After a busy CERAWeek, I got to spend some time helping my better half replace one side of our fence. It was very satisfying to see the project come together under budget and ahead of schedule—very different from some big energy projects around the world! 😂
Now, let’s look at two key energy developments from last week.
Shangyou Nie
Editor, Well Read
TotalEnergies Gets $920 Million Back From Offshore Wind to Invest in U.S. Gas and Power
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Last week, TotalEnergies announced during CERAWeek that it had just signed settlement agreements with the Department of the Interior to relinquish its two offshore leases, Lease OCS-A 0538 in New York and Lease OCS-A 0545 in Carolina Long Bay. Under the terms of the agreement, it will recover $920 million in fees for these leases.
Total is the first European company to strike a deal like this with the United States. It has promised to reinvest the money in gas and power projects in the United States. Will other European companies attempt to do the same?
Deal details:
In a press release, TotalEnergies said it “will no longer develop offshore wind projects in the United States.”
It added, “offshore wind developments in the United States, unlike those in Europe, are costly and might have a negative impact on power affordability for U.S. consumers.”
TotalEnergies will use the refund to invest in Rio Grande LNG and other power projects, “supplying Europe with much-needed LNG from the U.S. and provid[ing] gas for U.S. data center development.”
According to the Financial Times, the DOI is in discussions with several companies, hoping to persuade them to sign similar deals.
Background:
TotalEnergies’ two offshore leases were awarded in 2022 during the Biden administration.
The New York Bight project lease was won for $795 million with partner Corio Generation. It was planned to have a 3-gigawatt capacity and begin operation in 2029.
Total won the Carolina Long Bay project for $133 million. It was planned to have a 1-gigawatt capacity and begin operating in 2030.
According to TotalEnergies, it had a ten-project, 11-gigawatt offshore wind portfolio before the latest announcement, including five projects in the United Kingdom, one in France, one in South Korea, one in Taiwan, and the two now-relinquished projects in the United States.
Now, the U.S. government’s strategy is to incentivize offshore wind developers to redirect funds to oil and gas projects.
Most of these developers are European companies, including Danish leader Orsted, U.K. majors BP and Shell, Equinor from Norway, and RWE from Germany.
Total’s U.S. LNG portfolio:
TotalEnergies claims it is the number one European exporter of U.S. LNG, having exported 19 million tonnes per annum in 2025, with 14 million tonnes per annum being sent to Europe.
Cheniere is the largest U.S. LNG exporter, producing about 60 million tonnes per annum.
In late February, TotalEnergies signed a Letter of Intent with Glenfarne Group for a 20-year, 2 million-tonnes-per-annum offtake agreement for Alaska LNG, subject to the project reaching a successful LNG.
What they’re saying:
“We’re partnering with TotalEnergies to unleash nearly $1 billion that was tied up in a lease deposit that was directed towards the prior administration’s subsidies that were pushing expensive, weather-dependent offshore wind,” said Doug Burgum, Secretary of the DOI, during CERAWeek.
“Considering that the development of offshore wind projects is not in the country’s interest, we have decided to renounce offshore wind development in the United States, in exchange for the reimbursement of the lease fees,” said Patrick Pouyanné, CEO of TotalEnergies.
“The deal is an outrageous misuse of taxpayer dollars to prevent Americans from having clean, affordable power exactly when they need it most,” said Ted Kelly, a director at the Environmental Defense Fund.
What to watch:
Orsted and Equinor’s offshore projects are close to completion. Will they decide to go ahead with their projects?
Which companies will follow Total in seeking reimbursement, then redirecting their investments? Where will they reinvest?
Will TotalEnergies continue to invest in its offshore wind projects in other countries?
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Chevron and QatarEnergy Will Join Shell for Deepwater Exploration in Uruguay
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As part of its continued expansion of its E&P portfolio, Chevron is joining operator Shell in the deepwater block OFF-7 in Uruguay. QatarEnergy is Shell’s non-operating partner in OFF-7 and OFF-2.
All seven deepwater blocks in Uruguay are licensed, with APA set to drill its first wildcat in OFF-6 in 2026. Here’s a look at the set:
OFF-1: Chevron (operator, 60 percent) and Sintana Energy (40 percent)
Subsequently, OFF-1 and 3 were awarded to London AIM-listed Challenger Energy, which is now part of Toronto-listed Sintana Energy.
Namibia-focused Sintana Energy acquired Challenger Energy in October 2025 for $60 million to enter Uruguay by becoming the license holder for OFF-1 and OFF-3.
A key reason for active farm-ins to Uruguay blocks stems from the development of the conjugate margin on the other side of the Atlantic Basin in West Africa (e.g., Namibia).
In October 2024, Chevron paid $12.6 million to acquire operatorship and 60 percent equity from Challenger Energy for OFF-1.
According to Sintana Energy, Chevron’s farm-in agreement included full carry for a 3D seismic acquisition (up to $37.5 million) and partial carry for exploration drilling (up to $100 million).
In November 2025, ENI farmed into 50 percent as a non-operator of OFF-5, operated by YPF. The deal is still pending government approval.
What to watch:
Will APA become the first to make a breakthrough discovery in Uruguay?
APA has been one of the earliest independent American companies to seek overseas exploration activities, as U.S. shale matures.
Will Sintana Energy become an acquisition target in the recent push for international E&P growth?
Sintana has a 4.9 percent indirect stake in Galp Energia's Mopane discovery in Namibia.
According to Upstream, Sintana’s partner and 40 percent equity holder, Galp Energia, updated the resource estimate for the Mopane discovery by 57 percent to 1.38 billion barrels of oil equivalent in its 2025 annual report.
In December 2025, TotalEnergies signed an agreement to become the development operator (40 percent) for the Mopane field.
Sintana has a market cap of $200 million.
Will Shell further dilute its 70 percent in OFF-2? If so, who might become its latest partner?
Go deeper: For a government’s perspective on the exploration potential of offshore Uruguay, refer to ANCAP’s official presentation in Brazil in October 2025.
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