Daily Management Review

The Netherlands says goodbye to the gas era


02/18/2019


The Netherlands said goodbye to its own gas. For the first time in half a century, since 1963, when the development of the largest gas field on the continent began in Groningen, the kingdom’s gas purchases exceeded its sales. Thus, Holland, a country with a population of 17 million, joined a large club of European countries, which are increasingly dependent on the supply of natural gas through pipelines from Norway and Russia, and liquefied gas from Qatar, the United States and other gas producing countries.



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stevendepolo
The Dutch, of course, understood that sooner or later it had to happen. Of course, gas reserves are gradually decreasing, but the reduction is not so rapid as to talk about turning the country from an exporter of gas into an importer. The Dutch decided to close Europe’s main gas field, Groningen, after scientists proved that there is a direct link between gas production and earthquakes.

The Groningen gas field, located in the north of Holland, more than half a century, regularly supplied gas to 98% of the inhabitants of the kingdom. More than a third of the gas is produced in Groningen. Moreover, Groningen gas companies have the right to sell all their gas themselves.

Residents of the Netherlands, who are very concerned about their safety, demanded that the authorities take action. After much debate and discussion at The Hague, they decided to close the field in Groningen, not immediately, but gradually, stretching the process for 12 years. The Dutch government decided to reduce gas production in Groningen by two-thirds by 2021–22, and gradually reduce the remaining third over the next ten years. By 2030, the Groningen field should be closed.

The Netherlands receives almost 40% of the required energy from gas. According to GasTerra, a joint venture of the kingdom and two oil companies, the sale of Dutch gas in 2018 rose 17% to 11.2 billion euros.

The Netherlands is a major consumer of gas. In 2017, for example, the need for blue fuel amounted to 40 billion m³. Now it will have to be covered more and more by importing liquefied gas (LNG) and natural gas through pipelines. The only plant in the country to return LNG to the gas form is not able to satisfy all the demand, because its capacity is only 12 billion m. per year. As for gas, The Hague can buy it only from Norway and Russia. In the case of Norwegian gas, the possibilities are limited by the ceiling in the level of gas production of the northern kingdom. Therefore, Oil Price concludes, the only way out for the Netherlands is Russian gas.

source: oilprice.com






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