A Win for Coexistence in North Sea | BP and Ørsted Reach Agreement on Offshore Wind-CCS Project Overlap Area

June 26, 2023, by Adrijana Buljan

Ørsted and BP have reached an agreement on the previously disputed overlap area between the Hornsea Four offshore wind farm and the Endurance carbon storage site, developed by the Northern Endurance Partnership (NEP) that gathers BP, Equinor and TotalEnergies.

Quick overview:

Hornsea Four development consent decision expected on 12 July
BP and Ørsted say they reached a commercial agreement, details remain undisclosed
Shell exited the CCS project earlier this year, following National Grid

Ørsted submitted an application for the development consent order (DCO) for the 2.6 GW Hornsea Four offshore wind farm in September 2021.

The examination by the UK Planning Inspectorate (PINS) began in February 2022 and, in November 2022, a Recommendation Report for the project was sent to the Secretary of State, who has been reviewing the application since.

In February, the Secretary of State moved the deadline for making a decision by five months to gather further information from the developer and other parties, and allow enough time for responses to new submissions.

The DCO decision for Hornsea Four is expected to be reached by no later than 12 July.

Ørsted and BP Dispute Comes to End – Ørsted: ‘This Bespoke Way Forward Good News for Both Projects’

The dispute between Ørsted and BP that started with the Hornsea Four DCO application entering the permitting process is related to a 110-square-kilometre area shared by the offshore wind farm and the NEP carbon capture and storage (CCS) project, known as the Overlap Zone.

An Interface Agreement was signed back in 2013 between the parties who led the two projects at the time to manage any conflicts. However, an issue with seemingly no resolution still arose over BP’s plan to use vessels for monitoring operations at its carbon storage site which poses a risk of vessels alliding with wind turbines in the overlapping area.

Both Ørsted and BP had submitted several position statements to the Planning Inspectorate over proposed protective provisions that did not seem to have been favoured by the other party.

Ørsted had said that the allision risk could be avoided by BP opting for a monitoring solution that does not require vessels, for which BP had said would negatively impact its project.

BP proposed an exclusion zone for the benefit of its Endurance project, but this was not accepted by Ørsted, which had said the overlap zone represented some 25 per cent of the developable area for Hornsea Four and narrowing it would mean a significant reduction in the number of turbines that would account for a loss of between 630 MW to 675 MW of generation capacity.

Nevertheless, the two companies have found a way to progress both the offshore wind and the CCS project through a commercial agreement.

“Orsted and bp confirm that a commercial agreement has been reached. On this basis, Orsted and bp agree that there are no requirements for protective provisions under the Hornsea Four DCO for the benefit of bp or any other party involved in the NEP Project. bp has no remaining objection to the Hornsea Four DCO application and agrees to withdraw any and all prior representations made in relation to the Hornsea Four DCO application”, BP and Ørsted stated in a letter sent to the Secretary of State.

The companies have not disclosed details of the commercial agreement and the resolution to the abovementioned matter so far.

Responding to offshoreWIND.biz‘s inquiry about the agreement and a request for a statement, a spokesperson for Ørsted said: “We have worked constructively with bp, The Crown Estate and other stakeholders for over two years to find a pragmatic solution that will secure the future of both projects. Now that an agreement has been reached, we await the determination from the Secretary of State on planning consent which is expected on July 12th”.

“This bespoke way forward is good news for both projects, however it remains clear that a long-term solution to co-location needs to be found in order to safeguard future offshore projects. The UK government has sent a clear message on the importance of offshore wind in the UK’s transition to green energy. If we are to meet the UKs ambitions for 2030 and beyond, it’s vital that offshore wind projects are deployed sensitively, sustainably and without delay”.

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The 2.6 GW Hornsea Four offshore wind farm is planned to be built 69 kilometres off the Yorkshire Coast at its closest point. The site covers an area of up to 468 square kilometres where up to 180 wind turbines could be installed.

If the Hornsea Four DCO is granted, Ørsted will move to the detailed design stage and work up an indicative layout of the offshore wind farm by the end of 2024, according to a document filed by Pinsent Masons on behalf of the developer.

As for the NEP project, the Endurance Store offshore carbon storage site has the capacity to store 450 million tonnes of CO₂ through which the Northern Endurance Partnership plans to enable Net Zero Teesside (NZT) and the East Coast Cluster projects by providing the common infrastructure needed to transport CO₂ from emitters in the Humber and Teesside to secure offshore storage in the North Sea.

In October 2021, NEP’s East Coast Cluster, which includes the NZT project, was selected as a priority cluster in Phase 1 of the UK government’s Carbon Capture, Usage and Storage (CCUS) cluster sequencing process, the consortium writes on its website.

The NZT project is currently also undergoing the Secretary of State’s examination for a DCO, with the deadline for making a decision recently pushed back from May to September this year.

The NEP consortium was established in 2020 by BP, Eni, Equinor, Shell, TotalEnergies and National Grid. Earlier this year, however, Shell withdrew from the NEP project with an aim to focus on the Acorn CCS project in Scotland, according to Reuters, which reported in April that National Grid had also exited the partnership.