Court finds Shell liable for Nigerian oil spills

Article by Amanda Jasi

A DUTCH appeals court has ruled that Shell is responsible for the consequences of oil spills in two Nigerian villages from its subsidiary Shell Petroleum Development Company of Nigeria (SPDC). A decision regarding oil spills in a third village is yet to be made.

In a case launched 13 years ago, four Nigerian farmers and Milieudefensie (Friends of the Earth Netherlands) claimed compensation from Shell for damage suffered due to oil spills from underground pipelines and an oil well. The spills from pipelines occurred in the villages of Goi (about 150 bbl) and Oruma (400 bbl) in 2004 and 2005, respectively. Two leaks occurred in the village of Ikot Ada Udo in 2006 (about 1 bbl) and 2007 (629 bbl). Shell has argued that it is not responsible under Nigerian law, as the spills were caused by sabotage.

In 2015, an intermediate judgement by The Hague Court of Appeal established that Dutch judges would be allowed to assess the behaviour of Shell, a British-Dutch multinational oil and gas company, in Nigeria.

According to the court, Shell failed to provide sufficient evidence for sabotage in the Goi and Oruma spills. As a result, it has ruled that the company must compensate 3 of 4 plaintiffs in this ongoing case – those that were affected by the Goi and Oruma spills, along with other residents of the villages. The amount of compensation will be decided in a follow-up procedure.

Furthermore, the court has ruled that Shell shall install leak detection systems (LDS) at Oruma pipelines I and II. It is believed that the leaks could have been detected more quicky, and environmental damage limited if LDS had been present. Shell has been ordered to install the systems within a year of the ruling. Shell and SPDC will face a daily fine of €100,000 (US$120,328) once the year is up, if the systems are not in place.

The claims by the Nigerians and Milieudefensie included a demand that Shell take measures to prevent recurrence.

Despite claiming sabotage was the cause of all the spills, Shell cleaned up the resulting contamination. Damage affected fishponds, soil, and water sources, across areas of 311,000 m2 (soil) and 23,500 m2 (fishponds) in Goi, and across about 60,000 m2 in Oruma.

The plaintiffs also demanded that Shell more sufficiently clean the environmental damage caused by the oil spills. The court was not convinced that Shell did not sufficiently clean the Goi and Oruma spills and did not order any further remediation. If there is any residual contamination this may be accounted for in the damage statement procedure.

News reports say that Shell was disappointed that the courts did not agree that sabotage was present in Goi and Oruma.

The court has not yet made a decision on Shell’s liability regarding the Ikot Ada Udo spills, as it still has questions about the seriousness of the resulting pollution and whether further cleanup is required. However, sabotage is accepted as the cause of these spills. According to the New York Times, SPDC spokeman Bamidele Odugbesan said in an emailed statement that “sabotage, crude-oil theft and illegal refining are a major challenge in the Niger Delta”.

Channa Samkalden, Lawyer for the Nigerian farmers and Milieudefensie, said: Not only is Shell liable for the oil spill, and my clients will get what they are entitled to, this case also shows that European companies must behave responsibly abroad.”

Donald Pols, Director of Milieudefensie, commented: “This is fantastic news for the affected farmers. It is enormous that Shell has to compensate for the damage. This is also a warning for all Dutch transnational corporations involved in injustice worldwide. Victims of environmental pollution, land grabbing or exploitation now have a better chance to win a legal battle against the companies involved. People in developing countries are no longer without rights in the face of transnational corporations.”

In addition to being an important oil-producing region, Niger Delta is one of the most polluted places on earth, according to Amnesty International. Oil spills have been occurring for decades, damaging the environment and impacting populations. Amnesty adds that Shell and Eni are two of the biggest companies operating in the region and says that most spills are due to sabotage and theft.

A report by Milieudefensie and Friends of the Earth Nigeria says SPDC is complicit in leaks, encouraging sabotage aiming to profit from the cleanup.

Milieudefensie says despite decades of “promises, projects, reports and other lawsuits, the Niger Delta remains heavily polluted”. It adds that a cleanup operation by the Nigerian Government, Shell, and others has not started after ten years of promises and preparations.

Article by Amanda Jasi

Staff Reporter, The Chemical Engineer

Recent Editions

Catch up on the latest news, views and jobs from The Chemical Engineer. Below are the four latest issues. View a wider selection of the archive from within the Magazine section of this site.