The Dutch state has earned more than €360 bn from the exploitation of the Groningen gas field since extraction began in 1963, according to an analysis by the Financieele Dagblad.

Total revenues from the gas region amounted to €428 when adjusted for inflation, of which €363.7 bn went to the government coffers while €64.7 bn was split between Shell and ExxonMobil, the joint owners of NAM, the company set up in 1963 to distribute Dutch gas.

The amount of money raised from Groningen’s gas reserves has been a closely guarded secret, with official statistics only giving the total income from natural gas production – €452 when adjusted for inflation.

The FD’s study, based on documents obtained from Shell, shows that Groningen accounted for 80% of that income.

The figures do not include the income from selling Dutch gas to other countries through Gasunie and later Gasterra, which generated revenues of €36 million a year, half of which went to Shell and ExxonMobil.

The state’s large share of the revenues, around 85% of the total, reflects the relatively low cost of producing gas in Groningen, which has a high volume concentrated in a small land area.

High pressure

‘We knew that the government recouped a large share of the profits, but not that the difference between that and the gas companies’ profits was so great,’ Aad Correljé, lecturer and energy specialist at the TU Delft told the newspaper.

‘Because an enormous amount of gas was produced in a small area, the number of processing installations could be concentrated. Moreover, the gas didn’t have to be transported far and the pressure in the Groningen field was so high that for a long time we didn’t need compressors to pump the gas.’

Production costs started to rise rapidly in 2013, from less than €500 mln a year to a peak of €2.9 bn in 2018, as the government started to compensate people in Groningen whose homes had been damaged by earthquakes.

The government announced in 2018 that it was scaling down gas production rapidly prior to phasing it out altogether. So far €8.36 bn has been set aside to compensate to Groningen residents, but the process has been held up by a conflict between the government and the NAM over who should foot the bill.