Matthew Rigdon, Executive VP and COO

The harsh realities of offshore renewables, particularly in the USA, continue to prove problematic for those that have invested in that market. While an “all of the above” approach to solving our collective energy transition problem is appropriate, far too much optimism is being driven by government inducement. While both positive and negative, it is resulting in troubled offshore wind projects that simply are not feasible in the current technological and economic environments. We should continue to applaud the significant investments global energy companies are making in the quest for sustainability, so long as they actually make sense. 

What doesn’t make sense to me, however, is the continued maligning of investment in conventional offshore oil and gas. Much of the early momentum that took investments toward offshore renewables (and renewables in general) is beginning to shift. Some energy companies have been very forthright about needing to refocus on oil and gas. Shell, as an example, has made a significant and necessary strategy shift back to oil and gas. This pivot is a practical as the cash flow from oil and gas production is what will fund the future of renewables for that survive the energy transition. The reality is that the renewables market is far from sustainable (excuse the pun.) Investment dollars must be focused on oil and gas to insure survival, then increase renewables investments when the technological and market conditions are economically viable. 

The cancellation of the Empire Wind 2 project just a few weeks ago further exemplifies these company shifts. In 2023 Empire Offshore Wind, a joint venture between BP and Equinox, had awarded various contracts begin the subsea and surface infrastructure of the project. However, those contacts have now been canceled as significant challenges have made it no longer economically viable. 

There still needs to be continued investment in renewable energy solutions, including offshore wind in the USA. However, it seems that the number and scope of potential projects must be more closely evaluated, particularly when compared to the viability of similarly sized investment potential in conventional offshore oil and gas.