SHELL AND THE COURT JUDGEMENT

The supreme court verdict holds lessons for the oil companies operating in Nigeria

The decision by the Anglo-Dutch company, Shell Petroleum Development Company (SPDC) to pay the compensation of N45.9 billion (£94.9 million) to some Ogoni communities ravaged by oil spillage is a welcome development. It came sequel to an order by Justice Ahmed Mohammed of a Federal High Court in Abuja which gave the oil exploration giant a 21-day ultimatum to pay the sum awarded against it more than a decade ago for oil spills in the area. With that, the legal drama of the past three decades is over.

The substantive suit commenced in 1991 before a Rivers State High Court sitting at Nchia Division, when the Ejama-Ebubu community in Tai Eleme Local Government Area of Rivers State through their representatives Isaac Agbara and nine others, sued Royal Dutch Shell Plc, Netherlands, Royal Dutch Shell Plc, United Kingdom, and SPDC over alleged oil spills which occurred when the oil exploration giant operated in the community in 1970s. While the litigation lasted, the community lost several of its members before judgement was eventually entered in 2010 for the sum of N6 billion in their favour. Dissatisfied with the judgement, Shell went to the court of appeal where it lost again before taking the case to the Supreme Court. On 11th January 2019, the apex court upheld the high court judgement. Shell did its best to prevent the community from reaping the benefits of the judgement by filing multiple appeals.

Meanwhile, Shell again filed an application at the Supreme Court for a review of the verdict, but on 27th November 2020, the apex court dismissed the application. Still pushing back, Shell again filed another action at the Federal High Court in Abuja. The oil major said it was ready to pay but asked the judge to allow that the money be paid to the Chief Registrar of the Court. The judge declined the request by insisting that the damages be paid to the community as directed by the Supreme Court. This time, Shell has promised to comply.

The Niger Delta of Nigeria is not only Africa’s most important oil-producing region, but also one of the most polluted places on earth. For decades, oil spills have devastated the environment and ruined many lives in this part of Nigeria. Shell, one of the biggest corporations working in the Niger Delta, claimed that most oil spills are caused by sabotage and theft, and that they are doing all they can to prevent spills. But the judgement is a signpost that it is no longer business as usual, especially coming at a period the Petroleum Industry Bill (PIB) has just been signed into law.

Oil spills have deteriorating effects on the general well-being of oil producing communities, including the pollution of their waters and rivers, laying their lands waste, as well as spreading toxic fumes in the air. The SPDC in acknowledging the resolution in the court said in a statement that the order to pay N45.9 billion to the plaintiffs is intended to satisfy the judgement fully and finally and apparently help to bring an end to the legal battle that spanned decades.

It is the expectation therefore that this judgement will provide the foundations to address the long and lasting injustices suffered by the Ogoni people, including the slow clean-up exercise embarked by the federal government. It is a great lesson to other oil companies operating in Nigeria that no matter how long, justice will eventually prevail.