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Groningen gas field in Netherlands to shut down as Senate authorizes law

The Dutch Senate on Tuesday authorized a law to permanently close the Groningen gas field, following the federal government's guarantee that production will never ever be resumed to limit seismic risks in the area.

Normal gas production at Groningen in the north of the Netherlands ended last October after years of output cuts to limit seismic activity linked to years of extraction, that has damaged countless structures.

The gas field, as soon as among Europe's primary suppliers, was offered for limited production during a cold wave in current months, however the government has proposed a law that would close the field completely by Oct. 1.

The law will leave substantial reserves in the ground and has actually been criticized by some political leaders and gas market advocates, who argue doing so might jeopardize the country's security of supply.

The Senate reacted previously this month by unexpectedly delaying the last vote on the law, as a number of factions stated they required more guarantees on supply.

That move angered the federal government, as Mining Minister Hans Vijlbrief - who had actually been a strong supporter for the shutdown - stated he would resign if it would cause a long hold-up and continuous seismic uncertainty for people living in the area.

Without the law, gas production might resume.

The field is operated by gas business NAM, a joint endeavor of Shell and ExxonMobil, who have asked an arbitration court to decide whether the Dutch state must compensate them for the ending of gas production at Groningen.

Gas revenues have actually provided an approximated 363 billion euros

(source: Reuters)