Shell lawsuit (re oil spills & Bodo community in Nigeria)

Woman & child in Niger Delta near shore & water damaged by oil spill - credit: Leigh DayMembers of the Bodo community in Nigeria filed a lawsuit against Shell in London High Court on 23 March 2012, seeking compensation for two oil spills, which occurred in 2008 and 2009 in the Niger Delta.  The 15,000 plaintiffs ask for compensation for losses suffered to their health, livelihoods and land, and they ask for clean-up of the oil pollution.  They allege that the relevant pipelines caused spills because they were over 50 years old and poorly maintained, and that Shell reacted too slowly after being alerted to the spills.  Shell admits that its Nigerian subsidiary, the Shell Petroleum Development Company (SPDC), is liable for the spills.  However, it denies the allegations of the plaintiffs and argues that the cause of the oil spills was oil theft and sabotage.  It further disputes the alleged volume of oil spilled and the size of the area affected.

Shell has made settlement offers to the plaintiffs, which they refused on the basis that they were too low in light of the alleged damages suffered.

A preliminary hearing took place from 29 April to 9 May 2014 to consider Shell’s duty to take reasonable steps to prevent spillage from their pipelines – whether from malfunction or from oil theft.  The judge ruled on 20 June 2014 that Shell could be held responsible for spills from their pipelines if the company fails to take reasonable measures to protect them from malfunction or from oil theft (known as “bunkering”).  In November 2014, it was revealed that documents produced in the UK High Court suggested that Shell had been warned about the “risk and hazard” of the pipeline before the oil spill that affected the Bodo community.  Shell "dismisses the suggestion that it has knowingly continued to use a pipeline that is not safe to operate". 

While the case was expected to go to trial in mid-2015, Shell agreed a £55 million out of court settlement in January 2015.  £35 million will be split between those impacted by the spill who will each receive £2,200, and £20 million will go to the community.

- "Shell announces £55m payout for Nigeria oil spills", John Vidal, Guardian (UK), 7 jan 2015
-“Shell in preliminary Nigeria oil spill judgement”, BBC News, 20 Jun 2014
- “Niger delta oil spill victims reject 'derisory' Shell compensation offer”, John Vidal, Guardian (UK), 13 Sep 2013
- “Shell seeks settlement for Nigeria oil spill”, Sarah Kent, Dow Jones Newswires, 06 Sep 2013
- “Shell 'uses sabotage claims to avoid blame for Nigeria oil spills'”, Tom Bawden, Independent (UK), 19 Jun 2013
- “Shell accepts liability for two oil spills in Nigeria”, John Vidal, Guardian (UK), 3 August 2011
- “[PDF] The true tragedy: delays and failures in tackling oil spills in the Niger Delta”,  Amnesty Intl. & Centre for Environment, Human Rights and Development (CEHRD), Nov 2011

- Shell's Nigerian subsidiary agrees £55 million settlement with the Bodo community, Shell, 7 Jan 2015
- Senior English judge delivers ruling in preliminary Bodo trial, Shell Nigeria, 20 Jun 2014
- [DOC] Open letter on oil spills from the Managing Director of the Shell Petroleum Development Company of Nigeria Ltd (SPDC), Managing Director of the Shell Petroleum Development Company of Nigeria (SPDC), 04 Aug 2011

Leigh Day (lawyers for the plaintiffs):
- Shell agrees £55m compensation deal for Niger Delta community, 7 Jan 2015
- London High Court rules that Shell Nigeria could be legally liable for bunkering, 20 Jun 2014
- Background to the Bodo claim, 25 Apr 2014
- [PDF] Leigh Day & Co 2012 Annual Review, Dec 2012 [see p.23]

Royal Courts of Justice:
- Bodo Community & others v. Shell Petroleum Development Company of Nigeria Ltd, 20 Jun 2014

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4 January 2017

Interview with John Gbei from the Bodo community in Nigeria

Author: John Gbei & Leigh Day

This interview was prepared with the support of Leigh Day as input for the session on “Access to Remedy: Victims’ Perspectives in Cross-Border Cases” at 2016 UN Forum on Business & Human Rights. 

11 November 2015

Nigeria: Bodo community claim Shell has yet to begin oil spill clean-up following settlement

Author: Jesse Winter, Ottawa Citizen (Canada)

“How a poor Nigerian town got Shell to pay for major oil spills”, 6 Nov 2015

…The waters of Bodo Creek and the surrounding delta were once strewn with fishing boats…But in 2008 a Royal Dutch Shell pipeline burst beneath the surface and gushed thousands of barrels of oil into the surrounding river…20 years after the first large protests over oil pollution…a court victory has given new hope that redress is possible…In January…Shell admitted responsibility for the Bodo spills…and settled a landmark lawsuit with the community.  The company agreed to pay $110 million in compensation…and pledged to clean up Bodo Creek.  The case, thought to be the largest settlement of its kind in Africa, has implications for the oil industry…It set the precedent that individual citizens can claim damages and be compensated directly for oil pollution to their land.  And it confirmed that the legal battle could be fought where the parent company is located…rather than in Nigeria, “where there is no hope of any justice”...“Parent companies have a due diligence requirement to make sure that their subsidiaries are not trampling people’s human rights overseas”…The oil company’s promised cleanup of Bodo Creek hasn’t been started...[I]f Shell doesn’t make meaningful progress by the new year, the company [will be dragged] back to court…

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12 January 2015

Shell & the Bodo community – settlement vs. litigation

Author: Elodie Aba, Legal Researcher, Business & Human Rights Resource Centre

On 7 January 2015…Shell had agreed to an out of court settlement of £55 million with the Bodo community affected by oil spills in Nigeria.  This agreement brings to an end a six year journey seeking justice for these residents of the Niger Delta. It is a ground-breaking settlement – despite so much damage, no multinational oil company has ever directly compensated individuals harmed in the Niger Delta for the destruction of the environment on which so much of their livelihoods depends…Shell’s settlement with the Bodo community means the Nigerian victims will receive compensation without needing to endure a potentially lengthy legal process…However…[a] trial…could have potentially set an important legal precedent and clarified the position of English courts for future corporate human rights lawsuits. But…a trial involves an uncertain outcome, and the legal process could be made even longer with subsequent appeals…The hope must be that this settlement sends a message to so many other companies embroiled in long legal cases around extensive environmental damage to communities.

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9 January 2015

Shell and the liability debate

Author: Sudeep Chakravarti, Livemint

The new year has provided an object lesson in…corporate responsibility. It has global implications for businesses. That makes it local for India, currently in the throes of a policy makeover that firmly places government on the side of business…While businesses here continually push the boundaries of what they can get away with…, globalization of activism and judicial process is increasingly ensuring that businesses get away with less…[O]n 7 January, Royal Dutch Shell Plc. agreed to pay £55 million…in an out-of-court settlement to a community of fishermen in Nigeria… From the liability and risk-planning perspective, some feel the settlement…has not exactly closed the book, merely one chapter. FT quotes the concern of [the] executive director of Stakeholder Democracy Network, as to the likelihood of continuing scrutiny of Shell: “If I was a shareholder, I would be factoring in future liabilities.”

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7 January 2015

Long-awaited victory as Shell finally pays out £55 million over Niger Delta oil spills

Author: Amnesty International

“While the pay-out is a long awaited victory for the thousands of people who lost their livelihoods in Bodo, it shouldn’t have taken six years to get anything close to fair compensation,” said Audrey Gaughran, Director of Global Issues at Amnesty International. 

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7 January 2015

Niger Delta communities hit by oil spills to instigate more claims in London against oil firms, say civil society actors

Author: John Vidal, Guardian (UK)

“Niger delta communities to sue Shell in London for oil spill compensation,” 7 Jan 2015

Niger delta communities hit by oil spills will bypass Nigerian courts and try to sue Shell and other oil companies in London following the…settlement awarded…to…people in Bodo, say community chiefs and non-government groups…“…Shell…are a big company and if we go to the Nigerian courts, they will win,” said Abere [a Bonny island community leader]...“Communities will now look to London for justice. In Nigeria they know they cannot get redress. People get no individual compensation…,” said Akpobari [who works with…Social Action]. The tendency of Nigerian courts to side with oil companies when they appeal against lower court awards was acknowledged by an oil company source who said…: “It is not unusual for large awards to be made against companies in the Nigerian courts but often they are overturned on appeal...” Leigh Day say…they plan to investigate four other pollution claims against Shell because the English court system is fairer...

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7 January 2015

Nigeria: Shell agrees to compensate communities affected by two oil spills

Author: William Wallis, Financial Times

"Royal Dutch Shell agrees $83M Nigeria oil spill settlement"

Royal Dutch Shell is to pay tens of millions of pounds in compensation to 15,000 Nigerian fishermen affected by two huge oil spills. The out of court deal, believed to be the biggest of its kind, ends a three year legal battle. The Anglo-Dutch oil company has agreed payouts averaging £2,000 each to the fishermen in the Bodo region of the Niger delta, as part of a compensation package worth £55 million ($83 million) for what it called two "highly regrettable" spills in 2008...The deal settles a lawsuit brought against Shell in London over leaks in the Bomu-Bonny pipeline that caused environmental damage to rural coastal settlements of 49,000 people living in 35 villages, many of whom are subsistence farmers and fishermen...Mutiu Sunmonu, managing director of SPDC, said it was "pleased" to have reached agreement and clean-up work would begin soon. Human rights group Amnesty International called the settlement "an important victory for the victims of corporate negligence".


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Author: France 24

« Des pêcheurs nigérians obtiennent gain de cause face au géant pétrolier Shell », 7 janvier 2015

Le groupe pétrolier Shell s'est engagé à verser 70 millions d'euros pour indemniser les 15 600 pêcheurs nigérians touchés par deux importantes fuites de pétrole en 2008. Cet accord met fin à trois années de bataille juridique…La filiale au Nigeria du géant néerlando-britannique, SPDC, a accepté de verser 35 millions de livres aux plaignants, des pêcheurs de la communauté de Bodo, au sud du Nigeria, et 20 millions de livres à la municipalité…Chacun des 15 600 pêcheurs, qui réclamaient une compensation pour les pertes subies par deux fuites dans le pipeline du groupe dans le delta du Niger, recevra 2 200 livres, soit l'équivalent d'environ trois années de salaire minimum au Nigeria…Indépendamment de l'accord annoncé mercredi, SPDC s'est engagé à nettoyer la zone polluée par les fuites de 2008. Ce nettoyage devrait commencer dans deux ou trois mois…

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7 January 2015

Nigeria: Shell's N15 Billion Settlement to Ogoni Community "Inadequate"

Author: Ben Ezeamalu, Premium Times (Nigeria)

…Shell's agreement to pay £55 million…to…fishermen in…Ogoniland is not commensurate with the disaster…on the area…[t]he Health of Mother Earth Foundation, HOMEF, said…"When compared to what polluting oil companies pay elsewhere for their ecological crimes, HOMEF sees the compensation…as inadequate for the severity of damage done"…Shell's Managing Director said…"We've always wanted to compensate the community fairly and we are pleased to have reached agreement…" Shell also said it would begin clean up of the sites immediately. HOMEF, however, welcomed Shell's agreement to pay the penalty noting that it was a confirmation of their guilt…"Since the oil companies do not respect fines imposed on them by Nigerian regulatory agencies…this decision should encourage other communities to bring up cases against Shell and other oil companies operating in the Nigeria…and other countries," said…a member of the international Advisory Board of HOMEF…"A safe environment is a foundational basis for human survival," the group said...

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7 January 2015

Shell agrees £55m compensation deal for Niger Delta community

Author: Leigh Day

Oil-giant Shell have agreed a compensation package of £55m to compensate 15,600 Nigerian fishermen and their community after it was devastated by two massive oil spills in the Niger Delta in 2008 and 2009. Today’s announcement follows a three-year legal battle by the Nigerian’s lawyers, London based law firm Leigh Day, in the High Court in London following the spills which devastated the environment surrounding the community of Bodo, in Gokana Local Government Area, Rivers State, Nigeria. Each member of the community impacted by the oil spill will each receive approximately 600,000 Nigerian Naira (£2,200)...The total cost of the compensation package agreed with Shell is £55m being split £35m for the individuals and £20m for the community and is thought to be one of the largest payouts to an entire community following environmental damage....In the aftermath of the spills Shell originally offered £4,000 (four thousand pounds GBP) compensation to the entire Bodo community before the villagers sought legal representation from lawyers in London, where Shell have their headquarters...The lawyer representing the claimants, Martyn Day from Leigh Day, said: ...“Whilst we are delighted for our clients, and pleased that Shell has done the decent thing I have to say that it is deeply disappointing that Shell took six years to take this case seriously and to recognise the true extent of the damage these spills caused to the environment and to the those who rely on it for their livelihood...."...Chief Sylvester Kogbara, Chairman of the Bodo Council of Chiefs and Elders, said: “For now, the Bodo community is very happy that this case has been finally laid to rest. The hope is that this will forge a good relationship with Shell for the future, not only with the Bodo people but with all the Niger Delta communities that have been impacted in the same way as us.

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