Draft decision on Groningen production gas year 22/23 still expected to be sufficient for security of supply

In January, GTS gives the State Secretary for mining advice about the security of supply for the upcoming gas year. This advice contains an analysis about the expected supply and demand. GTS calculates the amount of production from the Groningen field necessary to ensure the security of supply based on the amount of gas expected from the different sources (for example from foreign countries, offshore production, small fields) and the expected demand. This year in January GTS reported that in gas year 2022/2023 the Groningen field only needs to operate on the so called ‘pilot light’ mode, resulting in minimal production. Our recent study shows that this minimal production is still sufficient.

In February Russia invaded Ukraine, causing the geopolitical situation to change significantly. This had big consequences on the energy markets. The flow of Russian gas to Europe is low, causing an historic increase in gas prices and a significant reduction in demand. Meanwhile European countries have also pursued a policy to fill the gas storages. Therefore GTS has done additional research to map the consequences of these developments for the necessary production from the Groningen field.

Furthermore, GTS has to report a delay in the commissioning date for nitrogen installation Zuidbroek II. GTS and the head contractor agreed this summer to a package of measures intended to speed up the construction, with a phased completion in October 2022. Although over 700 people are working at the site, the desired acceleration has not been realized. This means that the date when the plant is fully operational and can be used by the market, shifts four weeks. This shift has no consequence for the expected production from the Groningen field.

GTS has taken into account the changed circumstances and developments in our review of the expected decision (the so-called ontwerpvaststellingsbesluit) of the State Secretary for mining for gas year 2022/2023. Our conclusion, which is further substantiated in the advice to the State Secretary, is that the capacity of 4,4 million (n) m³/hour and accompanying volume of 2,8 billion (n) m³ for gas year 2022/2023 is still enough to ensure the security of supply.