Equinor ASA has announced a final investment decision on Empire Wind 1 and financial close for $3 billion in debt financing for the under-construction project offshore Long Island, expected to power 500,000 New York homes.
The Norwegian majority state-owned energy major said in a statement it intends to farm down ownership “to further enhance value and reduce exposure”.
Equinor has taken full ownership of Empire Wind 1 and 2 since last year, in a swap transaction with 50 percent co-venturer BP PLC that allowed the former to exit the Beacon Wind lease, also a 50-50 venture between the two.
Equinor has yet to complete a portion of the transaction under which it would also acquire BP’s 50 percent share in the South Brooklyn Marine Terminal lease, according to the latest transaction update on Equinor’s website. The lease involves a terminal conversion project that was intended to serve as an interconnection station for Beacon Wind and Empire Wind, as agreed on by the two companies and the state of New York in 2022.
“The expected total capital investments, including fees for the use of the South Brooklyn Marine Terminal, are approximately $5 billion including the effect of expected future tax credits (ITCs)”, said the statement on Equinor’s website announcing financial close.
Equinor did not disclose its backers, only saying, “The final group of lenders includes some of the most experienced lenders in the sector along with many of Equinor’s relationship banks”.
“Empire Wind 1 will be the first offshore wind project to connect into the New York City grid”, the statement added.
“The redevelopment of the South Brooklyn Marine Terminal and construction of Empire Wind 1 will create more than 1,000 union jobs in the construction phase”, Equinor said.
On February 22, 2024, the Bureau of Ocean Energy Management (BOEM) announced it had allowed Equinor to proceed with the construction of Empire Wind 1 and 2, which would rise in part in New York and in part in New Jersey. “Together these projects would have a total capacity of 2,076 megawatts of clean, renewable energy that BOEM estimates could power more than 700,000 homes each year”, the Interior Department sub-agency said in a statement then.
On March 1, 2024, the New York State Energy Research and Development Authority (NYSERDA) announced the 810-MW Empire Wind 1 as one of the conditional winners in its fourth offshore wind solicitation round.
On March 27, 2024, Empire Offshore Wind LLC said it had inked a union deal securing construction work for the project to convert the shipping terminal into a staging and assembling facility that will serve the two Empire Wind facilities.
On June 5, 2024, Equinor announced a purchase and sale agreement with NYSERDA for Empire Wind 1.
“At a strike price of $155.00 per MW/h [megawatt hour] Empire Wind 1 is expected to deliver forward looking real base project returns within the guided range for renewable projects”, Equinor said at the time.
To contact the author, email [email protected]
What do you think? We’d love to hear from you, join the conversation on the
Rigzone Energy Network.
The Rigzone Energy Network is a new social experience created for you and all energy professionals to Speak Up about our industry, share knowledge, connect with peers and industry insiders and engage in a professional community that will empower your career in energy.
MORE FROM THIS AUTHOR