TotalEnergies to Receive $928M for US Wind Leases, Redirect to LNG and Gas
TotalEnergies has agreed to relinquish its two US offshore wind leases—New York Bight ($795M) and Carolina Long Bay ($133M)—for a $928M reimbursement from the US government. It will reinvest the funds into Rio Grande LNG Trains 1–4 in Texas and expand oil and gas operations in the Gulf of Mexico and Alaska.
1. Lease Reimbursement Agreement
TotalEnergies has entered into a settlement with the US Department of the Interior to abandon its Carolina Long Bay and New York Bight offshore wind leases, securing a $928 million refund equal to its original payments. These leases, acquired in mid-2022, carried an estimated combined output of over 4 GW but faced a regulatory freeze that halted their development.
2. Planned Reinvestment into Fossil Projects
The reimbursed funds will be allocated to four trains at the Rio Grande LNG facility in Texas and to expanding conventional oil drilling in the Gulf of Mexico, alongside shale gas operations. The company also signed a letter of intent for up to 2 mtpa of LNG from an Alaska project, subject to final investment decisions.
3. Strategic Rationale and Market Impact
Patrick Pouyanné stated that offshore wind development was not in US interest and that redeploying capital into gas and LNG presents greater efficiency. Critics warn the move could exacerbate regional power shortages and slow renewable capacity additions, while other developers holding costly wind leases may seek similar buyouts.