Danish clean energy group Orsted has announced the departure of its Chief Financial Officer (CFO) Daniel Lerup and Chief Operating Officer (COO) Richard Hunter, following setbacks in its offshore wind projects. The decision, described as mutual, comes in the midst of challenges faced by Orsted, particularly the discontinuation of the Ocean Wind 1 and 2 projects in New Jersey.
In a statement, Orsted's Chief Executive, Mads Nipper, acknowledged the demanding and volatile business environment impacting the industry. Nipper expressed the need for new leadership capabilities in the Finance and EPC & Operations functions to fortify Orsted's trajectory into the future.
The departure of Lerup and Hunter is effective immediately, prompting Orsted to initiate a search for suitable candidates to fill these key roles. In the interim, Rasmus Errboe, Chief Executive of Region Europe and Executive Vice President at Orsted, will serve as the interim CFO, overseeing efforts to bolster the company's capital structure and uphold its long-term commitment to its credit rating. Meanwhile, Andrew Brown, a member of Orsted's board of directors with extensive executive experience at organizations such as Shell and Galp, will take on the role of interim COO.
Orsted's recent decision to abandon the Ocean Wind projects in New Jersey led to substantial impairments and drew attention from credit rating agencies. S&P Global Ratings placed Orsted on credit watch negative, while Fitch Ratings adjusted the company's outlook to negative.
David Hardy, Chief Executive of the Americas Region at Orsted, clarified in a LinkedIn post that challenging macroeconomic factors, including high inflation, rising interest rates, and supply chain bottlenecks, forced the company's hand in ceasing the development of the New Jersey projects awarded by the NJ BPU (New Jersey Board of Public Utilities). Hardy expressed disappointment in the decision but emphasized the lack of alternatives given the prevailing circumstances.