Dick Benschop, former director of Shell Nederland, regrets afterwards that he did not ask in December 2012 about the ‘space’ that was available to limit gas extraction. The oil companies may have had their license to operate (the support of the Groningen population for extracting gas) if they had turned the gas tap off slightly – instead of opened it further. The oil companies could have afforded that financially, Benschop said on Thursday afternoon to the parliamentary committee of inquiry in The Hague that is investigating gas extraction in Groningen.
A second point that Benschop regrets is that it has not been possible to involve the people of Groningen more in the decision-making process about gas extraction, and to allow them to benefit more from it. In his own words, he made a proposal at the beginning of 2015 to admit the province to the meetings of the so-called Maatschap Groningen, in which the most important decisions about gas extraction were taken, but that came to nothing. A ‘missed opportunity’, says Benschop, because perhaps gas extraction could have continued longer if the people of Groningen had been given more control over gas extraction and the reinforcement of their homes.
Two hats
The members of the House of Representatives who interviewed him wanted to know from Benschop how it was possible that on the afternoon of 13 December 2012, he had agreed to the plan of gas trading company GasTerra to extract more gas in 2013, while he had heard that same morning that the State Supervision of de Mijnen (SodM) warned that gas extraction was much more risky than previously thought.
Benschop, who was CEO of Shell in the period 2011-2016, wore two hats on that thirteenth December in 2012. In the morning he had a meeting with the Maatschap Groningen, the body in which the oil companies, together with state-owned company EBN, took the most important decisions about gas extraction. That morning the members discussed the findings of the SodM. After the severe earthquake in Huizinge on 16 August 2012, the supervisor concluded that the earthquake risk was greater than expected and that it was also less safe for the people of Groningen.
In the afternoon of 13 December 2012, Benschop attended another meeting, GasTerra’s board of directors. There he agreed to GasTerra’s business plan to trade 48.9 billion cubic meters of gas, more than in 2012. The parliamentary committee of inquiry found it incomprehensible that he had taken that decision that same afternoon, according to the questions asked by the MPs.
But according to Benschop, his insight at the time was “that the height of the maximum earthquake would not be influenced by the production at that moment. It’s the frequency,” said Benschop. Moreover, it was ‘difficult’ that the SodM came up with a different vision than, for example, the KNMI, which according to Benschop was seen as ‘the authority in the field of seismicity’. He thought it would be better if the experts reached an agreement first; then new gas decisions could be based on this. TNO and experts from NAM should also consider the safety issue. He considered it ‘justifiable’ to take a year for research and only then make a decision about the level of gas extraction.
unrealistic number
In January 2013, SSM advised to reduce gas extraction to 12 billion cubic meters as soon as possible. However, the then Minister of Economic Affairs Minister Henk Kamp (VVD) decided, in consultation with his official top and the oil companies, not to intervene. Instead, he launched fourteen investigations into gas extraction. Benschop still considered the 12 billion that the SodM called “an unrealistic number” at the time. A production cut would have had “quite consequences”, both for the international market and for Dutch households, he said.
However, he regretted that he had not looked into the possibilities of reducing gas production a bit, because it is now clear that that was indeed an option. GasTerra had investigated this. Instead, the gas tap was opened further in 2013, even to more than 53 billion cubic meters, a fact that caused a lot of bad blood among the people of Groningen and their administrators. “I wish I had asked that question at the time. Because this fact has of course had a devastating effect on the discussion about Groningen,” said Benschop.
This article is also part of our live blog: Former Shell CEO: regret that we did not win a little less gas in 2013