More than 1,216 residents from the host communities have filed a N500 billion claim against Shell Petroleum Development Company, alleging a violation of an existing “Mareva” injunction and seeking to halt the sale of its onshore assets.
The communities were represented by Mr. Mohammed Ndarani, a Senior Advocate of Nigeria (SAN).
The case, filed at the Federal High Court in Abuja under case number FHC/ABJ/CS/1300/2024, follows a reported $2.8 billion divestment deal between Shell Petroleum Development Company Limited and a consortium of Nigerian organizations.
The host communities are contesting the transaction, claiming it violates a subsisting Mareva injunction issued by the Federal High Court in Akure on September 28, 2023.
The injunction had restrained Shell from disposing of its Nigerian assets until the case is resolved. The communities allege that the recent deal between Shell and Renaissance constitutes a clear breach of this order.
The claimants, represented by Mr. Mohammed Ndarani (SAN), are seeking a perpetual injunction to prevent Shell, Renaissance, and any other potential investors from entering into further negotiations to dispose of the assets in question.
They have also requested the court to order Shell to pay N500 billion in damages and an additional N5 billion for legal costs within 48 hours of the judgment. The host communities, primarily fish farmers, claim to have suffered significant property losses due to frequent oil spills from ruptured pipelines owned by Shell.
Backstory
In January, Shell agreed a divestment deal, valued at $1.3 billion with an additional $1.1 billion in potential payments tied to receivables and cash balances, involves Renaissance, a consortium of ND Western, Aradel Energy, First E&P, Waltersmith, and Petrolin.
Opposition to Shell’s sale of onshore assets
However, the deal has generated opposition from civil society groups and communities blaming Shell for seeking to abandon its responsibilities to clean up the Niger Delta region where it operated for around 50 years.
Prominent among them is Amnesty International and other civil society groups who are urging the Nigerian government to halt Shell Plc’s proposed sale of its onshore oil operations in the country.
The Centre for Research on Multinational Corporations (SOMO) argues that Shell should not be permitted to divest from the Niger Delta until it addresses its responsibility for cleaning up its legacy of pollution and ensuring the safe decommissioning of abandoned oil infrastructure.
SOMO’s report emphasizes a concerning lack of transparency around the financing for decommissioning activities. While Nigerian law requires companies to allocate funds for decommissioning, it remains unclear whether any significant amount has been set aside for this purpose.
