Sweet Crude

April 30, 2012

Shell faces two Niger Delta oil spill lawsuits

Royal Dutch Shell PLC is facing two lawsuits over its activities in Nigeria, after lawyers acting for a Niger Delta community whose land and water was polluted from a 2009 oil spill lodged a series of actions against the Anglo-Dutch giant in Port Harcourt and a separate suit was filed in London over two earlier spills in the same region.

The claims are the latest attempt by residents from the oil-rich Delta to seek restitution from foreign oil companies. Shell’s operations there have long been criticized by environmental and rights groups, although the company contends that much of the damage caused by spills in the area is due to sabotage and theft. The company has sought to reduce its onshore Nigeria presence in recent years by selling off some fields.

However, the West African country still accounts for around 10% of the oil major’s total global output of around 385,000 barrels of oil equivalent a day.

Lawyers representing tens of thousands of residents from the village of Kegbera Dere and other Ogoniland communities filed suit March 6 at the Federal High Court in Nigeria’s oil hub Port Harcourt, against Shell’s local onshore unit, the Shell Petroleum Development Co., or SPDC. The action pertains to an April 2009 fire on the Bomu-Bonny Trans-Niger pipeline—and subsequent oil spill—that has since been comprehensively documented in a United Nations report funded by Shell.

The suit calls on SPDC to pay compensation totaling 121 billion naira ($767 million) to assuage their hurt. The plaintiffs also want Shell to carry out the recommendations of last year’s U.N. report, which suggests a nine point clean-up plan for the affected site. The report said these remediation efforts should be coordinated and conducted by a new body set up and funded by the oil industry and government.