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    Dutch Council Finds Minister Must Work Harder on Groningen Cuts: Update


The minister needs to work harder to cut output even faster, with supplies to three major sectors inadequately analysed, the advisory body has found.

by: William Powell

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Dutch Council Finds Minister Must Work Harder on Groningen Cuts: Update

(Adds ministry response at end)

The Dutch economy minister must provide better reasons as to why gas extraction from the Groningen field cannot be phased out more quickly, said government advisory body the council of state July 3.

The minister must make it clear in concrete terms what may be done to reduce demand from three major sectors: industry; greenhouse growers; and gas exports. The administrative jurisdiction division has therefore set aside the minister's decision to approve gas extraction, the council said. The ruling may not be appealed.  

In setting the maximum volume of gas permitted for extraction in the gas year 2018-2019 (19.4bn m³), the minister weighed the safety interests of Groningen's residents against the interests of meeting the demand for gas (security of supply). For the present gas year: he made it plausible that extracting a lower volume of gas could have significant societal repercussions. Furthermore, the minister applied an acceptable standard to estimate the probability of the most serious safety risk, such as death as the result of an earthquake, for this gas year, and that standard will also be met. The minister was therefore not required to lower the level of gas extraction for this gas year.

However, the minister's explanation does not meet the necessary standards of decision-making for the subsequent gas years (from October 1, 2019), the council ruled.

Therefore, the administrative jurisdiction division "has allowed the legal consequences of the voided approval decision to stand." This means that the ruling has no effect on the extraction level permitted for the gas year 2018-2019. But the ruling does impact assessment of the so-called operational strategy the minister will be required to make for the next gas year, after 2018-2019. For this strategy, the same interests will again have to be weighed up against each other, and thus the potential measures for phasing out gas extraction as fast as possible will once again be on the agenda.

The council of state told NGW that there would be more financial repercussions from cutting further and faster: and as the indirect 50% owner of GasTerra, the exclusive marketing agency for Groningen gas, the government will have to be involved in finding a solution. Which levers the ministry pulls will be his decision however.

The ministry told NGW in June that it had might be able to cut another more from next year's output than it planned but that it would only know the likelihood of that late this gas year.

Ministry in agreement

The economy ministry told NGW that it had to study the ruling more in detail before giving a comprehensive response, and repeated its ambition to bring production close to 12bn m³ in the 2019-2020 gas year, which starts October 1. "The ruling is a signal that we must always do our very best to explain gas decisions. Of course we totally agree," it said.