Shell proves test case for oil majors’ environmental records in Nigeria

Royal Dutch Shell’s environmental record will come under renewed fire on Wednesday in two cases that will test the ability of aggrieved communities in Nigeria to use UK courts to hold the company to account.

Shell’s Nigeria subsidiary, the Shell Petroleum Development Corporation (SPDC), is the largest onshore producer in the Niger Delta, where millions of barrels have been spilled — in accidents and as a result of criminal interference — since oil was first discovered in 1956.

In many instances — including in the two cases being brought to the high court in London by solicitors Leigh Day on behalf of the affected communities of Ogale and Bille — the spills have yet to be properly cleaned up. Shell says that in both cases sabotage and oil theft was a likely cause.

Lawyers at Leigh Day said their action would contribute to establishing whether oil spill litigation “goes international”. They would also seek to compel the company to clean up the affected areas immediately and compensate villagers for the impact on their lives in the wake of last year’s £55m payout by Shell for a similar Nigerian case brought by the Bodo community, also handled by Leigh Day.

Wednesday’s hearing is a procedural one in which Leigh Day will begin to make the case for why a UK court should have jurisdiction over Shell’s Nigeria subsidiary. Similar cases brought against SPDC and other oil companies in Nigeria have tended to languish for years, even decades.

“No one is going to mess around in the Nigerian courts if they can get remedy in the UK,” said Daniel Leader, lead solicitor in one of the cases.

In the past, the World Wildlife Fund has said that amount of oil spilled in Nigeria over the decades has been equivalent to an Exxon Valdez disaster every year for half a century. It claims the Niger Delta is one of the top five polluted places on earth.

In 2011 the UN’s environment agency published an assessment funded by Shell of pollution in the area of south-east Nigeria known as Ogoniland, which included a detailed study of Ogale. Shell was forced to abandon production in the area in 1993 as a result of community protests, but studies by Amnesty International allege that the infrastructure it left behind was not safely closed down, resulting in continuing spills.

The UN report recorded carcinogenic benzene levels in the water table at Ogale that were 900 times safe levels. It said “it is a fair assumption that most members of the current Ogoniland community have lived with chronic oil pollution throughout their lives.”

Shell has since contributed to piping in fresh water and committed to cleaning up the area as part of a broader operation. The UN recommended in 2011 that this should be financed initially with $1bn provided by the government and oil companies including Shell and its joint venture partners.

However, wrangling over the institutional framework governing the exercise has delayed implementation.

Leigh Day said the community had taken legal action because they were suffering continuously as they waited. Mark Dummett, an Amnesty International researcher, said evidence of a significant 2009 spill was still “shockingly” present when he visited the area last year. “The air was really thick with the smell of oil. Any attempted clean-up was a joke,” he said.

Shell blames sabotage and oil theft for most recent spills and dismisses allegations that it knowingly uses pipelines that are unsafe to operate. The company argues that while it is responsible for cleaning up any oil spilled from its network, it is not obliged to pay compensation as a result of criminal interference.

Shell also argues these cases have no place in a UK court.

A spokesperson for Shell’s Nigeria subsidiary said: “Both Bille and Ogale are areas heavily impacted by crude oil theft, pipeline sabotage and illegal refining which remain the main sources of pollution across the Niger Delta. Ogale is in Ogoniland and it is important to note that SPDC has produced no oil or gas in Ogoniland since 1993.”

The spokesperson added that access to the area had been limited following a rise in violence, threats to staff and attacks on facilities.

Leigh Day argues that Nigeria’s 1990 oil pipelines act requires oil companies to pay damages to anyone suffering as a result of their “neglect in protecting, maintaining and repairing any work structure”.

Their second case seeks to establish Shell’s liability for spills caused by sabotage and oil theft around Bille, leaving the village surrounded by thick layers of crude, and destroyed mangrove forests.

Mr Dummett, the Amnesty researcher, said these fresh cases, if successful, could prove “the tip of the iceberg” encouraging other communities to take similar action. Shell is facing a similar suit from Nigeria in the Netherlands, its global headquarters.

Patrick Dele Cole, an influential politician and community leader, said the timing of the case was critical as Shell and other international companies had abandoned problematic onshore production to focus on Nigeria’s deep offshore.

“It is especially important as the companies divest from onshore assets where the devastation is most severe. Understanding how and if liability is being transferred is vital,” he said.