Equinor Takes $955 Million Charge Citing US Wind Policy and Tariffs

South Brooklyn Marine Terminal — Equinor cited the diminished prospects and the costs for the development of the terminal, which it expected would be covered by multiple projects (Equinor)

The Norwegian state-owned energy company Equinor included a nearly $1 billion impairment charge in its second quarter financial report linked to the changing outlook for the U.S. offshore wind industry. While the company reports the Empire Wind I offshore project is back on track after a month-long stop-work order by the U.S., it said the outlook for the offshore wind industry in the U.S. is diminished.

Speaking on the outlook, CFO Torgrim Reitan told investors, “Without investment tax credits and without a government that wants it to happen, we are not going to invest in it.” He said the main driver for this charge is the “changes in regulations for future offshore wind projects in the U.S.”

In April, Equinor called the actions by the Trump administration “unlawful” as it related to a stop work order issued days before offshore work began on Empire Wind I, an 810 MW project being built 15 to 30 miles off New York. The company denied the administration’s allegations that the approval process had been rushed, noting it won the lease in 2017 during the first Trump administration. Final approvals were issued in February 2024.

The company said, however, that the charges were due to the future outlook. It is taking a $192 million charge to reduce the value of the lease for Empire Wind II, a planned second phase of the project that it does not expect will proceed in the near term. The bulk of the charge, $763 million, is related to Empire Wind I and the investment in the redevelopment of the South Brooklyn Marine Terminal.

The company said that the investment in the terminal had included the assumption that it would be a base for two more developments in addition to Empire Wind, which would help pay for the project. “That is now unlikely,” Reitan said.

While the tax credits will remain in place for Empire Wind I, the company pointed out that other costs are rising due to the tariffs Trump has imposed. It cited specifically the impact on the cost of steel and other key materials for Empire Wind I. While it had reported significant daily costs during the work stoppage, the company said the charge included “a more limited amount” related to the pause in work.

The charges came in what was overall a positive quarter for the company. It highlighted its investments in U.S. offshore gas, which it said delivered substantial value during the quarter. The company also cited the stabilized production from the Johan Castberg FPSO as contributing to it meeting its forecasts.