Empire Offshore Wind, a joint venture between Equinor and BP, has terminated the contract awarded to Great Lakes Dredge & Dock Corporation and Van Oord for rock installation at Empire Wind 2 offshore wind project.
In 2022, the Great Lakes and Van Oord consortium was contracted by Empire Wind to perform rock installation for the Empire Wind 1 and 2 projects with installation windows in 2025 and 2026, respectively.
The Article 7 for Empire Wind 1 was approved by the New York State Public Service Commission in December of 2023.
Empire Wind 1 is currently on track for rock installation in 2025.
However, Empire Wind has informed Great Lakes and Van Oord that it has terminated the Empire Wind 2 rock installation contract that was set to commence in 2026.
Termination of the Empire Wind 2 project initiates a contractually obligated termination fee payable to the consortium that is intended to cover lost earnings potential related to Empire Wind 2, according to Great Lakes.
The announcement follows Equinor’s and BP’s decision to terminate their agreement to sell power from 1.26GW Empire Wind 2 to New York state, citing rising inflation, higher borrowing costs, and supply chain issues.
After that, Seatrium also confirmed its contract for the offshore substation platform for the project, valued at more than $188 million (S$250 million), had been cancelled.
“New York remains committed to meeting the State’s clean energy goals and they have taken steps forward with the accelerated solicitations for new PPAs to allow developers to adjust prices for inflation and develop more robust projects going forward.
“Awards for the next solicitation round are expected in February 2024. We look forward to the start of the Empire Wind 1 installation expected in 2025, continuing our relationship with Equinor and BP as a preferred supplier, and bidding on future projects. We continue to pursue additional opportunities including projects internationally for 2026 and beyond,” said Eleni Beyko, Senior Vice President-Offshore Wind at Great Lakes.