Offshore wind
After 12 years in the Korean market, Equinor has decided to pull out, citing hurdles in the offshore wind sector.
Despite establishing a branch in Korea in 2014 and pursuing three floating offshore wind projects, the company failed to produce results amid growing business uncertainty.
According to sources in the energy industry, Equinor Korea, Equinor’s Korean subsidiary, has decided to close its office by the end of the year. It is said to have already let go of all staff.
On its website, Equinor stated that it had decided not to seek future offshore wind business opportunities in Korea.
The company has focused on oil and gas production as its core business, while developing floating offshore wind as a new growth area.
In 2017, Equinor began operating the Hywind project in Scotland (30 MW), the world’s first floating offshore wind farm. In 2023, the company started up the Hywind Tampen project (88 MW) in the Norwegian North Sea, the world’s largest floating offshore wind farm.
Equinor pursued three floating offshore wind projects in Korea, but halted them amid difficulties in achieving profitability. Its flagship project, the 750 MW Firefly floating offshore wind farm off Ulsan, was selected in a government tender in 2024, but Equinor returned the power generation business licence to the government earlier this year.
The company failed to sign a renewable energy certificate (REC) sales contract and was unable to secure a long-term revenue structure.
Equinor has expressed concern that rising supply chain uncertainty could make it challenging to recoup investment at the fixed contract price. The projected cost of the Firefly floating offshore wind farm was estimated at 10 trillion won.
Following Equinor’s exit, the Ulsan Donghae-1 floating offshore wind project (200 MW) is adrift. This project was a consortium effort between Equinor and several domestic public corporations, including Korea National Oil Corporation (KNOC) and Korea East-West Power (EWP).
The project aimed to build a floating wind farm near the Donghae gas field, where gas production has ended.
However, the environmental impact assessment, a step required before groundbreaking, has not even begun. Equinor has decided to transfer all of its equity to the consortium.
Equinor had previously withdrawn from the 3GW fixed-bottom and floating downwind offshore wind project off Chuja-do. The conditions that the generated power must be connected only to the Jeju grid and that more than 130 billion won must be contributed annually as resident benefit-sharing funds became stumbling blocks.
According to an industry official, Equinor also decided to withdraw from its Tokyo office in Japan in June this year. They added that this appears to be a strategy to focus on Europe, the core market for offshore wind.
