Netherlands targets additional offshore gas production under new industry deal

The Dutch government said April 23 it had reached a joint agreement with state-owned producer EBN and Dutch industry group Element NL on improving gas production volumes from the Dutch sector of the North Sea.

In a statement, the government said the agreement paved the way for more efficient offshore gas production as part of efforts to reduce the country's new dependence on imported gas.

The Netherlands was historically a net gas exporter thanks to its giant onshore Groningen gas field, but the field was closed in October 2023 due to the risk of earthquakes associated with drilling at the site.

However, the country also produces gas from some 240 small gas fields, with around half onshore and half offshore.

The latest agreement is designed to speed up permitting for North Sea gas projects.

"In a world that is becoming increasingly unstable, it is important that we take responsibility for our own energy supply," Dutch climate minister Sophie Hermans said.

"This agreement helps us move forward -- with less foreign dependency, lower emissions and with an eye to the future," Hermans said.

The Netherlands is moving quickly toward a cleaner energy mix but the government said gas would still be needed for the time being in the transition to a climate-neutral energy system.

"For years, the Netherlands has been importing more gas than we produce ourselves. A large part of this comes from far away, which leads to additional emissions during extraction, transport and processing," Hermans said.

"That is why the government wants to source the necessary gas from our own soil as much as possible, because it makes us less dependent and it is better for the climate."

Remaining gas

Since 2022, the Netherlands has turned to increased LNG supplies to replace imports of Russian pipeline gas and due to the end of production from the Groningen field.

According to data from S&P Global Commodity Insights, Dutch LNG imports in 2024 totaled 13.8 million mt, down from 16.5 million mt in 2023.

Of last year's imports, 9.5 million mt were sourced from the US -- accounting for almost 70% of total supplies.

EBN CEO Jan-Willem van Hoogstraten said US LNG imports caused more CO2 emissions than Dutch gas.

"And besides that, there is still at least 100 Bcm of gas under the Dutch North Sea. This natural gas can make a major contribution to our energy independence," van Hoogstraten said.

Spot LNG prices also remain high.

Platts, part of S&P Global Commodity Insights, assessed the DES Northwest Europe LNG marker at $10.74/MMBtu on April 22.

Joint planning

The government said that under the new agreement with EBN and Element NL, there would be joint planning of offshore gas projects.

"Permitting procedures are becoming faster, but above all clearer and more predictable," it said.

The government said it was also investigating how financial risks can be limited.

"In exceptional cases, EBN can take a larger share in projects to reduce the risk for companies. If a company decides not to develop an area, others can take it over, thus ensuring that the potential gas remains accessible," it said.

Gerda Verburg, chair of Element NL, said domestic gas production was good for Dutch energy independence.

"This agreement is the starting signal for an intensive collaboration to improve predictability and stability. It is now up to the government, EBN and the natural gas sector to jointly put the first steps into practice," Verburg said.

The agreement focuses primarily on scaling up gas extraction in the North Sea.

The government said that for onshore gas extraction, agreements are currently being worked out.

"These will provide clarity on a responsible phasing out of onshore gas production and the conditions under which gas extraction can still take place," it said.