The White House has consented to provide TotalEnergies $1 billion to halt East Coast wind farm initiatives that it deemed “expensive,” as the French energy corporation’s funding will now be redirected to U.S. LNG production.
The U.S.’ Department of the Interior (DOI) declared on Monday what it referred to as “a significant agreement” with TotalEnergies for the firm “to shift resources from costly, unreliable offshore wind leases to affordable, dependable natural gas projects that will deliver secure energy for diligent Americans.”
TotalEnergies has pledged to allocate around $1 billion — the worth of its canceled offshore wind leases — towards oil and natural gas and LNG production within the U.S., as per the DOI stated in an announcement.
After the new investment, the department indicated that the U.S. will reimburse the corporation dollar-for-dollar, up to the costs incurred for leasing offshore wind.
The arrangement will entail TotalEnergies shelving its offshore wind projects in New York and Carolina. Instead, it will invest in the construction of four trains at the Rio Grande LNG facility in Texas, as well as upstream conventional oil in the U.S. Gulf and shale gas production.
U.S. President Donald Trump has openly expressed his disdain for offshore wind initiatives, often criticizing such ventures as costly and unattractive.
This announcement arrives as the Iran situation continues to impact global oil and gas supplies, positioning the U.S. — the largest liquefied natural gas (LNG) exporter globally — as an increasingly vital supplier for markets in Asia and Europe.
The DOI conveyed on Monday that, “due to national security issues,” TotalEnergies has committed to refraining from developing any new offshore wind projects in the U.S. CNBC has reached out to TotalEnergies for a statement and is awaiting a reply.
Patrick Pouyanné, chairman of the Board of Directors and CEO of TotalEnergies, was cited in the DOI’s announcement as expressing satisfaction to have signed the settlement agreement “and to endorse the Administration’s Energy Policy.“
“Given that pursuing offshore wind projects is not in the country’s best interest, we have opted to abandon offshore wind development in the United States, in return for the reimbursement of lease costs,” he reportedly stated.
Pouyanné mentioned that the agreement will enable the organization to “foster the growth of U.S. gas production and export.”
“These investments will help supply Europe with essential LNG from the U.S. and provide gas for U.S. data center development. We see this as a more optimal deployment of capital in the United States,” he added.
U.S. Secretary of the Interior Doug Burgum referred to the agreement with the French energy giant as “another triumph for President Trump’s dedication to affordable and reliable energy for all Americans.”
“Offshore wind is among the most pricey, unreliable, environmentally intrusive, and subsidy-dependent ventures ever imposed on American ratepayers and taxpayers. We appreciate TotalEnergies’ commitment to pursuing projects that deliver consistent, economical power to reduce the bills of Americans,” he concluded.
