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Statoil Puts Maine Offshore Wind Pilot Project on Hold
07/03/2013   Reported By: Susan Sharon

Norwegian energy giant Statoil announced today that it is preparing to put its deep-water, offshore wind energy pilot project indefinitely on hold. The company had previously gotten preliminary approval from the Maine Public Utilities Commission to develop the floating wind park. But in a letter to the PUC, Statoil's vice president for wind business development said a recent amendment approved earlier this month by Maine lawmakers puts the future of a contract for the Hywind Maine project in doubt. Jennifer Mitchell has the story.

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In the letter, Statoil Vice President Lars Johannes Nordli says the company is considering several other locations for the pilot project and "cannot continue to spend its resources on this project without certainty that a contract for the project output will be finalized." The measure passed by the Legislature re-opens bidding for the pilot project to the University of Maine.

"It's unfortunate that the university has been put in this position," says Maine Senate Majority Leader Seth Goodall, who spoke with company representatives by telephone Wednesday morning. Goodall calls Statoil's decision "very disappointing."

The pilot project is intended to put Maine on the map as a worldwide innovator and developer of offshore wind. If successful, it is expected to create hundreds of jobs. But without a partner like Statoil, Goodall says it's unlikely that the University of Maine will be able to develop the pilot project on its own. And he views the recent amendment as a "poison pill" intended to thwart the entire effort.

"The University of Maine is a great research institution, and they have made so much progress in developing cutting-edge technology," Goodall says. "They need a partner, an international company, an investor such as Statoil. The governor has been very clear that he's against Statoil and he's against offshore energy."

The measure gives the university until the first of September to submit its own proposal. For his part, Gov. Paul LePage thinks Maine's flagship university should have the ability to compete for a project that's going to benefit the state and beyond, according to his spokeswoman Adrienne Bennett.

And the director of the Governor's Energy Office, Patrick Woodcock, says there are additional factors to consider. "We really should be getting a maximum return on an investment of up to $200 million the ratepayers would be subsidizing. Frankly, when you look at Statoil's term sheet, it did not deliver on a basic requirement of establishing an industrial base to manufacture and develop offshore wind."

Woodcock acknowledges that the project will be a challenge for the university, but he says Mainers are already paying some of the highest rates for electricity in the country and the Statoil project does nothing specific to grow the economy over the long term.

Statoil officials were unable to be reached for comment, but in their letter to the PUC they say they will continue to assess recent changes made to the law and keep the option open to re-initiate the project.

Editor's Note: This story was reported and written by Susan Sharon.



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