Equinor was awarded the Empire Wind lease in 2017 and the Beacon Wind lease in 2019. BP farmed into a 50% share of the Empire Wind and Beacon Wind assets in 2020 for $1.1bn.
Subject to closing conditions and with an expected close date in Q2 or Q3 2024, the swap will see Equinor take 100% ownership of Empire Offshore Wind Holdings LLC and, subject to conditions, Equinor will also gain BP’s 50% share of the South Brooklyn Marine Terminal (SBMT) lease.
In the cash neutral transaction, BP will take over Beacon Wind Holdings LLC, the associated project company that holds the Astoria Gateway for Renewable Energy site, and become the operator of the Beacon Wind projects.
Equinor will take forward on a 100% ownership basis both Empire Wind 1, with a potential capacity of 810 MW, and Empire Wind 2 with its potential capacity of over 1,200 MW. BP will take forward Beacon Wind 1 and 2, with their 1,230 MW and 1,360 MW potentials, respectively.
“We aspire to be a leading company in the energy transition. Building on our experience as a leading player in US offshore wind, we now take full ownership of a mature, large-scale offshore wind project in a key energy market, where we have built a strong local organization,” said Pål Eitrheim, executive vice president of Renewables in Equinor.
After the signing of the swap agreement, a bid was submitted for the Empire Wind 1 project in New York’s fourth offshore wind solicitation round, a call for proposals through which offshore wind projects are chosen to sell energy to New York State. Development of Empire Wind 1 is dependent on a positive outcome to the solicitation round, Equinor said, and project returns are expected on the low end of its guide range of 4-8% for renewable projects.
Equinor has had previous success in the rounds, winning an offtake contract with the state of New York for Empire Wind 1 in 2019, and then in 2021 with BP, offtake contracts for the Empire Wind 2 and Beacon Wind 1 were awarded in New York’s second solicitation round.
“Empire Wind 1 is ready to deliver on New York’s climate and energy goals, with numerous permits and supplier contracts secured. The strong commitment by the state to develop this industry is reflected in the NY4 rapid rebid offering, providing an opportunity to improve value creation for the project,” said Molly Morris, senior vice president for Renewables in the Americas in Equinor.
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