GE and Statoil: the start of a beautiful friendship?
It will soon be Valentine’s Day, so what better time to look at a blooming relationship?
US manufacturing giant General Electric and Norwegian energy company Statoil last week to tackle some of the biggest challenges for the global oil and gas market. Issues for the pair to solve include emissions and water usage.
GE chairman and chief executive Jeff Immelt —one of our top 100 people in wind in 2014 —said the oil and gas initiative would allow the businesses to pool their engineering and technology resources to develop “energy solutions that reduce environmental impacts”.
This sounds like a good step, but the fact is it is still focused on fossil fuels. We can’t help but wonder whether this might lead to the pair partnering on wind technology.
Now, they haven’t hinted at it so far but a tie-up would make a lot of sense. GE is one of the world’s largest turbine manufacturers and is seeking to make its move into the offshore wind sector through a joint venture with Alstom. That deal is expected to close this year.
Meanwhile, Statoil is investing in some huge offshore wind projects, including the 402MW Dudgeon with Statkraft and Masdar. The company has said that the offshore wind sector should be able to attract more investors if it could reduce offshore wind installation costs.
If GE and Statoil were to take their technology venture into wind then it would enable GE to further expand its influence in Europe and offshore; and would enable Statoil to develop projects more competitively. Both firms could benefit, and may end up with technology and knowledge that they could sell to others in the sector enabling both to profit.
We should reiterate that, of course, there is no evidence that the pair are looking to extend their tie-up into the wind sector. We are speculating. But surely both businesses would be open to this possibility if it made commercial sense.
This could be the beginning of something beautiful.