Trump administration to compensate Total for withdrawing from offshore wind projects. It will receive nearly $1 billion

Donald Trump’s administration has reached an agreement with French energy giant Total to compensate it for withdrawing from an offshore project. The company is to invest in fossil fuel projects in the US instead.

The agreement was announced by US Interior Secretary Doug Burgum at the CERAWeek conference in Houston. He said offshore wind energy was “expensive, unreliable and harmful to the environment” and that investment in oil and gas would instead “lower Americans’ monthly bills.” The Interior Department was the agency that negotiated with the French company, as it is responsible for permitting processes in the US.

According to the description of the agreement, the department will compensate the company $928 million for two leases for offshore projects. In return, the company will give up the leases. The sum is the full amount the company paid for them. Instead, the company is to invest the funds in oil and gas and has also reportedly pledged not to develop any further offshore projects in the US. The company should receive the compensation only after investing in fossil fuels.

The CEO of Total, Patrick Pouyanné, said the funds would go towards the Rio Grande LNG project, which he said would help supply Europe. Some of the money will probably also go towards oil production in the Gulf of Mexico and shale gas extraction.

“Given that building offshore projects is not in the country’s interests, we have decided to withdraw from offshore project development in the US in exchange for a refund of the fees,”Patrick Pouyanné said, adding that he believes investment in gas would be a better use of capital in the US.

Trump against wind

Donald Trump’s administration has opted for a major shift in US energy policy, focusing on the fossil fuel industry under the slogan “Drill, baby, drill.” The shift also involves pressure on renewable energy projects developed under Joe Biden’s previous administration. Trump’s pressure targets both solar and wind power.

The president appears to have a particularly negative view of wind power. He often criticises it (not always accurately) and points out, for example, that some components come from China. At the end of last year, he also halted five major offshore projects under construction.

Total’s projects were not affected, however, as both—one in New York and one in North Carolina—had already been suspended. Total suspended them in November 2024 after Donald Trump was elected, citing “market uncertainty.” The New York project was to be developed in partnership with other US companies, which joined only after the project received its permits in 2022.

There are currently three large offshore wind farms in the United States. As mentioned, Trump halted five projects under construction, and court rulings are pending in those cases. Many other projects were at various stages of development, and some were awarded under the previous administration.

Large-scale wind farm construction was planned, particularly along the US East Coast. Their future is now uncertain, however. Given the administration’s pressure, companies may prefer to accept agreements similar to Total’s and withdraw their investments in exchange for compensation rather than face further regulatory risks.