Groningen Soil Movement is disturbed by substantial bonuses for top Gasunie. Due to the delay of the Zuidbroek nitrogen plant, ‘a difficult story’

Groninger Bodem Beweging (GBB) finds the fact that the top and senior management of gas transport company Gasunie from Groningen receive substantial premiums and bonuses a difficult sell. Especially because the construction of the nitrogen plant at Zuidbroek, for which Gasunie is responsible, is still not finished.

This factory must ensure that gas extraction from the Groningen field can stop. Recently, the Groningen Soil Movement carefully read Gasunie’s 2022 annual report again and found out that the top of the gas transport company has been well rewarded. Way too good, in GBB’s opinion.

Top executive Han Fennema received a variable bonus of EUR 54,518 on top of his basic salary of EUR 340,736 last year. His fellow director Bart Jan Hoevers received a bonus of 43,612 euros for his work last year. This is added on top of his salary of 272,577 euros. In both cases it means a bonus percentage of 16 percent of their salary.

Fennema has been leading the Dutch state-owned company since 2014 and in that sense, just like Hoevers, is close to the fire when it comes to the completion of the Groningen gas field. The annual report also states that the two top executives of the gas transport company received 26,178 euros and 10,307 euros respectively in one-off payments.

Delivery of Zuidbroek is not going smoothly

The civil organization GBB finds these bonus amounts difficult to accept. Especially since, among others, the two directors according to the organization [mede] be responsible for supervising the timely delivery of the nitrogen plant in Zuidbroek. But the delivery is anything but smooth. Actually, the factory should have been running at full capacity for a long time, but time and time again the installation, owned by Gasunie, was delayed, much to the anger of State Secretary Hans Vijlbrief (Mining).

“The delay of the Zuidbroek nitrogen plant and the conclusions of the parliamentary committee of inquiry are, in our opinion, reason to question the bonuses,” says Merel Jonkheid. According to the civil society organization, the timely delivery of the nitrogen plant in Zuidbroek could have allowed Groningen’s natural gas extraction to be at a considerably lower level two years earlier. And with that, says Jonkheid, for a lower earthquake risk.

With the plant in Zuidbroek, foreign high-calorific gas is made suitable for heating boilers and stoves in Dutch households via nitrogen injection. By adding nitrogen, the gas becomes low-calorific and thus resembles the gas from the Groningen field.

The GBB also calls it difficult that considerably high bonuses have been awarded, while it has clearly emerged, thanks to the witness hearings under oath, that in 2013 gas extraction was considerably increased under the false pretenses of ‘security of supply’, whereby the safety of Groningen residents was completely compromised. was ignored”. Gasunie director Bart Jan Hoevers was one of those involved who were interrogated under oath.

Hoevers stated there, among other things, that at the beginning of 2013 it had already been possible to convert 20 billion cubic meters of high-calorific gas with nitrogen into pseudo-Groningen low-calorific gas. In other words: gas production from Groningen could have easily been reduced by nitrogen conversion. While it was always said that security of supply stood in the way of lower gas production. Minister Henk Kamp and a top civil servant told Hoevers that nitrogen installations had been idle for too long to make a difference, but Gasunie’s top man called that nonsense.

Gasunie: GBB compares apples with oranges

At Gasunie they think that the GBB really misses the point with their criticism of the bonuses and the link with Zuidbroek and especially with the security of supply. A spokesperson for the gas transport company calls it “comparing apples and pears” in a response. The company states, for example, that although director Hoevers was questioned by the parliamentary committee of inquiry on gas extraction in Groningen, nothing bad about Gasunie was brought to light in the final report. “In that sense, we came out neutral or good,” said the spokesman.

The transport company does advise on the security of gas supply, the spokesperson acknowledges, but this also means that soil movement is going too fast as far as Gasunie is concerned. “The Ministry of Economic Affairs ultimately decides how much will be won. As a company, we are only responsible for the transport. Soil movement is well aware of this, because they are also well versed in the matter.”

The Gasunie spokesperson does not attach a value judgment to the amount of the bonuses. But she does indicate that it is normal. “These bonuses are legal.” The spokesperson states that agreements will be made at the beginning of the year about goals that must be achieved. Top Gasunie executives can earn a maximum of 20 percent of their base salary in bonuses. “That has become 16 percent in 2022,” said the spokesperson, who emphasized that great achievements were made under high pressure last year. This concerns, for example, the realization of extra LNG capacity in the Eemshaven “so that the Dutch keep their feet warm”.

Jonkheid van GBB says that the organization wants to draw attention once again to the stark contrast with residents of Groningen “who have been fighting for years to get every euro of damage caused by gas extraction compensated” and the parties “who are still always earn a shocking amount from gas extraction”.