Equinor Slashes $955M Offshore Wind Value Amid Tariffs and Permit Freeze

Equinor (OTC: EQNR), the Norwegian energy giant, took a hefty hit this week with a $955 million writedown tied to its U.S. offshore wind ambitions. The reasons? A messy mix of shifting U.S. policies, tariffs, and a few direct hits from the Trump administration's stance on offshore wind development.

Back in January, President Donald Trump threw a wrench into the offshore wind sector by halting new lease approvals right off the bat, casting a long shadow over projects like Equinor's Empire Wind in New York. That pause wasn't just a hiccup - in April, Interior Secretary Doug Burgum put a stop-work order on Empire Wind, which was only lifted later. But as far as Equinor is concerned, the damage was done.

Digging into the numbers, the bulk of the write-down-$763 million-was linked to Empire Wind 1 and the company's South Brooklyn Marine Terminal, a crucial hub designed to serve multiple offshore projects. The remaining chunk covers the lease for Empire Wind 2.

The company's CFO, Torgrim Reitan, laid blame squarely on changing U.S. regulatory winds. Investment tax credits that once sweetened the deal are now off the table for new builds. Add to that the tariffs-especially on steel, which blasted project costs by $300 million-and a presidential order freezing permit processing, and you've got a recipe for sinking project valuations.

"Without those tax credits and a federal government supporting the development, the economics simply don't stack up," Reitan summed up bluntly. The South Brooklyn terminal was initially expected to serve Empire Wind plus two other offshore wind developments. Those projects now look increasingly unlikely, which hits the terminal's expected returns hard.

Equinor snagged the federal lease for Empire Wind during Trump's first term and got investment approval during Joe Biden's administration, a rare switch from green light to red in a span of a few years. Still, the offshore wind sector worldwide isn't exactly cruising smoothly either. Costs are climbing, and logistical headaches keep piling up.

After these adjustments, the Empire Wind assets sit on Equinor's books at about $2.3 billion in value. When up and running, Empire Wind 1 aims to deliver around 810 megawatts, enough juice to power roughly half a million homes starting in 2027 - if it launches on schedule.

Aside from the wind setback, Equinor's core oil business also pulled back in Q2, squeezed by lower crude prices. So while the offshore wind writedown grabs headlines, the company faces challenges on several fronts.