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By Nichola Groom and Nora Buli
LOS ANGELES/OSLO (Reuters) -The Trump administration has lifted a month-old stop-work order on Empire Wind, a $5 billion wind farm project off the coast of New York, in a compromise with the state that could also see cancelled plans for a gas pipeline revived, officials said on Tuesday.
Norway's Equinor said construction work can now resume on the project, which is expected to provide power for half a million homes from 2027 onwards.
Shares in Equinor, which is mostly reliant on oil and gas, were up by 1.5% by 1016 GMT.
Denmark's Orsted, the world's largest offshore wind farm developer, which is constructing two plants off the coast of the United States, saw its shares jump by 15%.
U.S. Interior Secretary Doug Burgum, who had issued the stop order on Empire Wind on April 16, said he was encouraged that New York Governor Kathy Hochul will now allow new gas pipeline capacity to move forward.
The deal could revive plans to build the proposed Constitution natural gas pipeline from Pennsylvania to New York, which was cancelled in 2020 after years of regulatory and legal battles over environmental and other concerns.
"Americans who live in New York and New England would see significant economic benefits and lower utility costs from increased access to reliable, affordable, clean American natural gas," Burgum wrote in a post on X on Monday.
Hochul in a statement said New York would work with the U.S. administration and private entities on projects that meet the legal requirements under New York law.
"The road ahead for the Constitution Pipeline remains bumpy, but the broad strokes of a logical deal could be a win-win for end users," analysts at energy consulting firm EBW Analytics said in a note.
Officials at U.S. energy firm Williams Cos, one of Constitution Pipeline's joint venture partners, were not immediately available for comment. With U.S. President Donald Trump back in office and voicing his support for the Constitution project, executives at Williams have said the company was looking at dusting off plans for the pipeline under the right circumstances.
Norwegian Finance Minister Jens Stoltenberg, a former NATO chief who had discussed Equinor's case with U.S. policymakers, said the deal to unblock the wind farm was ultimately a matter to be settled between U.S. authorities.
"This is an agreement about natural gas and wind made in the United States," Stoltenberg told reporters in Oslo.
More broadly, he said the reversal was good news for investors in the U.S. as the stop-work order threatened to create uncertainty after permits had been granted by U.S. authorities.