Shell disputes $2 billion oil spill case, appeals judgement

By Emeka Nze

Royal Dutch Shell has appealed a 2020 $2 billion judgement which was awarded against her for oil spill in Rivers State, Nigeria.

The energy giant is challenging a November 2020 judgment in favor of community members claiming a leak from a company pipeline damaged their land and waterways. A federal appeals court in the city of Owerri is scheduled to hear both parties’ claims on Jan. 25, according to an attorney for the plaintiffs.

In January 2020, farmers in the Ejalawa community in southern Rivers state sued Shell and its joint venture partner, the state-owned Nigerian National Petroleum Co. damaged the surrounding environment.

The court said the 88 plaintiffs were entitled to 800 billion naira ($1.92 billion) in compensation and ordered Shell to clean up. The sum is far greater than any damages previously awarded by Nigerian courts to residents of the crude-producing region for the degradation of their land.

“I am satisfied that the amount of compensation sought results from the colossal damage caused to the plaintiffs’ lands,” Judge Tijjani Ringim wrote in his November 2020 decision.

Shell and the NNPC deny that any spills occurred on the alleged dates and say the allegation against them is “unsubstantiated, vague and exaggerated”, according to the decision. They also argued unsuccessfully that the judge should not award damages because several required steps, such as a joint investigation into the alleged leak and an assessment of its volume, had not been completed.

These disputes can take many years to reach a conclusion. Shell agreed in August to pay 46 billion naira to another community in Rivers state to resolve a lawsuit filed more than three decades ago, but it denied responsibility for the rupture of the pipeline in the center of the case.

A Shell spokeswoman confirmed the call, without providing further details.

Shell will seek a stay of execution on January 25, seeking to delay any payments until the appeal is decided, while Ejalawa residents will ask the judge to order the company to deposit N800 billion on a court account, said plaintiffs’ attorney. , Mohammed Ndarani Mohammed, said in an interview.

Shell has been selling onshore and shallow water deposits to Nigerian independent producers for more than a decade. The company is trying to find a buyer for the rest of these assets so it can focus on deepwater projects.

If upheld, the $2 billion judgment could complicate Shell’s efforts to sell its remaining licenses. The community plans to file a petition asking the appeals court to stop the company from disposing of the permits until compensation is paid, Ndarani said.