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Dutch agency calls for further cut in Groningen gas production

by Reuters
Wednesday, 22 June 2016 07:34 GMT

(Adds details, background)

AMSTERDAM, June 22 (Reuters) - A Dutch advisory body has advised the government to make additional cuts to production at the Groningen gas field to reduce the risk of earthquakes in the northern province, local media reported on Wednesday.

The Netherlands' National Mines Inspectorate has advised the government to cap production at 24 billion cubic meters (bcm) of gas annually, De Telegraaf newspaper said in its overnight edition, citing a recommendation to Economy Minister Henk Kamp.

The agency declined to comment.

The Cabinet is expected to announce its production plans for the field for the period after Oct. 1, 2016 on Friday, after several cuts in the past year have left it at the rate of 27 bcm on an annualized basis.

The final decision will be based on the recommendations from the agency, Groningen's operator NAM, a joint venture of Royal Dutch Shell and Exxon, and six other parties.

A majority of lawmakers Dutch parliament have called for production to be cut as far as possible to reduce earthquakes in the northern province caused by the gas extraction.

Groningen gas has supplied almost 10 percent of demand in the European Union and announcements to cut production have led to short term spikes in gas prices. (Reporting by Toby Sterling, editing by Louise Heavens)

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