News

September 16, 2013

Ogoni communities reject Shell’s oil spill compensation offer

Some Ogoni fishing communities in Bodo have rejected an offer of compensation by Shell Petroleum Development Company, for damage done to their sources of livelihood by oil spills from pipelines operated by the company, their lawyers have said.

Failure to reach a settlement means that Shell and about 15,000 members of the Bodo fishing communities in Rivers State, remains locked in litigation.

Their lawyers said that they would now go back to a British court to request a trial timetable.

The legal action is being closely watched by the oil industry and by environmentalists for precedents that could have an impact on other big pollution claims against oil majors.

“We haven’t reached agreement on compensation, which is disappointing,” a spokesman for Shell’s Nigeria unit said.

“Nonetheless, we’re pleased to have made progress in relation to cleanup,” he added, saying measures had been put in place to get remediation work done as soon as possible.

A source close to Shell and another source involved in the negotiations told Reuters that the company offered a total compensation of N7.5 billion ($46.3 million).

Leigh Day, the British law firm representing the villagers, said the compensation offer amounted to approximately 1,100 pounds ($1,700) per individual impacted.

“The whole week has been deeply disappointing,” said Martyn Day of the London-based law firm, who has been in talks with Shell since Monday in Nigeria’s oil hub, Port Harcourt.

“The settlement figures are totally derisory and insulting to these villagers,” he added.

The Nigerians filed a suit against Shell before the High Court in London in March 2012, seeking millions of dollars in compensation for two major oil spills in 2008, but both sides agreed to try and settle in compensation talks in Port Harcourt.