July 3, 2019 / 9:46 AM / 3 months ago

UPDATE 1-Dutch gov't must explain how it will end Groningen gas extraction -advisers

(Updates with more context, detail)

By Nina Chestney

LONDON, July 3 (Reuters) - The Dutch government's top advisory body on Wednesday called for a clearer explanation from the minister of economic affairs and climate policy regarding how natural gas extraction at Groningen will be ended.

Output at Europe's largest onshore gas field reached 88 billion cubic metres (bcm) in 1976 but tremors blamed on drilling in recent years have damaged buildings and forced authorities to slash production.

Following a 3.4 magnitude earthquake, the government last year vowed to halt output at Groningen by 2030 and to lower production as quickly as possible in the coming years.

The minister of economic affairs and climate policy, Eric Wiebes, must explain more clearly how he expects to end gas extraction, the Council of State's Administrative Jurisdiction Division (AJD) said on Wednesday.

The ruling comes in response to appeals lodged by Groningen residents.

"The minister's explanation is not satisfactory for the period after the gas year 2018-2019," the AJD said in a statement.

"The minister must make it clear in concrete terms why gas extraction from the Groningen field cannot be phased out more quickly," it said.

The Groningen field is operated by NAM, a joint venture between Royal Dutch Shell and Exxon Mobil.

Last month, the government said Groningen's output next year was set to fall by 20% more than previously announced, to 12.8 bcm. Output stood at 54 bcm as recently as 2013.

The Dutch gas sector regulator has said output should be limited to 12 bcm next year to limit risks.

But the government has repeatedly said such a step would lead to shortages, as the Netherlands still depends on Groningen gas for a large part of its energy supply.

Plans to reduce demand for Groningen gas include building extra capacity to convert high-caloric imported gas to the low-caloric gas needed for the Dutch network.

The AJD said the minister had set the level of gas extraction properly for the current gas year.

But for after 2018-19, the minister needs to explain what measures will be taken to phase out gas extraction as quickly as possible, it said.

"The minister has not made it clear what can be done, and at what costs, to achieve a more rapid reduction in the demand for gas from major industrial consumers, the greenhouse horticultural sector and gas exporters," it said. (Reporting by Nina Chestney; editing by Jason Neely)

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