Shell Plc files appeal against $2 billion decision in Nigerian environmental lawsuit

Royal Dutch Shell Plc’s appeal to reverse a nearly $2 billion verdict against the firm for allegedly leaking oil in Nigeria will be heard by a Nigerian court. 

The energy behemoth is appealing a November 2020 ruling in favor of neighborhood residents who believe a business pipeline spill harmed their property and waters. According to a lawyer for the plaintiffs, a federal court of appeal in the city of Owerri will hear petitions from both parties on Jan. 25.  

In January 2020, farmers from the Ejalawa village in Rivers State sued Shell and its joint venture partner, the state-owned Nigerian National Petroleum Company. Shell’s abandoned flow line began pouring a “significant volume of crude oil” in September 2019, causing environmental damage, according to a court judge. 

The court ruled that the 88 plaintiffs were entitled to compensation in the amount of 800 billion naira ($1.92 billion), and Shell was ordered to clean up the mess. The amount is far greater than any prior reparations granted by Nigerian courts to inhabitants of the crude-producing region for land degradation.  

In his November 2020 judgement, Justice Tijjani Ringim noted, “I am satisfied that the amount of compensation demanded is a result of the catastrophic harm to the plaintiffs’ land.” 

According to the judgement, Shell and the NNPC dispute that spill happened on the specified dates and contend that the allegation against them is “unsubstantiated, unclear, and overblown.” They also argued unsuccessfully that the judge should not award damages since numerous mandatory processes were not completed, including a joint examination of the alleged leak and a volume estimate.  

It might take years for these conflicts to be resolved. Shell agreed in August to pay 46 billion naira to another town in Rivers State to settle a lawsuit filed more than three decades earlier, but it disputed culpability for the pipeline break at the core of the case.