Netherlands: Oil and Gas Industry to Remain Healthy Despite Diminishing Reserves

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The Dutch oil and gas supply industry is one of the top five of the world, behind the USA, the UK, Norway and France. The energy industry contributes to seven percent of GDP, or 40 billion Euros and employs 100,000 workers. Of this, gas is the primary fossil fuel in the country, generating 12 billion in revenue and employing 70,000 workers.

The oil and gas sector in the Netherlands has operating expenditures of about € 5 billion. A large portion of this goes toward employment, particularly for expensive downstream workers. The Dutch gas sector currently supports approximately 11,600 full-time jobs directly, 31,500 indirectly and 23,300 induced jobs.

The Netherlands’ excellent logistical infrastructure and access to ports are major geographic contributors to the Dutch oil and gas supply industry. Approximately 500 companies work within the Netherlands’ oil and gas supply industry. These companies employ approximately 20,000 people in the areas of: design and maintenance of infrastructure, construction and manufacturing, engineering, research and development and the supply of materials and equipment. The Dutch also specialize in offshore technology, working in the design and construction of advanced drilling rigs, drilling vessels, jack-up barges, diving support vessels, crane vessels, and other mobile offshore units.

In 2012, the Netherlands was the world’s ninth largest producer of natural gas and the eighth largest exporter. The Netherlands continues to be the largest producer and exporter of gas within the EU. Oil and gas production plays an important role in the overall Dutch economy. This can be seen by the economy’s contraction by 1.4 percent in Q1 of 2014, which was ultimately due to less natural gas production. Production in Q1 2014 was 25 percent lower than a year earlier.

There have been changes to Dutch gas production and sales due to the fact that the country has passed the point of peak gas production and their reserves are diminishing. In fact, the Netherlands can only maintain its current position until approximately 2025. Due to this and increasing concern in the EU of dependence on oil and gas from geopolitically unstable regions, the Netherlands has planned to increase their renewable energy investment and production. Additionally, of the 45 oil fields cited in the Netherlands in 2009, 12 are in production and 25 are undeveloped, six of which will go into production from 2009-2013. Despite the reserves, Dutch oil reserves are minimal compared to Saudi-Arabia, Iraq, and Iran.