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Shell Nigeria appeals in Bonny land rights dispute

Reuters

Wed Oct 15, 2008 11:29am EDT

By Nick Tattersall

LAGOS, Oct 15 (Reuters) – Royal Dutch Shell (RDSa.L: QuoteProfileResearch,Stock Buzz) said on Wednesday it had appealed against a Nigerian court ruling in favour of community elders who challenged its land rights for the Bonny oil export terminal in the restive Niger Delta.

A court in Bori, in the southern Rivers State, earlier this year found in favour of local elders who disputed the right of the Shell Petroleum Development Company (SPDC) — a joint venture with the Nigerian state — to use the land at Bonny.

“Judgement was given against the SPDC joint venture in July 2008 at the High Court in Bori, Rivers State, in a case brought by two Bonny families and the Bonny Council of Chiefs over the Bonny Terminal land issue,” a Shell spokeswoman said.

“We are of the view that the judgement was erroneous. We have since filed an appeal,” said Caroline Wittgen, a spokeswoman for Shell in Nigeria, giving no further comment.

Foreign investors say Nigeria ranks among the most litigious and bureaucratic business environments in the world. Legal disputes commonly take years to settle, usually becoming bogged down in a tangle of counter-claims and appeals.

Industry sources said the dispute over Bonny had had no impact on operations at the terminal and was not likely to do so in the immediate future because Shell’s appeal meant the legal process continued.

The Niger Delta is home to Africa’s biggest oil and gas industry but residents in some of the polluted villages nestled in its labyrinthine mangrove creeks have seen little benefit from five decades of oil extraction.

Armed groups, some of whom say they are fighting for a greater share of the natural wealth in the region, have blown up pipelines and attacked industry installations, cutting output by around a fifth over the past two years.

Shell has been the hardest hit by the latest unrest. Six days of attacks last month forced it to declare force majeure on shipments from Bonny, meaning it may not be able to meet all of its contractual export obligations.

Security experts say the gangs are mostly part of a criminal mafia whose real motivation is protecting a lucrative trade in stolen crude, worth millions of dollars a day. (For full Reuters Africa coverage and to have your say on the top issues, visit: africa.reuters.com/ )

 

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