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Shell/Exxon NAM Earthquakes: Thousands of people protested in Groningen last week

Printed below is an English translation of an article published today by the Dutch Financial Times, Financieele Dagblad

Thousands of people protested in Groningen last week against natural gas drilling. Photo: Joris van Gennip

From our editor • Entrepreneurship

Shell is no longer responsible for debts with the 50% subsidiary NAM. The damage to houses caused by earthquakes in Groningen is therefore not at the expense of the petroleum company.

Dagblad Trouw says that this morning on Saturday from the annual report of Shell Netherlands. According to Trouw, the report shows that Shell withdrew the so-called 403 declaration, which concerns liability for subsidiaries, last June. The Rotterdam financial expert Hans Beckman explains in the daily newspaper that this means that ‘for all settlements and agreements that NAM closes after that withdrawal to compensate for earthquake damage, you cannot turn to Shell.’

The court in Leeuwarden ruled Tuesday that the NAM must compensate the depreciation of houses by gas extraction in the province of Groningen. The court in Groningen had already determined this in 2015.

The Groningen professor of administrative law Herman Bröning believes in Trouw that ‘there is a real scenario that the NAM is full of obligations and Shell is therefore pulling off its hands.’

‘Issue of annual accounting law’

Shell told Trouw that the deletion of the 403 statement is ‘purely a matter of annual accounting law’. According to Shell, the sentence no longer appears in the financial statements because NAM publishes its own annual accounts. ‘The 403 statement that Shell Nederland issued in the past served to protect NAM’s suppliers, because they were unable to assess NAM’s financial situation on the basis of a financial statement published by NAM. Those annual accounts are now available. ‘

After the publication in Trouw, the oil company stated that it was not able to find itself in the mood of the news coverage. As a shareholder, we take the problems in Groningen seriously and work towards a solution. ‘ Moreover, according to Shell Nederland, the NAM is’ financially sound and is able to meet all its obligations. Naturally, scenarios are conceivable in which extra measures are required. Shell Nederland will endeavor to keep NAM financially sound in the long run. ‘

Urgent debate

Members of the Dutch Parliament reacted with surprise. Member of Parliament Henk Nijboer stated that his party, the PvdA, wants an urgent debate on the issue. ‘Unfavorable’, tweeted Nijboer. ‘The image of socially irresponsible entrepreneurship.’ CDA member of parliament Agnes Mulder says he is ‘white with rage’ and wants the Minister of Economic Affairs to explain.

Read also the interview with CEO Gerald Schotman and financial director Anton Broers of June 2017.

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