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Shell Pays Niger Delta Community $84 Million To Settle Pollution Claims

by Fatima HansiaCorpWatch Blog
February 5th, 2015

Damage caused by oil-related activities in a Niger Delta community. Photo: Sosialistisk Ungdom. Used under Creative Commons license.

The Bodo community in the Niger delta will get £55 million ($84 million) to settle claims of environmental pollution by the Nigerian subsidiary of Shell, the Anglo-Dutch oil giant. Despite the relatively large settlement, many other pollution claims by Nigerian communities affected by Shell remain unresolved.

The delta region, where the Niger river meets the Atlantic Ocean, has long attracted major oil companies since the discovery of major petroleum deposits in 1956. Shell Petroleum Development Company of Nigeria (SPDC) is one among several companies that include Agip of Italy, Chevron and ExxonMobil from the U.S., and Total from France that have invested heavily in oil exploration in the region.

While these companies help Nigeria produce some two million barrels of oil a day, experts estimate that some 11 million gallons a year are spilled in local communities every year – more than the famous Exxon Valdez spill in 1989 in the coastal waters off Alaska.

Bodo comprises some 35 fishing villages located on approximately 90 square kilometers of rich mangroves, swamps and channels in Ogoniland, Rivers state. On two separate occasions in 2008 – one in October and the other in December – equipment failure in SPDC’s pipelines caused over 100,000 barrels of crude oil to spill into the Bodo community creeks and surrounding swamps.

Subsistence fishermen – who make up close to 60 percent of the delta’s population - are now finding it increasingly difficult to rely on the wetlands as a source for livelihood as a consequence of the toxic impact of the spills.

The company initially claimed that just 4,000 barrels of crude were released until it was forced to disclose the correct amount under a lawsuit brought against the company in UK courts.

“If Shell had not been forced to disclose this information as part of the UK legal action, the people of Bodo would be completely swindled,” Audrey Gaugran, director of global issues at Amnesty International’s headquarters in London, said in a press statement.

“Whilst we are delighted for our clients, and pleased that Shell has done the decent thing, I have to say that it is deeply disappointing that Shell took six years to take this case seriously and to recognize the true extent of the damage these spills caused to the environment and to those who rely on it for their livelihood,” Martyn Day, a British lawyer from the firm Leigh Day who represented the community, said in a press statement.

Approximately $53 million of the settlement will be divided amongst the 15,600 fishermen directly affected by the spills and the remaining $31 million will be paid out to the community as a whole. Shell also agreed to clean up Bodo creek over the next few months.

This is by no means the first time that Shell and its subsidiaries have been accused of polluting the Niger delta. For example, the company was sued in the Netherlands for causing major spills in three other Rivers state villages - Goi, Ikot Ada Udo and Oruma between 2004 and 2007. However in a January 2013 ruling Dutch courts dismissed most of the claims and ordering Shell to compensate just one farmer.

Mutiu Sunmonu, SPDC's managing director, told the media that the company was willing to accept responsibility for the two specific spills in the Bodo community but blamed the other spills on "the scourge of oil theft and illegal refining.”

Yet Bodo is just one small community among the 30 million inhabitants of the delta that have been impacted by six decades of oil exploration. “Shell…has caused monumental havoc in the Niger Delta,” said Godwin Uyi Ojo, Executive Director of Environmental Rights Action and Friends of the Earth Nigeria at the UN Climate Change meeting in Peru in 2013. “ Shell has polluted our rivers. Shell has taken our land. Shell has destroyed our livelihood.”

“Bad Information: Oil Spill Investigations in the Niger Delta,” an Amnesty International report published last year, estimates that Shell has been responsible for approximately 1,124 oil spills in the Niger Delta just between 2007 and 2013.   The burning of over 100 gas flares a day has also resulted in acid rain that in turn causes health ailments such as respiratory disease and skin rashes.

Ogoniland, a part of the Niger delta where Shell extracted oil from the 1950s to the 1990s, has been hit particularly hard, according to a series of expert reports published in 2011 by the United Nations Environment Program. 

One study found oil sitting in the cracks of plant roots 40 years after a clean up of an oil spill. Researchers also discovered toxic hydrocarbons and oil floating on surface water that caused the destruction of fish habitat in mangroves. Yet another study confirmed heavy exposure to air contamination and drinking water especially in the tribal area of Nisisioken Ogale where water has been found to have cancer-causing benzene levels that were 900 times above World Health Organization standards.

“Everyone was sure they would be blessed with the coming of the black gold and live as well as people in other parts of the world,” Patrick Omaospusanibo, a retired businessman who is now a farmer near Oloama village in Rivers state, told National Geographic in 2007. “But we have nothing. I feel cheated.”

The magazine summed up the situation in the Niger delta in an article called “Curse of the Black Gold.” “There is no electricity, no clean water, no medicine, no schools. Fishing nets hang dry; dugout canoes sit unused on muddy banks. Decades of oil spills, acid rain from gas flares, and the stripping away of mangroves for pipelines have killed off fish,” writes Tom O'Neill. “Villages and towns cling to the banks, little more than heaps of mud-walled huts and rusty shacks. Groups of hungry, half-naked children and sullen, idle adults wander dirt paths.”

But in reality, not everyone in the community has been idle. Activist groups like the Movement for the Survival of the Ogoni People (MOSOP) have been organizing peaceful protests against oil drilling since the early 1990s. In recent years, local villagers have also come forward to work with lawyers and activist groups in Europe to sue the companies in British and Dutch courts.

For these activists, the Bodo settlement is just the first step towards a bigger goal. “We hope that Shell will take their host communities seriously now and use this platform as recommended by UNEP for the clean-up of the whole of Ogoniland,” Chief Sylvester Kogbara, the chairman of the Bodo Council of Chiefs and Elders, said in a press statement for Leigh Day. “The hope is that this will forge a good relationship with Shell for the future, not only with the Bodo people but with all the Niger Delta communities that have been impacted in the same way as us.”