Shell and ExxonMobil pay billions to shareholders, but stop earthquake compensation

Shell and ExxonMobil have long profited from gas extraction in the Dutch province of Groningen, leaving behind a legacy of earthquakes, damage, and disruption to local communities. After years of struggle, the gas field is finally closed, but instead of honouring agreements to pay for the harm caused, the companies are walking away from their responsibilities. This article explores how Shell and ExxonMobil are turning their backs on Groningen residents while continuing to reward their shareholders.

Shell and ExxonMobil made €64.7 billion(opens in new window) in total profit from nearly sixty years of gas extraction in the Dutch province of Groningen, through the joint venture NAM (Nederlandse Aardolie Maatschappij). The people of Groningen paid an immense price for these riches. 

The gas extraction and the earthquakes it caused have destroyed homes and communities in the region. Thanks to the relentless efforts of Groningen activists and others involved, after years of difficult negotiations, the Dutch State finally closed the Groningen gas field permanently in 2024.

In response, Shell(opens in new window) and ExxonMobil decided to initiate arbitration proceedings(opens in new window) against the State to receive financial compensation for what they claim is a loss of revenue due to the “early” closure of the gas field. An arbitration case(opens in new window) is an alternative to litigation for resolving commercial disputes. In an arbitration, three “expert” arbitrators (co-appointed by Shell and ExxonMobil) are appointed to make a binding decision.

If the arbitration were to be resolved in favour of Shell and ExxonMobil, this would be a huge slap in the face for the people of Groningen. Dutch taxpayers’ money would then go to Shell and ExxonMobil to compensate them for their so-called losses. This means that affected residents of Groningen, by paying their taxes, would themselves contribute to ‘compensation’ for Shell and ExxonMobil. In effect, paying the two companies that have caused them so much damage and made their homes uninhabitable, and which now refuse to pay for the damage they have caused.

Going even further, both companies have also initiated arbitration procedures(opens in new window) to avoid paying for the repairs and compensation to affected citizens in Groningen. They believe that the government has not sufficiently substantiated(opens in new window) why they should pay and have stopped paying in protest(opens in new window) , partly because of the ‘early’ closure of the gas field. The government wants to recover all the costs of the damage compensation from Shell and ExxonMobil. However, because these costs can be deducted from the companies’ profits, they can also pay less income tax. According to the Dutch newspaper Financieele Dagblad(opens in new window) , “the gas companies pay 27 cents for every euro, with the government footing the bill for the rest”. This means that Shell and ExxonMobil are already paying much less for the damages than the amounts suggest. 

Of the €1.3 billion in home reinforcement costs that the NAM is supposed to pay, it refuses to pay €550 million(opens in new window) . Due to the “early” closure of the gas field, the NAM has also stopped contributing(opens in new window) to the “Perspectief voor Groningen” programme, which was intended to boost the economy and quality of life in the province. In 2018, the company promised to contribute €500 million to this program, but it still owes €167 million.

Shell and ExxonMobil made billions in profit in 2024

Shell and ExxonMobil’s refusal to pay for compensation is all the more scandalous given the enormous profits these companies are making. In the first three months of 2025 alone, Shell earned $5.6 billion(opens in new window) in profits, and ExxonMobil earned $7.7 billion(opens in new window) .

The graphs above, based on figures from the financial database LSEG Workstream, provide an overview of Shell and ExxonMobil’s revenues and shareholder payouts over the past ten years. In 2024, Shell and ExxonMobil together earned more than $51 billion in profits and paid out nearly $60 billion to their shareholders.

Even in years when the two companies made less profit, or even losses, they paid out billions to their shareholders. In the COVID-19 year 2020, ExxonMobil and Shell suffered heavy losses but still paid out dividends of $15 billion and $7 billion, respectively.

Over the entire period from 2015 to 2024, ExxonMobil made $204 billion in profits and paid out $202 billion to shareholders. Shell made $140 billion in profits during the same period and paid out $165 billion to shareholders. These payouts consist of two components: dividends and share buybacks. Alongside dividends, share buybacks are the main way for companies to distribute money to their shareholders. By buying back their own shares, the value of the shares still on the market increases, making their shareholders richer. An important reason why these share buybacks are so popular is that shareholders pay less tax on the income from these buybacks than on dividends(opens in new window) . Returning profits to shareholders through share buybacks instead of dividends can therefore also be considered a form of tax avoidance.

For both companies, buying back their own shares has become a central part of their business strategy. Over the past three years, ExxonMobil has bought back $71 billion worth of its own shares, two-thirds of its total share buybacks since 2015. Shell has bought back $52 billion worth of its own shares since 2022, half of its total share buybacks since 2015. If these amounts had been paid out as dividends, tax authorities worldwide could have levied much higher taxes on them.

Who are the largest shareholders of ExxonMobil and Shell?

The two tables below list the top five largest shareholders in both companies. They show that the major US asset managers are the most important shareholders. BlackRock and Vanguard are the largest shareholders in both ExxonMobil and Shell. State Street is the third and fourth largest shareholder in ExxonMobil and Shell, respectively.

Every year, these asset managers receive billions through Shell and ExxonMobil’s dividends and share buybacks. It is possible to make a rough estimate of the dividends received by Shell and ExxonMobil shareholders. Based on the number of shares they held on December 31, 2024, Vanguard would have received over $2 billion in dividends, and BlackRock over $1.7 billion. The tables below provide a complete overview.

Shell and ExxonMobil’s scandalous refusal to pay their debt to the people of Groningen

The suffering caused to the people of Groningen by the gas extraction in the province is enormous. It is therefore unacceptable that Shell and ExxonMobil find that making their shareholders even richer is more important than the fate of the people of Groningen. 

The fact that both companies are now demanding compensation from the Dutch state for their alleged loss of income due to the ‘early’ closure of the Groningen gas fields is utterly shameful.

Both companies must immediately withdraw all arbitration proceedings against the Dutch state and take full responsibility for the damage they have caused in the Groningen region. 

They must immediately pay the outstanding €550 million for reinforcement costs for homes in Groningen, and pay the agreed €500 million for the quality of life in Groningen in full.

This is the least these two companies can do to begin to repay their enormous debt to the citizens of Groningen.