Shell agrees to an $83.5m settlement for oil spill

Royal Dutch Shell has agreed to an $83.5m settlement for residents of the Bodo community in the Niger Delta, after two oil spills in 2008 and 2009 ravaged the land and destroyed thousands of hectares of Mangrove. With $53.1m of the total going directly to the 15,600 affected fishermen and farmers, the remaining $30.4m will be given to the Bodo community in a bid to restore the land and improve local facilities.

The out-of-court settlement marks the end of a difficult period, in which neither party could agree to an appropriate sum

“From the outset, we’ve accepted responsibility for the two deeply regrettable operational spills in Bodo. We’ve always wanted to compensate the community fairly and we are pleased to have reached agreement”, said Mutiu Sunmonu, Managing Director of the Shell Petroleum Development Company of Nigeria (SPDC), in a statement. “Despite delays caused by divisions within the community, we are pleased that clean-up work will soon begin now that a plan has been agreed with the community.”

The out-of-court settlement marks the end of a difficult period, in which neither party could agree to an appropriate sum. And while the oil giant acknowledges full responsibility for the disaster, SPDC’s Managing Director again stressed the dangers associated with oil theft and the importance of clamping down on the issue. “Unless real action is taken to end the scourge of oil theft and illegal refining, which remains the main cause of environmental pollution and is the real tragedy of the Niger Delta, areas that are cleaned up will simply become re-impacted through these illegal activities.”

Still, the case marks the first instance of an oil company granting compensation directly to the affected individuals in Africa. In a country where the minimum monthly wage amounts to 18,000 naira – or just shy of $100 – the $3,340 awarded to each individual has been welcomed warmly by the people in the community.