KEY POINTS
- TotalEnergies will abandon offshore wind projects in the U.S. and redirect nearly $1 billion into fossil fuel development.
- The U.S. government will reimburse Total for wind lease payments, drawing criticism from the offshore wind industry.
- Investments will focus on LNG, conventional oil, and shale gas projects, reflecting a policy shift toward traditional energy sources.
French energy company TotalEnergies and the United States government announced an agreement to redirect nearly $1 billion from offshore wind leases to domestic oil and natural gas projects.
The move marks a significant change in strategy, as the U.S. continues its push to increase fossil fuel production while scaling back support for clean energy initiatives.
Under the agreement, the U.S. will reimburse TotalEnergies for the payments made on offshore wind leases, and the company has agreed not to pursue new offshore wind projects in the country.
The decision is part of a broader effort by the Trump administration, which has criticized offshore wind as expensive, unreliable, and subsidy-dependent.
The deal has drawn criticism from the offshore wind sector. Oceantic Network, a trade group, described the agreement as political theater that removes wind capacity from the energy pipeline at a time of rising energy prices. Critics argue that existing offshore wind projects continue to provide reliable and affordable power.
Interior Secretary Doug Burgum defended the move, stating that it aligns with the administration’s goal of providing affordable and reliable energy to Americans.
The shift reflects broader policy priorities that favor conventional energy development over renewable projects in the near term.
Planned investments in fossil fuel projects
TotalEnergies will invest $928 million in 2026 to develop four trains at the Rio Grande LNG plant in Texas and expand upstream conventional oil production in the Gulf of Mexico, as well as shale gas projects.
As a result, offshore wind leases in the Carolina Long Bay and New York Bight areas, executed in 2022, will be terminated, and Total will receive reimbursement.
Total CEO Patrick Pouyanne stated that offshore wind is not the most affordable method to produce electricity in the U.S., emphasizing that fossil fuel investments offer a more cost-effective energy solution for the country. The announcement was made at the CERAWeek energy conference in Houston.
