Gas firm to withhold Shell, Exxon profits; Promises cash to earthquake-prone region
Dutch gas firm NAM will for the time being not pay profits to its two shareholders - Shell and ExxonMobil, Shell announced in a press release. NAM has 18 billion euros available to compensate for damaged caused by gas extraction related earthquakes in Groningen for the next five years, the Dutch gas firm also announced in a press release.
These two press releases were an attempt to calm unrest caused by the revelation that Shell withdrew its so-called 403 declaration from NAM last year, as Trouw reported on Saturday. This 403 declaration held Shell liable for NAM's debts. The withdrawal of this declaration, which happened in June last year, raised concerns that Shell is trying to escape its liability for damages caused by fracking earthquakes in Groningen.
"Shell Nederland is shocked by the news about the withdrawal of the so-called 403 declaration", Shell said in a press release, according to NOS. "We understand that this has led to concerns among people in Groningen. It has always been our intention to compensate all damage caused by earthquakes." The company adds that it and ExxonMobil is in the midst of consultation with the Ministry of Economic Affairs and Climate on a "broad package of measures" for Groningen. "We hope to conclude these talks shortly. In anticipation of the outcome of these talks, NAM will announce as soon as possible that it will not distributed a dividend to its shareholders for the time being. NAM is financially sound and we, as shareholder, would lie to keep it that way."
In 2016 NAM paid 469 million euros to Shell an ExxonMobil.
On top of Shell's statement, NAM also released a statement to calm down the commotion surrounding the 403 declaration. According to the press release, NAM has 18 billion euros available for compensation for the next five years, RTL Nieuws reports. By way of comparison, last year NAM paid a total of 450 million euros in damages. And since 2012, the company paid a total of 1.7 billion euros in damages.
Of the 18 billion euros, 10.3 billion euros comes from NAM itself. The rest of the amount comes from the government, which profits massively the gas revenues. According to RTL, 90 percent of the gas revenues go to the treasury, the other 10 percent to NAM.