to see if there are opportunities out there that you know even better than what are within our own portfolio. I think that's just good business. So we continue to do that but you know you mentioned Scott when they think that that's a project we like it some of the best wind resource anywhere in the North Sea and so.
Speaker Change: From a technical perspective, it's a it's a really strong project, we're proceeding through the the community engagement process on that now and as is always our way you know we will advance projects at the pace and in the way that that community wanted to see them happen, but we have a great project, there and I think that eventually will come into the portfolio.
Speaker Change: Then so that those opportunities I think continue to exist and fundamentally we're back to what's the energy mix in many countries its very difficult to make the energy mix work.
Speaker Change: Without offshore wind it just makes a lot of sense. It delivers good reliable clean reasonable cost electricity into the system. So.
Speaker Change: To me it makes a lot of sense.
Speaker Change: Good to hear maybe last question for me just with the grid outage in Spain any negative impacts for your operations there.
Speaker Change: No. Thank you for the question I think that was a difficult moment in Spain, but I think that it was that from the our team's perspective, it was handled well and safely with <unk> and <unk>.
Speaker Change: No impacts in terms of our infrastructure and capability in Spain, So I'm actually very impressed with the team in Spain, and how they reacted to that are unexpected circumstance. So it wasn't a test we were looking for but I'm pleased to say, it's a test that we passed with flying colors.
Okay, alright, thanks for the time today.
Speaker Change: Thank you.
Speaker Change: And our next question comes from Rupert <unk> of National Bank. Your line is open.
Speaker Change: Hi, good morning, everyone and welcome Jeff.
Speaker Change: Yeah.
Speaker Change: Thank you if I can can start with high long. So it sounds like things are moving well, they're moving to plan can you remind us when are you expecting to generate the first power there and what's your forecast for pre completion revenues this year.
Speaker Change: So our we're still saying the same as we've been saying throughout that first power will be in the back half of this year.
Speaker Change: Okay do you have a certain number of turbines that you need to get installed before you turn it on there and do you have a sense for how many <unk>.
Speaker Change: A bunch of might have installed before you reach the winter break this year.
Speaker Change: So.
Speaker Change: Rupert.
Speaker Change: I appreciate the push on that but I don't control. The they are the lead ocean conditions. So the first priority is that the teams have to do this installation safely. So right now they have been having good productivity they've been taking advantages of some good weather situations. So we're seeing good installation, but we have a.
Speaker Change: Plan a plan B plan C for what happens when conditions are if conditions change so but to answer your technical question. No. We are good there's not a minimum number of turbines in terms of generating first tower, but of course, we do have a plan of turbine installation and as I said earlier, we're on track.
Christine Healy: Okay, Great and I'll ask you a growth question to Christine do you like those.
Christine Healy: Maybe talk about Ed So you've had some good growth in <unk> and.
Christine Healy: In Colombia, and I know, our northern pulled back from looking at organic growth around that utility historically, what's the outlook. There do you see opportunities to put more capital to work in Colombia, or where do you see it more of a.
Christine Healy: We're recycling opportunity in the future.
Christine Healy: Well Rupert I, you know I don't want to tell all the secrets too soon because we have investor day coming up in the fall I will say that across the whole portfolio. One of the things. We're also looking at in our internal competition for capital is where do we have brownfield or augmentation opportunities within the existing fleet because those cannot.
Christine Healy: Can be very high rates of return investments. So we're making sure that we have a close look at that and I would say that that's everywhere in our global portfolio that we're looking at ways to enhance value. So then the rest I would say stay tuned for the fall.
Christine Healy: And maybe a follow up on brownfield opportunities. So the last couple of years, you were able to put some more capital into thrilled that that's a good location here in Ontario. It could you see more brownfield investment going into sites like that and it may be even leveraging what you have some.
Christine Healy: Some of your other sites some other grid connections in Ontario.
Speaker Change: So Rupert I would say there are a number of opportunities across the global portfolio. So not just in Canada, but internationally as well and so the teams are working hard on those and to see how would we sequence them how would we prioritize them, but we do see that there there are brownfield opportunities they have.
Speaker Change: <unk> deployments and you know similar to for all of them involve deployment of some capital, but with very quick returns for us so and that that's an opportunity and sometimes it can lead to a change in our terms that would extend the lives. The lives of these facilities as well so we see some some good opportunities there, but again they the teams have to bring.
Speaker Change: Them forward and then they have to compete for the capital.
Speaker Change: Alright, very good I'll leave it there thank you.
Speaker Change: Thanks.
Speaker Change: Q.
And our next question comes from Robert Hope of Scotiabank. Your line is open.
Robert Hope: Good morning, everyone and congrats Jeff.
Speaker Change: Thank you maybe on maybe on how long can you talk about the supply chain are wherever you see the alerts as improvements are there any remaining challenges or kind of where do you think the key pinch point in terms of the supply chain or is everything is looking good.
Speaker Change: Well, thanks for that question, Rob, but I'm I'm never going to say everything's looking good because I feel like the headset.
Not the right message I think the message is that everything is on track we have had to do a lot of work with our supply chain for high long.
Speaker Change: We are making sure that we deliver on expectations in terms of local content and we ensure that we deliver on expectations for a schedule and cost. So the supply chain I think now we're seeing is delivering very well so in some cases.
Speaker Change: There were slower start than we wanted to see but now we see that the supply chain is delivering the way that we want I will add that we have a very high emphasis on safety and we continue to follow up with our entire supply chain to ensure that they meet our safety standards and all the work that they do.
Speaker Change: Alright, I appreciate that and then maybe just on the supply chain for Baltic, It's a little bit more diversified.
Speaker Change: How are things progressing there or do you have more kind of reverse.
Speaker Change: To pull there.
So well take is on track I would say, we never let up on the attention to the supply chain and you may or may not be aware, but we you know we put people our Northland resources in facilities around the world to track the delivery of our supply chain and make sure that things are on track. So we follow that up closely so.
Speaker Change: I would say we have no level of Oh, we just have constant vigilance, maybe I'll say on that we are we have people who are following that and I'm I'm getting reports on that very frequently because it's so critical to our success on the project and so so I would say I wouldn't put it in the category of where more or less relaxed work.
Speaker Change: Instantly vigilant on all of it.
Speaker Change: Alright, I appreciate the color. Thank you.
Speaker Change: Thank you.
Benjamin Pham: And our next question comes from Benjamin Pham with BMO. Your line is open.
Benjamin Pham: Hi, Thanks, good morning.
Benjamin Pham: First question on the Q1 in 2025.
Benjamin Pham: You flagged that onshore wind.
Benjamin Pham: Weakness.
Benjamin Pham: Can you can you comment on I know, it's an industry trend in Europe with the weakness.
Do you know, what's what's driving that.
Overall, and what do you what are you seeing so far in Q2.
Benjamin Pham: Do you mean, sorry on the wind resource generally.
Benjamin Pham: And you know, what's driving the weak offshore wind resource.
Benjamin Pham: Ah well so the wind resources.
Benjamin Pham: Everything that we do is probabilistic so we gather met ocean data, we analyze it and every day as we get more data. These models are further and further refined so when we look at the tracking over sort of a decade or more of wind speed in the area. Then you you have a range and then we do our budgeting based on what we think a likely outcome is for the year.
Benjamin Pham: Now there are going to be years like Q1 last year was exceptionally high and everybody is very happy when that happens, but it's also unusual this year. We're on the lower end of the curve so less happy but again, it's within our range of expected outcomes and it's just a.
Benjamin Pham: It's it's it's not it's not where you would probabilistic Lee you expect it to be so that's why I referred earlier about <unk>.
Benjamin Pham: Where geographically correlated now with our three offshore wind facilities there in the North sea there reasonably close to each other so they're all kind of affected by similar wind patterns. When we add on a facility in the Baltic that will be a different set of met ocean conditions, a bit of a different set of wind conditions and similarly, when we add on high long.
Benjamin Pham: It's again, a different geography different wind. So you should not see the same amount of correlation that we have now with three facilities that are close to each other so it's been about finding the balance there's economies of scale. When we have facilities close to each other because our operational teams can be deployed across multiple facilities. But then we do have this issue that.
Benjamin Pham: When there is a less wind in a geography it affects all of them at the same time, so we try to strike that right balance between diversification and intensity.
Benjamin Pham: Yeah.
Benjamin Pham: Alright, guys Christine and then maybe just.
Benjamin Pham: It doesn't sound like there's anything specific that the meteorologists have flagged ground is thinking about 2018 19 experience very warm temperatures in Europe, driving low wind speeds and Thats. When you saw something like this we cannot see any really pinpoint here to to drive that weakness.
Benjamin Pham: No I mean, I think that I'm I'm gonna well out of my depth, because I'm not a meteorological expert, but no. We don't see anything here that that's causing us any great concern I mean, we would've preferred if the wind blew more in Q1, obviously, but we still see that the overall picture for these assets is really positive.
Speaker Change: Okay. Thanks for that Sam.
Benjamin Pham: Next question for Jeff Welcome.
Speaker Change: Can you can.
Speaker Change: Can you talk about.
Speaker Change: Just what what attracted you to the Northland power just I know it's been a few weeks your.
Speaker Change: NASA thoughts on the balance sheet and then lastly, just any any.
Work projects that are priorities for you the next little bit into the Investor day.
Speaker Change: So yeah. Thanks, Thanks for the question and you're rounding up I think I've been in a week or a little over but I'll.
Speaker Change: I'll just give you some context on the macro worldwide Northland.
Speaker Change: And then.
Speaker Change: I'll turn my attention to my thoughts and priorities and my impressions.
Speaker Change: I've been around the energy complex and energy systems My entire life over the last 20 years I've been in the integrated oil space.
Speaker Change: As you know both CFO of Husky, and Synovus and I've also led supply chain global regulatory organizations can safety organizations and so on.
Speaker Change: I am passionate about energy.
Speaker Change: Really bullish and look at it for the quality of waste energy demand is going to continually rise and we need to.
Speaker Change: Rise to that challenge to deliver the energy.
Speaker Change: So with that is why Northland by Christine has talked to talk to it I think it's the diversification of the platform that we can build from we're going to need as much energy as possible whether it be onshore wind offshore wind natural gas generation and so I think that platform attracted me number one.
Speaker Change: Number two is as <unk>.
Speaker Change: You know obviously it was impressed with Christine and the leadership team.
Speaker Change: All I was coming in and my impressions coming in and you can see it in the quarter.
Speaker Change: We have to focus on what we can control, which is our operations availability uptime and.
Speaker Change: Project execution, and I've been really impressed with the organization and depth there coming in and then as far as priorities over the next little while I you know number one is obviously to get onto the assets.
Speaker Change: It gets talked about theme is we need to control what we can control I think it's important that the executive are totally integrated with their operations and have a good understanding on the ground number one number to really get out and meet with our key investors and analysts and really get to meet the street and build share feedback and understand.
Speaker Change: Are there thoughts on priorities, which then will help us lead into and where we're taking the company forward and.
Speaker Change: Pursue the right kind of growth that drive shareholder returns and laid out laid that out at Investor day, and that's really ended up at a high level and I'll leave it there.
Speaker Change: Okay. That's great. Thank you that's good color.
Speaker Change: Thank you I'm showing no further questions at this time I'd like to turn it back to Christine Healy for closing remarks.
Christine Healy: Well. Thank you very much I'm not sure there's much else left to say I will say, thank you to everyone for joining US today. Our next earnings call will be after our Q2 results and we're anticipating that in August. So thank you for your attention and your questions and your continued support.
Christine Healy: This concludes today's conference call. Thank you for participating and you may now disconnect.
Christine Healy: Yeah.
Christine Healy: [music].
Okay.
Christine Healy: Okay.