Oil giant Shell offers 30 million pounds to settle Nigeria compensation claims
Energy company Royal Dutch Shell's offer of 30 million pounds in compensation for two spills in Nigeria rejected by claimants' counsel as 'insulting and derisory' compared to 300-million-pound claim
Royal Dutch Shell is ready to pay up to 30 million pounds (HK$396 million) in compensation for two oil spills in Nigeria in 2008, but lawyers said it may face a far bigger pay out after a London court ruled it could be liable for damages.
Around 15,000 residents of the Bodo community in the Niger Delta represented by law firm Leigh Day appealed in 2011 to a London court for more than 300 million pounds in compensation.
Claimants say that the two spills resulted in the leakage of 500,000 barrels of oil but Shell estimated the volume at around 4,000 barrels.
Shell has already offered some compensation for the spills.
In a preliminary hearing ahead of a trial which will take place in May next year, London’s High Court ruled that Shell’s Nigerian subsidiary could be liable if it were proven that it did not take reasonable steps to protect and maintain the pipeline from thefts that have plagued the key African oil producer.
“Short of a policing or military or paramilitary defence of the pipeline, it is my judgement that the protection requirement involves a general shielding and caring obligation,” the judge said in a ruling.
Leigh Day argued that under the Nigerian Oil Pipelines Act anyone who suffered from an oil spill can claim compensation if they can show a company was guilty of neglect in failing to “protect, maintain or repair” its pipeline.
