Shell Agrees To Pay $83 Million For Devastating Nigerian Oil Spill

CREDIT: AP/Sunday Alamba

In this June 20, 2010 photo, men walk in an oil slick covering a creek near Bodo City in the oil-rich Niger Delta region of Nigeria.

Oil giant Royal Dutch Shell has agreed to pay a Nigerian fishing community for two massive oil spills that devastated the Niger Delta region in 2008 and 2009. Shell will give $53 million of the $83 million settlement, one of the largest settlements ever in Africa, to 15,600 fishermen and farmers with the remaining $30 million going to the broader Bodo community. This is the first time that compensation for an oil spill has been paid directly to affected individuals, according to the BBC.

The settlement “is thought to be one of the largest payouts to an entire community following environmental damage,” the claimants’ London lawyer, Leigh Day, said. With the out-of-court settlement, Shell avoids having to defend what could have been a negatively portrayed high court case in London that was due to start shortly.

The company has maintained that the vast extent of environmental degradation from oil in the area was not caused by its negligence, but by “the scourge of oil theft and illegal refining.” However, documents obtained in November revealed that company employees warned Shell that the aging pipeline was at risk. Internal documents showed that the pipeline — which eventually spilled up to 500,000 barrels of oil — had reached the end of its life several years before the spill.

Following the spill, a 2011 Amnesty International report found that the spill caused the price of food to rise and contaminated water supplies. A U.N. report estimated it could take up to three decades to fully rehabilitate the Ogoniland region where Shell has been operating for years.

After this three-year legal battle, the farmers and fisherman most impacted by the spill will now receive $3,300 each as compensation, which could equal several years’ earnings. London lawyer Martyn Day, who had just returned from a trip to the region with more than a dozen other lawyers to help set up bank accounts for those in need, told the Guardian that every single one of the 15,600 claimants said yes to the deal.

The broader environmental community responded positively to the developments, but warned that there is still much work do to.

“The compensation is a step towards justice for the people of Bodo, but justice will be fully achieved when Shell properly cleans up the heavily polluted creeks and swamps so that those who rely on fishing and farming for their income can begin to rebuild their livelihoods,” said Styvn Obodoekwe, Director of Programmes of the Centre for Environment, Human Rights and Development, in a statement.

While Shell said they’ve accepted responsibility for the spills since the outset, their original compensation offer was as low as $6,000 to the entire community.

Oil is a growing industry in Nigeria and environmental damage continues to be a major concern. Hundreds of spills occur every year in the country, which is Africa’s largest oil producer.