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US, TotalEnergies reach 'nearly $1 bn' deal to end offshore wind projects / Photo: © AFP
US, TotalEnergies reach 'nearly $1 bn' deal to end offshore wind projects
The United States and TotalEnergies on Monday signed an agreement to end the French company's offshore US wind farm projects and redirect those funds towards fossil fuel production, with the US interior secretary saying the deal was worth "nearly $1 billion."
US Interior Secretary Doug Burgum made the announcement at the annual CERAWeek conference in Houston, at an event where he appeared alongside TotalEnergies CEO Patrick Pouyanne, after which both men signed the agreement.
"We're partnering with TotalEnergies to unleash nearly $1 billion that was tied up in a lease deposit that was directed towards the prior administration's subsidies that were pushing expensive weather-dependent offshore wind," said Burgum.
Pouyanne welcomed the deal, saying it redirected TotalEnergies's $928 million investment in two wind farm leases off the North Carolina and New York coasts into US natural gas projects, in particular the Rio Grande LNG plant.
French giant TotalEnergies had four gigawatts (GW) of offshore projects under development, including 3 GW for the New York Bight project and 1 GW in North Carolina.
But at the end of 2024, Pouyanne announced that they were "put on hold" due to the unlikelihood of obtaining federal licenses from the Trump administration.
Under former president Joe Biden, the United States had accelerated progress on wind farm construction as part of its fight against climate change.
US President Donald Trump, however, has reversed course on many of Biden's climate policies, taking particular aim at wind power.
Trump has long complained about the aesthetics of wind farms, and says they produce expensive electricity.
In December, the Trump administration put five wind power projects on hold, citing "national security" risks.
That order was then nullified by rulings at several US federal courts, allowing work to resume.
In Houston on Monday, TotalEnergies CEO Pouyanne said offshore wind was "not the most affordable way to produce electricity" in the United States, which he identified as being natural gas-fired power plants.
"We could recycle all this money we are dedicating into, I would say US energy policy, and, for us, in I would say smarter investment. So it was a win-win dialog," he said.
According to a TotalEnergies statement, the company has also signed a letter of intent with Glenfarne, the lead developer of the Alaska LNG project, for the longterm offtake of 2 million tons per year of liquefied natural gas (LNG) over 20 years.
X.Eom--SG
