Nigerian Government Approves U.S.$5 Billion Fine Against Shell

Shell pollution in the Niger Delta

Nigeria’s Federal Government has given approval for the collection of a $5billion administrative fine imposed on the Shell Nigeria Exploration and Production Company, SNEPCo, for the December 20, 2011, oil spill from its deepwater facility, Bonga, despite threats by the company to resist it.

The administrative fine, which was prescribed by the National Oil Spill Detection and Remediation Agency, NOSDRA, has already been approved by the Presidency after due consideration of the issues involved.

The Director General of NOSDRA, Dr. Peter Idabor, in a telephone interview said, “The recommendation we made that Shell should pay $5billion was approved by Mr President.”

Idabor explained that the fine had nothing to do with third party shoreline contamination, as being speculated but on account of the impact of the spill on the sea and aquatic life.

He explained, “We agree that the sample tests show that the spill did not affect the shorelines, also agree the laboratory analysis on the third party spill agree with their own. But looking into the sea, the 30,000 barrels oil spill impacted about 950 square kilometres beneath the sea bed. So as we speak, there is still a lot of oil at the bottom of the ocean which has not been cleaned up.”

Shell also liable to pay compensation

Idabor added that as investigations into the oil spill, the largest in the recent times, continue, Shell also risked paying compensations if it is determined that the spill has caused additional impact.

“Let me note here that this administrative fine is different from compensation, because investigations are still ongoing, and Shell may also pay compensations if we determine more damages.”

The NOSDRA boss noted that as a result of the spill, the livelihoods of the people in the communities along 120 kilometeres to Bonga have been affected, “due to contamination of the open water, loss of employment as the people are mainly fishermen, and this has also led to the incidence of the migration of the people from these communities in search of fresh waters.”

Shell clarifies fine

SNEPCo had insisted that there was no legal basis for such the $5billion fine, while clarifying media reports of a hearing in Abuja on 16th July, 2012, on the spill before the House of Representatives Committee on Environment, during which NOSDRA disclosed it recommend “an administrative fine” to Government because of the incident.

According to Managing Director of SNEPCo, Mr. Chike Onyejekwe, “SNEPCo will challenge any attempt to impose such a penalty, as the company responded professionally and diligently to the incident and worked at all times alongside and with the support of relevant authorities including NOSDRA.”

Onyejekwe blamed the imposition of the fine on the handiworks of “Some parties alleging that oil from the spill impacted communities, the shoreline, rivers and creeks.”

While expressing deep regrets for the incidence, he noted that Shell went a step further to clean up even the third party spill, in keeping with its corporate responsibility policy.

Amnesty International urges more action

But international watchdog, Amnesty International, while lauding the imposition of the fine, urged government to cause Shell to take responsibility for the oil spills that resulted from its operation in the Niger Delta.

In an observation by the group’s Director of Global Issues, Audrey Gaughran, the group has been in the fore of the campaign to make Shell acknowledge its responsibility for the impacts of oil pollution in the Niger Delta for several years.

As part of this campaign, Amnesty International has called on Shell to:

•Carry out a comprehensive clean-up of oil pollution and environmental damage in Bodo and all other affected sites, in consultation with local communities.

•Support the need for further assessment of oil pollution across the wider oil-producing Niger Delta region.

•Pay fair and adequate compensation to all affected communities.