Gas extraction in Groningen is producing earthquakes with consequent fall in the houses price, scientists and the Dutch government recently said. The problem is that the activity is an enormous business. Nowadays, Groningen gas is extracted by NAM, a company jointly owned by Shell and Exxon. It is the most important gas source in The Netherlands, providing half of the total domestic product.
The state earns lots of money from concessions and taxes, while total private revenue since extraction began, in 1959, has now reached 300 billion euros. Journalists have calculated that NAM earns about 300 euros per second thanks to the Groningen gas field.
Unfortunately, citizens living in the area haven’t been as lucky as the state and the energy companies. Machiel Mulder, a renewable energy expert at the University of Groningen, investigated the topic. “Up to now,” he says, “about 1.5 billion euros has been spent on the repairs for damage to houses resulting from the earthquakes caused by gas production. In addition to this, it is estimated that the earthquakes have reduced the average value of houses by 2 to 4%,”.
Mulder’s papers show how tremors are strongly linked to gas extraction. About 1,500 earthquakes were detected in the area from the moment extraction started. More than one hundred houses in the region have been demolished or declared unsafe. An independent study revealed that the number of earthquakes is rising as the extraction of gas continues.
A report from 2013 shows how for two decades the government didn’t act despite its knowledge of the problem. In recent years something has changed, and the government had now obliged companies to stop extraction by 2030.
Luckily, there’s a hope. “The Government’s announcement to stop extracting gas from Groningen opens up opportunities for the region to develop alternative energy solutions”, Mulder adds. “The region may have a comparative advantage in the field of a transition towards renewable energy sources”.