AMSTERDAM (Reuters) - Energy companies Royal Dutch Shell (RDSa.L) and Exxon Mobil (XOM.N) will not submit a claim for missed revenue due to the Dutch government’s decision to halt gas production at the Groningen field by 2030, the Dutch ministry of Economic Affairs said on Monday.
“A lot of gas will be left in the ground,” Economy minister Eric Wiebes said at the presentation of his deal with the oil majors responsible for extracting Groningen gas.
“That gas is the property of the oil companies, but they will not submit a claim and the government is not required to compensate them.”
The Dutch government in March said it would end gas production at the Groningen field by the end of the next decade, in an effort to stop a string of relatively small, but damaging earthquakes caused by gas extraction.
This will leave around 450 billion cubic metres (bcm) of gas in the ground, Wiebes said, with an estimated value of approximately 70 billion euros (61.48 billion pounds).
The decision to halt Groningen production forced the government to broker a new deal with Shell and Exxon Mobil, whose 50-50 joint venture NAM is responsible for the field.
NAM will be required to pump as much gas as the government says is needed in the coming years. In return, it will see its share of the revenue from Groningen rise from 10 to 27 percent, Wiebes said, starting this year.
As part of the deal, NAM will also contribute a total of 500 million euros to strengthen the economy in the Groningen region.
Reporting by Bart Meijer, editing by David Evans