Shell to Pay Settlement for Nigeria Oil Spills
Royal Dutch Shell PLC, the Hague-based company, reached a settlement to compensate thousands of residents of the Bodo community in Nigeria's crude oil-rich Niger River delta region. The company is compensating the local residents for two "highly regrettable" oil spills which occurred in 2008.
Shell, the biggest oil producer in Nigeria, has faced criticism from locals who say it pollutes the environment. Nigeria is Africa's top oil producer and largest economy. Hundreds of oil spills occur every year which damage the the environment and destroying the livelihood of fishing and farming communities in the delta region.
After a three-year long battle between Shell and 15,600 Nigerians from Ogoniland, Shell has finally agreed to pay each claimant who accepts the settlement. The company will be paying a grand total of $83.3 million (55 million pounds). Shell will be paying 35 million pounds to the individual claimants and 20 million pounds to the community. From the outset, Shell has accepted responsibility for the oil spills, but disagreement arose over the amount to be paid. Early attempts at settlement had failed due to what the company said was a "grossly exaggerated" claim by the local residents which exeeded 300 million pounds.
Martyn Day, the lawyer representing the claimants, said that while he was delighted for his clients, it is "deeply disappointing" that for six years Shell didn't recognize the true extent of the damage caused by the spills. He went on to say, "We hope that in future Shell will properly consider claims such as these from the outset and that this method of compensation, with each affected individual being compensated, will act as a template for Shell in future cases in Nigeria."
Shell will begin work to clean up the spill sites now that an agreement has been reached.