The Shell Petroleum Development Company is still countering the N1.84 trillion fine imposed on it by regulatory agencies because of its Bonga oil spill which damaged the community
| By Anayo Ezugwu | Feb. 17, 2014 @ 01:00 GMT
MORE than two years after the Bonga oil spillage, regulatory agencies and Shell Nigeria Exploration and Petroleum Company, SNEPCO are still at daggers drawn over the penalties and appropriate compensation for the communities. The Nigerian Maritime Administration and Safety Agency, NIMASA, and the National Oil Spills Detection and Response Agency, NOSDRA, imposed a fine of $6.5 billion on SNEPCO over the December 2011 Bonga oil spill. But Shell has faulted the imposition of the fine saying that there was no evidence to support the allegation that any community was impacted by the Bonga oil spill to merit compensation.
Chike Onyejekwe, managing director, SNEPCO, denied allegations that its officials frustrated government agencies from accessing spill sites in the aftermath of the Bonga spill. “We deeply regret that this incident took place, but as a responsible operator and corporate citizen we responded to it professionally and effectively and everything we did was with the active support of the regulatory authorities and in compliance with the applicable regulations. On December 20, 2011, SNEPCO shut down production from the Bonga field after a leak occurred on one of three export loading lines as oil was being transferred from the floating production storage and offloading, FPSO, vessel to a loading tanker.
“A well-coordinated cleanup operation was successfully completed on January 1, 2012, and production resumed, following the reinforcement of asset integrity and safety programmes. Satellite and aerial images confirmed that the Bonga oil spill could not have reached coastlines in the eastern Niger Delta, as has been claimed. Oil from the Bonga spill had largely dispersed by Sunday, December 25, 2011, due to the integrated efforts of SNEPCO, the Nigerian government and our industry partners in the application of approved dispersant and natural processes of dispersal and evaporation. The Bonga facility is 120km from shore and we were surprised to see images of a third party spill, which appeared to be from a vessel, at approximately 100 km from the Bonga facility in areas close to Forcados shore. SNEPCO, as a responsible corporate citizen, voluntarily took action to clean up this spill as well, despite it having nothing to do with its operations,” he said.
But Patrick Akpobolokemi, director general, NIMASA, said at a public hearing organised by the House of Representatives Committee on environment last month that the maritime agency calculated a total of $6.5 billion, about N1.04 trillion, as compensation to be paid to the communities affected by the spill. The NIMASA boss said that Shell tried as much as possible to frustrate the agency’s moves to get to the site of the spill, adding that the agency had to step in immediately after the spill by providing some stop gap measures such as providing relief materials to some of the communities. He lampooned Shell and its allies over their nonchalant attitude towards the spill and called on the organisation to take responsibility for its actions and ensure that such does not repeat itself.
“The kind of impunity Shell and its allies have demonstrated so far in the Niger Delta area in the past must stop if the future of the people of Nigeria and the environment are to be protected. And in other climes when spills like this occur, the first thing is remuneration, attention to the affected communities and finding ways of reducing the suffering of the people and restoring the eco-system, but Shell fell short of all these criteria and of course, it is sad that it is only in Nigeria that we can witness this degree of impunity,” he said.
Peter Idabor, director general, NOSREA, said it fined Shell $5 billion, about N800 billion for the oil spill incident. He said that the agency had started studying the Post-Impact Assessment Report on Bonga oil spill. “Compensation really derives after you have done a post-impact assessment. After you have done evaluation of the place and mapped out places affected by the spill, then you can now say this one take three naira; this one takes N100; it is different from fine. So, just recently, they formally announced to us that the post-impact assessment report is ready; which we are studying now. The House of Representatives has asked NOSDRA as the lead agency in oil spill to contact other stakeholders including the communities to see how we can study the report. We will then recommend compensation based on the report of the post-impact assessment,” he said.
Idabor said that NOSDRA faulted SPDC for not providing immediate relief to the affected communities, whose livelihoods were affected by the disaster. The director-general said that the fine would serve as a deterrent to other firms that would treat activities which deplete the environment with levity. The kind of impunity Shell and its allies have demonstrated so far in the Niger Delta area in the past should be addressed if the future and people of Nigeria and the environment are to be protected.”
Some nongovernmental organisations are happy with the action of the regulatory agencies against Shell. The Environmental Rights Action/Friends of the Earth Nigeria, ERA/FoEN, has commended the federal government for the N1.84 trillion fines imposed on SNEPCO for the December 2011 Bonga oil spill, saying that the oil company’s days of impunity were over. Godwin Ojo, executive director, ERA/FoEN, said, “The fines imposed on Shell by NIMASA and NOSDRA and the drop in Shell’s global profits are victory for all environmental justice groups fighting for justice in Nigeria’s Niger Delta. Shell cannot continue to ruin the environment, violate the rights of local communities, dodge responsibility and then expect to rake in mega-profits from the same communities.
“We have said it consistently that Shell has refused to be regulated. It has inadvertently arrogated to itself the role of a regulator that wants government agencies that have that statutory responsibility to turn a blind eye to its environmental crimes that have ruined livelihoods. This is totally unacceptable. Shell will continue to face problems if it fails to respect the rights of local communities to a safe environment. It should promptly pay this fine and stop ignoring the laws of Nigeria. In solidarity with local groups and communities that suffer the impacts of the company’s recklessness, we insist that enough is enough. Shell’s day of reckoning is here,” Ojo said.
On 20 December 2011 an oil spill occurred at the Bonga oil field caused by Shell. And more than 40,000 barrels, or 1.68 million gallons of crude oil spilled on the field. This resulted in an oil slick 115 miles (185 km) long off the Nigerian coast. It was probably the worst oil spill in the area for a decade.