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  • Dutch court clears Nigerian farmers to sue Shell

    Dutch court clears Nigerian farmers to sue Shell

    Claims jurisdiction in pollution case  against oil giant

    A Dutch Appeal Court ruled on Friday that Royal Dutch Shell may be held liable for oil spills at its subsidiary in Nigeria, potentially opening the way for other compensation claims against multinationals in the Niger Delta and elsewhere.

    The ruling was hailed by rights groups as a victory for victims of environmental pollution worldwide, while Shell said it was disappointed.

    Judges in The Hague ordered Shell to make available to the court documents that might cast light on the cause of the spills and whether leading managers were aware of them.

    A lower Dutch court in 2013 had ruled that Shell’s Dutch-based parent company could not be held liable for leakages of oil at its Nigerian subsidiary.

    The legal dispute dates back to 2008 when four Nigerian farmers and campaign group Friends of the Earth filed a suit against the oil company in the Netherlands, where its global headquarters is based.

    “Shell can be taken to court in the Netherlands for the effects of the oil spills,” the court said yesterday.

    “Shell is also ordered to provide access to documents that could shed more light on the cause of the leaks.”

    The court still has to decide if Royal Dutch Shell is in fact responsible for the spills. The court will continue to hear the case in March 2016.

    Judge Hans van der Klooster said the court had also found that it “has jurisdiction in the case against Shell and its subsidiary in Nigeria.”

    Shell’s Nigerian subsidiary, Shell Petroleum Development Company of Nigeria Ltd (SPDC), said in a statement: “We are disappointed the Dutch court has determined it should assume international jurisdiction over SPDC.

    “We believe allegations concerning Nigerian plaintiffs in dispute with a Nigerian company, over issues which took place within Nigeria, should be heard in Nigeria.”

    Shell has always blamed the leakages on sabotage which under Nigerian law would mean it is not liable to pay compensation. But the Dutch court said yesterday, “It is too early to assume that the leaks were caused by sabotage.”

    “The ruling is unique and can pave the way for victims of environmental pollution and human rights abuses worldwide to turn to the Netherlands for legal redress when a Dutch company is involved,” Friends of the Earth Netherlands said in a statement.

    In January 2013, the district court in The Hague ruled that one of the farmers in the original suit was eligible for compensation from Shell’s Nigerian division for spills on his land in the Niger Delta.

    The farmer appealed over whether the parent company should also be liable.

    In a separate case, Shell agreed in January to pay out 55 million pounds ($82 million) in out-of-court compensation for two oil spills in Nigeria in 2008 after agreeing a settlement with the affected community in the Delta.

  • Shell liable for Nigeria spills – Dutch court

    Shell liable for Nigeria spills – Dutch court

    A Dutch Appeals Court ruled on Friday that Royal Dutch Shell can be held liable for oil spills at its subsidiary in Nigeria.

    Judges in The Hague ordered Shell to make available to the court documents that might shed light on the cause of the oil spills and whether leading managers were aware of them.

    Friday’s ruling overturned a finding by a lower Dutch court in 2013 that Shell’s Dutch-based parent company could not be held liable for spills at its Nigerian subsidiary.

    The legal dispute dates back to 2008 when four Nigerian farmers and campaign group “Friends of the Earth” filed suit against the oil company in Netherlands, where its global headquarters is based.

    “Shell can be taken to court in the Netherlands for the effects of the oil spills,” the court ruling stated on Friday.

    “Shell is also ordered to provide access to documents that could shed more light on the cause of the leaks.”

    Judge Hans van der Klooster said the court had also found that it “has jurisdiction in the case against Shell and its subsidiary in Nigeria”.

    The case has been adjourned till March for hearing.

    Shell’s Nigerian subsidiary, Shell Petroleum Development Company of Nigeria Ltd (SPDC), said in a statement: “We are disappointed the Dutch court has determined it should assume international jurisdiction over SPDC.”

    “We believe allegations concerning Nigerian plaintiffs in dispute with a Nigerian company, over issues which took place within Nigeria, should be heard in Nigeria,” it said.

    Shell has always blamed sabotage for the leaks, which under Nigerian law would mean it is not liable to pay compensation.

    But the Dutch court said on Friday: “It is too early to assume that the leaks were caused by sabotage.”

    In January 2013, the district court in The Hague ruled that one of the farmers in the original suit was eligible for compensation from Shell’s Nigerian division for spills on his land.

    The farmer appealed over whether the parent company should also be liable.

    “Friends of the Earth” Netherlands Director Geert Ritsema said Friday’s ruling meant the three other farmers could proceed with claims for compensation for lost income resulting from spills.

    “There are 6,000 kilometres of Shell pipelines and thousands of people living along them in the Niger Delta,” he said.

    “Other people in Nigeria can bring cases and that could be tens of billions of euros in damages.”

    In a separate case, Shell agreed in January to pay out 55 million pounds ($82 million) in out-of-court compensation to a community for two oil spills in Nigeria in 2008.

  • NCDMB, Shell, OEMs begin work on industrial park

    The Nigerian Content Development and Monitoring Board (NCDMB) and Shell Petroleum Development Company of Nigeria (SPDC) have begun work on a mini-industrial park, a major step towards the attainment of Nigerian Content goals.

    It took place in Port Harcourt, Rivers State capital, and it featured three original equipment manufacturers (OEMS) – Alcon, Fiddil, and Prime Atlantic – utilised by Shell for its operations. Each got 1,800 square metres within Shell’s industrial area to build facilities and domesticate some of their services.

    The Shell-promoted industrial park is in furtherance of the NCDMB’s Equipment Components Manufacturing Initiative (ECMI) introduced in 2011, to encourage OEMs and their representatives to set up facilities for manufacturing of spare parts and accessories of equipment for oil and gas operations.

    NCDMB Executive Secretary Denzil Kentebe said the event re-affirmed government’s vision of using Nigerian Content as an instrument for the industrialisation of the economy. He listed the targets of the initiative to include transformation of representatives of OEMs from “marketers to manufacturers and maximize retention of industry spend within the economy, on procurement of equipment, manufacturing, supply, installation and after sales services.”

    Kentebe identified other targets to include reversing the trend of equipment rentals by encouraging Nigerians to acquire equipment for activities, such as drilling and construction.

    He said: “To achieve the ECMI policy thrust, the board introduced the Nigerian Content Equipment Certificate (NCEC) as a Local Content Requirement (LCR) for participation in bids connected to the supply or utilisation of equipment in the oil and gas industry. This is to ensure that the full capacities of local manufacturers or owners of equipment are exhausted before any equipment can be imported.”

    He praised  Shell for embracing the ECMI, having obtained approval from the NCDMB in 2012 for OEM domestication scheme. He enjoined others to embrace such collaborative efforts to develop the local supply chain.

    Kentebe said domestication of local manufacturing was key to Nigerian content growth and the platform for value-adding activities, such as research and innovation, processing of local raw materials and establishment of ancillary services; all of which create employment and empowerment for youths and contributes to the gross domestic product.

    SPDC Managing Director and Country Chair Osagie Okunbor described the initiative as a key intervention of Shell Companies in Nigeria to support Nigerian Content development, adding that it would improve cycle time, enhance service delivery and engender long-term economic benefits, including employment for Nigerians.

    He listed key objectives to include increase in control, simplicity and potential for long-term cost saving.

    Okunbor, represented by the Project Director, Mr. Toyin Olagunju, said the OEMs and their Nigerian local partners were issued the NCEC by the NCDMB in 2012.  He said Shell Companies in Nigeria were committed to supporting Nigerian Content and other strategies aimed at increasing the participation of businesses in the oil and gas industry.

    “SPDC supported a Nigerian manufacturer, Egba Split Clamp Nigeria Limited, to refine their products with hydro and pressure tests. Egba clamps are now approved for use in SPDC operations and we are working towards the deployment of the clamps in our operation. We will also continue to support other manufacturing initiatives including pipe mill development, development of drilling fluids and production chemicals,” Okunbor added.

  • Shell asks shippers exporting Nigerian oil to sign guarantee

    Shell asks shippers exporting Nigerian oil to sign guarantee

    Royal Dutch Shell has asked ship owners exporting its Nigerian oil to sign a “letter of comfort” (LoC) to guarantee it is not stolen, according to an email from the company seen by Reuters.

    In July, state-run Nigerian National Petroleum Corp (NNPC) banned more than 100 tankers from Nigeria’s waters, citing a directive from President Muhammadu Buhari, who wants to trace and recover what he calls “mind-boggling” sums stolen from the oil sector.

    Last month, the NNPC lifted the ban but asked ship owners to sign a letter of comfort to “guarantee to indemnify” it against any illicit use of their vessel. This led some owners to reject pending bookings.

    “Please be informed we expect LPG & Products ship owners to sign the NNPC LoC for any future Shell loading voyages,” the email said, referring to liquefied petroleum gas.

    “Shell (is) putting (its) reputation on the table that warrants the cargo is NOT stolen and this should remove any concerns ship-owners have around bad title down the oil chain,” the email said.

    Shell said it was looking to mitigate any negative impact that the requirement to provide the letter might have.

    “What we are doing is to ensure that our business is not adversely affected by working with our own vessel owners to provide this letter in the legal language that everyone can live with,” Shell Nigeria country chair Osagie Okunbor said at a press briefing last week.”

  • Shell praises Buhari on UNEP report implementation

    Shell Petroleum Development Company (SPDC) has commended President Muhammadu Buhari for setting up governance structures for the implementation of the United Nations Environment Programme (UNEP) report.

    The General Manager, External Relations, Shell Petroleum Development Company (SPDC), Igo Weli, said at a forum in Lagos that the UNEP report implementation is paramount to Shell, adding, “we are greatly encouraged by the positive and constructive response from representatives of the community, Niger Delta non-governmental organisations (NGOs) and civil society. This is an important step forward and SPDC is determined to play its part in maintaining the momentum.”

    He noted that as the UNEP report stated, treating the problem of environmental contamination within Ogoniland merely as a technical clean-up exercise, will ultimately lead to failure. Ensuring long-term sustainability is a much bigger challenge, one that will require coordinated and collaborative action from all stakeholders. This must include putting an end to the widespread pipeline sabotage, crude oil theft and illegal refining that are the main causes of environmental damage in Ogoniland and the wider Niger Delta today. Shell Companies in Nigeria will continue to be at the forefront engaging interested stakeholders and seeking sustainable innovative ways to resolve the problem, he added.

    Weli stated the SPDC championed grassroots environmental campaign in partnership with the Rivers State Ministry of Environment, NOSDRA and NGOs to deepen awareness on the ills of illegal bunkering and oil theft. 12 town-hall sessions were held across the four local government areas yearly, and about 11,000 participants recorded from 2014 to date.

    He also drew attention to the need for the people of Ogoni to know that the $1 billion Ogoni Restoration Fund is not for distribution among indigenes of Ogoniland. He said most worrisome aspect of UNEP report implementation, is the belief among some of the community members that every Ogoni person will get $1 million from the planned $1 billion fund after which the remainder will be channeled to spill cleanup and environment remediation.

     

     

     

  • Shell begins operations in Bonga Northwest

    Shell begins operations in Bonga Northwest

    Oil major, Royal Dutch Shell said it has started the third phase of operations in Nigeria.

    The firm said its exploration and production company started production at the third phase of the offshore Bonga prospect.

    “This new start-up is another important milestone for Bonga, adding valuable new production to this major facility,” upstream director Andrew Brown said in a statement.

    Shell last year started oil production from the deepwater Bonga Northwest development off the coast of Nigeria. At its peak, the company said the third phase of operations in the country should be around 50,000 barrels of oil equivalent.

    Nigeria is a member of the Organisation of Petroleum Exporting Countries (OPEC). In August, Nigeria produced about 1.86 million barrels of oil per day (bpd), about four per cent higher than the previous month, according to OPEC.

    Reserves taken from the third phase of the Bonga prospect will be fed through existing production infrastructure offshore, which can produce more than 200,000 barrels of oil and 150 million cubic feet of natural gas per day at full capacity.

    The entire Bonga prospect started oil and gas production in 2005 and was Nigeria’s first  deep water project. To date, the full project has produced more than 600 million barrels of oil.

    “The country’s deepwater resources are making an important contribution to meeting growing energy demand in Nigeria and around the world,” Managing Director, Shell’s Regional Exploration subsidiary, Tony Attah, said in a statement.

    Royal Dutch Shell Plc expanded oil production off Nigeria’s coast by starting the third phase of its Bonga field.

    That phase has a peak production capacity of about 50,000 barrels of oil equivalent, Shell said yesterday in an e-mailed statement. The floating production and storage facility serving Bonga’s third phase has a capacity of more than 200,000 barrels of oil and 150 million standard cubic feet of natural gas a day.

    Shell has a 55 per cent stake in Bonga and operates what it says were the first deposits to be developed in Nigeria’s deep waters in 2005. Exxon Mobil Corp. holds 20 per cent, while units of Total SA and Agip, a subsidiary of Italy’s Eni SpA, each own 12.5 per cent.

    Shell has pushed on with projects close to production, such as Bonga Phase 3, even as a slump in crude prices forced it to join other producers in deferring more risky exploration. Europe’s biggest oil company is cutting 6,500 jobs this year and plans to lower spending by $7 billion.

    It abandoned an exploration program in Alaska last month after drilling a well that didn’t lead to sizeable oil and gas reserves.

    In July, Shell decided to go ahead with the Appomattox project in the Gulf of Mexico after cost cuts reduced the break-even price for the project to $55 a barrel. Benchmark Brent crude climbed as much as 1.7 percent to $48.95 a barrel on the London-based ICE Futures Europe exchange on Monday, after dropping 47 percent in the past year.

  • Three varsities build cars for Shell Eco-marathon

    Three varsities build cars for Shell Eco-marathon

    Students of three universities have built cars they will use at the Shell Eco-marathon, Africa (SEMA) in South Africa between October 2 and 4.

    The students, drawn from the University of Lagos (UNILAG), University of Benin (UNIBEN) and Ahmadu Bello University (ABU), Zaria, are being sponsored by Shell Petroleum Development Company of Nigeria Limited (SPDC) Joint Venture.

    They are collectively known as Team Nigeria and will join 40 teams from four countries to test the energy efficiency of their cars at the Zwartkops Raceway, near Pretoria.

    The competition, which will be hosted by the School of Electrical Engineering, University of Johannesburg, challenges students from all over the world to build and race energy-efficient cars, and rewards those that travel farthest with the least amount of fuel.

    In 2014, the SPDC JV provided seed funding for the three universities and sponsored them to the European edition of the competition in Rotterdam, The Netherlands. They also participated in the maiden edition of Shell Eco-Marathon Africa which held in South Africa in 2014, where the UNIBEN team winning the Best Designed Car award.  SPDC organised a test drive at the Campus Mini stadium in Lagos in March 2015 to test the readiness of the students.

    Mr Osagie Okunbor, Managing Director SPDC and Country Chair, Shell Companies in Nigeria, said the intervention is part of efforts to prepare students to solve problems for the society.

    “The sponsorship of the students opens an exciting phase in our long-standing support for education in Nigeria.  In addition to awarding scholarships, building schools and donating science equipment, we’re challenging the leaders of tomorrow to begin to think about, and act on the difficult energy choices facing a rapidly increasing world population,” he said.

    General Manager, External Relations SPDC, Igo Weli, said he was confident of the students’ chances in the competition.

    “The test drive was very successful and watched by cheering parents. The outcome of the event provided the assurance that the Nigerian students will pass the rigorous technical inspection before being allowed to race at Shell Eco-marathon in Europe or Africa. We’re pleased that our support has encouraged other universities to take part in this project designed to drive the efficient use of energy,” he said.

    The initiative is one of many that SPDC Joint Venture has in the education sector.

     

  • Shell stops Arctic exploration after ‘disappointing’ tests

    Royal Dutch Shell has stopped Arctic oil and gas exploration off the coast of Alaska after “disappointing” results from a key well in the Chukchi Sea.

    In a surprise announcement, the company said it would end exploration off Alaska “for the foreseeable future”.

    Shell said it did not find sufficient amounts of oil and gas in the Burger J well to warrant further exploration.

    The company has spent about $7billion (£4.5billion) on Arctic offshore development in the Chukchi and Beaufort seas.

    “Shell continues to see important exploration potential in the basin, and the area is likely to ultimately be of strategic importance to Alaska and the US,” said Marvin Odum, president of Shell USA.

    “However, this is a clearly disappointing exploration outcome for this part of the basin.”

    Lord Browne, former BP boss and government adviser, told the BBC that the Arctic “is a very risky place [to explore] and very expensive to develop, so there are probably easier places to go”.

    Indeed some analysts suggested Shell might give up on the Arctic completely.

    “It is possible that Shell might almost be relieved as they can stop exploration for a legitimate operational reason, rather than being seen to bow to environmental pressure,” Stuart Elliott from energy information group Platts told the BBC.

    “With the oil price around $50 a barrel, it was a risky endeavour with no guarantee of success.

    “You could argue that this has been bad for Shell’s reputation and it wouldn’t be a big surprise if they abandoned Arctic drilling altogether.”

    Certainly, the first findings from the Burger J exploration well 150 miles off the Alaskan coast were not promising.

    Second, although President Barack Obama had given the necessary permissions for drilling to start again following the problems of rig fires in 2012, Mrs Clinton’s tweet revealed that political risks were still substantial.

    Shell is not the only company to explore for oil offshore in the Arctic region – Italian energy group Eni could soon start producing oil from a field in the Barents Sea within weeks.

    There is also one field in operation in the Russian Arctic owned by Gazprom Neft, the oil arm of Russian energy giant Gazprom. Last year, a joint drilling project between Rosneft and Exxon was stopped due to sanctions placed on Russia.

    A number of additional exploration permits have also been issued by Moscow, but none have yet been taken up due to the current low price of oil, which has halved in the past year.

     

    The US Geological Survey estimates that the Arctic holds about 30 per cent of the world’s undiscovered natural gas, as well as 13 per cent of its oil.

    According to Shell, this amounts to around 400 billion barrels of oil equivalent, 10 times the total oil and gas produced in the North Sea to date.

    Image caption Shell has come under a lot of pressure from environmental groups to stop drilling

    However, environmental groups oppose Arctic offshore drilling, saying it will pollute and damage a natural wilderness largely untouched by human activity. They also argue that fossil fuels such as oil and gas must be left in the ground if the world is to avoid dangerous climate change.

    Over the summer, protesters in kayaks unsuccessfully tried to block Arctic-bound Shell vessels in Seattle and Portland, Oregon.

    “Big oil has sustained an unmitigated defeat,” said Greenpeace UK executive director John Sauven.

    “The Save the Arctic movement has exacted a huge reputational price from Shell for its Arctic drilling programme, and as the company went another year without striking oil, that price finally became too high.”

    Shell had continued to explore for oil despite the slump in the price of oil. Other oil and gas majors have shelved expensive exploration projects but, having invested billions of dollars in its Arctic project, Shell persisted, believing that Arctic oil would be competitive in the longer term.

    This is why the announcement came as such a surprise.

    Shell said it would take financial charges as a result of halting exploration, which it would disclose during its third quarter results. The company has existing contracts for rigs, ships and other assets.

     

  • Unilag, Uniben, ABU students for Shell Eco-marathon

    Unilag, Uniben, ABU students for Shell Eco-marathon

    Students of three Nigerian universities have built cars that will feature at the Shell Eco-marathon, Africa (SEMA) in South Africa from October 2 to 4. They are sponsored by the Shell Petroleum Development Company of Nigeria Limited (SPDC) Joint Venture.

    The students of University of Lagos, University of Benin and Ahmadu Bello University, Zaria, collectively known as Team Nigeria, will join 40 teams from four countries to test the energy efficiency of their cars at the Zwartkops Raceway, near Pretoria. The event will be hosted by the School of Electrical Engineering at the University of Johannesburg. The Shell Eco-marathon competition challenges students in different continents (America, Europe, Asia and Africa) to build and race energy-efficient cars, and rewards those that travel farthest with the least amount of fuel.

    “The sponsorship of the students opens an exciting phase in our long-standing support for education in Nigeria,” said Osagie Okunbor, Managing Director SPDC and Country Chair, Shell Companies in Nigeria.

    “In addition to awarding scholarships, building schools and donating science equipment, we’re challenging the leaders of tomorrow to begin to think about, and act on the difficult energy choices facing a rapidly increasing world population.”

    In 2014, the SPDC JV provided seed funding for the three universities and sponsored them to the European edition of the competition in Rotterdam, The Netherlands. They also participated in the maiden edition of Shell Eco-Marathon Africa which held in South Africa in 2014, with the University of Benin team winning the Best Designed Car award.  SPDC organised a test drive at the Campos Mini stadium in Lagos in March 2015 to test the readiness of the students.

  • Ilaje coastal communities seek compensation from Shell

    The Ilaje communities in Ondo State have urged Shell Nigeria Exploration and Production Company, (SNEPCO), to compensate them for the Bonga oil Spill of 2011.

    They said SNEPCo and the communities reached an agreement for compensation but Shell has not fulfilled its promise.

    The General Secretary, Abereke Communities and field coordinator, Communities Environmental Protection Committee of Ilaje land (CEPCOM), Prince Taiwo Aiyedatiwa, said despite that Ilaje coastal communities of Ondo State are host communities to SNEPCo’s Bonga oil facility, which is offshore Ilaje Local Government of Ondo State, Shell has not been carrying out its corporate social responsibilities to the communities.

    He said: “In January 2014, we were aware that SNEPCO called about 88 coastal communities in Delta and Bayelsa States to stakeholders’ forum in Abuja through the house of representative committee on environment in which the Minister of Environment, National Oil Spill Detection and Response Agency (NOSDRA), Department of Petroleum Resources (DPR), Nigerian Maritime Administration and Safety Agency (NIMASA) and other regulatory bodies were in attendance, and Shell agreed to compensate the communities.

    “But to our surprise, Ilaje local Government of Ondo State that plays host to SNEPCO, and also affected by the oil spill was left out. We have written several letters to the company, regulatory bodies and Presidency since the occurrence of the oil spill but our communities have not been invited by Shell. The oil spill affected five coastal states in the Niger Delta, including Akwa-Ibom, Bayelsa, Delta, Ondo and Rivers.”

    He appealed to Shell and the Federal Government as well as the spill committees to prevail on SNEPCO to call a stakeholders forum and invite the Ilaje coastal communities that were badly affected by the oil spill and compensate them, clean up and remediate the environment to restore aquatic lives.

    “We had planned to take legal action but were stopped by the traditional head of Abereke communities, Oloja Darosha Oladayo Mesagan. He advised us not to do so now, but the continued failure of SNEPCo to address our issue, will compel us to take action,” he added.

    NOSDRA’s Director-General, Sir Peter Idabor, had in a letter to Shell said the agency imposed a sanction on the company for pollution and damage to natural resources and means of livelihood of the affected communities. The Agency had recently threatened to sanction SNEPCo for failing to pay the $3.6 billion fine.

    He said: “Despite the fact that the incident was caused by equipment failure and the admission by the then Managing Director that 40,000 barrels of crude oil spilled into the Atlantic Ocean, no attempt was made by the oil company to provide relief materials for the shoreline fishing communities with respect to the acute and chronic impact of the crude oil on the environment.”

    NOSDRA directed SNEPCo to pay  $3,600,191,206 as compensation and administrative costs for failure to effect clean up on the impacted site within the stipulated period, as provided in the agency’s Act and Regulations.”

    Shell declined to comment on the issue when contacted by The Nation.