The Dutch government is prepared to allocate over 20 billion euros to compensate Groningen home owners for the damage wrought by years of gas drilling, sources told the NOS broadcaster.
The funding comes with caveats and should be used for specific goals, including infrastructure upgrade and equitable development. The monies should also go toward damage repair and home reinforcement.
Provincial administrators have previously said the cabinet should invest at least €30 billion in Groningen to repay the ‘debt of honor’ it owes the province after years of gas extraction. The money is badly needed to improve the quality of life and social cohesion in the province, tackle structural poverty, high unemployment, and making all of Groningen’s homes gas-free.
Many Groningers believe that compensation for damage and the reinforcement of homes to withstand earthquakes should be a separate issue. Those costs are estimated to be between 5 and 10 billion euros.
Two months ago, a parliamentary commission report concluded that gas extraction in the province was so lucrative for the Dutch state and energy companies Shell and ExxonMobil that they disregarded the long-term risks and clear signs of adverse effects on the residents of Groningen.
Since the drilling began sixty years ago, the Dutch national treasury has earned €363 billion, while Shell and Exxon’s revenue was about €66 billion. However, “the interests of the people in Groningen were structurally ignored,” the report said. Less than one per cent of that total flowed back to Groningen, whose community feels sidelined by the government and gas companies.
The commission said large-scale extraction caused numerous tremors leaving thousands of residents with damaged homes and health issues. It is widely believed the earthquakes in the three northern provinces are caused by ground settling following the decades of drilling.
Tremors in the Groningen field, which opened in 1963, began in the 1980s as the soft local clay and sandstone began to shift. According to the commission, gas pumping activities in the northern Netherlands have resulted in about 1,600 earthquakes, sending cracks through 85,000 family homes, farms, businesses and architectural landmarks.
The earthquake issue has generated a tide of cross-party political consensus around the urgent need to do more to compensate Groningen for the havoc wrought by decades of gas drilling. Last month, a group of municipal and provincial leaders, mayors, aldermen and water board administrators issued a joint statement saying that The Hague must invest much more in the province than in recent years.
Groningen’s wish list included demands to:
- Compensate for all the damage and suffering inflicted on local residents
- Invest in local communities, neighborhoods and villages
- Invest in safe living and broad prosperity for future generations
- Give direction and confidence to Groningen’s residents
- Listen to and work together with the residents of Groningen, the local government, business owners, and civil society groups
Following the damning report issued by the parliamentary commission of inquiry that blamed the government and energy companies for ignoring the risks of gas production in Groningen, the statement expressed belief that the cabinet and parliament owed a debt to Groningers.
