Shell to pay out $83 million to settle Nigeria oil spill claims

Royal Dutch Shell will pay out $83.4 million in compensation for two oil spills in Nigeria in 2008 after agreeing a settlement with the affected community. The largest ever out-of-court settlement relating to oil spills in Nigeria is a step forward for the oil-rich Niger Delta region that has been hit by regular environmental damage, but it is tiny compared with the billions in compensation and fines BP had to pay after the Macondo rig disaster in the Gulf of Mexico in 2010. Though significantly higher than the 30 million pounds Shell had previously said it would be willing to pay, its deal is a fraction of the 300 million pounds-plus originally sought by the Bodo community in the Niger Delta.

From the outset, we’ve accepted responsibility for the two deeply regrettable operational spills in Bodo.

Mutiu Sunmonu, managing director of Shell Petroleum Development Co, the oil major’s Nigerian joint venture

The payment will be split, with $52 million shared evenly between 15,600 Bodo individuals and the remaining $30 million set aside in a trust fund for projects such as health clinics and schools, said Martyn Day, senior partner at Leigh Day, the British law firm acting for the community. The individuals will each receive $3,249, in the first such case to pay compensation directly to individual community members, Day said.

It’s very unusual to have thousands benefit. The money will go directly to their bank accounts and this will hopefully be a model for future claims.

Martin Day, senior partner at Leigh Day law firm

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