Our History in the Netherlands
Vermilion started as a Canadian energy company in 1994, it was not long after our inception that we identified Western Europe as a key area of opportunity. Vermilion has been operating in Western Europe since 1997 when we acquired oil producing assets in France. Vermilion initially entered the Netherlands in 2004 through an acquisition of producing natural gas assets. We also have, and participate in, operations in Ireland (since 2009) and Germany (since 2014). As evidenced by our growth in the region, Western Europe has been, and will remain, a key area of focus for our company.
Following our initial acquisition, Vermilion opened up a head office at its processing facility in Harlingen and by the end of 2004, Vermilion Energy Netherlands was directly employing 10 people. Today, we still maintain our head office in Harlingen but we have added a second office in Amsterdam and we now employ over 225 people directly and indirectly. We have continued to invest significantly in our Netherlands operations which has resulted in growing production and increased opportunities for our stakeholders.
The following timeline details the key milestones in the history of our Netherlands operations:
Vermilion completed the €48.3 million purchase of natural gas assets in the Netherlands that were producing approximately 940 Nm3/d (35 mmcf/d or 5,900 boe/d) from 50 wells. Proved plus probable reserves associated with the assets totaled 17.4 mmboe and Vermilion also gained access to 180,000 hectares (445,000 acres) of land that included a number of exploration and development prospects.
- Vermilion drilled three successful wells during the year representing the Company’s first multi-well drilling campaign in the Netherlands.
- Vermilion replaced three oversized, gas-powered, turbine compression units at the Harlingen gas treatment centre with smaller electric units to significantly reduce total horsepower requirements and shift 32 Nm3/d (1.2mmcf/d or 200 boe/d) of fuel gas to the sales line. This project reduced Vermilion’s CO2 footprint in the Netherlands by 98%.
- Vermilion voluntarily shut-in approximately 160 Nm3/d (1,000 boe/d) of production in the Harlingen area in July due to concerns over subsidence. Our proactive approach on this issue was aligned with a core principle of Vermilion which is to prioritize the environment over profit.
- Vermilion completed a four well drilling program comprised of two (0.85 net) exploration wells (Vinkega-1 and De Hoeve-1) and two (1.9 net) development wells (Middelburen-2 and Middenmeer-3). All four wells were highly successful and nearly doubled production levels for Vermilion in the Netherlands over the next 18 months.
- Following the highly successful 2009 four-well drilling campaign, Vermilion submitted permit applications for 16 new locations with plans for a three-to-six well program for 2011. In addition, Vermilion tied-in and commenced production from the Middelburen-2 and Middenmeer-3 wells drilled in 2009 adding approximately 320 Nm3/d (2,000 boe/d.) We also worked toward obtaining the required regulatory approvals and completing required facility tie-ins to commence production from the Vinkega-1 and De Hoeve-1 wells.
- Vermilion brought the first of two producing zones of the Vinkega-1 well on production in May with the second zone brought on production in December.
- Vermilion drilled four exploration wells (Nieuwehorne-1, Langezwaag-1, Wommels-1 and De Kom-1). Although only one of the four wells (Langezwaag-1) was successful, Vermilion’s continued recognition of the significant development opportunities associated with its Netherlands land base ensured we did not delay arrangements for upcoming drilling programs for 2012 and later years.
- Vermilion drilled two development wells. Both the first well, Vinkega-2 (43% working interest) which was a follow-up to the extremely successful Vinkega-1 well drilled in 2009, as well as the second well, Eernewoude-2 (93% working interest) were highly successful.
- De Hoeve-1 was successfully brought on production in May.
- Awarded exploration licenses for the Hemelum and Opmeer concessions adding approximately 68,000 hectares (168,000 acres) to Vermilion’s land base in the Netherlands.
- Awarded an exploration license for the Akkrum concession that consisted of over 21,800 hectares (54,000 acres) situated between Vermilion’s existing Gorredijk and Leeuwarden concessions.
- The basis for pricing natural gas sold by Vermilion in the Netherlands switches to day-ahead indexed pricing at the Title Transfer Facility (TTF). Previously the natural gas pricing received by Vermilion was calculated using benchmark formula incorporating trailing average pricing for Dated Brent and other heating oils as well as a blend of natural gas prices from European trading hubs.
- Completed a €19.6 million acquisition of interests in nine concessions which included net production and reserves of approximately 65 Nm3/d (400 boe/d) and 2.3 mmboe of proved plus probable reserves, respectively, as well as 118,000 net hectares (292,000 net acres) of undeveloped land. Four of the onshore concessions are located in the northeastern part of the Netherlands, in close proximity to Vermilion’s existing interests. The remaining onshore licenses provided a new opportunity for Vermilion in the central region of the Netherlands.
- Vermilion increased staffing levels in the Netherlands to accelerate the conversion of our substantial inventory of prospect leads into drillable projects.
- Awarded the Ijsselmuiden exploration concession consisting of approximately 44,700 net hectares (110,500 net acres).
- Completed Vermilion’s largest drilling program in the Netherlands to-date with 7 wells drilled. Three of the wells (Diever-2, Sonnega-2 and Langezwaag-2) were highly successful. Although the results of the other wells in the program (Leeuwarden-102, Hempens-1, Havelte-1 and Lambertschaag-2) did not support completion and tie-in of the wells, the overall program was considered a strong success and further supported various development concepts for future programs. The Havelte-1 lease site also permitted the future tie-in of Eeesveen-1, a well located in a previously stranded gas field that was discovered in 1986.
- Opened a technical services office in Amsterdam.
- Vermilion drilled, completed and placed two highly successful wells on extended production tests (Slootdorp-6 and Slootdorp-7).
- Initiated production from Langezwaag-2, Sonnega-2 and Eesveen-1.
- Initiated an extended production test for Diever-2.
- Vermilion drilled two (0.9 net) wells. Langezwaag-3 (42% working interest) was completed and highly successful. The Andel-6ST (45% working interest) encountered a large gas column of inadequate reservoir quality to justify completion.
- Acquired an additional 30% working interest in the Drenthe VI production license, adding 30,000 net acres of land.
(Unless otherwise noted, references on this website to "Vermilion", or "the Company", or "we", or "our" collectively refer herein to any or all of the people and operations associated with Vermilion Energy Inc. and/or its subsidiaries including its Dutch subsidiary Vermilion Energy Netherlands B.V. whose operations and activities are the focus of this website)