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The environmental and social impact of Shell's operations in Nigeria

Antoni Pigrau
Member of the Governing Board of the ICIP (International Catalan Institute for Peace)
Antoni Pigrau

Antoni Pigrau

The environmental damage resulting from over fifty years of oil exploration and production in Nigeria, the leading oil producer in Africa, is devastating. The burning of gasses produced during oil production operations, the continued crude oil spillages and the deforestation have also generated an on-going impact on the health and well-being of those living in the area. A report commissioned by the United Nations Environment Programme in 2011, qualified Ogoniland, in the Niger Delta as the most contaminated area in the world and estimated that it would take between 25 and 30 years' work, with millions in investment to replenish the regions' ecosystem.

Since 1957, Royal Dutch Shell in Nigeria has been one of the leading oil companies in terms of oil exploration and production, operating in Nigeria through its subsidiary, Shell Petroleum Development Company of Nigeria (SPDC), in collaboration with other companies from the oil sector.

During this long period, Shell has been involved in numerous lawsuits in relation to, not just the environmental consequences of its activities, but also cases resulting from its involvement in infrastructures, financing and logistic support, in events concerning repression carried out by different Nigerian governments aimed at removing opposition to the continued oil exploration and production in the region. The most serious examples of this repression took place during the 1980's and 1990's and targeted the organization led by the opposition Movement for the Survival of the Ogoni People (MOSOP). In 1994, nine of its members, among whom one was author, Ken Saro Wiwa, were arrested, hastily tried by a special military tribunal, and eventually hanged in 1995.

During this period, the affected communities, with support from organizations such as Environmental Rights Action and Friends of the Earth Nigeria, have filed hundreds of claims with Nigerian courts against Shell and other oil companies especially in relation to oil spillages. Nevertheless, in many of these cases, sentencing has been delayed and adjourned for years and the number of solid judicial sentences leading to economic compensation are few and far between. Hardly any of these address restoration of the environment. For example, in July, 2010, almost ten years after the trial got underway, the Federal Court of Nigeria sentenced Shell Nigeria to pay 100 million dollars in damages to the Ejama-Ebubu Community, and to restore the area to its original condition prior to the disaster for an oil spillage that occurred forty years earlier, in 1970 affecting 250,000 hectares.

Cases have also been brought before the courts in other countries such as Holland, where the parent company is registered. On May 9th, 2008, farmers and fishermen resident in three communities on the Niger Delta (Oruma, Goi and Ikot Ada Udo), with the support of Friends of The Earth Holland and ERA/FoE Nigeria, filed three claims against Royal Dutch Shell PLC and SDPC Nigeria with the Hague District Court. The plaintiffs requested that the court rule regarding the legal liability for damages caused to the land and environment resulting from oil spillages that took place between 2004 and 2006. The plaintiffs requested that the court order the companies to clean up the contaminated areas and water springs, to implement a plan for pipeline maintenance to ensure prevention of further leaks, and to establish compensation for the victims. In January 2013, the Hague District Court handed down a sentence. The court exonerated the parent company, as well as the subsidiary, of all liability in two of the three cases, as they considered the defendants had demonstrated the spillages were caused by underground sabotage of the pipelines and therefore, was not the result of negligence on the part of SDPC concerning its duties to provide security at its facilities. However, negligence was demonstrated in the third case, regarding the spillage at Ikot Ada Udo and the subsidiary company was sentenced to respond for the legal liability incurred. This is a milestone in transnational litigation against multinational companies for one reason. It sets the precedent for establishing the jurisdiction of a court based in the same country where the parent company is registered for trying legal liability claims for (environmental) damages caused to third parties by subsidiary companies operating in a third party country.

In addition, taking advantage of the Alien Tort Claims Act, several civil lawsuits have been filed with the United States Federal Court in relation to Shell Nigeria's breaches of International law. The most noteworthy of these cases were those involving the Wiwa and Kiobel in 1996. The former, after complex court proceedings, finally came to an end in June, 2009; when the parties reached an agreement just before the case was due to begin. The agreement contemplated the payment by the different companies in the Shell group who had been sued, for a total of 15.5 million dollars in the concept of compensation for the victims. It also established a trust in benefit of the Ogoni community, to finance different social promotion initiatives in the area. The itinerary of the second claim presented in 2002, was equally as complex and came to an end with a controversial decision by the US Supreme Court on April 17, 2013, which stated that the US courts did not have jurisdiction regarding this case.

Shell's activities in Nigeria have also given rise to claims filed with international bodies based in Africa. In these cases, the lawsuits were aimed at the Nigerian State for tolerating environmental damage and the corresponding human rights violations committed by Shell.

On the one hand, the African Commission on Human and Peoples' Rights, adopted a decision in October 2001, in which they considered that Nigeria had violated the articles of the African Charter on Human and Peoples' Rights, regarding the right to a decent environment, right of all people to control their natural resources, the right to health and the right to life, in relation to the Ogoni people, violations in which the Commission considered the involvement of the Nigerian National Petroleum Company (NNPC), in cooperation with SPDC has been demonstrated.

On the other hand, in 2009 the Nigerian NGO Socio-Economic Rights and Accountability Project (SERAP) filed a lawsuit against Nigerian authorities and several oil companies, including Shell, for human rights violations committed in the Niger Delta region, before the Court of Justice of the Economic Community Of West African States (ECOWAS). The Court ruled that it did not have jurisdiction in relation to the companies sued and the lawsuit was reformulated in 2011 against the Nigerian authorities (President and Attorney General). On September 14, 2012, the Court sentenced Nigeria for breaching the right to a decent environment, in relation to the breach of its obligations to adopt efficient measures to protect rights recognised under the African Charter on Human and Peoples' Rights, for non-compliance with its obligations to oversee activities of companies operating within its borders.

Despite the existence in Nigeria of legislation to protect the environment and the rules establishing companies liability for damages caused, victims have been able to confirm that there is a vast difference between the existence of written laws and their actual effective application. In addition, victims perceive the huge influence exercised by enormous transnational oil companies operating in Nigeria over state structures with the purpose of eluding, in the majority of cases, their responsibilities for damages inflicted. As a result of this, victims have resorted to exploring channels to access justice systems around the world, with varying degrees of success, given that extraterritorial channels for justice are few and far between and in general, difficult to access.

Nevertheless, apart from the evident limitations existing in the field of human rights protection, the principal issue here is, while the current trend prevails, in terms of the pressure exerted by demand for natural resources and energy throughout the more developed world and until there is a move towards clean energy over fossil fuels, the negative impact on the environment and peoples' and communities rights affected by extractive activities, is set to continue. Shell's track record in Nigeria is a paradigmatic example.