Sunday 09 August 2020

NAM says it has billions available for earthquake claims

Photo: Depositphotos.com

Gas producer NAM said on Wednesday has billlions of euros available to pay damages claims arising from earthquakes resulting from its extraction of gas in northern Groningen province, the Telegraaf has reported.

Earlier Shell, a 50-50 partner with US-based ExxonMobil in NAM, said it would fulfill any financial obligation it may have towards the mounting claims.

In NAM’s financial plans for the next five years, NAM has budgeted between €3bn and €6bn for claims related to the earthquake damages. In the best case scenario the claims will require some €2bn from NAM’s cash flow in the same period, the Telegraaf said.

In addition, NAM already has €1bn in cash reserves and can quickly borrow another €1.3bn from its shareholders.

NAM made the statement to alleviate fears of people affected by the earthquakes. Their uncertainty arose after it was revealed last weekend that Shell had withdrawn a clause admitting financial responsibility for NAM.

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