* BP becomes 50% owner of 2 U.S. offshore wind projects
* Key step in BP's renewable energy expansion
* Equinor to book $1 bln capital gain from deal
* Empire, Beacon projects to power over 2 million homes
(Adds details, quotes)
By Nerijus Adomaitis and Ron Bousso
OSLO/LONDON, Sept 10 (Reuters) - BP entered the
offshore wind market on Thursday with a $1.1 billion deal to buy
50% stakes in two U.S. developments from Norway's Equinor
, a significant step by the oil firm towards its energy
transition goals.
The British oil and gas company has set itself a target of
increasing its renewable power generation capacity 20 fold over
the coming decade to 50 gigawatts (GW)..
As part of the deal, BP and Equinor also agreed to form a
partnership to develop other offshore wind projects in the
United States, Dev Sanyal, BP's head of gas and low carbon
energy, told Reuters.
European oil firms are under pressure from activists, banks,
investors and some governments to shift away from fossil fuels
and analysts say offshore wind farms are probably the quickest
way for them to scale up.
The deal includes the Empire Wind project off New York and
Beacon Wind off Massachusetts, which could together generate up
to 4.4 GW - enough power for more than two million homes.
The Empire project is expected to start operations in the
mid-2020s, Equinor's renewables chief Pal Eitrheim told Reuters.
Equinor will be the operator of the two projects and BP
staff will join the development and construction phases as part
of the two companies' partnership to develop both bottom-fixed
and floating offshore wind facilities, he added.
Equinor expects to book capital gains of roughly $1 billion
from the transaction, an executive at the state-controlled firm
told Reuters.
"It confirms that our strategy to get early access to the
U.S. coast was right and it created the value," Equinor's head
of renewable energy Paal Eitrheim said.
The $1.1 billion deal, which does not include development
spending, is expected to close in early 2021.
BP already has a large onshore wind business in the United
States with a capacity of around 1.7 GW, but has refrained in
the past from entering the offshore wind market.
The deal challenges any assumption that renewable projects
can't offer returns on the scale offered by oil and gas, and is
likely to increase the market's confidence in Equinor's offshore
wind business, Sparebank 1 Markets analyst Teodor Sveen-Nilsen
said.
Empire Wind phase 1 secured an offtake agreement last year
and will have between 60 and 80 turbines.
(Reporting by Gwladys Fouche and Nerijus Adomaitis in Oslo and
Ron Bousso in London; Writing by Terje Solsvik; Editing by
Jacqueline Wong, Jan Harvey, Alexander Smith and David Clarke)