By Andrea Shalal-Esa
WASHINGTON Feb 11 Top U.S. arms maker Lockheed
Martin Corp on Tuesday said it had signed an agreement
with a unit of Ocean Power Technologies Inc to harness
the motion of ocean waves to generate electricity off the coast
of Victoria, Australia.
The A$230 million ($205.68 million) deal will produce the
world's largest wave energy project using power buoys designed
by Ocean Power Technologies that tap energy from the surface
motion of waves.
News of the deal sent Ocean Power's shares up nearly 60
percent to $3.66 on the Nasdaq Stock Exchange. Lockheed shares
rose 2.5 percent to $157.82 on the New York Stock Exchange.
Once completed around 2018 or 2019, the project will
generate 62.5 megawatts of peak power, enough to meet the needs
of 10,000 homes, Lockheed said. That is about one-third the
capacity of a small coal-fired power plant in the United States.
"Ocean energy is a tremendously large, untapped resource
which has global applicability," said Tim Fuhr, director of
ocean energy for Lockheed. "You can pretty much get ocean energy
on coastlines around the world. It's essentially clean and the
fuel is free."
The agreement is part of a drive by Lockheed - the maker of
F-35 fighter jets and coastal warships - to expand its foothold
in the alternative energy business as it seeks to offset a slump
in U.S. and European military budgets.
The company last year announced a deal with Chinese consumer
products firm Reignwood Group to design the biggest power
station fueled by differences in ocean temperatures.
It also has projects based on tidal power.
Energy from ocean waves is more predictable than wind and
solar energy, and can generate electricity for more hours in the
year than other alternate energy sources, Lockheed said.
The power buoys to be used in this project will rise about
30 feet (9.1 meters) out of the water, far smaller than wind
turbines, which are typically 130 feet (40 meters) tall and have
drawn public resistance.
Fuhr said Lockheed had worked with Ocean Power Technologies
on several smaller projects for the U.S. Department of Energy
since 2004, and kicked off initial work on this project about 18
months ago. Lockheed recently signed an agreement with Victorian
Wave Partners, an Australian special purpose company owned by
Ocean Power, to develop the wave project.
The goal is to complete the first phase by 2014 or 2015,
producing about 2.5 megawatts of peak power, Lockheed said.
Fuhr said Lockheed hoped to leverage its design and
engineering skills to help commercialize the new energy source
in coming years. Under the agreement with Victorian Wave,
Lockheed will handle overall management of the project, assist
with design for manufacturing of the power buoys, produce
selected components, and integrate the wave energy converters.
Lockheed was part of a consortium that built the first
net-power producing facility in the 1970s based on ocean thermal
energy conversion. Since then, it has invested tens of millions
of dollars in ocean energy initiatives, Fuhr said.
He said Lockheed was beginning to see revenues from those
investments, but declined to provide estimates for the amount.
The company does not break down revenues by individual sectors.
Fuhr said he expected it to take until the 2020s before
different forms of ocean energy accounted for a significant
percentage of world energy production. Countries such as
Australia and Britain were among the most forward leaning at the
moment, although there are some U.S. projects as well, he added.