Statoil Wind wins right to build wind farm off Long Island
Statoil's Sheringham Shoal wind farm in the North Sea. The proposal off Long Island is its first wind lease in the United States. Credit: Statoil / Alan O’Neill
Statoil Wind won leasing rights Friday to build an offshore wind farm in 79,350 acres of ocean 11 miles off Jones Beach with a record-setting bid of $42.46 million, the federal Bureau of Ocean Energy Management said.
Statoil Wind US LLC, an international energy company with offices in Houston, outlasted five other bidders, including the New York State Energy Research and Development Authority, in an online auction that lasted 33 rounds.
“We are excited to have submitted the most competitive bid in a highly attractive project, Statoil’s first offshore wind lease in the United States,” said Irene Rummelhoff, the company’s executive vice president for New Energy Solutions.
U.S. Interior Secretary Sally Jewell said the auction “underscores the growing market demand for renewable energy among our coastal communities.”
Statoil said it would work with the state energy authority, runner-up in the auction, as it conducts studies of the project area.
Headquartered in Norway, Statoil operates in 36 countries and has 22,000 employees worldwide focused on oil exploration and production.
Other bidders were Avangrid Renewables LLC, DONG Energy Wind Power Inc., Innogy US Renewable Projects LLC and wpd offshore Alpha LLC.
The auction began Thursday with participants agreeing to pay a minimum of $158,700, the original asking price set by the Ocean Energy Management bureau, part of the Interior Department. The number of bidders dropped to four when the price reached $14.46 million, and another dropped out when the price hit $19.46 million.
At day’s end Thursday, the three participants were each bidding $25.46 million. On Friday, the field narrowed to Statoil and the state authority as the price reached $33.46 million.
“We have seen robust competitive interest for this auction, as evidenced by 33 rounds of bidding — the most we have seen for any of our lease sales to date,” said Abigail Ross Hopper, the bureau’s director.
The previous record for a U.S. offshore wind lease was $8.7 million, paid in 2014 to develop two ocean zones off Maryland, said Tracey Moriarty, a spokeswoman for the bureau. Auction proceeds go to U.S. Treasury Department, officials said.
The Department of Justice and Federal Trade Commission will conduct an anti-competitiveness review of the auction before the lease is executed, officials said.
Statoil also must submit a plan detailing its vision for the project, conduct an environmental review and give the public an opportunity to comment on the plans.
If its plans are approved, Statoil would have 25 years to construct and operate the project.
Fishing groups, including the largest commercial fishing association on Long Island, filed suit this month seeking to block the project, alleging the 194 turbines would hinder access to vital fishing grounds.
The auction marked the first time in six auctions for Atlantic Coast wind-energy areas that a government entity bid against private developers, Moriarty said.
The state energy authority said it “remains committed to the development of cost-effective offshore wind that will benefit all New Yorkers by producing clean, renewable energy, while growing a robust offshore wind infrastructure that supports new jobs.”
Kevin Law, president of the Long Island Association, the region’s largest business organization, called Statoil’s win “good news” for Long Island’s “renewable energy efforts.”
With David M. Schwartz
Robert Brodsky is a breaking news reporter who has worked at Newsday since 2011. He is a Queens College and American University alum.
Updated now Newsday travel writer Scott Vogel took the ferry over to Block Island for a weekend of fun.
Updated now Newsday travel writer Scott Vogel took the ferry over to Block Island for a weekend of fun.
