Photographer: Dukas Prism / Editorial Universal Group Group / Getty Images
Photographer: Dukas Prism / Editorial Universal Group Group / Getty Images
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One of the country’s state governments has confiscated a field operated by the Nigerian unit of Royal Dutch Shell Plc due to a dispute over an oil spill that occurred decades ago.
The government of the state of Rivers, in the Niger Delta, on Wednesday sealed the base, called Kidney Island, located in the oil center of Port Harcourt, according to a statement sent by email by Kelvin Ebiri, spokesman for the governor, Nyesom Wike . The installation and 30% stake in Shell in a nearby block, known as Oil Mining Lease 11, was “legally purchased through a court-ordered public auction,” he said.
Shell “dismissed the alleged acquisition” of Kidney Island and OML 11, saying in a statement that the sentence is still subject to appeals filed by the company in a local Rivers state court. The state government announcement is “premature and harmful,” he said. The transfer of the oil license requires the approval of the Federal Minister of Petroleum Resources of Nigeria, which has not been granted, according to the statement.
The spokesman for the Minister of State for Petroleum Resources, Timipre Sylva, did not immediately respond to a request for comment on the conflict over OML 11. It will be difficult for Rivers State to take control of the part of the Shell permit because the federal government is “highly unlikely” to sign the transfer, Menas Associates Ltd., a London-based strategic and political risk consultancy, said in a note released Nov. 30.
Shell is embroiled in a lengthy legal battle with a local Rivers state community, which has successfully sued the company for millions of dollars in damages for contaminating its land. Last year, the regional government claimed it had acquired Shell’s interest in the oil block at the center of the case and the nearby support base after a court approved the sale of the firm’s assets to execute the sentence.
According to the statement, Rivers State offered $ 150 million for the two assets. The government also paid one billion naira ($ 2.6 million) to the Ejama-Ebubu community, which initiated the lawsuit against Shell, while the funds used for the purchase are in deposit, he said.
In 2010, a federal court ordered a Nigerian subsidiary of the Hague-based oil company to pay 17 billion naires to the Ejama-Ebubu community to compensate for the damage caused by the rupture of one of the firm’s pipelines long ago. fifty years. Shell is not responsible for the spill, which blames “third parties” during a civil war that lasted from 1967 to 1970, and says the affected sites have been cleared.
Although Shell has challenged the decision on several occasions, all appeals have been dismissed, most recently by the Nigerian Supreme Court late last month. In March, a judge in a related court case said that, with accrued interest, Shell’s debt stood at nearly 183 billion naires in January 2019, a valuation the company is challenging.
A federal court has issued an order restricting any further enforcement of the underlying judgment debt at least until a hearing scheduled for mid-January 2021, according to Shell’s statement. The Rivers state government should “allow due process of the law,” he said.
– With the assistance of Elisha Bala-All
(Update the fourth paragraph with comments)