Veer Group, the Lunenburg, NS, startup that plans to build hydrogen- and wind-powered container ships, has signed a €50 million, or about C$73.2 million letter of intent with a European backer to finance its first two vessels.

Founded by shipping entrepreneur Danielle Southcott, the company is in the midst of the tender process with shipyards. Her team recently toured a production facility for DynaRig sails, which are an industry-leading sail rig for large vessels made by marine manufacturer Southern Spars.

At the end of this month, Veer Group will also close its seed round, which Southcott said previously would go towards funding its operations while its first ships are built. As of April, the round had raised US$1.6 million or C$2.2 million, and this month Veer bagged an additional $295,000 of investment. When the seed round closes Southcott plans to immediately open a Series A round.

“Our crew is beginning to review the bids received from shipyards,” wrote Southcott in a note to investors. “Veer’s tender pack is comprised of 22 documents totalling 825 pages of detailed work by the multiple engineering firms that are part of our team.

“Receiving bids from shipyards is an exciting time: our team gains clarity on construction costs, financing options, and delivery timelines from the shipyards who will ultimately be responsible for the construction and delivery of Veer’s first two ships.”

Southcott, who hails from near Kingston, Ontario, previously founded Costa Rican shipping company SAILCARGO, which builds and operates wooden sailing ships augmented with electric motors. A combination of sails and hydrogen is better suited to container ships like those Veer plans to build because hydrogen is more energy dense than batteries.

Veer’s planned ship design has also already been approved by the American Bureau of Shipping, which provides certification services to the marine industry. The company will operate its own ships under charter for other businesses, rather than selling them outright, because hydrogen ships have specialized operating requirements.

“We are open to partnering with shipping firms, but due to the unique nature of the vessel, we want to make sure that the crew training and logistics and everything is handled in a way that is appropriate for the ship,” said Southcott in April