As Bloomberg reports, Europe’s largest gas field is to be finally closed in October.
The news triggered a 30 percent jump in benchmark European natural gas futures on Thursday.
Earthquakes near the Groningen field in the Netherlands have damaged thousands of homes in recent years.
Europe largest natural gas field is to be shut down on October 1, according to internal sources Sources on BloomberG. The message drove them Prices for the most important energy source on Thursday upwards.
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European gas market reacts to planned shutdown
A final decision on the Groningen field in the Netherlands has not yet been made, but a Dutch government cabinet meeting later this month will make it official, the report said.
Dutch front-month gas futures, the European benchmark, rose as much as 30 percent before giving back most of those gains. They were later quoted 10 percent higher at EUR 42.16 per megawatt hour. For six decades, the company has been an important source of energy for large parts of Western Europe.
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Dutch government is being urged to shut down
hundrets of earthquakecaused by the production have damaged thousands of homes since the 1980s and increased political pressure to shut down Groningen. Since 2012, over 3,300 homes have been demolished in the region due to earthquake damage. Financial compensation was promised to the affected citizens at the beginning of the year.
The closure was originally scheduled for October next year. The accelerated plans come days after a vote of no confidence in Prime Minister Mark Rutte, who was accused of the Dutch government not responding to complaints.
For the time being, Groningen will continue to be operated at the minimum level, so that by then there will still be 2.8 billion cubic meters Gas can be promoted. Although the field produces relatively little gas for the European market, it represents an important buffer for the continent’s energy supply. After the field is closed, wells can be reopened in the event of extreme demand.
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Price pressure in Europe due to a lack of Russian gas
Last year Europe suffered from a debilitating energy crisistriggered by Russia’s invasion of Ukraine.
Since then, thanks to a mild winter, Europe has its Stocks of natural gas increased to a level not seen in years. However, hot weather this summer is increasing demand, while outages in Norwegian gas fields and increased competition are increasing LPG further intensify the price pressure.
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