Supreme Court Greenlights Shell’s Appeal in Niger Delta Following Oil Spill Claim
On Friday, Nigeria’s Supreme Court made a ruling in favor of Shell, granting the company a hearing regarding an alleged oil spill in the Niger Delta. This decision came after the Court of Appeal had suspended an asset sale by Shell and mandated the payment of a judgment claim before proceeding with the case.
The legal dispute originated with a High Court ruling in November 2020, instructing Shell to pay 800 billion naira ($878 million) to the communities of Egbalor Ebubu in Rivers state. These communities accused the company of causing an oil spill that resulted in damage to waterways and farms.
Shell appealed the High Court’s decision, seeking to prevent the execution of the judgment. However, the Court of Appeal ruled that Shell must deposit the specified amount in a court-controlled account before the appeal could move forward.
Last June, Shell was also instructed to halt the disposal of local assets until the Supreme Court issued its ruling, allowing for potential compensation to the Niger Delta Community.
According to Mohammed Ndarani, the community’s lawyer, the Supreme Court has now redirected the case to the Court of Appeal. The Supreme Court concluded that the appeal court had not thoroughly examined the case’s merits and directed that Shell be granted a hearing.
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This legal development is significant, especially in the context of heightened scrutiny of oil companies operating in Nigeria. It follows the country’s oil regulator’s refusal to approve Exxon Mobil’s $1.28 billion asset sale to Seplat Energy in 2022, raising concerns among international oil companies about the challenges associated with selling assets in Nigeria.
Like other major oil players in the country, Shell is shifting its focus to deep-water drilling and divesting from onshore operations, which are susceptible to crude theft and pipeline vandalism, impacting Nigeria’s oil production.
