• Tuesday, July 16, 2024
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These three oil majors are betting big on wind energy

Inside western countries’ plot to cut oil imports from Nigeria, others

In a bid to find new ways to reduce emissions, generate growth and maintain share price, Royal Dutch Shell, British Petroleum (BP), and France’s Total are intensifying plans for energy diversification by creating strategies that will allow offshore wind turbines replace oil rigs before the end of this decade.

The world’s biggest oil and gas companies are stepping up efforts to develop wind power, as the focus on renewables gains traction amid ongoing efforts to achieve peak carbon dioxide emissions by 2030.

For instance, Shell’s pursuit of offshore wind allowed it teamed up with Dutch renewable energy company Eneco to build giant wind farms off the coast of the Netherlands.

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The investment will help the two energy firms to scale the innovative wind project, which is scheduled to come online in 2023.

“Big Oil’s” big spending on offshore wind is an investment in their long-term future,” Mark Lewis, the chief sustainability strategist at BNP Paribas Asset Management, a major investor in renewable energy, said in a note.

BP is also partnering with German firm Energie Baden-Wuerttemberg (EnBW) to develop two giant wind farms in the Irish Sea which could power as many as 3.4 million homes across the United Kingdom.

“This is both important progress towards BP’s transformation into an integrated energy company as well as a significant next step in our long history in the UK,” CEO of BP, Bernard Looney, explained of the development.

The two wind projects come as BP pledged to spend $5 billion a year in low-carbon investments as part of its renewable energy strategy.

Recently, BP signed a partnership with Norwegian state oil company Equinor to develop existing offshore wind in the U.S at a cost of $1.1 billion. In September 2020, the company announced plans to advance a project that is expected to produce 50GW of renewable power by 2030, generating power for over two million houses.

French oil giant Total also won in the auction, partnering with Macquarie’s Green Investment Group to secure a 1.5 GW project off the East Anglian coast. This sees the U.K. lending all suitable areas of its coastline to wind production.

“Happily for oil companies there are opportunities in offshore wind,” Lewis said. “It is a great growth market where they already have some transferable skills because the engineering proposition is very similar. We’re talking about building big infrastructure in the middle of the sea, and that’s something we know oil companies do well.”