Shell appeals $2Bn court ruling

Shell Plc, one of the major oil companies operating in Nigeria, has filed an appeal to overturn an almost $2 billion awarded against the company for oil spillage in Nigeria. The oil giant’s latest move is sequel to a November 2020 judgment in favor of communities in river state claiming that a leak from the company pipeline damaged their land and waterways.

It should be recalled that farmers from the Ejalawa community in the southern part of Rivers state sued Shell and its joint venture partner, the Nigerian National Petroleum Corporation, NNPC in January 2020. The Federal court was able to establish that an abandoned flow line operated by Shell began spilling a “large volume of crude oil” in September 2019 that damaged the surrounding environment.

The court said the 88 plaintiffs were entitled to 800 billion naira ($1.92 billion) in compensation, and it ordered Shell to clean up the spillage. “I am satisfied that the amount of compensation claimed is a result of the colossal damage to the plaintiffs’ land,” Justice Tijjani Ringim wrote in his landmark judgement in November 2020.

However, Shell and the NNPC, the first and second respondents in the case, denied that spills occurred on the alleged dates and say the claim against them is “unsubstantiated, vague and exaggerated,” according to the ruling. They also argued unsuccessfully that the judge shouldn’t award damages because several required steps, such as a joint investigation of the alleged leak and an assessment of its volume, weren’t carried out. Shell’s position is weakened further when it agreed in August to pay another community in Rivers state 46 billion naira to resolve a lawsuit filed more than three decades ago, yet it denied responsibility for the pipeline rupture at the center of the case.

Meanwhile, Shell has ordered its legal team to apply for a stay of execution on January 25, to delay any payments until the appeal is decided. In the interim, the Ejalawa inhabitants will ask the judge to order the company to deposit 800 billion naira into a court account, the plaintiffs’ lawyer, Mohammed Ndarani Mohammed, said in an interview.


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