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Equinor ASA EQNR, the Norwegian energy major, has suspended offshore construction on the Empire Wind project after the U.S. Bureau of Ocean Energy Management (“BOEM”) issued a halt work order. The order, received by Empire Offshore Wind LLC on April 16, requires an immediate cessation of all activities on the outer continental shelf until BOEM concludes its review.
EQNR Responds to BOEM Order, Weighs Legal Options
Empire, a joint venture led by Equinor Wind US LLC, is engaging with federal authorities to clarify the reasons behind the suspension. The company is also evaluating legal options, including the possibility of appealing the BOEM directive.
Despite the order, Empire confirmed that it is complying fully and has promptly suspended relevant marine operations. The decision prioritizes worker and environmental safety as the project navigates this regulatory hurdle.
Empire Wind 1, one of the two phases of the project, had already secured all required state and federal permits and was under active construction. The project is backed by a contract with the New York State Energy Research and Development Authority (“NYSERDA”) and is expected to provide clean electricity to approximately 500,000 New York homes. The construction phase alone has already created more than 1,500 jobs in the United States.
EQNR Faces Financial Exposure Amid Project Uncertainty
As of March 31, 2025, the gross book value of Empire Wind was around $2.5 billion, including investments in the South Brooklyn Marine Terminal. Equinor’s financial exposure is notable — approximately $1.5 billion has been drawn under the project’s term loan facility, backed by guarantees from Equinor US Holdings Inc.
If the suspension escalates into a complete halt, Equinor would have to repay the loan from its equity commitment and face termination penalties from suppliers, adding further pressure to the project's economics.
Equinor emphasized its long-term investment in the United States, where it has been active for over 35 years and invested more than $60 billion in oil, gas and renewables. The company stated that the halt work order will be reflected as a subsequent event in its first-quarter 2025 report.
The temporary halt adds another layer of uncertainty to the offshore wind sector in the United States, even as EQNR continues to bet on the country’s energy transition efforts.
EQNR’s Zacks Rank & Key Picks
EQNR currently carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector may look at some better-ranked stocks like Archrock Inc. AROC, Kinder Morgan, Inc. KMI and Enterprise Products Partners L.P. EPD. While Archrock presently sports a Zacks Rank #1 (Strong Buy), Kinder Morgan and Enterprise Products carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.