The launch of a pioneering project called Win-Win in 2013 met with a mixed reaction from the offshore wind sector.

The idea being explored by a group of international oil and gas companies led by energy consultancy DNV GL — to hook up floating wind turbines to offshore platforms to replace the gas and diesel generators used to run the pumps squeezing the last hydrocarbons from a reservoir — split opinion.

On one side, the pragmatists who viewed it as a means to reducing emissions from ageing petroleum assets while further field-proving floating wind technology; on the other, purists who saw it as a gateway to the ‘dirtification’ of wind.

Global markets appear to have taken the decision in recent months that it is worth the wager. Last summer Norwegian energy giant Equinor unveiled its Hywind Tampen development, an 88MW floating wind array to be wired into the Snorre-Gullfaks complex in the North Sea, and there are several other projects now bubbling away for similar schemes in the US Gulf and off Southeast Asia.

But last month’s announcement that Win-Win is moving into the prototype phase may prove to be the tipping point for the widespread take-up within the international oil industry, given that project partners including petro-majors ExxonMobil, Eni and Nexen have anointed the concept as “both cost efficient and technically feasible”.

Indeed, the premise that the combination of offshore oil engineering’s decades-long track-record in floating exploration and production projects and deep corporate pockets could be key to the fledgling sector taking off is not without merit.

“From the start, this project has always had a commercial focus. Potentially substantial rewards await a first mover willing to build a prototype to increase technology readiness and optimise system integration,” says DNV GL project director Johan Sandberg.

“As operators know too well, conventional water injection [which pressurises extra crude from oil reservoirs] is expensive, with the power plant occupying valuable deck space and expensive flowlines running to the injection site. With Win-Win, the power is supplied in situ at potentially much lower cost, with increased flexibility and without emissions.

“But this project is also very important insofar as we believe it will move the technology discussion forward in the oil industry, to get them thinking about floating wind as economically viable in its own right and how it can play a larger role in the overall offshore energy system.”

The short-term economics are alluring: around the world oil operators are reaching the point on many assets where they have to either extend the life of a field — and incur the capital-intensive investment needed for installing flowlines, pumps and other equipment — or shut down production, which carries heavy decommissioning costs.

Win-Win offers a cut-price, low-carbon alternative. Tow out a “packaged autonomous microgrid solution” made up of floating wind turbines each kitted out with water-injection systems and battery, moor it, and start pumping.

“All these technologies are proven. What hasn’t been done is to run them together as an integrated system. By developing the first Win-Win prototype we are presenting the oil industry with an opportunity to approach late-life production in an unconventional way — and with no emissions,” Sandberg tells Recharge.

And though he stresses that “each project is different”, early number crunching suggests such a project could produce additional output for as little as $3/barrel of injected water. So even on North Sea oil and gas fields, where it takes ten barrels of water to get a single extra barrel of crude out of a reservoir, the potential is eye-catching.

We are offering the oil industry an opportunity to approach late-life production in an unconventional way — and with no emissions

“This has been a long time in development because the oil & gas industry is so very conservative — historically, there has been a reluctance to explore using renewables as a power source — and really until now hasn’t believed that wind could provide a steady [power] supply for water injection,” says Sandberg. “That seems finally to be changing. Now is the time for the oil industry to take this forward. It will only take one or two projects to break new ground and open other company’s eyes to the potential for this concept.”

Equinor (then Statoil) — which installed the first floating wind turbine, the Hywind Demo, in 2008 — was on board for the first phase of the Win-Win project, which was originally conceived of “on the back of a napkin”. But with Hywind Tampen, the developer has chosen to pivot towards using the 11 concrete spar-based floating turbines to be installed as a clean-energy supply for five of the Snorre-Gullfaks complex’s gas-turbine-powered platforms themselves, offsetting 35% of the annual energy demand.

And unlike Win-Win, which is being advanced with a “zero-subsidy” business model, Hywind Tampen will be built with significant state-level support, as 50% of the total NKr5bn ($575m) project cost is being provided by the Norwegian government.

“The Tampen project for us is ‘Kinder egg’ thinking,” Sebastian Bringsværd, head of Hywind Development in Equinor’s New Energy Solutions division, tells Recharge — the chocolate and the bonus of a toy being comparable to floating wind and the added prize of low-emission crude extraction.

“It is about lowering CO₂ emissions while further innovating and developing our floating wind concept [which has also been used to build the 30MW Hywind Scotland project, the world’s first floating wind array, brought online in 2017]. And it is a stepping stone to advance the technology cost-wise and market-wise.

“This idea has developed a lot in the last 12 months from something we were broadly ‘in control’ of and could push the timeline on, to one that has captured so much interest among oil & gas majors [and] now has a life of its own in the market. And it is no longer just about late-life [oil recovery] — it is being seen more as a general alternative power supply, for remote assets, smaller fields and so on.”

Despite the promise presented by the Tampen project — and the model “possibly” finding a place in in Equinor’s future offshore energy project portfolio — Bringsværd emphasises that the company is progressing it for the longer-term, pure-play floating wind technology-development potential.

The Tampen project for us is ‘Kinder egg’ thinking

“We are still weighing up whether our next floating wind project after Hywind Tampen will be another offshore oil and gas field,” he says. “We are working with a cost roadmap [that targets getting floating wind down to €40-60 ($45-67) per MWh by 2030] so while Tampen points the way toward the commercial viability of this application, it also will help us move ahead with a 200-500MW [standalone] floating wind farm, as well as allowing us to explore the economics of powering fish farms and coastal heavy industry and other applications [with floating wind].”

A study undertaken last year by power technology giant ABB and Norwegian environmental lobby group Zero calculated that the Nordic country could have up to 3GW of floating wind by 2030, by using a step-wise strategy that would curb emissions from the network of offshore oil platforms by at least one million tonnes of CO₂ a year, while giving impetus to the transition away from hydrocarbon production in the one of world’s largest petroleum provinces.

The plan would involve a first gigawatt of floating wind arrays powering late-life output from many of the ageing offshore fields on the Norwegian continental shelf, followed by a second gigawatt built “in surrounding waters” and tied-in to electrical infrastructure installed during phase one. A third gigawatt of offshore wind, both bottom-fixed and floating, could be added as power exported direct to the onshore grid, driven by the improved economics of a by-then-mature regional industry.

“We have been trying to get the offshore oil & gas industry to reduce their emissions for many years too, using power from shore. And now that floating wind is sufficiently mature [as a technology] we think it should be looked at to do the same,” Einar Wilhelmsen, head of energy systems at Zero, told Recharge at the time of the report’s launch.

Andrei Utkin, senior analyst at IHS Markit, believes that with the continued reduction in the levelised cost of energy (LCOE) of floating wind, there will “definitely soon be a business case for this as at least a niche application” alongside mass deployment of utility-scale projects that are not linked to offshore fields. But he cautions there are variables ranging from “Capex/Opex [ capital expenditure / Operating expenditure] considerations to capacity factors to whether the oil & gas field is far from shore or near-shore, and others [that make it] still somewhat of a theoretical discussion”.

There is no question that floating is on track to be a baseload energy supply globally.

“Our predictions are that the LCOE for floating [wind] will be €50-60/MWh by 2030 and at that price it would definitely make it viable for a wide range of uses,” he says. “And when we commercialise the next generation of floating wind technologies, which will include new designs, new materials, new turbines, and we see mass deployment too, then we will see LCOE drop even further.

“There is no question that floating is on track to be a baseload [energy supply globally] so why not for oil and gas [operations]? Still, right now we feel it is case-by-case.”

Eoghan Quinn, global wind lead of international energy contractor Worley’s New Energy business unit — which is working on several floating wind-powered oil and gas projects in the US Gulf and off Malaysia that are still cloaked by non-disclosure agreements — says the upsurge in interest in the concept this year for a wide spectrum of projects has been “unprecedented”.

“The rise in activity for floating wind combined with activities in the hydrocarbon sector has been incredible. Leveraging the knowledge is one aspect and the other is providing an isolated generating solution,” he says. “We see a strong correlation between the capability of oil & gas to floating wind.” And he sees the potential for mutual benefit as real: “The floating wind market will likely see a spike in development once they can leverage the existing know-how from the hydrocarbon sector in an economical manner.

“But this is also driven by emissions reduction targets… in many geographies which have the potential to act as a catalyst for this sector if approached correctly. This development also allows end-users become more familiar with a disruptive new energy technology — a great starting point for the energy transition.”

And while Quinn doesn’t discount that it may lead to a “temporary ‘dirtification’ of the sector”, he insists that the idea “has the potential to fast-track both technology and commercial readiness levels, removing the dependency from government subsides, which will be good in the long-term for emissions reduction”.

Houston-based start-up Excipio Energy is counting on this view becoming an industrial truism. The company, whose founders came out of the offshore oil industry, is currently finalising “agreements or expressions of interest” with 12 companies to underpin the launch of a prototype of its Excibuoy concept, a high-capacity hybrid offshore energy floater, by 2024 (see panel).

Excipio COO George Engelman thinks floating wind could solve the main “show-stopper” facing operators of ageing offshore oil and fields – where to source the power for tight-margined life-extension projects – while accelerating the transition toward renewables in the offshore energy industry.

“This potential aspect in the burgeoning development of floating renewable energy systems could preserve the offshore energy industry, leverage the billions of dollars in existing oil and gas assets, defer or avoid the need for decommissioning and abandonment of platforms and pipelines and the environmental impacts associated with their removal,” he says, “as well as eventually displacing the hydrocarbon economy.”

Gunnar Herzig, managing director of advocacy body World Forum for Offshore Wind, shares the view that there is a plain value in bringing the global oil industry “into” the floating wind sector through projects such a Hywind Tampen and Win-Win. “The use of floating wind turbines to power oil & gas activities is very promising. It deepens the connection between the two industries and is likely to attract even more oil & gas companies to enter the global offshore wind industry,” he says.

“The offshore oil industry is already extremely familiar with floating components… and can therefore build on this deep knowledge when integrating floating wind into their operations. This knowledge transfer will also greatly advance the development of the floating offshore wind industry. This is a clear win-win.”

Transition

Will floating wind power help Big Oil crack its 'Kinder Egg'?