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EMAIL to Shell CEO Ben Van Beurden from the Niger Delta Peace Coalition (NDPC)  

EMAIL to Shell CEO Ben Van Beurden from the Niger Delta Peace Coalition (NDPC)  

From: Zik Gbemre <[email protected]>

Subject: ON SHELL REVEALED PLANS TO VACATE NIGER DELTA – THE REAL ISSUES

Date: 1 June 2021 at 11:13:46 BST

To: [email protected]” <[email protected]>, “[email protected]” <[email protected]>

Cc: [email protected]” <[email protected]>, “[email protected]” <[email protected]>, John Donovan <[email protected]>, “[email protected]” <[email protected]>

June 1, 2021.

Sir. Ben Van Beurden,

Chief Executive Officer (CEO),

Royal Dutch Shell,

Shell Headquarters,

Carel Van Bylandtaan 16,

2596 HR, The Hague,

P.O. Box 162, 2501AN,

The Netherlands.

Dear Sir,

ON SHELL REVEALED PLANS TO VACATE NIGER DELTA – THE REAL ISSUES 

  • With numerous challenges in the oil and gas exploration and production in the region, especially as regards security and oil theft, one may not be able to blame them for wanting to leave the region’s onshore… 
  • The oil companies are not philanthropic organizations, neither are they the government at all levels. But they are business enterprises that are aimed to maximize profit while adding value to their operating environment… 
  • The problems of illegal bunkering, pipeline vandalization, and their illegal refinery trade are networks of a well-organized crime and syndicate made up of high- and low-profile persons… 
  • This problem has persisted in the region because the issue of Integrity and earning an honest living, have been thrown away and replaced with GREED by some people… 

When I saw recent reports that Oil giant, Shell (SPDC) has said it intends to exit Nigeria, Africa’s leading crude oil producer’s onshore oil sector, as continuing operations in the country was no longer in tandem with its strategic investment interest, I could not blame them for wanting to leave the Niger Delta region. The Royal Dutch Shell’s CEO, Ben van Beurden, who made the decision known at the company’s annual general meeting recently, said he was in talks with the Nigerian government to work out how to exit its onshore licenses. Ben van Beurden, according to reports, explained that Niger Delta oil is no longer suitable for its business, adding that the incessant cases of oil theft and sabotage and spillage don’t fit with the organization’s risk appetite.

The truth is that challenges in the oil and gas exploration and production in the region are just too hectic for the oil companies to accommodate, especially if it wants to remain in business for long. As such, one may not blame them. And one thing many elites and the locals fail to realize is that the oil companies are not philanthropic organizations, neither are they government at all levels. But they are business enterprises that are aimed to maximize profit and also add value to the lives of their host communities, without having to lose so much in the process. It is the primary duty of the government at all levels to provide needed infrastructural development in local communities, and most importantly, enforce law and order that will guarantee the investments made by oil companies in the Niger-Delta region are secured. Where this is missing, or not properly attended to, it becomes a huge problem for the oil companies to sustain their business in such an unsure business environment.

To give us an idea of some of the challenges I am talking about, and what insiders of Shell think about this whole issue, here are portions of responses by former Managing Director/Country Chair of Shell (SPDC), Mutiu Sunmonu, from an Interview in the company’s Shell World magazine of 2010 edition:

When asked: Has there ever been a time during your 31 years in service that you’ve thought Shell should just pull out of Nigeria? Mutiu said: “I have never felt that Shell should pull out of Nigeria. In the last few years, people have become more aware of what government should do for them; there is an increasing level of poverty and we now have more youth in our society than we had some 50 years ago. There is a lot more information sharing among stakeholders and therefore they are demanding more from the government and, in the process, they are venting their anger and their frustration on oil companies, a major source of revenue to the government. But I can tell you these attacks are not against Shell. The attacks are really to call attention to themselves to ensure that their expectations, their desires, are heard at the right level of government. That should not be a reason for Shell to pull out. No, I believe, rather, that Shell should focus on what we can do to enable the people to get more from the wealth that we’re helping to create; play advocacy roles to see ways to improve capacity in governance.

We believe that the better the capacity in governance the more the benefits of democracy that people are expecting will actually be made accessible. I am confident that there is a lot of goodwill for Shell in this country. I was looking at the Shell Reputation Tracker results was pleasantly surprised at the amount of goodwill that exists in the country, in government, and among the general public about the role of Shell in Nigeria.”

Here is Mutiu’s response when it was noted that the theft of oil and condensate has now become part of the Nigerian economy, he said: “There was a time when the government was really focused on fighting crude oil and condensate theft and to a large extent they succeeded. In 2003 or 2004 it was very clear that crude oil theft was running over 100,000 barrels per day, but when the government moved in the scale went down dramatically.”

While there are several aspects and angles that have made the issue of crude/condensate theft a problem that has refused to go, however, we can conclusively say that there are Five aspects/angles which cover most of the activities and intricacies that have made the issue of illegal bunkering/pipeline oil/gas facilities vandalization and illegal refinery, a persistent problem in the Niger Delta region. It must be emphasized here again that “No single” act of illegal bunkering (sabotage of oil and gas pipelines), and illegal refinery activity can take place in any of the said local communities without the ‘active’ collusion/involvement/collaboration and cooperation of the Executive leaderships of the stated host communities concerned, and sometimes Security Operatives. No foreigner/outsider can easily go to the bush/creeks to sabotage pipelines for illegal bunkering/refinery activities without the active participation/involvement of some elements of the said Communities’ Executive leaders/locals.  As a matter of fact, the said host Communities’ Excos are obviously benefitting from this illegal trade, hence they allow them to use their land, creeks, and Jetty for these illegal businesses to thrive on a commercial scale.

Firstly, we believe that these pipeline vandals are being sponsored by some interest groups/persons whose trade and stock is to benefit from the whole illegal trade. The cost of creating/making a hot tap is close to N1million. This can only be afforded by a group of persons within the system that has the wherewithal to do so. Even some politicians and Community Opinion Leaders in the areas concerned, also sponsor and encourage this illegal trade in order for them to use the proceeds during elections in their favour. Hence, IT IS A WELL-ORGANIZED CRIME AND SYNDICATE OF HIGH- AND LOW-PROFILE PERSONS. These Five Groups include:

  • Spill Clean-up and Remediation Contractors who “create the opportunities” for pipelines/oil and gas facilities to be vandalized or spills to occur, so as to create jobs/contracts for themselves at the end of the day.
  • Contractors in the system who are responsible for Clamping/Repairs of Hot Taps/vandalized pipelines/oil and gas facilities. They, directly and indirectly, encourage the activities of illegal bunkerers and pipeline vandals so as to create jobs for themselves. Even the Welders & Fitters Association in the region are heavily involved in encouraging this illegal trade.
  • The Community Executives, Opinion Leaders, Chiefs, Local Politicians/Power brokers, Local Community Vigilantes, and host Community locals themselves who benefit from the whole illegal trade. Apart from the FTOs (Freedom To Operate), which the Community Executives benefit from the illegal bunkerers/pipeline vandals, they also benefit from every spill clean-up and remediation exercise within their communities. This is because the Spill Clean-up and Remediation Contractors are usually compelled/expected to employ their workforce from the local communities concerned. Even the Community Executives also share from the locals’ labour.
  • It has also been discovered that Communities’ Executives where any spill occurs, are very keen on “encouraging spills” to “spread” in the Communities as far as possible. So that when Spill Clean-up/Remediation Contractors are engaged, they will have the opportunity to provide more Labour they would benefit from. That is why whenever there is any spill in these Communities, they would rather keep quiet and pretend as if they are not aware, so as to allow the spill to spread as much as possible because the wider the spread, the more labour it would require to clean up, and the more opportunity for them to make more money.
  • Those whose focus is on “ILLEGAL REFINERY ACTIVITIES”. They use every available loophole and opportunity they can muster to create the flow/supply of stolen crude oil and condensate to their yards/mini-depots so as to continue their illegal business.
  • The Others, particularly those who are engaged in the sales of condensate and locally refined diesel to filling stations across the region, who in turn mix these petroleum products (e.g condensate and fuel, or condensate and kerosene) to sell in the Black Market or Filling Stations to unsuspecting costumers. Those who also encourage this aspect of the illegal trade are obviously the owners of filling stations. Some of the filling stations in and around the region are encouraging/directly/indirectly involved in this illegal trade. It is also believed that some of the Oil companies’ officials who are responsible for the award of Contracts, also encourage this illegal trade and are part of the problem here. In fact, the more occurrence of broken pipelines, the more contracts to be awarded by them for spill clean-ups/remediation and clamping/welding of pipes services.

Aside from the occurrence of Equipment Failures, we can see the sort of challenges as stated above, that oil companies have to contend with to address in running their business. If it was not for the proactive activities of few dedicated Surveillance Contractors in the OML 34 Right of Way, Ughelli South Area of Delta State as an example, the said areas would have been overrun by this illegal trade.  But thanks to the few dedicated Surveillance Contractors in these areas of OML 34 of ND Western/NPDC in Delta State, as an example, and the support of some Security Operatives and Personnel of the Operators there, they have been able to maintain a near 100% production output.

It is painful how Integrity has been thrown away and replaced with GREED by some people, who ought to be respected in their communities, or whose responsibilities it is to safeguard the Oil and Gas assets/facilities. It is also painful that some of the host community Surveillance Guards, who ought to protect Trunk lines, are the ones also involved in or encouraging this booming illegal bunkering trade.

It is no news that there are serious cost implications, as well as severe environmental ecocide and damage to our natural habitation, as a result of the problem of illegal bunkering and pipeline vandalization. There is also the severe cost of carrying out frequent repairs, clamping of broken/damaged pipelines/oil and gas facilities by oil companies, as well as the cost of executing Spill Clean-ups and Remediation Contracts to restore the natural environment. Then there is the NEGATIVE PUBLICITY that goes with these issues stated, all of which adversely affects the “public image” and public impression of the Operators in the region.

If we consider all of these, we would realize that the Federal Government of Nigeria, The NNPC/NPDC and the International Oil Companies (IOCs) like Shell, are all losing a whole lot of funds, which ought to be channeled to other areas of their operations. So, I don’t blame Shell for wanting to leave their Onshore operations to focus on deep Offshore I believe. But as noted by Mutiu Sunmonu, I believe there are still ways that the IOCs can address these issues without having to leave completely from the region. It is now left for the people of the region to realize themselves and adjust their ways, and also for the Government at all levels to play its part in providing security in the region.

Zik Gbemre.

National Coordinator                 

Niger Delta Peace Coalition (NDPC)

No.28, Opi Street, Ugboroke Layout, Effurun-Warri,

P.O. Box 2254, Warri, Delta State, Nigeria.

Tel:        +2348026428281

+2348052106013

Email: [email protected]c-zik.org, [email protected],

Website: www.ndpc-zik.org 

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