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Shell settles Nigerian oil spills claim for $83.5 million

Screen Shot 2015-01-07 at 09.02.16An AFP article published 7 Jan 2015 by Mail Online under the headline:

“Shell strikes Nigerian oil spills compensation deal”

Royal Dutch Shell has agreed a multi-million-dollar settlement to compensate 15,600 Nigerian fishermen over two serious oil spills in 2008 after a three-year legal battle, both parties announced Wednesday.

The Anglo-Dutch energy giant’s Nigerian arm has agreed to pay £55 million ($83.5 million, 70 million euros) to people in Bodo, a town in southern Nigeria, Shell and the fishermens’ London-based lawyers Leigh Day said.

The Shell Petroleum Company of Nigeria (SPDC) will pay around £35 million to the individual claimants, and a further £20 million to the community.

The out-of-court settlement averted a full trial at the High Court in London and the money has been paid to the claimants’ lawyers.

Screen Shot 2015-01-07 at 09.19.30Each individual will receive around £2,200, equivalent to around three years’ income on the Nigerian minimum wage, Leigh Day said.

SPDC accepted in November that the spills, caused by operational failures on the Bomu-Bonny pipeline in Bodo, were greater than the previously-reached total figure of 4,144 barrels, though they did not give an amount.

Amnesty International claimed the first leak could have exceeded 100,000 barrels, while Leigh Day claimed both spills could have entailed 600,000 barrels.

SPDC said the leaks were “highly regrettable”, but insisted most oil pollution in the Niger River Delta region was caused by theft and illegal refining.

Separately, SPDC is set to clean up the affected area.

Chief Sylvester Kogbara, chairman of the Bodo council of chiefs and elders, said his community was happy the case had finally been laid to rest.

“The hope is that this will forge a good relationship with Shell for the future, not only with the Bodo people but with all the Niger Delta communities that have been impacted in the same way as us,” he said.

“Due to the cordiality of the conclusion of this agreement with Shell, we are hopeful that the clean-up of the Bodo environment will follow suit in no distant time.”

– Shell ‘committed’ to clean-up –

The clean-up of Bodo Creek is expected to begin over the next two to three months.

Nigeria is Africa’s biggest crude producer, but much of the Niger Delta oil region remains deeply impoverished.

Decades of spills have caused widespread pollution in the region.

“From the outset, we’ve accepted responsibility for the two deeply regrettable operational spills in Bodo,” said SPDC managing director Mutiu Sunmonu.

“We’ve always wanted to compensate the community fairly and we are pleased to have reached agreement.

“We are fully committed to the clean-up process being overseen by the former Netherlands ambassador to Nigeria.

“We are pleased that clean-up work will soon begin now that a plan has been agreed with the community.”

Sunmonu added: “However, unless real action is taken to end the scourge of oil theft and illegal refining — which remains the main cause of environmental pollution and is the real tragedy of the Niger Delta — areas that are cleaned up will simply become re-impacted through these illegal activities.”

Amnesty called the settlement an “important victory for the victims of corporate negligence”.

The London-based human rights group claimed many Bodo residents had their fishing and farming livelihoods destroyed by the spills and, without compensation, have faced poverty in the years since, it said.



Shell agrees $84m deal over Niger Delta oil spill: BBC News 7 Jan 2015


Lawyer Martyn Day, who represents the claimants, said it was “deeply disappointing that Shell took six years to take this case seriously and to recognise the true extent of the damage these spills caused to the environment and to those who rely on it for their livelihood”.

Shell to Pay $83 Million Settlement for Nigeria Oil Spills: BloombergBusinessweek 7 Jan 2015


Shell, the biggest oil producer in Nigeria, has faced criticism from locals who say it pollutes the environment. In 2009, the company agreed to pay $15.5 million to settle U.S. lawsuits brought by Nigerians representing the delta’s Ogoniland area.

Shell Settles Nigeria Oil Spill Claims for $83 Million: Voice of America/Reuters: 7 Jan 2015

“It’s very unusual to have thousands benefit,” Day said. “The money will go directly to their bank accounts, and this will hopefully be a model for future claims.”

Nigeria: Long-awaited victory as Shell finally pays out £55 million over Niger Delta oil spills:Amnesty International 7 Jan 2015

Shell in Nigeria: the landmark oil case is  warning shot to multinationals: 9 Jan 2015


Recent court documents, however, revealed that Shell knew for years that corrosive pipes and equipment failure were a significant risk factor, but failed to address this properly. During the legal process Shell admitted that its figures were wrong and that it had underestimated the amount of oil spilled in Bodo.

Another reason why Shell has managed to conceal its culpability…

Court documents expose Shell’s false claims on Nigeria oil spills: Amnesty International 13 November 2014


Court documents revealed by Amnesty International today expose the fact that Shell has repeatedly made false claims about the size and impact of two major oil spills at Bodo in Nigeria in an attempt to minimize its compensation payments. The documents also show that Shell has known for years that its pipelines in the Niger Delta were old and faulty.

Screen Shot 2015-01-07 at 09.33.37

Activists in Port Harcourt, Nigeria protest to demand that Shell pay reparations and clean up its oil spills. © Amnesty International

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