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Shell Files Arbitration Against Nigeria Over Spill Dispute

Shell Files Arbitration Against Nigeria Over Spill Dispute

William Clowes: Feb 13 2021, 7:57 PM Feb 13 2021, 10:38 PM

(Bloomberg) — Royal Dutch Shell Plc launched arbitration proceedings against the Nigerian government over a long-running community dispute.

The oil major’s Netherlands-registered holding company and a Nigerian unit filed a case at the World Bank’s International Centre for Settlement of Investment Disputes on Feb. 10, according to the Washington-based organization’s website. Shell brought its claim against Africa’s biggest crude producer under the bilateral investment treaty between the governments of the Netherlands and Nigeria, it said.

The decision follows the Anglo-Dutch energy giant’s unsuccessful efforts last year to reverse a court order instructing the company to pay compensation to a community for polluting its land. While the case’s victors say they are now owed more than 183 billion naira ($479 million), Shell contests that valuation and denies being responsible for the decades-old oil spill.

“Given the history of this particular case, we are seeking protection of our legal rights from an international tribunal,” a spokeswoman for Shell’s Nigerian subsidiary said in an emailed statement. She didn’t provide further details about the oil major’s case.

A spokesman for Nigerian Attorney General Abubakar Malami didn’t immediately respond to a request for comment.

Read more: Shell Oil Site Seized by Nigerian State Over Unpaid Damages

All of Shell’s appeals against the ruling have been dismissed, most recently by Nigeria’s Supreme Court in November.

The origin of the community’s grievance against Shell dates back to a rupture in one of the firm’s pipelines 50 years ago. The company blames the oil spill on “third parties” during a civil war that lasted from 1967 to 1970, and says the affected sites have been cleaned up.

Shell operates the oil block at the heart of the dispute, which is known as Oil Mining Lease 11, in a joint venture with the NNPC, Total SE and Eni SpA.

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