Yesterday the Council of State’s Administrative Jurisdiction Division (hereinafter: the Council) ruled in proceedings regarding the Ministerial consent of September 2016 (together with the amendment decision of May 2017) required for the 5 year production plan 2016 for the Groningen Field Concession.

The Groningen Field produces L-gas (low calorific gas) and the security of supply of this type of gas to consumers in Holland, Germany, Belgium and France is at stake with this production plan. The production of natural gas in Groningen induces earthquakes and (in brief) a lower production volume is beneficial to mitigate this earthquake risk.

The Council came to the conclusion that the minimum volumes required to safeguard the security of supply (of L-gas) as determined by GTS (the national gas transmission grid operator) were sufficiently motivated by the Minister, as such the Council sets aside the various points of criticism by appellants with regard to the methodology applied to determine these minimum volumes for the security of supply (of L-gas) which in their view would lead to a higher level than absolutely necessary.

On the other hand, the Council decided that the decision of the Minister is not adequately motivated by taking the minimum volumes for the security of supply (as determined by GTS) as fixed and given for the next coming years, without taking into account potential measures to further reduce these required minimum volumes in view of the interests involved with the production of natural gas in Groningen (i.e to reduce production volumes in order to mitigate the earthquake risks involved).

The Minister will have to take a new decision within one year. In the meantime, by provisional measure imposed by the Council, the production by NAM may temporarily be continued for this one year within the current maximum volumes and restrictions as provided in the consent decision, until a new decision by the Minister comes into force.

The Minister will have to take a new decision within a year. The Minister will have to study with more scrutiny potential available measures to further reduce the volumes required for the security of supply of L-gas in order to further reduce the Groningen production in coming years. Or to better motivate and substantiate why such measures for a further reduction of L-gas required for the security of supply cannot be pursued.