Nigerian communities from the oil-rich Niger Delta initiated court action on Wednesday in London against the energy giant Royal Dutch Shell, in a case that may have far-reaching implications for whether companies can be sued in Britain for pollution and damages caused by their activities in other countries.The case is based on accusations by farming and fishing communities that say they have suffered years of damage because of repeated large spills from oil pipelines in their home areas.
The law firm Leigh Day is bringing the claims against Shell and its Nigerian joint venture, the Shell Petroleum Development Company of Nigeria, in London on behalf of two communities in the swampy, oil-rich Niger Delta: the Ogale and the Bille.
On Wednesday, the claimants won a small victory when a judge ruled that the Nigerian venture could be included in the case, along with its parent company.
Daniel Leader, a partner at Leigh Day, said in an interview that the outcome of what are likely to be lengthy proceedings “will set an important precedent as to whether the courts here are going to be willing to hear cases relating to multinational enterprises and their subsidiaries in the developing world.”
If the case is ultimately successful, he added, “cleanup costs could run into the hundreds of millions of dollars.”
Jonathan French, a Shell spokesman in London, said in an email that the company was “at an early stage of assessing the Bille and Ogale claims.”
Shell’s Nigerian subsidiary said in a statement that “both Bille and Ogale are areas heavily impacted by crude oil theft, pipeline sabotage and illegal refining, which remain the main sources of pollution across the Niger Delta.”
The Nigerian joint venture is 55 percent owned by the Nigerian National Petroleum Company, with Shell holding a 30 percent stake. The French energy company Total holds 10 percent, and Eni of Italy owns the remaining 5 percent. Shell has said that cleanup costs from spills are shared on the basis of holdings.
The company says it is committed to cleaning up oil spills, which it is obliged to do under Nigerian law no matter what the cause, but the company said it was not liable to pay compensation for damage caused by oil thieves and saboteurs.
In January last year, the energy company settled a claim brought by Leigh Day on behalf of another Nigerian community, the Bodo, for 55 million pounds, or $77 million at current exchange rates, in a development that analysts say has encouraged new lawsuits. Mr. French said the Bodo case differed from the ones now being brought because the company acknowledged that the spills in the settled case had been “caused by operational failure.” All of the money paid in that case was listed as compensation.
Shell’s Nigerian subsidiary said that it would fight having the case tried in Britain.
“We believe that allegations concerning Nigerian plaintiffs in dispute with a Nigerian company, over issues which took place within Nigeria, should be heard in Nigeria,” the company said…. Continue reading
