The US government has issued a halt work order for the Empire Wind project. Equinor, which is executing the project, has subsequently stopped the offshore construction in waters of the outer continental shelf offshore New York.
On April 16, Equinor‘s company Empire Offshore Wind LLC received notice from the Bureau of Ocean Energy Management (BOEM), ordering Empire to halt all activities on the outer continental shelf until BOEM has completed its review. Empire states it is engaging with relevant authorities to clarify this matter and is considering its legal remedies, including appealing the order.
Also read: Fugro at work on Equinor’s European CO2 highway
Federal lease from 2017
The federal lease for Empire Wind was signed with the US Administration in 2017. Empire Wind 1 has validly secured all necessary federal and state permits and is currently under construction.
The project is being developed under contract with New York State Energy Research and Development Authority (NYSERDA) to provide electricity for the State of New York. Empire Wind 1 has the potential to power 500,000 New York homes.
Also read: Shell and Equinor plan UK’s largest oil and gas company
Financial consequences
Upon receipt of the stop work order, immediate steps were taken by Empire and its contractors to initiate suspension of relevant marine activities, ensuring the safety of workers and the environment.
Empire Wind has per March 31, 2025, a gross book value of around USD 2.5 billion, including South Brooklyn Marine Terminal. Equinor’s ownership to Empire is held through the Equinor Wind US LLC.
Total amount drawn under the project finance term loan facility per March 31, 2025, was around USD 1.5 billion. Empire is in the process of ascertaining the impact on the project and project financing. Equinor US Holdings Inc has provided guarantees for the equity commitment in the project financing.
In a full stop scenario, the USD 1.5 billion will be repaid from the equity commitment to the project finance lenders and Empire Offshore Wind LLC will be exposed to termination fees towards its suppliers.
Picture by Empire Offshore Wind.
Also read: ‘Trump’s America First trade policy is hurting US shippers’
