EARTHQUAKE IN DUTCH
An independent Dutch safety panel has found that the operators of Europe's largest natural gas field, Royal Dutch Shell and Exxon Mobil, as well as the Dutch government, for years ignored the dangers posed by earthquakes in the field.
That finding could add to growing pressure to reduce production at the field, in the Dutch province of Groningen, which has long been a crucial source of fuel for northern Europe and generates billions of euros in revenue annually for the Dutch government.
In a report published on Wednesday, the Dutch Safety Board, a government-financed but independent organization, concluded that "the parties concerned failed to act with due care for citizen safety in Groningen" related to the earthquakes caused by gas extraction.
The government had already ordered a series of cutbacks at the field, which lies under about 350 square miles of farmland and cow pastures, after residents became increasingly vocal in their concern about the numerous earthquakes in the area attributed to the compaction of subsurface rock after gas is extracted.
The residents' worries were further stoked by a 3.6-magnitude temblor in 2012 that damaged many homes and other buildings. People in the area worry that a larger quake would cause injuries or even deaths.
Natural gas prices briefly spiked this month after the Dutch minister of economic affairs, Henk Kamp, ordered a 16 percent cut in production at the Groningen field for the first half of 2015, in addition to previous cuts.
A further cut could come in July, and the field's production may eventually be reduced to less than 60 percent of 2013 levels, according to a Ministry of Economic Affairs spokeswoman.
In a statement on Wednesday, Mr. Kamp acknowledged that the government had underestimated the problems that gas production could cause.
The government initially responded to the earthquakes by ordering that production be cut 80 percent in a prolific area of the field around the town of Loppersum. The Ministry of Economic Affairs said in November that while that measure reduced earthquakes around Loppersum, they increased in the southern part of the field, where production was increased.
In a telephone interview, Ernst Moeksis, a spokesman for the Shell-Exxon joint venture that operates the field, Nederlandse Aardolie Maatschappij, or NAM, said the 2012 earthquake "was a turning point for us."
"After that, it became clear that earthquakes are safety issues," he said.
The Dutch report on Wednesday did not propose halting gas production, but it recommended that local authorities be given a greater voice in decisions about the Groningen field. It also called for further research on the field's safety.
Since natural gas was discovered in Groningen in 1959, the field has served as a European reservoir whose production could be throttled up or down, depending on need. Because there is plenty of gas in storage elsewhere, and this winter has been comparatively warm in Europe, there is still a substantial amount of gas in reserve, analysts say.
''Europe still looks pretty comfortable over all, and prices still remain well below what they were two years ago,'' said Trevor Sikorski, an analyst in London at the market research firm Energy Aspects.
The Dutch government has promised a large compensation package, largely paid for by NAM and including repairs to damaged homes, in an effort to appease the approximately 150,000 residents in the gas field area, many of whom say their concerns have been ignored.
The Dutch Safety Board report said that decision makers, including the government, had put financial and energy security concerns ahead of safety. The way the Groningen field is managed is intended "to look after significant public interests such as the guaranteed supply of gas and revenue optimization," the report said.
The Groningen field is expected to contribute about 10 billion euros, or $11.4 billion, to government revenues this year.
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