In order to reduce dependence on foreign gas, the government is considering playing a greater role in gas extraction in the North Sea. The government currently still owns a minority stake in all oil and gas projects on land and in the Dutch part of the North Sea.
Due to the risk of earthquakes, 500 billion cubic meters of gas remain in the soil of Groningen. About 100 billion cubic meters of gas can still be extracted under the North Sea. Dutch households and companies currently consume approximately 30 billion cubic meters of gas annually.
A third of this consumption now comes from the North Sea, but this share is declining rapidly. Offshore gas extraction, that is, extracting gas at sea, is more expensive than pumping gas from the Groningen field. Due to the decline in gas prices before the gas crisis, companies’ investments in offshore gas extraction were already declining. But even with today’s high gas prices, there is little interest in extracting gas from the North Sea.
Long permitting processes and lawsuits from environmental organizations are making companies wary of new offshore gas exploration. The oil and gas industry finds it more attractive to invest in exploiting offshore gas fields In the United Kingdom and Norway. These countries have recently been granted permission to explore for new gas and, according to the industry, have more attractive conditions than the Netherlands.
In the video you can see how gas is extracted in the North Sea at an altitude of 60 kilometers above Terschelling:
100 billion cubic meters of gas in the North Sea and companies don’t want it
The outgoing Dutch government wants to extract the last remnants of North Sea gas as quickly as possible. Although the government eventually wants to phase out gas, about 87% of households still rely on natural gas to heat their homes.
Residual heat and geothermal alternatives are slow to take off. Right now, there is still a need for natural gas, and it would be better if it came from our country, that’s the logic.
Recently, researchers at the Hague Center for Strategic Studies have discovered the benefits of this included. For example, methane emissions from domestic gas extraction are more than 30 percent lower than those of imported liquefied gas. North Sea gas also ensures that the Netherlands is less dependent on foreign countries. Moreover, its gas extraction has a dampening effect on the extreme fluctuations in gas prices.
Last North Sea gas
To convince companies, State Secretary for Economic Affairs and Climate Vegelbriev wants to speed up permitting procedures and increase the role of Energie Beheer Nederland (EBN). EBN now participates on behalf of the government with a 40 percent stake in all oil and gas projects on land and in the Dutch part of the North Sea.
In this way, a significant portion of the revenues from oil and gas extraction flow into the state treasury via the EBN. In cooperation with oil and gas companies, it is now investigating whether a majority stake in EBN could facilitate the exploitation of new gas fields. Interest could theoretically rise to 100% in some drilling operations, with oil and gas companies being used to carry them out.
Elections are determined
The investigation must be completed before the end of the year in order for it to be part of the negotiations to form the government after the November elections.
Not everyone in The Hague supports gas extraction. The GroenLinks-PvdA group wants a legal ban on the exploitation of new gas fields due to the climate.
The VVD wants to expand natural gas extraction in the North Sea to reduce dependence on foreign countries. Peter Omtzgut and the New Social Contract Party also want to use North Sea gas to protect Dutch consumers from large price fluctuations.
“Sustainable electricity is better”
Opponents, including Greenpeace, believe new gas exploration is not only harmful to the climate, but also irrational. They say gas shortages will be a problem in the coming years mainly due to the closure of the Groningen field and the Russian gas embargo.
Because new drilling operations take several years to produce gas, they consider new drilling operations useless. Opponents say that accelerating the transition to sustainable electricity and saving energy is better than exploiting new gas fields.
If investments in new gas exploration are to yield any return, proponents believe rush is needed. As existing offshore gas fields close, some of the pipelines at the bottom of the North Sea that transport gas to the mainland will also disappear. According to the industry, it’s now or never.
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