Two oil spills, six years and a three-year legal battle later, Royal Dutch Shell has agreed to pay £55 million (Dh305m) in compensation to the Bodo community in Nigeria’s oil-rich Niger delta. On the surface this is good news for 15,600 subsistence farmers and fishermen and their families who will receive an average of £2,200 each, and for the wider community, which will receive the balance. But the out-of-court settlement raises questions about corporate responsibility for damage done to the environment and to people’s livelihoods.
According to news reports, Shell at first underestimated the scope of the “operational failures” along the Bomu-Bonny pipeline, saying that the leaks amounted to 4,000 barrels, when other independent estimates went as high as 600,000 barrels. The company originally made an offer of just £4,000 to the entire Bodo community. That was before the legal action was launched in London. To put all this in perspective, the spills damaged about 600,000 hectares of mangrove swamp and virtually closed down the fishing industry in many villages in the region.
That is why it is hard to be overly enthusiastic about the compensation that Shell has now agreed to pay. Though the amount eventually received by many Bodo individuals may be 30 times the average monthly wage, that pales in comparison with payouts for comparable incidents elsewhere in the world. In 2010, the explosion of the Deepwater Horizon rig caused between 2.45m and 4.2m barrels of oil to leak into the Gulf of Mexico. BP paid $43 billion (Dh158bn) for clean-up and other costs, plus $4bn in fines. It also set up a $20bn compensation trust fund. But then that accident occurred within US jurisdiction and the US government pursued the matter vigorously.
For the harried people of the Niger delta, it was a London legal firm that pushed the case hard. The firm says the villagers are happy with the result. Even so, the settlement does not address their long-term future. Shell has agreed to clean up the polluted region, but this is yet to begin. And activists are disappointed that no legal precedent has been set because the case didn’t go to court. There is no knowing what will happen when the next spill occurs.
