Norwegian energy giant StatoilHydro has today unveiled plans for the world's first full scale floating wind turbine, a technology it hopes could slash the cost of offshore wind farms.

The company said it will invest 400m NKr (£40m) in the pilot project, which will see a 2.3Mw wind turbine attached to the top of a so-called Spar-buoy at a location 10km off the coats of Norway.

The 80 metre diameter turbine will be provided by Siemens and will be attached to a large buoy that will be moored to the seabed using three anchor points.

Øistein Johannessen, information manager for new energy at StatoilHydro, said that the Spar-buoy technology was already widely used in the offshore oil and gas industry, and could provide a basis for wind turbines in waters with depths of up to 700m.

He said that the record oil prices meant that demand for such buoys is high and costs have risen, but he added that in theory, floating buoys could provide a far more cost effective means of installing offshore wind turbines than mooring the turbine direct to the sea bed. "In the long term, we hope that this will provide a means of making offshore wind energy cost competitive [with the grid]," he said.

Work on the project is scheduled to begin later this year, with a planned start-up of the turbine scheduled for autumn 2009. StatoilHydro will then undertake a two year feasibility study of the technology to assess how it copes with high winds and how easy the turbine proves to maintain.

Johannessen said that the company was confident any technical problems could be overcome and that the main issue would be finding a means to bring down the cost of the technology. "The key problem is the cost picture, and the technology will need access to incentives if we are to scale it up," he admitted.