Fallow areas

Parts of a licence may be split off to encourage new or renewed exploration, production or storage activities in onshore and offshore hydrocarbon production licence areas or storage licence areas. This may be done if no significant hydrocarbon exploration or production activities or storage activities have taken place during the previous two calendar years or if production activities have ceased (Mining Act, Article 32 (a)).

As a practical implementation of this rule offshore, E&P operators and the Dutch government have signed a ‘fallow acreage covenant’ (convenant ter bevordering van de opsporing en ontwikkeling van de olie- en gasreserves en de opslag van stoffen op het Nederlands deel van het continentaal plat). 

Covenant procedure
The covenant is a non-binding agreement that allows holders of licensed acreage on the continental shelf where no activities have been carried out for an extended period or for which no concrete plans are in place (‘fallow acreage’) – even after having been given another chance - to voluntarily surrender all or part of that licence to a third party after a prompt by the licensing authority (i.e. the Minister). Every year, the Minister of Economic Affairs prepares an inventory of offshore production licences (or parts of such licences) that are classified as fallow acreage. The most up-to-date inventory is published on NLOG.

As soon as any acreage is declared fallow, the main licence holder is notified by the Ministry of Economic Affairs. That licence holder then has nine months to submit an activity plan detailing operations that are significant for the purposes of the Mining Act. If this main licence holder does not submit a plan, joint licence holders are allowed a further three months to submit their own operational plans. Lastly, third parties can submit operational plans.

Significant activities
Significant activities in any event include activities where:

Overview maps fallow areas