Shell Nigeria
Encyclopedia
Shell Nigeria is the colloquial name for Royal Dutch Shell
's Nigerian operations carried out through four subsidiaries—primarily through Shell Petroleum Development Company of Nigeria Limited (SPDC). Royal Dutch Shell accounts for more than 40% of Nigeria
's total petroleum production (899000 oilbbl/d (bpd) in 1997) from more than eighty fields.
and started oil exports in 1958.
and flowlines, 87 flowstations, 8 natural gas plants and more than 1,000 producing wells. SPDC's role in the Shell Nigeria family is typically confined to the physical production and extraction of petroleum
. It is an operator of the joint venture, which composed of Nigerian National Petroleum Corporation
(55%), Shell (30%), Total S.A.
(10%) and Eni
(5%). Until relatively recently. it operated largely onshore on dry land or in the mangrove swamp.
.
production. Shell has a share of 25.6% in this company and is also its technical adviser. Other partners are Nigerian National Petroleum Corporation (49%), Total (15%) and Eni (10.4%).
and Shell. The concerns of the locals were that very little of the money earned from oil on their land was getting to the people who live there, and the environmental damages caused by Shell's practices. In 1993 the Movement for the Survival of the Ogoni People
(MOSOP) organized large protests against Shell and the government, often occupying the refineries. Shell withdrew its operations from the Ogoni areas. The Nigerian government raided their villages and arrested some of the protest leaders. Some of these arrested protesters, Ken Saro-Wiwa
being the most prominent, were later executed, against widespread international opposition from the Commonwealth of Nations
and human rights
organisations.
Shell maintained that it asked the Nigerian government for clemency towards those found guilty but that its request was refused. A 2001 Greenpeace
report claimed that "two witnesses that accused them later admitted that Shell and the military had bribed them with promises of money and jobs at Shell. Shell admitted having given money to the Nigerian military...". Shell denied these accusations and claimed that MOSOP was an extortionary movement that advocated violence and secession.
In December 2003, Shell Nigeria acknowledged that the conflict in the Niger Delta
makes it difficult to operate safely and with integrity and that "we sometimes feed conflict by the way we award contracts, gain access to land, and deal with community representatives", and that it intends to improve on its practices. In 2009, Shell offered to settle the Ken Saro-Wiwa
case with US$15.5 million while denying any wrongdoings and calling the settlement a humanitarian gesture. According to the New York Times and the journalist Michael D. Goldhaber the settlement came days before the start of a trial in New York that was expected to reveal extensive details of Shell's and MOSOP's activities in the Niger Delta.
and Friends of the Earth International contested the claims by Shell that up to 98% of all oil spills in Nigeria were due to sabotage. The two groups filed a complaint against the company in the OECD. Under Nigerian law, Shell has no liabillity when spills are classified as result of sabotage. Soon after, Shell grilled by the Dutch Parliament and revised its estimates from 98% to 70%. It was the second time the company did such a large revision to its oil spill statistics.
. In July 2010 the Federal High Court of Nigeria set damages against Shell Petroleum Development Company of Nigeria Limited, SPDC, at 15.4 billion Nigerian naira
(about 100 million US dollars).
Royal Dutch Shell
Royal Dutch Shell plc , commonly known as Shell, is a global oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the fifth-largest company in the world according to a composite measure by Forbes magazine and one of the six...
's Nigerian operations carried out through four subsidiaries—primarily through Shell Petroleum Development Company of Nigeria Limited (SPDC). Royal Dutch Shell accounts for more than 40% of Nigeria
Nigeria
Nigeria , officially the Federal Republic of Nigeria, is a federal constitutional republic comprising 36 states and its Federal Capital Territory, Abuja. The country is located in West Africa and shares land borders with the Republic of Benin in the west, Chad and Cameroon in the east, and Niger in...
's total petroleum production (899000 oilbbl/d (bpd) in 1997) from more than eighty fields.
History
Shell started business in Nigeria in 1937 as Shell D’Arcy. In 1938, the company was granted an exploration license. In 1956, Shell Nigeria discovered the first commercial oil field at Oloibiri in the Niger DeltaNiger Delta
The Niger Delta, the delta of the Niger River in Nigeria, is a densely populated region sometimes called the Oil Rivers because it was once a major producer of palm oil...
and started oil exports in 1958.
Shell Petroleum Development Company
Shell Petroleum Development Company (SPDC) is the largest fossil fuel company in Nigeria, which operates over 6000 kilometres (3,728.2 mi) of pipelinesPipeline transport
Pipeline transport is the transportation of goods through a pipe. Most commonly, liquids and gases are sent, but pneumatic tubes that transport solid capsules using compressed air are also used....
and flowlines, 87 flowstations, 8 natural gas plants and more than 1,000 producing wells. SPDC's role in the Shell Nigeria family is typically confined to the physical production and extraction of petroleum
Extraction of petroleum
The extraction of petroleum is the process by which usable petroleum is extracted and removed from the earth.-Locating the oil field:Geologists use seismic surveys to search for geological structures that may form oil reservoirs...
. It is an operator of the joint venture, which composed of Nigerian National Petroleum Corporation
Nigerian National Petroleum Corporation
The Nigerian National Petroleum Corporation is the state oil corporation through which the federal government of Nigeria regulates and participates in the country's petroleum industry.-History:...
(55%), Shell (30%), Total S.A.
Total S.A.
Total S.A. is a French multinational oil company and one of the six "Supermajor" oil companies in the world.Its businesses cover the entire oil and gas chain, from crude oil and natural gas exploration and production to power generation, transportation, refining, petroleum product marketing, and...
(10%) and Eni
Eni
Eni S.p.A. is an Italian multinational oil and gas company, present in 70 countries, and currently Italy's largest industrial company with a market capitalization of 87.7 billion euros , as of July 24, 2008...
(5%). Until relatively recently. it operated largely onshore on dry land or in the mangrove swamp.
Shell Nigeria Exploration and Production Company
Shell Nigeria Exploration and Production Company (SNEPCO) was established in 1993. It operates two offshore licenses, including for the Bonga FieldBonga Field
The Bonga Field is an oilfield in Nigeria. It was located in License block OPL 212 off the Nigerian coast, which was renamed OML 118 in February 2000. The field covers approximately 60 km2 in an average water depth of . The field was discovered in 1996, with government approval for its...
.
Shell Nigeria Gas
Shell Nigeria Gas (SNG) was established in 1998 for Shell Nigeria natural gas activities and natural gas transmission system operation.Shell Nigeria Oil Products
Shell Nigeria Oil Products (SNOP) was incorporated in 2000 for developing the market for Shell branded products and services, such as fuels, chemicals and lubricants.Nigeria Liquified Natural Gas
Nigeria LNG (NLNG) is a joint venture for liquefied natural gasLiquefied natural gas
Liquefied natural gas or LNG is natural gas that has been converted temporarily to liquid form for ease of storage or transport....
production. Shell has a share of 25.6% in this company and is also its technical adviser. Other partners are Nigerian National Petroleum Corporation (49%), Total (15%) and Eni (10.4%).
Human rights controversies
In the 1990s tensions arose between the native Ogoni people of the Niger DeltaNiger Delta
The Niger Delta, the delta of the Niger River in Nigeria, is a densely populated region sometimes called the Oil Rivers because it was once a major producer of palm oil...
and Shell. The concerns of the locals were that very little of the money earned from oil on their land was getting to the people who live there, and the environmental damages caused by Shell's practices. In 1993 the Movement for the Survival of the Ogoni People
Movement for the Survival of the Ogoni People
The Movement for the Survival of the Ogoni People is a campaigning organization representing the Ogoni people. Ogoniland is situated north-east of Niger Delta...
(MOSOP) organized large protests against Shell and the government, often occupying the refineries. Shell withdrew its operations from the Ogoni areas. The Nigerian government raided their villages and arrested some of the protest leaders. Some of these arrested protesters, Ken Saro-Wiwa
Ken Saro-Wiwa
Kenule "Ken" Beeson Saro Wiwa was a Nigerian author, television producer, environmental activist, and winner of the Right Livelihood Award and the Goldman Environmental Prize...
being the most prominent, were later executed, against widespread international opposition from the Commonwealth of Nations
Commonwealth of Nations
The Commonwealth of Nations, normally referred to as the Commonwealth and formerly known as the British Commonwealth, is an intergovernmental organisation of fifty-four independent member states...
and human rights
Human rights
Human rights are "commonly understood as inalienable fundamental rights to which a person is inherently entitled simply because she or he is a human being." Human rights are thus conceived as universal and egalitarian . These rights may exist as natural rights or as legal rights, in both national...
organisations.
Shell maintained that it asked the Nigerian government for clemency towards those found guilty but that its request was refused. A 2001 Greenpeace
Greenpeace
Greenpeace is a non-governmental environmental organization with offices in over forty countries and with an international coordinating body in Amsterdam, The Netherlands...
report claimed that "two witnesses that accused them later admitted that Shell and the military had bribed them with promises of money and jobs at Shell. Shell admitted having given money to the Nigerian military...". Shell denied these accusations and claimed that MOSOP was an extortionary movement that advocated violence and secession.
In December 2003, Shell Nigeria acknowledged that the conflict in the Niger Delta
Conflict in the Niger Delta
The current conflict in the Niger Delta arose in the early 1990s over tensions between the foreign oil corporations and a number of the Niger Delta's minority ethnic groups who felt they were being exploited, particularly the Ogoni and the Ijaw...
makes it difficult to operate safely and with integrity and that "we sometimes feed conflict by the way we award contracts, gain access to land, and deal with community representatives", and that it intends to improve on its practices. In 2009, Shell offered to settle the Ken Saro-Wiwa
Ken Saro-Wiwa
Kenule "Ken" Beeson Saro Wiwa was a Nigerian author, television producer, environmental activist, and winner of the Right Livelihood Award and the Goldman Environmental Prize...
case with US$15.5 million while denying any wrongdoings and calling the settlement a humanitarian gesture. According to the New York Times and the journalist Michael D. Goldhaber the settlement came days before the start of a trial in New York that was expected to reveal extensive details of Shell's and MOSOP's activities in the Niger Delta.
Oil spills
Rebels occasionally attack Shell Oil pipelines causing oil spills. On early 2011 Amnesty InternationalAmnesty International
Amnesty International is an international non-governmental organisation whose stated mission is "to conduct research and generate action to prevent and end grave abuses of human rights, and to demand justice for those whose rights have been violated."Following a publication of Peter Benenson's...
and Friends of the Earth International contested the claims by Shell that up to 98% of all oil spills in Nigeria were due to sabotage. The two groups filed a complaint against the company in the OECD. Under Nigerian law, Shell has no liabillity when spills are classified as result of sabotage. Soon after, Shell grilled by the Dutch Parliament and revised its estimates from 98% to 70%. It was the second time the company did such a large revision to its oil spill statistics.
Ejama-Ebubu spill case
In 1970 an oil spill occurred that affected 255 hectares and the Ejama-Ebubu community in the Rivers StateRivers State
Rivers State is one of the 36 states of Nigeria. Its capital is Port Harcourt. It is bounded on the South by the Atlantic Ocean, to the North by Imo, Abia and Anambra States, to the East by Akwa Ibom State and to the West by Bayelsa and Delta states...
. In July 2010 the Federal High Court of Nigeria set damages against Shell Petroleum Development Company of Nigeria Limited, SPDC, at 15.4 billion Nigerian naira
Nigerian naira
The naira is the currency of Nigeria. It is subdivided into 100 kobo.The Central Bank of Nigeria is the sole issuer of legal tender money throughout the Federation. It controls the volume of money supply in the economy in order to ensure monetary and price stability...
(about 100 million US dollars).