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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.
