for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up

UPDATE 1-Dutch parliament orders annual check on Groningen gas production

(Updates with details, background)

AMSTERDAM, Sept 15 (Reuters) - The Dutch parliament adopted a motion on Thursday ordering the government to evaluate every year whether gas production at the country’s Groningen field can be reduced further.

Output from Groningen, Europe’s largest gas field, has halved over the past two years after the country’s Safety Board said the government was failing to protect citizens from earthquakes triggered by gas exploitation.

In June, the government capped production at 24 billion cubic meters (bcm) annually for the coming five years but the motion adopted Thursday opens the door to further reductions.

The Groningen gas field is operated by NAM, a joint venture between Royal Dutch Shell and Exxon Mobil Corp.

In June, Economics Minister Henk Kamp cited expert advice that 24 bcm was the minimum that could be produced at Groningen while still guaranteeing customers at home and abroad would have enough gas to heat homes in the winter.

But he reversed that judgment on Tuesday, saying in a letter to parliament that German customers had signalled they would reduce their dependence on Dutch gas ahead of schedule and find other sources.

That raises the possibility gas output from Groningen could be lowered in the coming years without causing supply problems.

Although Kamp had opposed the motion to impose annual checks, it passed with the support of opposition parties and the government’s junior coalition member Labour. (Reporting by Toby Sterling; editing by David Clarke)

Breakingviews

Reuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.


Sign up for a free trial of our full service at https://www.breakingviews.com/trial and follow us on Twitter @Breakingviews and at www.breakingviews.com. All opinions expressed are those of the authors.

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up