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The Trump administration has agreed to pay TotalEnergies almost $1bn to pull out of offshore wind in the US and invest instead in oil and gas production, as it tries to boost supplies of fossil fuels.
The Department of the Interior said on Monday that it would reimburse the French energy company the full $928mn cost of its two offshore wind leases in exchange for the company cancelling the leases and spending the money instead on producing oil and gas.
The deal comes as President Donald Trump is under pressure to limit energy price increases triggered by the war in Iran, which have pushed up pump prices for US motorists.
It also reflects his dislike for offshore wind, which he has dismissed as costly and unreliable. In December, the administration cancelled the leases of all major offshore wind projects under construction in the US, citing national security concerns due to potential radar interference. Courts have subsequently allowed the projects to proceed.
Announcing the deal at the CeraWeek conference in Houston, Doug Burgum, interior secretary, said offshore wind was “expensive, unreliable [and] environmentally disruptive” and the oil and gas investment would help “lower Americans’ monthly bills”.
Patrick Pouyanné, chief executive and chair of Total, said the deal would fund its Rio Grande liquefied natural gas project, which he said could help supply gas to Europe, as well as oil production in the Gulf of America and shale gas production.
“Considering that the development of offshore wind projects is not in the country’s interest, we have decided to renounce offshore wind development in the US, in exchange for the reimbursement of the lease fees,” he said.
“We believe that this is a much more efficient use of capital in the US.” The gas would also supply US data centres, he added.
Total’s offshore wind leases, which are off the coasts of New York and North Carolina, were not included in Trump’s cancellation of wind leases in December as they were not yet under construction.
The company paused the development of both projects in November 2024 after Trump won the general election, citing market uncertainties. The projects would have a combined capacity of about four gigawatts.
The New York project, known as Attentive Energy, was a joint venture with Corio Generation and Rise Light and Power, although they joined the project after Total won the leases in 2022.
Under today’s deal, Total has also pledged “not to develop any new offshore wind projects in the US”, the interior department said in its press release.