Energy / No successful applications in oil and gas offshore wind leasing round for seas off Shetland
IT APPEARS the results of a seabed leasing round designed to encourage offshore wind energy to directly supply oil and gas platforms does not feature any areas around Shetland.
Thirteen out of 19 applications have been offered initial agreements relating to seabed leases in Crown Estate Scotland’s INTOG (Innovation and Targeted Oil & Gas) project – but none are in the seas around Shetland.
A total of six areas to the west, north and east of Shetland had been designated for INTOG projects targeting oil and gas decarbonisation.
A spokesperson for Crown Estate Scotland said no decisions have been taken in relation to future offshore wind leasing rounds.
The INTOG process allowed developers to apply for seabed rights to develop offshore wind projects that either reduce emissions from the North Sea oil and gas sector – by supplying renewable electricity directly to oil and gas infrastructure (TOG) – or consist of small-scale (IN) innovative projects of 100MW or less.
This offshore wind leasing is different to any other previously carried out in the UK or in the world, and it is separate to the Crown Estate’s ScotWind project, which is set to see offshore wind farms to the east of Shetland.
The 13 successful applicants, covering total potential output of around 5.5GW, have now been offered initial agreements – called exclusivity agreements – for sites mainly to the east of the Scottish mainland.
The geographical outlier is ESB Asset Development, which is proposing a small 100MW development off the west coast of Scotland.
Among the successful applicants are Cerulean Winds, who previously proposed offshore wind farms around Shetland.
A spokesperson for Cerulean confirmed the company never ended up bidding for INTOG areas around Shetland.
However, the developments it is proposing east of the Scottish mainland will still be able to link into oil and gas assets off Shetland, they said.
“We worked closely with our partners and advisors during the process and submitted final bids for three sites in the Central North Sea, which provides the scale for an integrated transmission scheme that can provide green power to UKCS [UK Continental Shelf] oil and gas assets, including those off Shetland,” the spokesperson said.
If the developers accept the agreement offers and proceed to sign them, they can start offshore wind development work while the Marine Scotland’s planning process for the INTOG Sectoral Marine Plan (INTOG SMP) is completed.
Once the Sectoral Marine Plan has been finalised and option agreements signed – expected in 2024 – around £262 million in applicant fees will be secured. Once projects are operating, further revenues will flow into the public purse.
All net revenues from Crown Estate Scotland go to Scottish Government for public spending.
Crown Estate Scotland marine director Colin Palmer said: “Today’s results for this very distinctive and targeted leasing round are extremely encouraging.
“INTOG provides a range of practical ways to support innovation, reduce North Sea carbon emissions, and encourage technical and commercial innovation in the offshore renewables market.
“In addition to delivering economic and environmental benefits, INTOG will generate funds for the Scottish Government, from initial fees when option agreements are signed, to ongoing rent payments when the projects are constructed and move to operation.
“There are still significant challenges that need to be addressed to ensure INTOG’s many opportunities are realised fully, but today marks a real step forward.”
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