Finance

Shell battles Nigerian communities in high-stakes London lawsuit

A court in London will decide in coming weeks whether Royal Dutch Shell can face trial in the UK over oil spill allegations in Nigeria, a decision some legal experts predict could attract more cases against multinationals in Britain.

The High Court will judge whether members from two communities, Bille and Ogale in Nigeria’s oil-rich Delta region, can sue the Anglo-Dutch company in British courts.

The communities say Nigerian courts are unfit to hear the case against Shell subsidiary Shell Petroleum Development Company of Nigeria (SPDC). Shell says the case should be heard in Nigeria because the matter is “uniquely a Nigerian problem”.

Shell also denies responsibility for the spills, which it says were due to sabotage and illegal refining.

Some legal experts warned that a victory by the communities could encourage unscrupulous residents to let oil spills worsen at remote sites by denying clean-up access, as payouts are often linked to the scale of the damage.

“This case brings home the message that multinationals may increasingly face claims in the English courts arising from disputes which have little or no connection to England,” said Tom Cummins, a partner at law firm Ashurst.

The Bille and Ogale groups launched their claim just months after Shell agreed a 55 million pound ($68 million) settlement in 2015 with another Nigerian group, the Bodo community.

That case covered two pipeline leaks in 2008, which Shell accepted were its fault due to corrosion, and marked the largest ever out-of-court settlement relating to Nigerian oil spills.

 

For its part, the Nigerian government’s National Oil Spill Detection and Response Agency defended the effectiveness of the Nigerian court system, saying it had successfully sanctioned and sued several companies locally, including SPDC.

Source: Reuters

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