Thursday, April 18, 2024

Louisiana issues its first-ever state offshore wind energy leases

by BIZ Magazine

(Louisiana Illuminator) — Louisiana approved the state’s first-ever wind energy operating agreements in state offshore waters Wednesday at the State Mineral and Energy Board meeting.  

Gov. John Bel Edwards and Louisiana Department of Natural Resources Secretary Tom Harris announced approval of two projects, one off the coast of Terrebonne and Lafourche parishes and another in the Cameron Parish’s coastal waters.

The Diamond Offshore Wind (DOW) site is on 6,162 acres just offshore from Terrebonne and Lafourche. The Cajun Wind development will cover 59,653 acres off the Cameron coast. 

The two agreements have different payment structures to the state, Harris said in a statement from the governor’s office. Although the DOW Wind project covers a smaller area, it will pay more in upfront costs and rental fees per acre. The larger Cajun Wind field had a lower per-acre fee for upfront and rental payments but a higher energy royalty over the length of the agreement. 

The DOW Wind property agreement paid $308,101 upfront  and will submit 1.5% of its gross revenues in royalties over the life of the agreement

Cajun Wind first paid $357,923 for its agreement and will pay 2.2% in royalties. 

“One agreement offers more on the front end, while the other pays more over time,” Harris said. “These being the first wind energy operating agreements for the state, we were breaking new trails in negotiating these agreements, and I believe we have established that we can be flexible in how we set up payment structures while still ensuring that the state and its people are appropriately compensated for using our resources.”

“For generations, the state of Louisiana has been a leader in energy production and offshore wind energy is the next chapter in that great history as we expand our options for clean energy production and open new avenues for the development of our state economy,” Edwards said in the statement.

You may also like

-
00:00
00:00
Update Required Flash plugin
-
00:00
00:00