BREAKING: US Gov’t, TotalEnergies Strike USD 1 Billion Deal; Company to Invest Reimbursed Offshore Wind Fees in Its Oil & Gas Projects

The US Department of the Interior (DOI) and TotalEnergies have signed settlement agreements to terminate the company’s two offshore wind leases in the United States, confirming recent reports that a deal was being drafted under which TotalEnergies would be reimbursed USD 928 million (around EUR 806 million) paid in lease fees.

Under the deal, TotalEnergies, along with its partners, will relinquish the offshore wind lease areas in Carolina Long Bay and New York Bight, and recover the lease fees from the US government. The company will then invest an equal amount in the construction of the 29 Mt Rio Grande LNG plant and the development of its oil and gas activities in the US, according to TotalEnergies’ press release from 23 March.

According to a press release from the DOI, TotalEnergies has also “pledged not to develop any new offshore wind projects in the United States”.

The company secured both lease areas in 2022, first the Attentive Energy lease area in New York Bight (OCS-A 0538) and then Carolina Long Bay (OCS-A 0545). The information from the time the lease sales closed stated that TotalEnergies (and partners) won the sites by bidding USD 795 million for the New York Bight area and USD 160 million for the Carolina Long Bay offshore wind lease area.

According to the DOI’s press release, OCS-A 0538 in the New York Bight was fully executed by Attentive Energy (a joint venture between TotalEnergies and EnBW at the time) on 1 May 2022, after payment of USD 795 million, and the lease area in Carolina Long Bay (which the DOI states as being OCS-A 0535), was fully executed by TotalEnergies on 1 June 2022, after payment of a little over USD 133.3 million.

The DOI said on 23 March that under the new deal, TotalEnergies will invest the reimbursed USD 928 million in 2026 in the development of Train 1 to 4 of the Rio Grande LNG plant in Texas, and the development of upstream conventional oil in the Gulf of America and of shale gas production.

TotalEnergies, NextDecade, and their partners Global Infrastructure Partners (GIP), GIC, and Mubadala made the final investment decision (FID) for the development of Train 4 of Rio Grande LNG (RGLNG) in September 2025, according to a report from our sibling news site Offshore Energy.

For the settlement agreement on the French energy company’s offshore wind leases, the DOI stated that TotalEnergies would redirect capital from “expensive, unreliable offshore wind leases toward affordable, reliable natural gas projects that will provide secure energy for hardworking Americans.”

“Under this innovative agreement driven by President Donald J. Trump’s Energy Dominance Agenda, the American people will no longer pay for ideological subsidies that benefited only the unreliable and costly offshore wind industry”, the DOI stated in its press release.

TotalEnergies said on 23 March that its own studies on these leases had shown that offshore wind developments in the US, unlike those in Europe, were “costly and might have a negative impact on power affordability for U.S. consumers” and that other technologies are available to meet the country’s growing demand for electricity more affordably, so the company considers there is no need to allocate capital to offshore wind technology in the US.

The oil & gas projects in the US will not only support domestic supply but also the demand in Europe, according to the company, which has several gigawatt-scale offshore wind projects in Europe, as well as in the Asia-Pacific region, and was reported to also be eyeing offshore wind projects in Brazil.

YOU MIGHT ALSO LIKE

• Corio, TotalEnergies Get Development Consent for 1.5 GW UK Offshore Wind Farm
• TotalEnergies Applies for Permits for 3 GW German Offshore Wind Projects
• TotalEnergies-RWE Consortium Wins France’s Largest Offshore Wind Tender
• RWE, TotalEnergies to Install Nature-Inclusive Scour Protection at Dutch Offshore Wind Farm

“[These agreements], under which we will reinvest the refunded lease fees to finance the construction of the 29 Mt Rio Grande LNG plant and the development of our oil and gas activities, allows us to support the development of U.S. gas production and export. These investments will contribute to supplying Europe with much-needed LNG from the U.S. and provide gas for U.S. data center development. We believe this is a more efficient use of capital in the United States”, said Patrick Pouyanné, Chairman of the Board of Directors and Chief Executive Officer of TotalEnergies.

For Oceantic Network, the US offshore renewable energy industry organisation, which has been pointing out the Trump administration’s commitment to an “all-of-the-above” energy strategy, the news about the settlement agreement between the now-former developer of US offshore wind projects and the government does not align with the country’s needs, especially in terms of the impact on consumer bills.

“After failing to shut down offshore wind through strong-arm tactics and litigation losses, the administration is now spending $1 billion in taxpayer dollars to force developers out of the market—wrapped in a false narrative about affordability, reliability, and national security”, said Sam Salustro, SVP of Policy & Market Affairs at Oceantic Network.

Salustro noted that security claims were reviewed and dismissed by multiple federal judges, and that the Department of the Interior (DOI) and Department of Defense (DOD) had repeatedly signed off on projects well before construction began. 

“Offshore wind’s long-term trajectory remains secure in the U.S. as states continue to make the power source a foundational part of their energy mixture that creates good-paying local jobs. This is political theater meant to obscure the fact that offshore wind capacity is being pulled out of the pipeline when energy prices are skyrocketing, even as other offshore wind projects continue delivering reliable and affordable power to the grid. Paying to remove affordable, homegrown energy out of the equation leaves American consumers struggling to pay their electricity bills”, said Salustro.

Reach the offshore wind industry in one go!

offshoreWIND.biz is read by thousands of offshore wind professionals every day.

—

Increase your visibility with banners, tell your story with a branded article, and showcase your expertise with a full-page company profile in our offshore wind business directory.

CONTACT

Follow offshoreWIND.biz on: