This article was written in May 2012
Shell is the foremost operator in the oil and gas sector in Nigeria. Indeed, at the time it got a license to explore and exploit petroleum resources in Nigeria in 1937, the entire Nigerian nation constituted its concession. Over the years, the company has built a solid reputation of being foremost not in the span and breadth of its operations but in the abridgement of rights, including environmental pollution bordering on ecocide. Creeks, rivers and streams are constantly polluted by oil spills from aged pipelines and faulty equipment. Routine gas flares, illegal since 1984, pump toxic elements into the atmosphere, choking and poisoning the impoverished local people.
Spills don’t hide: The case of Ogoni
The release of the Assessment of the Environment of Ogoniland by the United Nations Environment Programme (UNEP) on 4 August 2011 marked a crucial turning point in the degradation history of the Niger Delta. The report is a scorecard on Shell’s activities in Nigeria and reminds the world particularly about the company’s ignoble role not just in the decimation of the Ogoni environment but in the massive human rights abuses in the territory that culminated in the execution of Ken Saro-Wiwa and other Ogoni leaders – Sunday Dobee, Nordu Eawo, Daniel Gbooko, Paul Levera, Felix Nuate, Baribor Bera, Barinem Kiobel and John Kpuine on 10 November 1995.
UNEP affirmed that pollution is widespread and not merely occasional in Ogoniland, reporting that all water bodies in Ogoniland are polluted with hydrocarbons. Hydrocarbons reached groundwater at 41 sites and in one place the groundwater that serves local wells was found to have a layer of up to 8cm of oil on it.
The report also revealed that benzene, a known carcinogen, is found in drinking water at a level 900 times above WHO standards. Benzene was also found in some air samples in the area. Generally, hydrocarbons were found at levels 1,000 times above Nigerian drinking water standards. UNEP warned that most of the people in Ogoni have been exposed to chronic oil pollution throughout their lives, with soils polluted with hydrocarbons up to a depth of 5 metres in 49 observed places.
The report also confirmed that Shell failed to meet the minimum requirements of the Environmental Guidelines and Standards for the Petroleum Industries in Nigeria (EGASPIN), failed to operate according to international standards and failed even to meet its own minimum operational standards. These all show that the oil mogul thrives on double standards in their operations in Ogoniland and, it bears saying, all their areas of operation in Nigeria. Shell ought to be sanctioned and its licence revoked for flouting the laws of the land.
Transparency claims vs reality
Shell would like us to believe it has now turned over a new leaf. In its Sustainability Report 2011, Shell’s chief executive, Peter Voser, makes the following declaration: ‘We believe transparency in our operations helps build trust. In Nigeria, for example, the Shell Petroleum Development Company (SPDC) launched a website in 2011 that enables people to track details of oil spills at its facilities, whether from operations or due to sabotage or theft, and how it deals with them.’ But these transparency claims require interrogation.
The major spill that Shell reported in 2011 occurred at their offshore Bonga Floating Production, Storage and Offloading (FPSO) platform. The spill occurred on 20 December 2011 and Shell made eight updates, but provided no definitive independent report on the cause of the incident. The report ought to have been issued after a team of stakeholders including Shell, government agencies and community representatives would have made a Joint Inspection Visit (JIV) to the site of the incident. Till date no such report has been seen in public.
The Bonga FPSO is situated about 120 kilometres offshore and floats on one-kilometre-deep ocean water. The deepwater facility is susceptible to high risks, as ocean waves and other events can easily result in catastrophic incidents— comparable to BP’s Macondo field platform that exploded in April 2010 in the Gulf of Mexico.
The Bonga spill occurred while a vessel was being loaded with crude oil. As it happened, the operators were busy pumping crude oil into the ocean rather than into the vessel. Shell deployed chemical dispersants in fighting the spill. There has been no word as to what those chemicals were and what impacts they may have on the ocean ecosystem and the food chain.
Shell claims that 40,000 barrels were dumped into the ocean before they stemmed the flow. With a history of underestimates, that figure is not trusted.
A test case of Shell’s transparency claim is the spills at Bodo in Ogoni, which occurred in 2008/2009. While Shell says that a mere 1,640 barrels of crude were spilled, Amnesty International puts the figure at between 103,000 and 311,000 barrels. An expert, Prof Richard Steiner, estimates the volumes of crude spilled at between 250,000 and 350,000 barrels  in a lawsuit filed by the local community against Shell, the figure put forward is 600,000 barrels.
Another example of Shell’s lack of transparency in Nigeria is the question of how much oil is being extracted daily. Audits by the Nigerian Extractive Industries Transparency Initiative (NEITI) reveal that Shell and other oil operators in Nigeria do not provide the Nigerian State with information as to the actual volume of crude oil or gas pumped out of the wells in the oil fields of the Niger Delta. Thus when Nigeria is said to produce between 2.4 million to 2.6 million barrels of crude oil a day, that figure represents the volume of crude oil officially accounted for at the distribution points. What happens between the wells and the distribution points is sheer mystery.
Figures put forward for daily crude oil losses in Nigeria range from 130,000 barrels to 300,000 barrels a day. The highest estimate is one that says that as much as is officially accounted for may actually be stolen on a daily basis. With this level of opacity, it is quaint for Shell to claim any level of transparency in the Nigerian oil and gas sector.
Stopping this yawning black hole should be easy through the installation of meters by which independent measurements can be made, but resistance has been reported:
There are allegations that high-level official corruption, reportedly involving top government officials and some expatriate oil workers that work in concert with their Nigerian counterparts who compromise themselves for financial gratification, are central to the problem.
Gas flares, carbon pollution and political control
According to the World Bank, gas flaring decreased in 2009 in Nigeria from 21.3 billion cubic metres to 15.2 billion cubic metres. Shell however admits that in 2010 their flares went up 33 percent over their 2009 figure.
Shell claims to have reduced its carbon emissions to 6.1 million tonnes of CO2 equivalent, and that non-routine flaring at upstream facilities accounted for 35 per cent of their gas flaring in 2011 while the remaining 65 per cent was flared due to lack of equipment to capture the gas produced with oil. They added the untenable claim that the ‘Nigeria, where the security situation and lack of government funding has previously slowed progress on projects to capture the gas.’ Yet Shell has in the past asserted that they flare gas because doing so became standard industry practice from the early years of oil extraction due to lack of domestic demand for the gas. We note that security concerns do not stop Shell from extracting crude oil. It only stops them from stopping routine gas flaring.
Meanwhile, Shell is actively blocking reform in the oil and gas sector. When the Nigerian government broached the idea of a new oil sector bill, Shell’s then Vice-President for Sub-Saharan Africa, Ann Pickard, warned that the oil company would not accept any law that is against the interest of the company. WikiLeaks subsequently revealed that Shell had intelligence to share on militant activities as well as on business competition in the Niger Delta. The leaked cables also revealed that Shell knows how leaky the Nigerian government is. Shell’s Pickard is quoted as saying to the US ambassador that ‘the GON [government of Nigeria] had forgotten that Shell had seconded people to all the relevant ministries and that Shell consequently had access to everything that was being done in those ministries.’
At the time of writing, a former Shell director sits as the Minister of Petroleum in Nigeria. Shell may not need small fries to snoop and scan pages from that Ministry’s bulging filing cabinets. They may not have to rely on low-level officials with tape recorders concealed in pens, tie clips, belt buckles, eyeglasses or cufflinks to record meetings and send transcripts to them. Now they may have copies of whatever document they want forwarded directly as a matter of routine.
Spilling and running
Shell’s spilling spree has not let up. At the same time the company is engaging in sales of its oil acreages in the Western Niger Delta area. Oil watchers wonder whether the company may be trying to divert attention from the real issue of the consequences of the environmental degradation that they have caused in the area.
The company has opted to move into the deeper offshore where there would be less oversight so that they can pollute without having to contend with watchful local communities. Some analysts have speculated that companies such as Shell are indicating that they may one day quit the Nigerian fields altogether and they do not wish to be saddled with liabilities.
In the meantime, the sales of the fields will not reduce the central role ofShell in Nigeria’s oil fields. Shell owns the crude handling facilities, and so would still be some kind of landlord, standing at the crude evacuation gate and reaping the benefits because the crude handling tariff is a crucial part of an operator’s economics. The company is simply moving into a new level of exploitation where smaller companies take the flack while they continue to profit.
The regime of pillage and destruction goes on. Nothing has changed, except the language and layout of Shell’s websites. A visit to Nigeria’s impacted communities reveals that they are now little more than empty shells of their former selves.
- No longer available online ↵
- Shell. Sustainability Report 2011. http://reports.shell.com/sustainability-report/2011/introduction.html (accessed 7 June 2016) ↵
- Production resumes at Bonga and EA. http://www.shell.com.ng/home/content/nga/aboutshell/media_centre/news_and_media_releases/2012/bonga_01052012.html (accessed 7 June 2016) ↵
- Prof Steiner quoted in Nnimmo Bassey (2012) To Cook a Continent – Destructive Extraction and the Climate Crisis in Africa, Oxford, Pambazuka Press,. p 82 ↵
- The Punch (24 April, 2012). N’Delta oil spill worse than Shell admits – Amnesty International http://www.nigerianbestforum.com/index.php?PHPSESSID=f3ee90497eb1b6362255eb723427583d&topic=162539.0;nowap ↵
- The Vanguard (22 February 2011) Nigeria’s crude oil production rises to 2.6 million barrels Daily – FG. http://www.vanguardngr.com/2011/02/nigeria’s-crude-oil-production-rises-to-2-6m-barrels-daily-fg/ (accessed 7 June 2016) ↵
- Editorial (20 July 2011 ) Nigeria’s Crude Oil Thefts. Daily Sun http://www.sunnewsonline.com/webpages/opinion/editorial/2011/july/20/editorial-20-07-2011-001.html (accessed 7 June 2016) ↵
- Ojo, Eric (12 November 2009) Bankole laments illegal oil bunkering in Niger Delta – Challenges security agencies on leakages in public funds, Business Day, Lagos; Mark Tran (29 July 2004) Shell fined over reserves scandal. The Guardian, London http://www.guardian.co.uk/business/2004/jul/29/oilandpetrol.news (accessed 8 June 2016) ↵
- Non-Metering of Oil Wells. 23 September 2011. http://www.thenigerianvoice.com/nvnews/70585/1/non-metering-of-oil-wells.html (accessed 7 June 2016) ↵
- Shell’s Sustainability Report 2011. p 29 ↵
- See So Shell is everywhere, Chapter 24, page 147 in this book. ↵