Shell agrees to pay Nigerian fishing community £55m ($83.5 million) for oil spill
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 farmers and fishermen.
The agreement is thought to be the biggest out of court settlement related to a Nigerian oil spill and the first time thousands of individual Nigerians will receive direct compensation for one. Each member of the Bodo community will receive an equal share of around £35m, and the remaining sum will be used to build health centres and schools.
Shell Petroleum Development Company of Nigeria (SPDC), a Shell subsidiary, had admitted liability for spills of 4,000 barrels caused by operational failures but later withdrew those estimates, conceding they underestimated the extent of the leaks.
“We’ve always wanted to compensate the community fairly,” said Mutiu Sunmonu, managing director of Shell Nigeria, which is 55 percent owned by the Nigerian government.
Sunmonu said Shell also has agreed and is “fully committed” to a cleanup.
Leigh Day, lawyers representing the claimants, reportedly stated that 500,000 barrels had leaked, damaging 600,000 hectares of mangrove swamp. It alleged that the spills were so devastating that the local fishing industry almost ground to a halt and said Shell had originally offered just £4,000 to the entire Bodo community before the villagers sought legal action in London.
Oil spills in the Niger delta over the years has occurred on varying levels under different operators. In many cases as the result of bunkering, sabotage, accidents and oil theft.