Federal government says it already knew of withdrawal of key offshore wind project in Illawarra

The government knew in June thatNorwegian offshore wind giant Equinor and its local partner OceanEx would not apply for a feasibility licence for the drastically shrunk Illawarra zone back, according to comments by energy minister Chris Bowen. 

In mid-June, the federal government cut the Illawarra wind zone by another third to 1022 sq km, and moved it further offshore to protect little penguins, rocky reefs and the southern right whales in response to community feedback.

Later in the month, Equinor and Oceanex were awarded a feasibility licence for the Hunter offshore zone to the north, for their proposed 2 gigawatt (GW) Novocastrian project.

But Bowen, responding to newly emerged media reports that Equinor and Oceanex have pulled out of applying for the southern New South Wales (NSW) zone around Illawarra, says the government knew much earlier.

“It was announced on the 11th of June, that… Oceanex, wouldn’t be applying for the Illawarra zone. They’ve applied for Hunter,” Bowen told journalists at a press conference on Thursday.

“They’ve got the Hunter, they’re the preferred tenderer for the Hunter. That’s great for the Hunter. They’ve made a decision that they can’t play in all six zones that they only had limited resources. Perfectly understandable commercial decision.”

A spokesperson for Equinor confirmed they told the government they’d not apply for the Illawarra zone in June.

Equinor not keen

It appears the combination of the growing issues with the Illawarra zone as well as securing a licence for the Hunter zone were behind the decision by Equinor, rather than Oceanex, not to pursue a second NSW licence.

A spokesperson from Equinor said the company “carefully evaluated risk factors that are currently impacting the global industry and conducted project-specific and site-specific assessments” to divine where capital and technical talent should be sent.

“This decision allows us to focus on the Novocastrian Offshore Wind project,” she told Renew Economy.

“We will work through next steps in line with DCCEEW’s timeline and revert accordingly. We look forward to working closely with local communities and suppliers, building on decades of coexistence with users of the sea, to bring offshore wind to the Hunter region in due course.”

Oceanex declined to comment.

Hot button issue

As well as being two-thirds smaller than the original proposition, the Illawarra zone has become a lightning rod for anti-renewables campaigning, led by the same federal Liberals and Nationals who set up the offshore wind industry in 2021. 

Nationals leader David Littleproud said in June that his party will ban projects in the new zone on the grounds that proposed turbines will be floating rather than fixed – although it’s still unclear why this distinction matters. 

Public consultations unearthed concerns such as that the wind turbines could block the sunrise, a campaign offering prizes to encourage people to vote no to the zone, and worries about the impact on whales and sea floors.