Shell to pay Pound 55 mn for oil spills to Bodo community in Nigeria

The Shell Petroleum Development Company of Nigeria Limited (SPDC), Shell’s Nigerian subsidiary, has announced a Pound 55 million settlement agreement with the Bodo community in respect of the two highly regrettable operational spills in 2008. The Pound 55 million settlement provides for an individual payment to each claimant who accepts the settlement agreement in compensation for losses arising from the spills, amounting to up to Pound 35 million in total. The remaining Pound 20 million payment will be made for the benefit of the Bodo community generally.
 
“From the outset, we have accepted responsibility for the two deeply regrettable operational spills in Bodo. We have always wanted to compensate the community fairly and we are pleased to have reached agreement,” said Mutiu Sunmonu, managing director of SPDC.
 
In late 2008, two oil spills took place on the Bomu-Bonny Pipeline in Bodo caused by operational failure of the pipelines, according to Shell.
 
As soon as the independent joint investigation team had determined the cause, SPDC accepted responsibility for the two operational spills in Bodo. SPDC acknowledged responsibility to pay compensation as required by Nigerian law.
 
In 2011, members of the Bodo Community brought claims against SPDC in the UK for environmental pollution. The claimants are represented by a London law firm, Leigh Day & Co.
 
Earlier settlement efforts failed mainly as a result of the grossly exaggerated nature of the claims, which at one stage exceeded Pound 300 million. “We wanted to compensate those who have been genuinely impacted by the spills; however, we could not do so at a level which rewarded those making false claims,” said Shell in a press release.
 
Shell added, “We have now reached a settlement agreeable to ourselves and the community which, from our perspective, also factors in the costs and time which would have been incurred by both parties should a full trial have taken place later in the year.”