North Sea gas key to stave off energy crisis as shortfalls loom, Element NL says

The Netherlands-based Element NL, an association of 12 oil and gas companies with a permit to explore or extract natural gas, is rolling up its sleeves, together with the Dutch Ministry of Climate and Green Growth and EBN, to enhance the permitting process to boost gas production in the North Sea against the backdrop of rising uncertainty across the global energy markets amid the fast-growing tariff tug-of-war.

According to Element NL, Europe will need to stock up on gas in the upcoming months to replenish stocks without further disrupting the energy market, which is being hit by trade wars spurred by the Trump administration’s latest wave of tariffs and reciprocal measures being taken in response.

As the governments’ response is still uncertain alongside the fate of Europe’s rules, the association claims the Dutch government is aware of the importance of increasing the gas output from the North Sea to curb the energy dependency that is now increasing, mainly due to liquefied natural gas (LNG) imports from countries such as the U.S.

Since Element NL sees natural gas as “a crucial transition fuel,” it is working with the Ministry of Climate and Green Growth and EBN on a joint agreement, which should lead to the optimization of permit procedures, less financial risks for operators, reduction of production costs through close cooperation, and more efficient use of infrastructure.

After the official gas season ended on March 31, the association believes a crucial period is dawning for the European energy supply, during which the gas storages, which are less than a quarter full after a cold winter, need to be replenished in the coming months for the next winter despite the ongoing “exceptional uncertainty.”

Element NL underlines that BNR Nieuwsradio and international media, such as Bloomberg, have signaled “a tense market” amid high prices, declining supply, and political pressure from Brussels. While traders usually buy gas in the summer at lower prices and sell it in the winter when demand and prices are higher, 2025 promises to be different, as the pattern is reversed.

The summer prices are now described as remarkably high, while prices for the coming winter are lower due to several factors. The colder winter prompted higher demand for gas, causing stockpiles to shrink more quickly, as Russian gas deliveries via Ukraine stopped in January 2025, putting further pressure on securing supply.

Even though the global production of LNG is on the rise, Element NL points out that it is still uncertain to what extent this gas will reach Europe. Given the current prevailing sentiment in the market leaning toward caution because of the inverse price difference and uncertainty about government measures, buyers are said to be postponing their decisions.

“Since 2022, EU member states have been required to fill their gas storage to at least 90% by 1 November. This measure is intended to guarantee security of supply in the winter, but has proven difficult to implement under current market conditions. The Dutch government is understandably reluctant to purchase gas at historically high prices, but is bound by European regulations,” elaborated Element NL.

“The European Commission has now proposed to extend the storage obligation by two years. At the same time, there is talk of relaxations: for example, a storage target of 80% could apply to the Netherlands, with additional margins or exceptions.”

The association explains that the business world is already feeling the consequences of high gas prices, and consumers are expected to follow suit inevitably. Therefore, Element NL is adamant that prices could rise further regardless of affordability if European obligations remain rigid, heaping pressure on policymakers to find a workable balance between market forces and public interests.

“In this uncertain context, domestic gas production is an important stabilising factor. The Netherlands has infrastructure, experience and gas fields that allow for fast, efficient and relatively low-emission production. Compared to much imported gas, Dutch natural gas has a significantly lower environmental impact,” underscored the association.

“In addition, approximately 70% of the proceeds benefit the Dutch treasury. And above all, local production strengthens security of supply, because it makes us less dependent on international market fluctuations.”

With this at the forefront, Element NL is convinced that more Dutch natural gas is needed in the short term, such as One-Dyas’ N05-A wind-powered project in the North Sea, which is perceived to show that the Netherlands can contribute to more security of supply while keeping an eye on the environment and society.

As the Netherlands is estimated to need gas at least until 2045, projects like the brand new platform that will run on wind power from an adjacent wind farm about 20 kilometers above Schiermonnikoog in the North Sea are seen as important steps to unlock domestic natural gas resources, paving the way to ensure the security of energy supply during turbulent times.

Jilles van den Beukel, The Hague Centre for Strategic Studies, emphasized:  “Gas prices will inevitably be passed on to the consumer. That is perhaps one of the few certainties we currently have. We can fill the storage, but that will be expensive. If we leave it to the market, we will not reach 90%.”

The Netherlands is putting pieces of its energy transition and decarbonization puzzle in place by pursuing not only gas and renewable energy but also low-carbon technologies such as carbon capture and storage (CCS).

Aiming to lend a helping hand in transforming a gas asset in the North Sea into the EU’s first CO2 transport and storage project, one of Valaris’ jack-up rigs recently arrived in Dutch waters to start its assignment on Porthos, said to be the first large-scale CCS project in the Netherlands.