Ørsted (company)

Ørsted A/S (formerly DONG Energy) is a Danish multinational power company based in Fredericia, Denmark. It is the largest energy company in Denmark. The company adopted its current name on 6 November 2017.

Ørsted A/S
Aktieselskab
Traded asNasdaq Copenhagen: ORSTED
ISINDK0060094928 
IndustryElectricity generation
PredecessorDansk Naturgas A/S
Elsam
Energi E2
NESA
Københavns Energi
Frederiksberg Forsyning
Founded14 March 2006 (2006-03-14) (as DONG Energy)
Headquarters
Fredericia
,
Denmark
Key people
Henrik Poulsen (CEO)[1]
Thomas Thune Andersen (Chairman)
ProductsElectricity
Revenue 59.5 billion DKK (2017)[2]
16.2 billion DKK (2017)[2]
20.2 billion DKK (2017)[2]
Total assets136,489,000,000 Danish krone[3] (31 December 2016) 
Number of employees
 5,638 (Q4 2017)[2]
Websiteorsted.com

History

The Danish state-owned company Dansk Naturgas A/S was founded in 1972 to manage gas and oil resources in the Danish sector of the North 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 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 on 14 March 2006.

In 2002, one of predecessors of DONG Energy named Elsam installed the 160 MW Horns Rev offshore wind farm, which was the first large scale offshore wind farm in the world.[4][5][6]

In 2005, DONG Energy acquired 10.34% in the Ormen Lange gas field (operated by Shell). The share of gas reserves allocated to DONG Energy are approximately 40 billion cubic metres (1.4 trillion cubic feet).

In 2009, DONG Energy sold its fiber broadband in northern Zealand to TDC A/S.[7]

In 2007, DONG Energy entered into the Dutch market.[8] In 2010, it started a cooperation with Dutch nl:Nederlandse Energie Maatschappij.[9] However, in 2014 DONG Energy withdrew its consumer activities from the Dutch market.[10][11] In 2010, DONG divested Norwegian power companies Salten and Nordkraft.[12] 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.[13]

In 2013, DONG Energy 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.[14][15][16] As of 2012, DONG Energy had a wind turbine capacity of 794 MW and planned to add another 594 MW in 2013.[17] In 2014 DONG Energy divested its last onshore wind turbines, focusing on offshore wind power.[18] of which DONG Energy had 3,000 MW in 2015;[19]

As part of a restructuring plan, in January 2014 DONG Energy sold an 18% stake to New Energy Investment S.a.r.l., a subsidiary of Goldman Sachs, while Danish pension funds, 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.[20] Six cabinet ministers and the Socialist People's Party withdrew from the government.[21] On 9 June 2016, some of these shares were sold in an IPO at Copenhagen Stock Exchange.[22]

In 2015, DONG Energy had a deficit of 12 billion DKK, the largest of any Danish company ever.[23] In 2016, DONG Energy was voted number 11 on the Clean200 list.[24][25]

DONG Energy was listed at 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.

In 2017, DONG Energy completed decommissioning the world's first offshore wind farm, Vindeby Offshore Wind Farm.[26] Also 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.[27][28] After selling its oil and gas business the company announced its intention to transition to renewable energy and change its name to Ørsted after the Danish scientist Hans Christian Ørsted, citing that DONG was inappropriate considering they had no oil and natural gas assets under ownership any more.[29]

In 2018 Ørsted acquired Deepwater Wind to expand offshore wind in the US.[30]

Operations

Ørsted considers Denmark, Sweden, United Kingdom, Germany and the Netherlands as core markets of corporation. However, in 2015 they also received a lease from the Department of the Interior and Bureau of Ocean Energy Management, which, in the lease, handed over some sea area in the United States for wind park development, specifically in New Jersey.

Oil and gas exploration and production

Before divestment of its oil and gas upstream assets to Ineos in 2017, DONG Energy's core areas of oil and gas exploration and production laid in southern part of the Norwegian North Sea and the Danish part of the North Sea, Barents Sea, west of Shetland, and in the middle region of Norway (gas production). The reserve base was expected to be 570 million barrels (91,000,000 m3) of oil equivalent.[27] In 2016, it produced 100,000 barrels per day (16,000 m3/d) of oil equivalent.[27]

In 2016, DONG Energy agreed to sell its oil and gas pipelines to Energinet.dk.[31][32] 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 to north of Hamburg in Germany, and the Langeled pipeline from Nyhamna terminal in Norway 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[33] with a market share of 16%.[34] Ørsted surpassed 1,000 offshore wind turbines in 2016.[35] In Denmark, it operates the 209 MW Horns Rev 2 offshore wind farm.[36][37] In the United Kingdom Ørsted operates Barrow and Burbo Bank offshore windfarms and will construct Walney and Gunfleet Sands I and II wind farms.[38][39] In addition, it is building the world largest wind farms, the 1,200 MW Hornsea 1 and the 1,386 MW Hornsea 2.[40][41][42] In North America it is a partner for the Bay State Wind offshore wind farm in the United States and the Haida Energy Field offshore wind farm in Canada.[43] The company is also developing Ocean Wind, an offshore wind farm on the Atlantic coast near Atlantic City, New Jersey. In the Netherlands, it develops Borssele 1 and 2 wind farms.

Ørsted is the largest shareholder (51%) of offshore wind turbine installer A2SEA,[44] while Siemens owns the other 49%.[45] Ørsted also has 30% of subsea cabling installer CT Offshore.[46]

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.[47] 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.

Sponsorship

Ørsted is the main sponsor of the Danish men's national ice hockey team.

See also

References
  1. Wichmann, Sonny (18 April 2012). "Henrik Poulsen bliver ny topchef i DONG" [Henrik Poulsen will be the new CEO of DONG]. Berlingske (in Danish). Archived from the original on 21 April 2012. Retrieved 18 April 2012.
  2. "Annual Report 2017 Summary". Ørsted. Retrieved 12 October 2018.
  3. https://datacvr.virk.dk/data/offentliggorelse?dl_ref=ZG9rdW1lbnRsYWdlcjovLzAzLzRhLzI4LzYxL2JhLzIwZmItNGY2ZS04Y2ZhLTU1NjczOTk1ZDI1Zg.
  4. Horns Rev I Offshore Wind Farm, Denmark Archived 29 January 2012 at the Wayback Machine Power Technology. Retrieved: 27 October 2010.
  5. Horns Rev 1 (Denmark) offshore wind farm Archived 9 October 2011 at the Wayback Machine 4C . Retrieved: 30 July 2010.
  6. Horns Revolution Archived 14 July 2011 at the Wayback Machine, Modern Power Systems, 5 October 2002, accessed 14 April 2010.
  7. "TDC køber DONGs fibernet" [TDC buys DONG's fiber network]. Berlingske (in Danish). 17 November 2009. Archived from the original on 5 October 2017. Retrieved 4 October 2017.
  8. "'Nederland is voor ons geen speeltuintje'" ['Netherlands is not a playground for us']. NRC Handelsblad (in Dutch). 23 June 2007. Archived from the original on 1 March 2016. Retrieved 8 April 2017.
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  11. Ussing, Jakob; Pedersen, Signe Ferslev (21 January 2014). "Dong Energy siger farvel til skidt investering" [Dong Energy says goodbye to bad investment]. Berlingske (in Danish). Archived from the original on 16 January 2017. Retrieved 8 April 2017.
  12. 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] Archived 22 February 2014 at the Wayback Machine DONG Energy, 12 October 2010. Retrieved: 16 November 2010.
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