The U.S. Department of the Interior announced that it has signed a new agreement with TotalEnergies, with the French energy giant agreeing to stop the development of new offshore wind projects in the U.S., in exchange for reimbursement of nearly $1 billion in lease fees.

As part of the agreement, the reimbursed funds will be redirected by TotalEnergies into U.S. gas and power projects.

The announcement indicates a new tactic by the Trump administration to target offshore wind projects in their early stages, as the latest in a series of moves to stop the development of renewable energy projects. The initiative started with a Presidential Memorandum signed by Trump on his first day in office, indefinitely halting all federal approvals for wind energy projects, and more recently pausing the leases for all large-scale offshore wind projects under construction in the U.S. on national security grounds to freeze the development five major projects along the U.S. east coast, representing nearly 6 GW of energy that was set to enter commercial operation over the next 2 years.

Most of the administration’s attempts to date have not fully succeeded, with a federal court striking down Trump’s initial halt on wind energy approvals, and each of the projects targeted by the lease pause move issued preliminary injunctions against the order, allowing work to proceed in the interim. Despite the setbacks, however, the administration’s actions have made wind power investment decisions more difficult for developers.

U.S. Secretary of the Interior Doug Burgum said:

“This agreement is yet another win for President Trump’s commitment to affordable and reliable energy for all Americans. Offshore wind is one of the most expensive, unreliable, environmentally disruptive, and subsidy-dependent schemes ever forced on American ratepayers and taxpayers.”

TotalEnergies entered the U.S. offshore wind market in 2022, with the acquisition of leases in Carolina Long Bay and New York Bight, with the projects scheduled to come online in 2031 and 2029, respectively, with a combined capacity of 4GW.

Under the new agreement, TotalEnergies said that it will relinquish both leases, and that it will no longer develop offshore wind projects in the U.S. The company added that studies on the leases indicated that U.S. offshore wind developments in the U.S. could have a negative impact on affordability for consumers, unlike the case in Europe.

The company will reinvest the reimbursed funds to finance the construction of an LNG plant in Texas, and for the development of upstream conventional oil in Gulf of America and of shale gas production.

TotalEnergies Chair and CEO Patrick Pouyanné said:

“TotalEnergies is pleased to sign these settlement agreements with the DOI and to support the Administration’s Energy Policy. Considering that the development of offshore wind projects is not in the country’s interest, we have decided to renounce offshore wind development in the United States, in exchange for the reimbursement of the lease fees.”