(Alliance News) - BP PLC on Thursday announced its strategic partnership with energy company Equinor ASA to develop offshore wind projects in the US.
The venture will see both companies jointly develop four assets under two licences located off the shores of New York and Massachusetts, which together have the potential to generate power for more than 2 million homes.
On top of the strategic partnership, BP will purchase a 50% interest in both the Empire wind and Beacon wind assets from Equinor.
BP shares were down 0.9% at 259.93 pence each on Thursday morning in London.
The Empire wind asset is planned for an area of 80,000 acres about 20 miles south of Long Island in New York, and will be developed in two phases.
BP said that Empire wind phase one secured an offtake agreement in the July 2019 solicitation and will have between 60 and 80 turbines with a potential generation capacity of 2 gigawatts. First power from Empire wind's phase one is expected in the mid-2020s and phase two is preparing for upcoming solicitations.
Beacon wind is planned for an area of 128,000 acres approximately 20 miles south of Nantucket and when fully developed is expected to have a capacity of 2.4 gigawatts. Beacon wind will be developed for future solicitation opportunities and will begin a review process to secure all necessary permits for the project.
This will be the oil and gas company's debut in offshore wind power generation and what the company calls "an important step" to its goal of developing 50 gigawatts of renewable power by 2030.
BP Chief Executive Bernard Looney said: "This is an important early step in the delivery of our new strategy and our pivot to truly becoming an integrated energy company. Offshore wind is growing at around 20% a year globally and is recognized as being a core part of meeting the world's need to limit emissions.
The agreement will see Equinor remaining at the helm as operator of the two projects, focusing on the development, construction and operations phases. The deputy project director for Empire wind will however be nominated by BP and over time the wind assets will be equally staffed by BP and Equinor.
The agreement comes a month after BP announced its new strategy which aims to increase its annual low carbon investment 10-fold to around USD5 billion a year and grow its developed renewable generating capacity from 2.5 gigawatts in 2019 to around 50 gigawatts by 2030.
Looney said: "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."
Equinor shares closed at USD15.52 each in New York on Wednesday.
By Greg Roxburgh; gregroxburgh@alliancenews.com
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