Gas has been an inextricable part of the European energy supply in general and the Dutch energy supply in particular for more than half a century. Since its discovery in 1959, the Groningen Gas Field, the largest gas field in the world at the time, has produced over 2,000 billion m3 of natural gas. More than 95% of Dutch households use natural gas for heating. GasTerra has the exclusive right to sell Groningen gas. A major share of it is sold on the domestic market and a significant proportion is supplied to customers in Germany, Belgium and France.
In addition to the Groningen gas, which is low-calorific gas (i.e. it has a relatively low calorific value), GasTerra also sells a large volume of high-calorific gas. Most of this gas comes from the smaller fields in the North Sea or is imported from Russia and Norway. The high-calorific gas is used by industry and is also exported to the countries named above, as well as to Switzerland, the United Kingdom and Italy. Unlike the Groningen gas, producers can offer the gas from the small fields to other gas traders, but GasTerra has a legal obligation to buy this gas at the going market price if asked to do so.
Gas has played a crucial role in the energy supply for decades. In a period of structural and radical change, in which the trade in gas and the transport of gas have been split off from each other and the market liberalised, gas has retained its pre-eminence in the energy supply. All the same the era when that could be taken for granted is over. The position and the image of gas have come under pressure. The positive characteristics of our product, such as comfort, cleanest fossil fuel, flexibility and versatility, are at risk of being pushed into the background. The most important reasons for this in our region have been the earthquakes, which have reinforced the idea among many people that gas is at best a necessary evil, and the crisis involving Russia and Ukraine, which has strengthened existing doubts about the security of the gas supply in Europe.
The earthquakes have had an indirect effect on our business strategy, as the production ceiling imposed by the cabinet since 2014 has not only restricted the producer of Groningen gas, NAM, but also the seller, GasTerra.
The developments outlined above have obviously had a negative impact on the image of gas. Although no-one in Europe denies the importance of gas in the energy mix, not only now but in the longer term, a sizeable group have difficulty seeing our product as part of the solution rather than part of the problem. It is our job therefore to improve the reputation of gas. The reality is that gas is indispensable worldwide, in Europe and in the Netherlands and will remain so for decades to come, from the perspective of both security of supply and responsible climate policy. With regard to the latter, natural gas will over time have to meet stricter CO2 emission standards, which is perfectly possible with the application of CCS. The high economic and social value of this mineral resource cannot be ignored. Fifty years after the discovery of the Groningen Gas Field, the Netherlands still has over 600 billion m3 of conventional natural gas. The responsible production of this gas will also benefit society, both economically and environmentally, in the future.