After 584 earthquakes and with still some 1100 predicted quakes in the near future, the first natural gas production unit in Groningen, The Netherlands, was finally shut down on April 14th. This event marked a struggle spanning some two decades, during which the population of the province of Groningen tried to prove to the Dutch government that the damage to their properties was directly related to the exploration and production of this valuable resource underneath the region where they happen to have chosen to live. The first quake was registered in 1993, some 30 years after the initial commencement of production of natural gas in 1963. Today (2015), as a consequence of the earthquakes 80 per cent of the properties in the town of Loppersum are severely damaged – 40 of those are no longer habitable and will need to be demolished. In the entire region of Loppersum some 170,000 properties are in need of urgent repair and/or require earthquake strengthening. Home-owners are trying to sell their properties but buyers understandably stay away and as a consequence the homeowners are forced to remain where they are. Meanwhile their homes rapidly decrease in value and sustain more damage every year. In 2014 compensation for the earthquake damage and the loss of value in properties was estimated at 1.2 billion euro.
It took a court directive for the Dutch government to take action. The Dutch government has until the court ruling always ignored the evidence of a clear connection between the extraction of natural gas from the region, the increasing number of earthquakes and that damage to buildings in this area was highly probable. Of course there is much at stake here. Every year some 1.25 trillion cubic feet of natural gas is produced in the Groningen gas field and sold at market prices. The annual proceeds enable the government to pay for the social premiums, to fund the national infrastructure of roads, waterways, the railroad network, etc. This additional income helps the government to balance its books and has provided the taxpayer over the years with some 211 billion euro in savings on taxes and social premiums.
The exploration, development and production of the gas field were granted to a joint venture between Royal Dutch Shell and Exxon. The Nederlandse Aardolie Maatschappij (the Dutch Oil Company) is their holding company and responsible for the oversight. Contractual obligations put the government on the back foot. This led to many decades of ignoring and denying the rising problem for citizens living in the area. While at the same time the government defended the Nederlandse Aardolie Maatschappij by saying that they had everything under control and people need not worry.
The recent intervention of the court was not only based on numerous complaints by the affected population but also on the basis of a report by an Independent Commission of Enquiry. In that report the link between the gas production and the damage to the properties was acknowledged beyond reasonable doubt. Over and above the material damage to people’s assets, it was also brought to the attention of the government that due to the ongoing aftershocks people no longer feel safe in their homes, resulting in anxiety and mental stress. The court ruled that for these reasons the Dutch government carried the responsibility to act on behalf of the well-being of those affected citizens in order to prevent further harm. The Raad van State (the highest senior advisory body in the Netherlands in legislation matters) urged the government to shift the burden of proof from those affected people, to the Nederlandse Aardolie Maatschappij. That company now bears the responsibility of proving that the damage caused to claimants’ assets is caused by the extraction and production of natural gas.
This ruling is ground breaking for a number of reasons.
First of all it broke the cycle of deny, delay, and defend which had been on-going for decades. Secondly, the Court acknowledged the claims of the affected population as being legitimate. The court prioritized the interests of the people over and above the interests of the national government and the corporates involved. Fourthly, the government was called to order, to take its responsibility to prevent any further foreseeable harm. Fifthly, the burden of proof that damage to homes was/is caused by the earthquakes as a direct result of the production of gas has moved from the claimants back to the corporate involved, the Nederlandse Aardolie Maatschappij.
What I learn from this is that not only the Government carries a responsibility for protecting it citizens and taking action against the corporate but the burden of proof in relation to damaged property was no longer the responsibility of the homeowner but has been firmly placed at the feet of the corporate involved. Is it not about time that this happens in New Zealand too?!
van der Voort, N. and Vanclay, F. 2015, “Social impacts of earthquakes caused by gas extraction in the Province of Groningen, The Netherlands”, Environmental Impact Assessment Review 50, 1-15. http://dx.doi.org/10.1016/j.eiar.2014.08.008