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2019-05-29 10:35:00

GRONINGEN'S SEISMIC RISKS

GRONINGEN'S SEISMIC RISKS

REUTERS - Production at the Groningen gas field in the Netherlands needs to be slashed by almost 40% to limit seismic risks, regulator SodM said on Tuesday, after a 3.4 magnitude earthquake hit the region last week.

Authorities have been forced to repeatedly reduce output at what was once Europe's largest gas field due to dozens of minor tremors each year that have damaged thousands of homes and sparked protests by locals.

Output should be cut for the year from October to no more than 12 billion cubic meters (bcm), the regulator said.

But a government spokesman immediately poured cold water on the advice, saying it would be very difficult to reach the required level so fast.

"We will look at ways to limit production further than currently planned, but lowering it below 12 bcm next year would have serious consequences for the safety of supply," spokesman Job van de Sande said.

The government next month will publish its preliminary production plans for the year from October, Van de Sande said.

"We will make it clear then how we plan to further reduce the demand for Groningen gas."

Annual output stands at 19.4 bcm and had been set to fall to 15.9 bcm per year from October under plans set forth in February.

"It will be an enormous challenge to reach 12 bcm, but we will try to get there as far as possible," Van de Sande said.

A 3.4 magnitude earthquake prompted the Dutch government last year to promise to end Groningen production by 2030 and to lower output as quickly as possible in the coming years.

SodM's new advise would mark a 38% cut versus the current year and a 25% reduction from plans set out in February to lower output to 15.9 bcm from October.

"A certain amount of risk for the safety of supply needs to be considered in comparison to the risks of gas production for the people in Groningen," the regulator said.

In February the government defended the target of 15.9 bcm for the year beginning October 2019, calling it the minimal level required to guarantee the country's safety of supply. The Netherlands still depends on Groningen gas for a significant part of its energy supply.

Plans to reduce demand for Groningen gas include building extra capacity to convert high-caloric imported gas to the low-caloric gas needed for the Dutch network and switching large industrial users to other sources of energy.

The government last year said this could allow a cut in production to less than 12 bcm by October 2021.

The field is operated by NAM, a joint venture between Royal Dutch Shell and Exxon Mobil. Output hit a peak of 88 bcm in 1976 and stood at 54 bcm as recently as 2013.

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Tags: NETHERLANDS, GAS, GRONINGEN, DUTCH