By Dow Jones Business News,
January 17, 2014, 11:56:00 AM EDT
By Robin van Daalen
AMSTERDAM--The Dutch government Friday announced it would lower the maximum amount of gas that can be produced in the
northern province of Groningen, following a series of studies over the past year that linked gas drilling to the rise in
earthquakes in the region.
"To improve the safety of the people that live above the gas field in Groningen, we will cut the production in the
most risky area and we will limit the total production," Dutch Minister of Economic Affairs Henk Kamp said.
In total the production of gas in the Groningen region will be limited to 42.5 billion cubic meters in 2014 and 2015,
compared to a previous cap of 90 billion cubic meters for both years. The measure will result in a shortfall of 700
million euros ($1.14 billion) in the Dutch government's budget for 2014, which had accounted for 45 billion cubic meters
of gas to be produced, a spokesman for the ministry of economic affairs said.
In 2013, 54 billion cubic meters of gas was produced at the Groningen gas field.
During the last few years, pressure on the Dutch government to slow or halt production grew after government studies
linked a rise in the number and severity of tremors in the Groningen region to natural gas production. However, the
Groningen field is important for both domestic energy supplies and government income at a time when the euro zone's
fifth largest economy is struggling.
Groningen provides almost 60% of the country's gas production. Total government revenues from gas production were
EUR11.5 billion in 2012. Nederlandse Aardolie Maatschappij, or NAM, a joint venture between Royal Dutch Shell PLC (RDSA)
and Exxon Mobil Corp ( XOM ), operate the field in Slochteren.
Write to Robin van Daalen at email@example.com
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