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Shell appeals against N800bn oil spill judgment

Aradel Holding confirms Shell acquisition deal

Shell Petroleum Development Company (SPDC) has filed an appeal against a judgment of an Owerri High Court that ordered it to pay N800 billion compensation to a community in Rivers State over a purported oil spill.

SPDC and the Nigerian National Petroleum Corporation (NNPC) in the appeal with Appeal No: CA/OW/489/2020, filed at the Owerri division of the Court of Appeal on March 21, asked the Court to nullify the ruling of the lower court.

Following the judgment granted in January, the judgment creditors, one Isaac Obor-Ntito Torchi and 87 others, from the Ejalawa community where an oil spill allegedly occurred, procured an order for the detention of the principal officers of Shell on the charge of contempt for allegedly disobeying the court order to pay the judgment debt as well as seize their passports to purportedly bar them from evading arrest.

Legal analysts expect the case to get the Supreme Court regardless of the outcome of the appeal.

On November 27, 2020, Justice T. G. Ringim of the Federal High Court, Owerri, Imo State, ruled that SPDC, Shell International Exploration and Production Company, and the Nigerian National Petroleum Corporation (NNPC) were liable for oil spillage from their facility in Ejalawa community in Oken-Ogosu swamp farmlands in Egbalor of Ebubu/Eleme Local Government Area of Rivers State.

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The ruling was delivered on the suit brought by a local community leader, Isaac Torchi, and 87 members of the Ejalawa community against SPDC, SIE&P BV, and NNPC dated January 16, 2020, over oil spillage which they claimed damaged their environment as well as a source of livelihood.

Other defendants are Shell International Company Limited and the Attorney General of the Federation (AGF).

Delivering judgment, Justice Ringim held that there was evidence of rupture at the defendant’s Akuka/Ebubu flow line named AKA-EBU- ONU-BAN 55 situated in the plaintiff’s land.

According to the judge, there was convincing evidence that the narrow diameter 4-inch pipes laid by the defendants in 1970 and which had a lifespan of 15 years and which was suspended above the earth were abandoned by the defendants, adding that the abandoned 4-inch pipes ruptured and spilled large volume of crude oil into the Oken-Ogosu swamps/farmlands.

SPDC and other defendants appealed the judgment of the Federal High court asking for a stay at the Court of Appeal, Owerri Division on January 25, 2022.

The defendants denied the occurrence of spills on the alleged dates before the court. They further argued that the court was duty-bound to hear evidence to determine, first, if the spill occurred and the alleged cause before proceeding to fix liability and compensation, which they said, didn’t happen in the case.

SDPC’s legal team stated that the pollution claim was largely unsubstantiated and that the purported evidence presented by the plaintiffs was not subjected to the appropriate legal scrutiny.

On February 24, the appeal court said it would rule on a later date and on March 11, the Appeal Court in Owerri ordered Shell to deposit the judgment sum in a court-controlled account within two working days effectively halting divestments plans of Shell.