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EARTHQUAKE WARNING TO SHELL SHAREHOLDERS

The following information is taken directly from Shell’s Annual Report for the year ended December 31, 2016

RISK FACTORS

From page 14

Production from the Groningen field in the Netherlands continues to cause earthquakes that affect local communities.
Shell and ExxonMobil are 50:50 shareholders in Nederlandse Aardolie Maatschappij B.V. (NAM), which Shell operates. An important part of NAM’s gas production comes from the onshore Groningen gas eld, in which EBN, a Dutch government entity, has a 40% interest and NAM a 60% interest. Production from the Groningen eld has caused earthquakes in the past which are expected to continue. The earthquakes have caused damage to houses and other structures in the region and complaints from the local community. Additional earthquakes could have a material adverse effect on our earnings, cash ows and nancial condition. Since 2013, the Minister of Economic Affairs (Minister) has imposed a cap on production from the Groningen eld in order to reduce the impact of the earthquakes on the neighbouring communities. In September 2016, the Minister approved the production of 24 billion cubic metres per annum from the Groningen eld until October 1, 2021. At the request of the Dutch parliament, the Minister will review annually whether new circumstances have arisen that call for a further reduction of the production. The rst such annual review is expected by October 1, 2017.

Netherlands

Shell and ExxonMobil are 50:50 shareholders in Nederlandse Aardolie Maatschappij B.V. (NAM). An important part of NAM’s gas production comes from the onshore Groningen gas eld, in which EBN, a Dutch government entity, has a 40% interest and NAM a 60% interest.

Production from the Groningen eld has caused earthquakes in the past which are expected to continue. The earthquakes have caused damage to houses and other structures in the region and complaints from the local community. Since 2013 the Minister of Economic Affairs has imposed caps on production in order to reduce the impact of the earthquakes on the neighbouring communities. In September 2016, the Minister approved the production of 24 billion cubic metres per year from the Groningen eld until October 1, 2021. At the request of Parliament, the Minister will review annually whether new circumstances have arisen that call for a further reduction of the production. Since 2013, a variety of measures have been taken by NAM, the Minister and the government, including an in-depth study and measuring programme (both sub-surface and above surface) and issuance of speci c building regulations. A national coordinator has been appointed by the government to coordinate public oversight and a dedicated damage claim handling company has been set up, with improvements to damage claim handling kept under review.

 

 

1 Comment on “EARTHQUAKE WARNING TO SHELL SHAREHOLDERS”

  1. #1 Gea
    on May 16th, 2017 at 10:33

    Earth­quakes in the Gro­nin­gen Gas Field

    http://www.dwarshuis.com/earthquakes-groningen-gas-field/

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