Shares of Orsted, the Danish wind farm developer, plunged on Monday after the Trump administration ordered a halt to a $6.2 billion project off the coast of Rhode Island, raising questions about the future of the company.
Orsted, which has helped establish offshore wind as a major source of power in Europe, had tried to replicate that success through large investments in the United States. It has been tripped up, first by inflation and higher interest rates and, more recently, by opposition to renewable energy from President Trump.
The company’s share price fell more than 16 percent Monday to fresh record lows in trading in Copenhagen.
“This latest development from the hostile U.S. administration is yet another blow to Orsted and makes the stock difficult to invest in,” Deepa Venkateswaran, an analyst at the Wall Street research firm Bernstein, wrote in a note to clients.
The wind farm, called Revolution Wind, aimed to supply electricity to 350,000 homes in Rhode Island and Connecticut by next spring.
The order on Friday to stop work on one of the Danish company’s premier projects heaped pressure on the company, which is seeking new funds from investors.
Earlier this month, Orsted rattled investors when it announced that it would need to raise 60 billion Danish kroner, or about $9.4 billion, by issuing new shares because of its inability to sell a stake in Sunrise Wind, another project off the East Coast of the United States.
In her note, Ms. Venkateswaran said that the order to cease work on Revolution Wind was “out of the blue” given that the project, according to Orsted, is 80 percent complete.
In a letter to Orsted ordering it to halt construction, the U.S. Bureau of Ocean Energy Management, which supervises offshore development, mentioned “protection of the environment” and concerns about “national security” but gave little further detail.
On Monday, Orsted said that it would proceed with “preparation” for the planned share issue and that the Danish government, which owns 50.1 percent of the company, continued to support the offering.
Of the Revolution Wind project, the company said it “was evaluating all options to resolve the matter expeditiously with permitting agencies and, potentially, through legal proceedings.”
Earlier this year, Equinor, the Norwegian energy giant, and Governor Kathy Hochul of New York were able to persuade the Trump administration to reverse an order to stop another large project, Empire Wind, off Long Island. Equinor wrote down nearly $1 billion in value because of the resulting delays.
Analysts say Orsted faces difficult decisions in the United States. Abandoning these projects would waste the capital already invested and lead to cancellation fees to contractors.
Yet putting additional money into U.S. projects is now risky, given the skepticism of the Trump administration about offshore wind. “It remains to be seen if management are willing to take such risk or decide to walk away,” wrote analysts from Citigroup.
Stanley Reed reports on energy, the environment and the Middle East for The Times from London. He has been a journalist for more than four decades.
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