Ocean Farm 1 cost owner NOK 100m last year
Money was spent on maintenance and upgrade of pioneering salmon cage
Ocean Farming, the company that operates the pioneering Ocean Farm 1 salmon cage, made an operating loss of more than NOK 100 million last year when the structure was out of use and was undergoing maintenance and an upgrade.
The deficit of NOK 101.7 million (£7.45m at current exchange rates) will be covered by transfers from other equity, said Ocean Farming, which is a subsidiary of SalMar Aker Ocean, the company formed by Norwegian salmon farming heavyweight SalMar (which owns 85%) and offshore engineering company Aker.
Ocean Farm 1 was upgraded at Aker Solutions’ yard at Verdal before it was transported back to its location on Frohavet in March 2023 and started its third production cycle in April. Fish will be harvested next year.
New netting
Ocean Farming’s board chairman Roy Reitan, who is also chief executive of SalMar Aker Ocean, has previously told Fish Farming Expert’s Norwegian sister site, Kyst.no, that the company was adopting completely new netting for Ocean Farm 1 (OF1) that could also be used on two more advanced iterations of the concept, Ocean Farm 2 and the Smart Fish Farm.
“As is well known, OF1 was a development project and precisely development has been our focus, and then development for the significant growth that lies in the open sea,” he told Kyst.no last year.
“In collaboration with suppliers, and not least DNV, we have developed a completely new net technology to be used in OF1, but equally important in OF2 and Smart Fish Farm. Significantly increased monitoring capacity will be built in, as well as technology that will notify in the event of any weakening in the net.”
Feed partnerships
In its annual report, Ocean Farming writes that the war in Ukraine creates increased uncertainty and increased inflationary pressure when it comes to raw materials for certain ingredients in fish feed. It nevertheless stresses that it is well equipped to handle this situation, partly because of its partnership with feed suppliers.
“The ban on the airspace over Russia reduces airfreight capacity to the Asian markets and creates logistical challenges. In addition, the recent increase in energy prices may indirectly affect other cost elements in our value chain such as transport and packaging.”
SalMar and Aker have ambitious plans for the company. The goal is for SalMar Aker Ocean to produce 150,000 tonnes of salmon annually in offshore farms by the end of 2030.
Regulatory framework
SalMar Aker Ocean has completed two production cycles in Ocean Farm 1 in the exposed area outside Trøndelag. The experiences from those cycles are now incorporated into an updated design, according to the company.
In its annual report for 2022, SalMar said work for design of new the semi-offshore OF2 and the open ocean Smart Fish Farm progressed last year. Simultaneously work continued to establish a regulatory framework including tax regulation for offshore farming in close collaboration with the respective authorities. This is necessary to have in place before investment decisions for new offshore units, said the fish farmer.
