Shell Nigeria liable for oil spills in Nigeria

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The Hague, 29 januari 2021

Shell's Nigerian subsidiary is liable for the consequences of two oil spills in Nigeria, according to a ruling of the Court of Appeal of The Hague on 29 January 2021.

Four Nigerian farmers and Friends of the Earth (Milieudefensie) are claiming compensation from Shell for damage they say they have suffered as a result of oil spills from underground pipelines and an oil well in Nigeria. These are pipe leaks in the Nigerian villages of Oruma and Goi and a well leak in the village of Ikot Ada Udo in the period 2004-2007. They also demand that Shell clean up the contamination better and take measures to prevent a recurrence.

Shell disclaims liability. According to Shell, the spills were caused by sabotage and in that case there is no liability under Nigerian law. Moreover, in Shell's opinion, the contamination has been cleaned up sufficiently. Shell says that cleaning up is done regardless of the cause of the leaks.

Earlier, in an interim judgment, the Court of Appeal of The Hague had already ruled that the Dutch court is competent to judge the claims of the farmers and Friends of the Earth.

Liable for damage

In two final judgments today, the court has assessed the claims substantively under Nigerian law. According to that law, a heavy burden of proof rests on the party who claims sabotage of pipelines (Shell in this case). This means that sabotage must be demonstrated beyond any reasonable doubt. Shell did not provide this evidence for the pipelines at Oruma and Goi. Shell Nigeria is therefore liable for the damage resulting from the leakage of those pipelines. The amount of the compensation has yet to be determined in a follow-up procedure (a damage assessment procedure).

Leak detection system

In addition, the court finds that Shell should build in a better warning system in the Oruma pipeline, so that future leaks are detected sooner. Then the outflow of oil in the event of a leak, and thus the (environmental) damage, can be limited. This obligation is imposed on both Shell Nigeria and the Shell parent company.

Further clean-up?

It has not been shown that Shell Nigeria has not sufficiently cleaned up the soil around Oruma and Goi. If there is still residual contamination then this is an aspect that can be included in the damage assessment procedure.

Sabotage of oil well

A third court ruling today concerns the oil well at Ikot Ada Udo. In this case, sabotage has been established. Whether this means that Shell cannot be held liable for the leakage remains open. First, the court wants clarification as to whether the pollution still needs to be cleaned up and to where the pollution has spread. The positions of the parties on the latter question differ widely. Therefore, this case will be continued.