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Shell court verdict: Lessons for other major oil companies in Nigeria

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Shell court verdict: Lessons for other major oil companies in Nigeria

Oil spillage has been described as an ongoing tragedy mostly perpetuated by industry giants who have more than enough money and/or power to get away with environmental damages.

Although the International Tankers Owners Pollution Federation (ITOPF) has it that the effects of an oil spill will largely depend on a variety of factors which include the quantity and type of oil spilled, its interaction with the marine environment, and prevailing weather conditions, still, there’s no denying that oil spillage adversely affects human lives and those of other species living in oil-producing communities.

Among other disasters, the pollution of local marine ecosystems makes it difficult for communities who rely on said ecosystems to survive, with fish and other food sources becoming contaminated or going into extinction. This is the reality of communities in the Ogoniland, the Niger Delta region of Nigeria.

To give it some context, consider the oil-rich history of the Ogoni people from Niger-Delta. In 1956, the Royal Dutch Shell PLC, in partnership with the British government, first discovered viable commercial oil in Bayelsa State in the Niger Delta.

Having begun oil exploration and production in the Niger Delta between 1976 and 2001, the region reportedly witnessed over 6,800 spills with a loss of approximately 3 million barrels of oil, a 2011 United Nations Environment Program (UNEP) report revealed.

The continuous degradation and environmental pollution not to mention the exploitation of natural resources in the Niger Delta led to the establishment of the Movement for the Survival of the Ogoni People (MOSOP) founded by Ken Saro-Wiwa.

The movement publicly denounced the environmental destruction of their land caused by the Shell Petroleum Development Company Of Nigeria. While the MOSOP movement resulted in the suspension of oil exploration, the case set a precedence for subsequent legal battles between the Dutch giant and the Ogoni people.

The long battle: Shell vs the Ogoniland

In 1991, the lawsuit began when the residents of Ejama-Ebubu community in Tai Eleme Local Government Area of Rivers State sued Royal Dutch Shell Plc, Netherlands, Royal Dutch Shell Plc, United Kingdom, and SPDC before a Rivers State High Court over alleged oil spills which occurred as a result of Shell’s activities in the community in the 1970s.

The oil giant never took responsibility but linked the oil spillage to the activities of vandals and thieves. While the litigation dragged on, judgment was eventually passed in favor of the community, initially requiring SPDC to pay the sum of N6 billion in damages.

Not satisfied with the High Court’s ruling, Shell took the case to the court of appeal where it lost again before presenting it before the Supreme Court which upheld the high court judgment.

Launching several appeals which were dismissed by the apex court and at the Federal High Court in Abuja respectively, Shell has now been directed by the Justice Ahmed Mohammed of a Federal High Court in Abuja gave the oil exploration giant a 21-day ultimatum to pay some Ogoni communities ravaged by oil spillage.

The three-decades-long battle came to a head when Shell, on Wednesday, August 11, finally acquiesced to the court’s demands. The multinational company announced that it will pay the N 45.9B (approximately US $111.6M) settlement- a move that has the Ogoni people as well as other environmental activists elated.

Not Shell’s first rodeo in court

Earlier in May, a court in the Hague ruled in a landmark case ordering Shell to reduce its carbon emissions by 45% compared to 2019 levels. The milestone verdict came in the wake of an accusation leveled against the oil giant by Friends of the Earth alongside 17,000 co-plaintiffs.

They argued that not only did “Shell know about the dangerous consequences of CO2 emissions for decades, but its climate targets also did not go far enough.”

What other major players in the oil industry can learn from the Shell verdict

Renowned as Africa’s most important oil-producing region, the Niger Delta of Nigeria is sadly one of the most polluted places on earth. For about three decades, oil spills have ravaged the environment ruining many lives in the Niger Delta. The long-drawn-out war between Shell and the Ogoni people, ending in victory for the latter, signals a shift in attitude towards the reality of climate change.

To other multinationals operating in the oil and gas sector, it is no longer business-as-usual; that model witnessed its death at the 2016 Paris Agreement on Climate Change.

The Shell verdict is not just a win for the Ogoni people but environmental campaigners– young and old alike- who have long desired to see major polluters brought to justice. With this recent development, other industrial giants will be reassessing their own operations to figure out how they could be affected.

After all, it is not enough for firms to comply with the law on their emissions, they also have to fall in line with global policies on climate change.

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