British petroleum giant BP is making its first move into the growing offshore wind market by partnering up Norway’s Equinor to develop offshore wind farms in the United States.
Under the deal, BP will spend $1.1 billion for a 50 percent interest in Equinor’s Empire Wind and Beacon Wind assets located offshore Massachusetts and New York, respectively. Equinor will remain operator in the projects.
Today’s announcement marks BP’s first venture into offshore wind, a renewable energy source which is forecast to grow six-fold globally in the next 10 years, according to BloombergNEF.
“This is an important early step in the delivery of our new strategy and pivot to truly becoming an integrated energy company,” said Bernard Looney, BP’s CEO. “Offshore wind is growing at around 20% a year globally and recognized as being a core part of the world’s need to limit emissions. Equinor is a recognized sector leader and this partnership builds on a long history between our two companies. It will play a vital role in allowing us to deliver our aim of rapidly scaling up our renewable energy capacity, and in doing so help deliver the energy the world wants and needs.”
BP says the deal is part of a new strategy announced by the company in August to increase annual low carbon investment 10-fold to around $5 billion a year by 2030, as well as grow developed renewable generating capacity from 2.5 gigawatts (GW) in 2019 to around 50GW by 2030.
Empire Wind is slated for offshore waters off New York City. With a total area of 80,000 acres, it is expected to have an installed capacity of 2 gigawatts (GW). Beacon Wind, meanwhile, will be located offshore Massachusetts state with a total area of 128,000 acres and an installed capacity of 2.4 gigawatts (GW).
The deal is subject to customary regulatory and other approvals and is expected to close in early-2021.