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Equinor eyes 1-GW Norwegian floating offshore wind farm to help decarbonize oil production, cut costs

22 June 2022 Cristina Brooks

A group of European and US oil companies is seeking to begin using the North Sea's offshore wind resources to power cheaper production.

Two Norwegian state-owned companies, Equinor and Petoro, said on 17 June they would conduct feasibility studies with Shell, TotalEnergies, and ConocoPhillips.

The so-called Trollvind floating wind farm would have about 1 GW (4.3 TWh) of capacity, which far exceeds all existing and some planned floating wind projects.

The project nears the size of Hornsea One, the world's largest bottom-fixed offshore wind farm when the UK facility commenced operations in 2021.

If the partners move ahead with a final investment decision in 2023, the Trollvind wind farm could start up in 2027.

The project is set to contribute to the electrification of production facilities at the Troll offshore field, which is the largest oil field on the Norwegian continental shelf.

Trollvind could help power the two newer production facilities focused on oil reserves in Troll Vest, Troll B and Troll C, as well as those at a separate field called Oseberg.

It would also power the Kollsnes natural gas processing plant on the island of Oøy, originally operated by Troll producers and now operated by Norwegian state-owned pipeline company Gassco.

Finally, the project could also provide power to Bergen, Norway's second largest city.

Each of the study partners has a stake in the Troll field through their partnerships and affiliates: Petoro (56%), Equinor (30.6%), Shell (8.1%), TotalEnergies (3.7%), and ConocoPhillips (1.6%).

Equinor is the main stakeholder in the Oseberg field with a 49.3% interest, followed by Petoro, TotalEnergies, and ConocoPhillips.

A precedent for using floating wind to power oil and gas production was set by Equinor's far smaller pilot floating wind project, the 88-MW Hywind Tampen project in Norway, which is expected to supply oil production installations on startup later this year.

Cost of power rationale

The proposed floating wind farm will not require Norwegian state subsidies, instead relying on oil and gas producers as anchor customers.

The agreement would ensure the producers have long-term access to power at stable prices while securing enough income to trigger investment in the floating wind farm, Trollvind's backers said.

It would also decrease the producers' costs. Equinor estimated the price of power from Trollvind could be as low as 10 cents/kWh.

While the Troll A production facilities were already electrified using grid connections near Kollsnes, the plans to use Trollvind to electrify the Troll B and C facilities were approved by the Norwegian Ministry of Petroleum and Energy last year.

About 35% of the project's power offtake could go to Troll B and Troll C, although the markets for Trollvind have not yet been set in stone.

The onshore Kollsnes gas production facility is another possible power offtaker. "Trollvind will be connected to shore and the grid at Kollsnes on the west coast of Norway, which means that the wind farm can also deliver power to an area where shortages have already created challenges," Equinor UK spokesperson Alice Baxter told Net-Zero Business Daily by S&P Global Commodity Insights.

The rest of the production would likely go to other onshore users.

Oil, floating wind technology development

A day before the feasibility study was announced, Equinor launched a floating wind turbine concept collaboration with French engineering firm Technip Energies that saw the pair "teaming up at an early design phase of a floating wind farm project."

But it remains to be decided whether the Technip-Equinor floating wind turbine concept will be used in the Trollvind project. "As Trollvind is still early phase, the concept and technological basis of the project will be matured as part of the study work towards a potential final investment decision during 2023," said Baxter.

Technip and Equinor said they are seeking to create an adaptable floating wind turbine that can be used in different geographies, leveraging Equinor's 20 years of experience in the floating wind field at its Hywind Tampen and Hywind Scotland projects.

They envisage building floating wind turbine manufacturing supply chains locally wherever the turbines operate.

Floating wind turbine manufacturing and installation costs continue to block companies aiming to bring the fledgling technology to commercial stage projects, for which "there is still a way to go," as Equinor noted in the statement.

It said that the Hywind projects contributed to decreases in floating wind costs, but that the sector should aim for more industrial standardization.

"We have already started to see early signs of value creation from this way of working in our early-phase floating wind projects in Southern Brittany in France and Firefly in South Korea," said Beate Myking, Equinor's senior vice president for renewables solutions.

Posted 22 June 2022 by Cristina Brooks, Senior Journalist, Climate and Sustainability

This article was published by S&P Global Commodity Insights and not by S&P Global Ratings, which is a separately managed division of S&P Global.


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