Hi, everyone, and welcome. My name is Marcus Thor. I'm the CEO of Hexicon. I will spend the next 20 minutes or so to present to you an update on what's happened in the floating offshore wind market, what's happened here at Hexicon, and how we look at the future. I will today go through a market update, run through our portfolio development, significant events during the quarter. I'll do a deeper dive into South Korea, as well as our technology, ending up with looking ahead. Starting off with the market update. No doubt that the industry remains in a rather weak position. With that said, there is certainly some political momentum that continues, in some aspects, actually grown as well. Global wind installation has been delayed over the last few years.
All in all, floating offshore wind is at 277 MW installed as today. A few years ago, we're certainly hoping for a higher number. Long-term projections remain very high, however. Specifically, if we look at the U.S., a market that certainly has taken some big turns, some big offshore wind projects there, fairly recently had their permits withdrawn. These were permitted projects, in some cases, where they actually started construction, that had their permits taken away. That's gone into court, in fact, the federal court, fairly recently, ruled in favor of these projects, and some of them have now resumed construction. We'll see how that continues to develop, but it's a definitely a market that we follow fairly closely.
Here in Europe, in Poland, a Baltic Sea neighboring country, had their first ever floating, sorry, offshore wind auction, not floating wind, that had a pretty decent result with 3.4 GW of results. Over in the U.K., where we ourselves a co-owner in the Pentland project, together with CIP. In January, mid-January, results of their Allocation Round 7 were announced. That did have a floating budget, so specifically, a specific pot for floating wind, and all in all, across all technologies, a very good outcome of that auction as well. Over in Asia, in our market being South Korea, probably the most important market for Hexicon at the moment, there was an auction at the end of last year, resulted in just shy of 700 MW of bottom-fixed projects that were auctioned. There, on top of auctions, continued to be conducted.
The new president since the summer, his now new Ministry of Climate, Energy and Utilities, is now fully up and running and operational. In fact, next month, we're expecting the results of what the new auction will look like. There will probably be one, as we see, in April or May this year again. Finally, over in Japan and Taiwan, two very big long-term markets, continues with political push, with advanced frameworks and policies, but these we see as longer terms, especially when it comes to the floating side of offshore wind. If we look at our own portfolio and some developments in projects, first of all, which I'll come back to as well as significant events, we did press release an impairment of our TwinHub project. This is a project we've certainly spent a lot of efforts on.
It's a rather small-scale technology project with macro climate difficulties, investor appetite, et cetera. This was not a project that we could divest at viable terms within the time frame we had. Reflecting reality, this is an impairment that we did obviously not take lightly, but one that was needed reflecting reality. It remains a priority for us, of course, to find a good place and home for that project going forward. The Pentland project we just mentioned, in terms of securing a CFD. What the project did do during the quarter, so the last quarter last year, was that it secured three new investors, UK institutions, into the project, preparing itself for the construction phase as well. For ourselves and our priorities in the portfolio, it certainly relates to divesting projects. Selected projects get cash flows in for Hexicon, that's the priority.
There are no plans at the moment to expand our portfolio further. Obviously, there's market surveillance. We are prepared for when that moment in time comes, with cash in, but for here and now, divestment is the focus, ensure money comes in, expansions comes afterwards. If we look at some significant events across the period, in October, we held an EGM to vote for the issuance of warrants. They were directed to the lenders within our RCF, so a revolving credit facility with a few Swedish lenders. It's an RCF that we'd put in place a few years ago, and this was an extension that was decided upon during the summer, a two-year extension. As part of that package and agreement, was also warrants in Hexicon AB.
Following a wider portfolio review, the impairment of TwinHub was announced during the quarter. SEK 118 million impairment of the TwinHub project, which is a reflection of the market as it stands today. It's a market that remains rather challenging. If you look at when this project secured its CFD, which was four years ago, almost now, the markets looked very different. These are more or less the four years that we've had of Ukraine War, high inflation rates, across periods, interest rates, capital costs gone up, and not the least, a lot of issues across the supply chain of offshore wind. The offshore wind industry looks very different today than it did four years ago. This impairment is reflecting that reality, unfortunately.
With that said, as I did mention, we are continuing to spend efforts on ensuring a good place for that project going forward. It does continue to have certain costs and liabilities for Hexicon, which we are focusing hard to get out of. We did put in place a smaller loan as well of SEK 2.8 million. That's a need to spend on some smaller scopes that is out of scope of the Nuveen facility. Nuveen's funding is earmarked for certain costs, cannot go into all costs. That deal as well included a smaller amount of warrants that is subject to an AGM that we will hold shortly. As did mention before, CIP during the quarter did secure three new investors, U.K. institutions, namely Great British Energy, the National Wealth Fund, and the Scottish National Investment Bank.
All three very good names, bringing this forward through the construction phase. After the quarter, mentioned both before, we did put up the controlled balance sheet. This is a reflection. This is for Hexicon Holding that owns several projects, both the Korean project, but also the TwinHub project. The impairment of TwinHub led to a controlled balance sheet procedure in Hexicon Holding that did conclude and result in surplus values, equity intact with margin, mainly due to the South Korean project. All gone through the procedural aspects of it and of course, verified and confirmed by our auditor as well. Finally, that after the period, the CFD and results were announced on the 14th of January, in which the Pentland project were one of the winners.
If we look over to South Korea, which remains a key market for Hexicon, due to the fact this is where we hold the combination of commercial scale and maturity, this is where our most valuable project sits at the moment. A few things have happened recently there. The government in December presented its offshore wind infrastructure expansion and supply chain plan. Continues to push the development of offshore wind, how to develop its own supply chain, which traditionally has had a fantastic and continues to have a fantastic shipyard industry that is transitioning into being able to deliver to offshore wind as well. This, part of this plan continues to put emphasis on how to take that even further.
The plan also renewed their 25 GW target for 2035, which means they continued over the next few years, a lot of new offshore wind installations needed. If we look at MunmuBaram within this market, this is a project that is qualified, so holds all the prerequisites to participate in the country's auctions. That's very much where our focus lies, to prepare ourselves for that auction. Part of that is to add partners and investors into it. Hexicon is not able to go through an auction of this scale and size ourselves. We do need additional partners into it with stronger balance sheets. That auction or going through an auction like that, confirming, securing that revenue for 20 years, is potentially the highest step change in value during the development phase.
This is very much on top of our priorities, is to ensure that partners are obtained to be able to go through an auction. Which auction is yet to be determined. There is, as I said earlier, one that is likely to occur April this year, potentially one towards the end of next year as well. We will not participate in the one in April or potentially May this year, but thereafter, all auctions are open. On the technology front, a lot of important milestones occurred during last year. We have gone through a full so-called integrated load analysis with turbine supplier Mingyang. So having gone through an ILA of this kind with a commercial vendor is something that quite few floating wind foundation suppliers have done to date. What it does is really it confirms that the foundation as such copes with turbines.
It can withstand and operate environmental forces and allow turbines to operate within their limits and margins, so maximum accelerations, movements, et cetera. It doesn't conclude that no additional developments are needed. You can continue, of course, and we will continue to develop and mature and refine this technology, increase its competitiveness. As a starting point, it ensures that there's a robust base to start from, that it withstands forces, it can operate, it can serve the turbines, and in this case, quite large turbines as well. Additionally, what we spend efforts on is to develop a platform controller system.
Not only a system like ours, which holds two turbines on the same foundation, not only are we in need of in the individual turbine controller, but we're also need to develop a controller that looks into the pair of turbines, so that the one turbine knows where the other is and operates. This is something we've also jointly developed with Mingyang across last year. Finally, worthwhile mentioning as well, that during the third quarter last year, we did announce that we put in place an MoU with Wallstreet , so a company within the Soya Group here in Sweden, for the development and commercialization of our technology. The conclusion and finalization of a lot of ingredients within that MOU is still to be determined, something we are working with and that we will announce shortly.
If we now look forward, our priorities are more or less the same as they were last quarter. On projects, it is very much a focus on divesting selected projects. The markets over the last few years have not allowed us to divest at the pace that we wanted. If you go back a few years, you know, the IPO and onwards, the plan was really to divest selected projects as soon as the portfolio as a whole is large enough and diversified enough. This was to conclude at that point in time, we reached probably already two years ago. The market conditions have not allowed us to divest at the pace that we wanted, so we are fully aware of that. There's nothing we prioritize further or higher than to do just that. Divesting projects remains a key priority for us.
If you look at the technology, it's very much on the one hand, to ensure that values are maintained, as well as making sure that those values and the IP we hold finds a home that allows it to be commercialized. This is partially the MOU that we put in place in third quarter last year with Wallenius, aims at doing that. The IP, our patents, finds a home with the right partners to be commercialized, and we do need partners in that to commercialize it. Finally, on the financing and operational side of things, what we need to do is to ensure that Hexicon secures its runway in the best possible way until money starts coming in from divestments.
Not the least more meaningful such, that we are seeing in the near future to be from, first and foremost, the South Korean project. To achieve that, we are improving our operational efficiency, so reducing our burn rate. This will take an action across several quarters in a row, actually, and not the least, over the recent period where we've reduced our organization quite significantly. To ensure that runway to divestments, which is the key priority, and from there on, of course, start again growing and investing in future projects. First things first, and the focus really remains in operational efficiency to get us to the point in time where money starts coming in from divestments, and the focus here now is clearly on divestments. With that said, thank you very much for your attention, so far, I should say.
A few questions have come in. I'll read out and thereafter, answer, of course. The first one reads, "Following the impairment of the TwinHub project, you announced that the controlled balance sheet concluded that there is sufficient value in Hexicon Holding for its equity to be intact. Can you elaborate on the values that you see and for which projects?" Certainly a question that I really see where it's coming from, and I appreciate the wish to see what exact values we see and for which projects. However, to make such values publicly available hold certain risks as well. First of all, early-stage projects, and especially in a novel industry like this, is quite uncertain. We are always in the need to work with quite big ranges, and there are uncertainties in these valuations.
That's the first probably aspects that we always need to consider. The second is that if a number or value of a project is made available, that puts a marker out there that will remain there, and this, regardless of that being slightly too high or too low, that marker is there and can negatively influence negotiations that we're in or are about to undertake in terms of divesting such project. This latter point is probably the most sensitive one, because that is our key priority, to divest at most favorable terms. Anything that risks jeopardizing that is something that we want to avoid in a possible way. Probably, what I will say is, we talked about it several times in the board, how to, in a good way, make these numbers available.
At this point in time, when the need to divest is high and processes are ongoing, these risks are, to date at least, something that we've not been willing to take to potentially jeopardize a divestment. We'll continue to have those discussions, continue to consider it, and hopefully be able to make available such valuations. Here and now, and in terms of the controlled balance sheet procedure in Hexicon Holding, what I can say, probably will little surprise, is that the lion's share of the surplus value that was concluded in Hexicon Holding stems from the South Korean MunmuBaram project. Worthwhile emphasizing again as well is that the whole balance sheet, or sorry, controlled balance sheet procedure and conclusion was, of course, done in the utmost correct way and reviewed and controlled by our auditor. Second question here.
These, the surplus values that was mentioned in the press release on 30th of January, why has Hexicon not been able to realize them in any transactions yet? Yes, I think I've covered quite a bit of it in the presentation, but the market continues to be weak. A lot of uncertainties are displayed globally. However, as we look longer term at this, we certainly think that there is the ability to capitalize on these values and to divest these projects, that remains there. Everything has taken longer than we would have wanted, but the possibility to realize them over time continues. Number three, do you think that there will be further impairments in the future?
I cannot say yet, but what we can say is that there are no decisions or a need, as we see right now, for any further impairments across the portfolio. The market continues to be weak. As I said before, I do see, my view is at least that across the year, we'll see some improvements that should really have reached better levels across next year. Whether we get to that point and we start realizing our plans before that, before a further need for additional impairments, I cannot say for sure right now. What I can say is that here and now today, we're not seeing a need for further impairments in the portfolio. The last question here that we've gotten in is the following: Can you comment on the CFD win for Pentland and what this means for Hexicon?
Is this a project that can be divested? First of all, certainly a great result, a huge milestone. When talking about the Korean project, I mentioned that, you know, going through an auction and securing a PPA is probably the biggest value-driving milestone that a project passes during the development phase. That's no different for the UK project. A huge milestone to start with. Yes, on top of that, it is one of the projects that we are in process and deliberation to divest. Nothing concluded yet, but we will potentially be able to get back to you later in the near term about that. With that said, those are all the questions. Thank you very much for your attention, and look forward to seeing and speaking to you again soon. Thank you.