Ørsted (company)
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Ørsted A/S (formerly DONG Energy) is a Danish multinational energy company. Headquartered in
Fredericia Fredericia () is a town located in Fredericia Municipality in the southeastern part of the Jutland peninsula in Denmark. The city is part of the Triangle Region Denmark, Triangle Region, which includes the neighbouring cities of Kolding and Vej ...
,
Denmark Denmark is a Nordic countries, Nordic country in Northern Europe. It is the metropole and most populous constituent of the Kingdom of Denmark,, . also known as the Danish Realm, a constitutionally unitary state that includes the Autonomous a ...
, Ørsted is the largest energy company in Denmark. The company adopted its current name on 6 November 2017. It was previously known as DONG. As of January 2022, the company is the world's largest developer of offshore wind power by number of built offshore wind farms. Ørsted developed approximately 30% of the global offshore wind power installed capacity, excluding mainland China. Globally, Ørsted produces 90% of its energy from renewable sources, and has an objective of exceeding 95% by 2023 and 99% by 2025. The company has a goal of net zero generation by 2025 and no carbon emissions by 2040.


History


Origin

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 the
North Sea The North Sea lies between Great Britain, Denmark, Norway, Germany, the Netherlands, Belgium, and France. A sea on the European continental shelf, it connects to the Atlantic Ocean through the English Channel in the south and the Norwegian Se ...
. 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 the electricity market by taking long positions in electricity companies. In 2005, DONG acquired and merged Danish electrical power producers Elsam and 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 the
European Commission The European Commission (EC) is the primary Executive (government), executive arm of the European Union (EU). It operates as a cabinet government, with a number of European Commissioner, members of the Commission (directorial system, informall ...
on 14 March 2006. In 2002 Elsam had installed the 160 MW Horns Rev offshore wind farm, which was the first large-scale offshore wind farm in the world.Horns Rev I Offshore Wind Farm, Denmark
''Power Technology''. Retrieved: 27 October 2010.

''4C'' . Retrieved: 30 July 2010.
Horns Revolution
, Modern Power Systems, 5 October 2002, accessed 14 April 2010.
In 2005, DONG Energy acquired 10.34% in the Ormen Lange gas field (operated by
Shell Shell may refer to: Architecture and design * Shell (structure), a thin structure ** Concrete shell, a thin shell of concrete, usually with no interior columns or exterior buttresses Science Biology * Seashell, a hard outer layer of a marine ani ...
). The share of gas reserves allocated to DONG Energy are approximately . The following year, DONG entered a 20-year contract for one billion cubic meters of natural gas per year from 2011, from
Gazprom PJSC Gazprom ( rus, Газпром, , ɡɐsˈprom) is a Russian State-owned enterprise, majority state-owned multinational Energy industry, energy corporation headquartered in the Lakhta Center in Saint Petersburg. The Gazprom name is a contract ...
in Russia through Nord Stream 1 and 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. In 2007, DONG and Wingas (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. The deal was criticized as "damaging to European interests".


Use of fossil fuels

At about the time of the 2009 United Nations Climate Change Conference in 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. In 2009, the Gazprom->DONG contract was doubled to 2 bcm/year for 18 years, beginning in 2012. However, Gazprom records showed that DONG only bought 15% of that amount in 2012 and 2013. In 2009, DONG Energy sold its fiber broadband in northern Zealand to TDC A/S. In 2010, the company started a cooperation with Dutch . However, in 2014 DONG Energy withdrew its consumer activities from the Dutch market. In 2010, DONG divested Norwegian power companies Salten and Nordkraft.http://www.offshorewind.biz/2010/10/12/divestment-of-stakes-in-nordkraft-and-salten-kraftsamband-has-been-approved-denmark/ Divestment of stakes in Nordkraft and Salten Kraftsamband has been approved] ''DONG Energy'', 12 October 2010. Retrieved: 16 November 2010. In September 2013, DONG Energy sold a power cable accessing the London Array wind farm to its partners, E.ON and Masdar for around $728 million.


Focus on offshore wind power

By 2012, DONG Energy had a wind turbine capacity of 794 MW and planned to add another 594 MW the following year. In 2013, the company finished the construction of the 400 MW Anholt Offshore Wind Farm off the Danish island of Anholt in the Kattegat at a cost of 10 billion Danish kroner (€1.35 bln). DONG Energy was the only bidder in the process.Hanne, Windemuller
Anholt Offshore Wind Farm will be the largest in Denmark
'' Danish Energy Agency'', 2 July 2010. Accessed: 27 November 2010.
The following year, DONG Energy divested its last onshore wind turbines, focusing on offshore wind power.Fribo, Adam.
Dong sælger de sidste landmøller
" '' Ingeniøren'', 23 December 2014. Accessed: 24 December 2014.
of which DONG Energy had 3,000 MW in 2015; 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 of Goldman Sachs, while Danish
pension fund A pension fund, also known as a superannuation fund in some countries, is any program, fund, or scheme which provides pension, retirement income. The U.S. Government's Social Security Trust Fund, which oversees $2.57 trillion in assets, is the ...
s, ATP and PFA Pension acquired 4.9% and 1.8% accordingly. The deal was heavily criticised and caused a split of the ruling coalition of Helle Thorning-Schmidt. Six cabinet ministers and the Socialist People's Party withdrew from the government. On 9 June 2016, some of these shares were sold in an IPO at Copenhagen Stock Exchange. In 2015, DONG Energy had a deficit of 12 billion DKK, the largest of any Danish company ever. DONG Energy was listed on the Copenhagen Stock Exchange in 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. In 2017, DONG Energy completed decommissioning of the world's first offshore wind farm, Vindeby Offshore Wind Farm.


Name change

In 2017, the company decided to phase-out the use of coal for power generation, and it sold off its oil and gas business to Ineos for US$1.05 billion. After selling its oil and gas business the company announced its transition to renewable energy was fulfilled and changed its name to Ørsted after the Danish scientist Hans Christian Ørsted, citing that DONG was inappropriate considering they no longer owned any oil and natural gas assets. In 2018 Ørsted acquired Deepwater Wind to expand offshore wind in the US. In 2018, a gas price
arbitration Arbitration is a formal method of dispute resolution involving a third party neutral who makes a binding decision. The third party neutral (the 'arbitrator', 'arbiter' or 'arbitral tribunal') renders the decision in the form of an 'arbitrati ...
case was closed between Gazprom on one side, and Ørsted, Shell and others on the opposite side. In 2019, Ørsted divested the Copenhagen electricity distribution network to Andel for $3 billion. On 9 September 2020 it was revealed that Mads Nipper, former CEO of
Grundfos Grundfos () is the largest pump manufacturer in the world, based in Denmark, with more than 19,000 employees globally. The annual production of more than 16 million pump units, circulator pumps (UP), submersible pumps (SP), and centrifugal pump ...
, will take over as CEO from Henrik Poulsen on 1 January 2021. In 2020 developer Ørsted sold a 50% stake in the Greater Changhua 1 Offshore Wind Farm in Taiwan to Caisse de depot et placement du Quebec and Cathay PE for $2.7 billion. In 2022, Ørsted began rewilding the seabottom near some of its offshore wind farms.


Operations

Ørsted considers
Denmark Denmark is a Nordic countries, Nordic country in Northern Europe. It is the metropole and most populous constituent of the Kingdom of Denmark,, . also known as the Danish Realm, a constitutionally unitary state that includes the Autonomous a ...
,
Sweden Sweden, formally the Kingdom of Sweden, is a Nordic countries, Nordic country located on the Scandinavian Peninsula in Northern Europe. It borders Norway to the west and north, and Finland to the east. At , Sweden is the largest Nordic count ...
, the
United Kingdom The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Northwestern Europe, off the coast of European mainland, the continental mainland. It comprises England, Scotlan ...
,
Germany Germany, officially the Federal Republic of Germany, is a country in Central Europe. It lies between the Baltic Sea and the North Sea to the north and the Alps to the south. Its sixteen States of Germany, constituent states have a total popu ...
and the
Netherlands , Terminology of the Low Countries, informally Holland, is a country in Northwestern Europe, with Caribbean Netherlands, overseas territories in the Caribbean. It is the largest of the four constituent countries of the Kingdom of the Nether ...
as core markets of corporation. However, in 2015 they also received a lease from the US agencies the Department of the Interior and the Bureau of Ocean Energy Management, which, in the lease, handed over some sea area in the
United States The United States of America (USA), also known as the United States (U.S.) or America, is a country primarily located in North America. It is a federal republic of 50 U.S. state, states and a federal capital district, Washington, D.C. The 48 ...
for wind park development, specifically in
New Jersey New Jersey is a U.S. state, state located in both the Mid-Atlantic States, Mid-Atlantic and Northeastern United States, Northeastern regions of the United States. Located at the geographic hub of the urban area, heavily urbanized Northeas ...
.


Oil and gas exploration and production

Before the divestment of its oil and gas upstream assets to Ineos in 2017, DONG Energy's core areas of oil and gas exploration and production lay in the southern part of the Norwegian
North Sea The North Sea lies between Great Britain, Denmark, Norway, Germany, the Netherlands, Belgium, and France. A sea on the European continental shelf, it connects to the Atlantic Ocean through the English Channel in the south and the Norwegian Se ...
and the Danish part of the North Sea, Barents Sea, west of Shetland, and in the central region of
Norway Norway, officially the Kingdom of Norway, is a Nordic countries, Nordic country located on the Scandinavian Peninsula in Northern Europe. The remote Arctic island of Jan Mayen and the archipelago of Svalbard also form part of the Kingdom of ...
(gas production). The reserve base was expected to be of oil equivalent. In 2016, it produced of oil equivalent. In 2016, DONG Energy agreed to sell its oil and gas pipelines to Energinet.dk. It owned oil and gas pipelines which extend from the Danish part of the North Sea to Nybro and the Swedish gas transmission network (Nova Naturgas). DONG Energy co-owned the Tyra West – F3 pipeline pipelines, which create a link from the North Sea Danish section to the Netherlands natural gas hub in Den Helder, the DEUDAN pipeline from
Jutland Jutland (; , ''Jyske Halvø'' or ''Cimbriske Halvø''; , ''Kimbrische Halbinsel'' or ''Jütische Halbinsel'') is a peninsula of Northern Europe that forms the continental portion of Denmark and part of northern Germany (Schleswig-Holstein). It ...
to north of
Hamburg Hamburg (, ; ), officially the Free and Hanseatic City of Hamburg,. is the List of cities in Germany by population, second-largest city in Germany after Berlin and List of cities in the European Union by population within city limits, 7th-lar ...
in
Germany Germany, officially the Federal Republic of Germany, is a country in Central Europe. It lies between the Baltic Sea and the North Sea to the north and the Alps to the south. Its sixteen States of Germany, constituent states have a total popu ...
, and the Langeled pipeline from Nyhamna terminal in
Norway Norway, officially the Kingdom of Norway, is a Nordic countries, Nordic country located on the Scandinavian Peninsula in Northern Europe. The remote Arctic island of Jan Mayen and the archipelago of Svalbard also form part of the Kingdom of ...
to Easington in the UK. DONG Energy also owned a share of the Norwegian gas pipeline system.


Power production

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 with a market share of 16%. Ørsted surpassed 1,000 offshore wind turbines in 2016. In Denmark, it operates the 209 MW Horns Rev 2 offshore wind farm.Horns Rev 2 (Denmark) offshore wind farm
''4C'' . Retrieved: 30 July 2010.
Horns Rev 2
''LORC'' . Accessed: 10 December 2011.
In the United Kingdom Ørsted operates Barrow and Burbo Bank offshore windfarms and will construct Walney and Gunfleet Sands I and II wind farms.Gunfleet Sands offshore wind farm (United Kingdom)
''4C'' . Retrieved: 27 October 2010.
In addition, it is building the world largest wind farms, the 1,200 MW Hornsea 1 and the 1,386 MW Hornsea 2. In
North America North America is a continent in the Northern Hemisphere, Northern and Western Hemisphere, Western hemispheres. North America is bordered to the north by the Arctic Ocean, to the east by the Atlantic Ocean, to the southeast by South Ameri ...
it is a joint-venture partner in multiple proposed offshore wind projects, including the Block Island Wind Farm, Revolution Wind, South Fork Wind, and Sunrise Wind, all off the southern coast of New England. The company was also developing Ocean Wind, an offshore wind farm on the Atlantic coast near
Atlantic City, New Jersey Atlantic City, sometimes referred to by its initials A.C., is a Jersey Shore seaside resort city (New Jersey), city in Atlantic County, New Jersey, Atlantic County, in the U.S. state of New Jersey. Atlantic City comprises the second half of ...
, until it was cancelled in October 2023, and Skipjack Wind, southeast of the mouth of Delaware Bay. The company also has interests in onshore wind farms in Texas, Kansas, Nebraska, and Illinois. Ørsted was until 2017 the largest shareholder (51%) of offshore wind turbine installer A2SEA, while Siemens owns the other 49%.Antitrust authority approves Siemens as equity partner in A2SEA
''DONG Energy'', 13 October 2010. Retrieved: 16 November 2010.
Ørsted also has 30% of subsea cabling installer CT Offshore.DONG becomes co-owner of CT
(in Danish) ''Maritime Denmark'', 12 November 2010. Retrieved: 16 November 2010.
Ørsted has been developing Borssele 1 and 2 wind farms in the Netherlands since 2021.


Shareholders

Ørsted is listed at the Nasdaq Copenhagen stock exchange. The Danish Government holds the majority of Ørsted shares (50.1%). Capital Group Companies, EuroPacific Growth Fund's, and SEAS-NVE holds over 5% of shares. According to a political agreement, the Danish Government shall maintain a majority in the company until 2025. Reduction of the ownership below 50% requires political agreement of Danish parties.


See also

* Energy in Denmark * List of companies of Denmark


References


External links


Ørsted website
{{DEFAULTSORT:Orsted (company) Oil and gas companies of Denmark Electric power companies of Denmark Wind power companies Public corporations of the Danish Government Non-renewable resource companies established in 2006 Danish companies established in 2006 2016 initial public offerings Companies based in Fredericia Municipality Multinational companies headquartered in Denmark Companies listed on Nasdaq Copenhagen Companies in the OMX Copenhagen 25 Companies in the OMX Nordic 40
Denmark Denmark is a Nordic countries, Nordic country in Northern Europe. It is the metropole and most populous constituent of the Kingdom of Denmark,, . also known as the Danish Realm, a constitutionally unitary state that includes the Autonomous a ...