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UPDATE 2-Groningen quake prompts review of Dutch gas production plans

Wed, 22nd May 2019 06:17

(Adds reactions by government and regulator, more detail)

AMSTERDAM, May 22 (Reuters) - The Dutch government will decide in the coming weeks whether a 3.4 magnitude earthquake that hit the northern natural gas-producing region of Groningen on Wednesday should lead to a change in plans to end output by 2030.

Once Europe's largest gas field, decades of gas extraction have led to dozens of minor tremors in Groningen each year, damaging thousands of homes and sparking protests by locals and prompting authorities to reduce production.

Residents demanding an outright stoppage took their fight to the highest court in the Netherlands early this year.

But at the time the state's lawyer successfully argued that further production cuts threatened to create shortages for companies and households in the Netherlands and abroad.

"We will await the regulator's analysis of the quake to see if new measures are needed," government spokesman Job van de Sande said on Wednesday.

Gas sector regulator SodM said it would publish its full analysis with recommendations for future production "within a month", with a preliminary assessment expected on May 28.

Wednesday's earthquake was among the most severe to ever hit the region. There were no reports of casualties, but local authorities said around 90 homeowners reported damage in the first hours after the quake.

After a similar quake in January 2018, the government pledged to end production by 2030 and to lower it as quickly as possible in coming years.

Van de Sande said Wednesday's event underlined the importance of that decision.

"We will continue to look for ways to rapidly decrease production, which is already going down faster than originally planned," he said.

Output at the Groningen field, which is operated by NAM, a joint venture between Royal Dutch Shell and Exxon Mobil , is set to fall to 19.4 billion cubic metres (bcm) in the year through October 2019, down from a 2013 peak of 54 bcm.

After last year's quake, SodM said production should be cut to less than 12 bcm as soon as possible to minimise seismic risks.

The government expects to reach that level by 2020, mainly by switching large industrial users off of Groningen gas.

(Reporting by Bart Meijer; Editing by Himani Sarkar and Nick Macfie)

(c) Copyright Thomson Reuters 2019. Click For Restrictions - https://agency.reuters.com/en/copyright.html

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