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Ørsted (company)

(Redirected fromDONG Energy)

Ørsted A/S(formerlyDONG Energy) is a Danishmultinationalenergy company.Headquartered inFredericia,Denmark,Ørsted is the largest energy company in Denmark. The company adopted its current name on 6 November 2017. It was previously known as DONG.

Ørsted A/S
Company typeAktieselskab
Nasdaq Copenhagen:ORSTED
ISINDK0060094928Edit this on Wikidata
IndustryElectricity generation
PredecessorDansk Naturgas A/S
Elsam
Energi E2
NESA
Københavns Energi
Frederiksberg Forsyning
Founded14 March 2006;18 years ago(2006-03-14)(as DONG Energy)
Headquarters
Fredericia
,
Denmark
Key people
Mads Nipper (CEO)[1]
Lene Skole(Chairman)
ProductsElectricity
RevenueDecrease79.26 billionkr.(2023)[2]
Decrease−17.8 billion kr. (2023)[2]
Decrease−20.2 billion kr. (2023)[2]
Total assetsDecrease281.1 billion kr. (2023)[2]
Total equityDecrease77.79 billion kr. (2023)[2]
Number of employees
Increase8,905 (FTE,end 2023)[2]
Websiteorsted.com

As of January 2022, the company is the world's largest developer ofoffshore wind powerby number of built offshore wind farms.[3]Ørsted developed approximately 30% of the global offshore wind power installed capacity, excluding mainland China.[4] Globally, Ørsted produces 90% of its energy from renewable sources, and has an objective of exceeding 95% by 2023 and 99% by 2025.[4] The company has a goal ofnet zerogeneration by 2025 and nocarbon emissionsby 2040.[5]

History

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Origin

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Ørsted has its origin in the Danish state-owned company Dansk Naturgas A/S. The company was founded in 1972 to manage gas and oil resources in the Danish sector of theNorth Sea.After some years, the company was renamed to Dansk Olie og Naturgas A/S (DONG), meaning Danish Oil and Natural Gas. At the beginning of the decade of the 2000s, DONG started to expand itself into theelectricity marketby taking long positions in electricity companies. In 2005, DONG acquired and merged Danish electrical power producersElsamand Energi E2 and public utility (electricity distribution) companies NESA, Københavns Energi and Frederiksberg Forsyning. The result of the merger was the creation of DONG Energy. The merger was approved by theEuropean Commissionon 14 March 2006. In 2002 Elsam had installed the 160 MWHorns Revoffshore wind farm, which was the first large-scale offshore wind farm in the world.[6][7][8]

In 2005, DONG Energy acquired 10.34% in theOrmen Lange gas field(operated byShell). The share of gas reserves allocated to DONG Energy are approximately 40 billion cubic metres (1.4 trillion cubic feet). The following year, DONG entered a 20-year contract for one billion cubic meters of natural gas per year from 2011, fromGazpromin Russia throughNord Stream 1and Germany. The deal included that DONG delivers 600 million cubic meters per year (for 15 years) from the Ormen Lange gas field to Gazprom in United Kingdom.[9]

In 2007, DONG andWingas(partly owned by Gazprom) agreed to a gas swap, where DONG delivers gas to Wingas UK, while Wingas delivers the same amount to DONG in North Germany.[10]The deal was criticized as "damaging to European interests".[11]

Use of fossil fuels

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At about the time of the2009 United Nations Climate Change Conferencein Copenhagen, DONG Energy adopted the "85/15 vision" strategy, with the aim of changing from a company with 85% of activities fossil fuel based to a company 85% based on green energy activities.[12]

In 2009, the Gazprom->DONG contract was doubled to 2 bcm/year for 18 years, beginning in 2012.[13] However, Gazprom records showed that DONG only bought 15% of that amount in 2012 and 2013.[14]

In 2009, DONG Energy sold itsfiber broadbandin northernZealandtoTDC A/S.[15]

In 2010, the company started a cooperation with DutchNederlandse Energie Maatschappij[nl].[16] However, in 2014 DONG Energy withdrew its consumer activities from the Dutch market.[17][18] In 2010, DONG divestedNorwegianpower companies Salten and Nordkraft.[19]

In September 2013, DONG Energy sold a power cable accessing theLondon Arraywind farm to its partners,E.ONandMasdarfor around $728 million.[20]

Focus on offshore wind power

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By 2012, DONG Energy had a wind turbine capacity of 794 MW and planned to add another 594 MW the following year.[21] In 2013, the company finished the construction of the 400 MWAnholt Offshore Wind Farmoff the Danish island of Anholt in the Kattegat at a cost of 10 billionDanish kroner(€1.35 bln). DONG Energy was the only bidder in the process.[22][23][24] The following year, DONG Energy divested its last onshore wind turbines, focusing on offshore wind power.[25]of which DONG Energy had 3,000 MW in 2015;[26]

As part of the restructuring plan to fund offshore wind projects, in January 2014 the company sold an 18% stake to New Energy Investment S.a.r.l., a subsidiary ofGoldman Sachs,while Danishpension funds,ATPand PFA Pension acquired 4.9% and 1.8% accordingly. The deal was heavily criticised and caused a split of the ruling coalition ofHelle Thorning-Schmidt.[12][27] Six cabinet ministers and theSocialist People's Partywithdrew from the government.[28] On 9 June 2016, some of these shares were sold in anIPOatCopenhagen Stock Exchange.[29] In 2015, DONG Energy had a deficit of 12 billion DKK, the largest of any Danish company ever.[30]

DONG Energy was listed on theCopenhagen Stock Exchangein June 2016. At the same time, it divested its ownership shares of five Norwegian oil and gas fields to Faroe Petroleum. That year, the company was voted number 11 on the Clean200 list.[31][32]

In 2017, DONG Energy completed decommissioning of the world's first offshore wind farm,Vindeby Offshore Wind Farm.[33]

Name change

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In 2017, the company decided to phase-out the use of coal for power generation, and it sold off its oil and gas business toIneosfor US$1.05 billion.[34][35] After selling its oil and gas business the company announced itstransition to renewable energywas fulfilled and changed its name to Ørsted after the Danish scientistHans Christian Ørsted,citing that DONG was inappropriate considering they no longer owned any oil and natural gas assets.[12][36]

In 2018 Ørsted acquiredDeepwater Windto expand offshore wind in the US.[37]

In 2018, a gas price arbitration case was closed between Gazprom on one side, and Ørsted, Shell and others on the opposite side.[38]

In 2019, Ørsted divested an electricity distribution network for $3 billion.[39]

On 9 September 2020 it was revealed that Mads Nipper, former CEO ofGrundfos,will take over as CEO from Henrik Poulsen on 1 January 2021.[40]

In 2020 developer Ørsted sold a 50% stake in theGreater Changhua 1 Offshore Wind Farmin Taiwan toCaisse de depot et placement du Quebecand Cathay PE for $2.7 billion.[41]

In 2022, Ørsted beganrewildingthe seabottom near some of its offshore wind farms.[42]

Operations

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Ørsted considersDenmark,Sweden,theUnited Kingdom,Germanyand theNetherlandsas core markets of corporation.[43]However, in 2015 they also received a lease from the US agencies theDepartment of the Interiorand theBureau of Ocean Energy Management,which, in the lease, handed over some sea area in theUnited Statesfor wind park development, specifically inNew Jersey.

Oil and gas exploration and production

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Before the divestment of its oil and gas upstream assets toIneosin 2017, DONG Energy's core areas of oil and gas exploration and production lay in the southern part of the NorwegianNorth Seaand the Danish part of the North Sea,Barents Sea,west ofShetland,and in the central region ofNorway(gas production). The reserve base was expected to be 570 million barrels (91,000,000 m3)of oil equivalent.[34] In 2016, it produced 100,000 barrels per day (16,000 m3/d) of oil equivalent.[34]

In 2016, DONG Energy agreed to sell its oil and gas pipelines toEnerginet.dk.[44][45] It owned oil and gas pipelines which extend from the Danish part of the North Sea toNybroand the Swedish gas transmission network (Nova Naturgas). DONG Energy co-owned theTyra West – F3 pipelinepipelines, which create a link from the North Sea Danish section to the Netherlands natural gas hub inDen Helder,the DEUDAN pipeline fromJutlandto north ofHamburginGermany,and theLangeled pipelinefromNyhamnaterminal inNorwaytoEasingtonin theUK.DONG Energy also owned a share of the Norwegian gas pipeline system.

Power production

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Ørsted is the largest power producer in Denmark with market shares of 49% for electricity production and 35% for heat production. It also owns power production facilities and projects in Germany, Sweden, the Netherlands, Norway and the United Kingdom.

Ørsted is the largest offshore wind farm company in the world[46]with a market share of 16%.[47] Ørsted surpassed 1,000 offshore wind turbines in 2016.[48] In Denmark, it operates the 209 MWHorns Rev 2offshore wind farm.[49][50] In the United Kingdom Ørsted operatesBarrowandBurbo Bankoffshore windfarms and will constructWalneyandGunfleet Sands I and IIwind farms.[51][52] In addition, it is building the world largest wind farms, the 1,200 MWHornsea 1and the 1,386 MWHornsea 2.[53][54][55] InNorth Americait is a joint-venture partner in multiple proposed offshore wind projects, including theBlock Island Wind Farm,Revolution Wind, South Fork Wind, and Sunrise Wind, all off the southern coast of New England.[56] The company was also developingOcean Wind,an offshore wind farm on the Atlantic coast nearAtlantic City, New Jersey,until it was cancelled in October 2023, and Skipjack Wind, southeast of the mouth ofDelaware Bay.The company also has interests in onshore wind farms in Texas, Kansas, Nebraska, and Illinois.

Ørsted was until 2017[57]the largest shareholder (51%) of offshore wind turbine installerA2SEA,[58]whileSiemensowns the other 49%.[59] Ørsted also has 30% of subsea cabling installer CT Offshore.[60]

Ørsted has been developingBorssele 1 and 2 wind farmsin the Netherlands since 2021.[61]

Shareholders

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Ørsted is listed at theNasdaq Copenhagenstock exchange.[62]TheDanish Governmentholds the majority of Ørsted shares (50.1%).[63]Capital Group Companies,EuroPacific Growth Fund's, andSEAS-NVEholds over 5% of shares.[64]According to a political agreement, the Danish Government shall maintain a majority in the company until 2025.[65]Reduction of the ownership below 50% requires political agreement of Danish parties.

See also

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References

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  1. ^"Ørsted appoints Mads Nipper the next CEO of Ørsted"[Ørsted appoints Mads Nipper the next CEO of Ørsted].
  2. ^abcdef"Ørsted Annual Report 2023"(PDF).Ørsted.Retrieved4 April2024.
  3. ^"Our offshore wind farms".orsted.com.Retrieved4 February2022.
  4. ^ab"Ørsted Annual Report 2021".
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  49. ^Horns Rev 2 (Denmark) offshore wind farmArchived10 December 2011 at theWayback Machine4C.Retrieved: 30 July 2010.
  50. ^Horns Rev 2Archived24 March 2012 at theWayback MachineLORC.Accessed: 10 December 2011.
  51. ^Gunfleet Sands offshore wind farm (United Kingdom)Archived9 October 2011 at theWayback Machine4C.Retrieved: 27 October 2010.
  52. ^"DONG Energy Invests in UK Offshore Wind Farms".Oil Voice. 3 December 2007.Archivedfrom the original on 13 April 2009.Retrieved16 December2007.
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  63. ^"Poulsen to stand down as Ørsted CEO".www.windpowermonthly.com.Retrieved31 August2021.
  64. ^"Ørsted.com - Love your home".www.dongenergy.com.Archivedfrom the original on 7 October 2017.Retrieved25 April2018.
  65. ^"Dong Energy: Risk Assessment for Shareholders of the Proposed 1500 MW Coal-fired Power Plant near Greifswald, Germany"(PDF).
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