BP Takes on Billion-Dollar Stake in Equinor’s US Offshore Wind Power Projects
Two of Europe’s largest oil and gas producers will lead four offshore wind projects that together have the potential of powering 2 million homes.
BP and Equinor announced today that they will join forces to build large windfarm projects that have a combined potential to produce 4.4 gigawatts (GW), enough to power 2 million homes along the US East Coast.
Under the agreement, BP is purchasing a 50% nonoperated interest in two lease areas offshore New York and Massachusetts for a sum of $1.1 billion.
Equinor has held a 100% stake in the two leases that it acquired in 2017 and 2019, respectively. The deal marks BP’s first offshore wind venture and another step toward its recently announced goal to increase its current renewable energy capacity from 2.5 GW to 50 GW by 2030. London-based BP said it will also increase its annual low-carbon investments 10-fold to nearly $5 billion annually.
BP’s Executive Vice President for gas and low-carbon energy Dev Sanyal said the two companies will likely be working together on other projects in the US wind market. “This partnership provides an extraordinary opportunity for our two companies to work together in pursuit of our shared ambition—creating better, lower-carbon energy for the world.”
About 15 to 30 miles southeast of Long Island, New York, is the Empire Wind project which includes 80,000 acres in water depths between 65 and 131 ft. First power from the lease could come sometime in the mid-2020s, BP said, with a final installed capacity of 2 GW.
About 20 miles south of Nantucket, Massachusetts, is the Beacon Wind project which is 128,000 acres and could generate up to 2.4 GW. No timeline for first power from this project was given. Both projects will use 10-MW wind turbines which can have blades longer than 300 ft—roughly the same length as a football field.
Though Equinor will remain operator on the project, BP will nominate its own deputy project director for the Empire Wind project. The companies said over time the wind assets of both projects will be equally staffed by BP and Equinor.
Equinor has been involved in offshore wind projects for a decade and plans to grow its renewable energy capacity from 4 GW to 6 GW by 2026 and from 12 GW to 16 GW by 2035. The company said in a statement that the BP deal “demonstrates Equinor’s ability to create value from developing offshore wind projects.”
Equinor is also looking outside of the US for other wind projects. In addition to its ongoing projects in the North and Baltic seas, the company also said this week that it formed a separate partnership with two Japanese utility companies to submit bids in Japan’s first-ever offshore wind auction next year. In 2017, Equinor commissioned the world’s first offshore wind farm off the Scottish coast.