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A Dutch can of worms for Shell and Exxon

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Screen Shot 2015-04-14 at 08.30.55By John Donovan

The financial repercussions from the Shell/Exxon induced earthquakes in the Groningen area of the Netherlands,  which are increasing in strength and frequency, is getting even more serious.

Reuters is reporting that the estimated cost to reinforce more than 150,000 Dutch homes to withstand the earthquakes caused by extracting gas in the Groningen gas field has increased to at least 30 billion euros ($32 billion). 

That does not include the cost of repairing widespread damage already inflicted on properties in the area.

The huge liability may impact on the share values of Royal Dutch Shell Plc and ExxonMobil Corp, the joint owners of NAM, the operating company for the gas field. 

$32 billion is big money, even for the likes of Shell and Exxon.

The question arises of whether Shell was already aware of its Dutch gas bill when it launched its bid for BG Group. 

SOURCE

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