5 Things You Should Know About The Bodo Community And Their $83 Million Shell Compensation

VENTURES AFRICA – Under-fire oil giant, Royal Dutch Shell, has finally reached an agreement with the Bodo community in Nigeria’s Niger Delta region, to pay $83.4 million in compensation for two oil spills in 2008. The community had dragged the Holland head-quartered company to a UK court over two pipeline spills resulted that it said caused the leakage of thousands of barrels of oil.
5 Things You Should Know About The Bodo Community And Their $83 Million Shell Compensation
The case has propelled the formerly little-known community to global attention, as well as set a precedence for industry behaviour of oil exploration companies in Nigeria and across Africa. So here are five things you should know about the community of fishers and farmers who just pulled off the greatest ever oil spill related compensation settlement in Nigeria.

The Bodo Community is part of Ogoni Land

The Bodo Community has an estimated 49,000 people spread across 35 villages in Gokhana, a Local Government Area of Rivers State, which is also one of the six kingdoms that make up Ogoni.
5 Things You Should Know About The Bodo Community And Their $83 Million Shell Compensation
The Ogoni people have had sustained disputes with Shell and the several Nigerian governments over resource control, oil exploration and environmental degradation of their land. One of the most famous Ogoni sons is Ken Saro Wiwa, a human and environmental rights activists who was the president of the Movement for the Survival of the Ogoni Peoples, MOSOP. The group began as a struggle against the exploitation of natural resources of Ogoniland by Royal Dutch Shell, when in 1957 its Nigerian operations, Shell Nigeria, known as Shell Petroleum Development Company of Nigeria Limited (SPDC), struck oil in the Niger River Delta. Saro Wiwa and eight other Ogoni chiefs were controversially executed in 1994 by the Abacha regime on highly disputed allegations of complicity in the murder of four Ogoni chiefs.

River State, where the Bodo community is located, accounts for more than 60 percent of the Nigeria’s crude oil output. However, agriculture continues to be the major employer of the state’s indigenes, especially in rural and oil producing areas like Bodo which is in its entirety a fishing and farming community. Oil Spills in Bodo and across Rivers State and the Niger Delta have drastically harmed agriculture in these communities. The Bodo Community estimates the 2008 oil spill at 500,000 barrels; Shell initially put the figure at about 4,000 barrels, although it subsequently accepted that the total may have been higher, but failed to provide a final figure.

It is the highest compensation ever paid in Nigeria

The $83.4 million agreed between shell and the Bodo community is the highest oil spill related compensation ever paid in the history of Nigeria, according to a Reuters report. Shell has in the past, paid several other compensation over oil and Niger Delta related issues.

In 2009 the company paid $15.5 million to the families of the Ken Saro Wiwa-led Ogoni nine executed by the Abacha regime. This was an out-of-court settlement brought to the United States District Court for the Southern District of New York by Saro Wiwa’s son on the charges of Shell’s accountability for alleged human rights violations in Nigeria. The company however, denies any liability for the deaths, stating that the payment was part of a reconciliation process. In a statement given after the settlement, Shell suggested that the money was being provided to the relatives of Saro-Wiwa and the eight other victims, to cover the legal costs of the case and also in recognition of the events that took place in the region.

The Bodo Community Actually Settled for less than 20 percent of their original Financial Demand

The $83.4 million which the Bodo Commnuity will get from Shell is $371.5 million, or 82 percent short of their original demand of $454.9 million. However, the community is also getting almost double the $45 million that the oil company had initially offered. 

Although Shell from the beginning admitted responsibility for the oil spill and sought a mediated settlement, disagreements over compensation delayed a resolution and eventually leed to the community filing a case against the London-listed company in a UK high court.

According to Reuters news agency, Leigh Day, the British law firm representing the community says the locals, mainly fishermen, have lost up to $454.9 a year each on average since the spills. That would amount to $2729.4 per person’s loss (calculated by the 15,60 persons been compensated). Given that the individuals of the community will get $3,249 each in compensation, it is quite a bargain, at least for the loss in their businesses.

For the first time, compensation will be paid directly to individuals

The compensation been paid to the Bodo community is split into two; $53.1 million will be shared evenly between 15,600 Bodo individuals and the remaining $30.3 million set aside in a trust fund for projects such as health clinics and schools. This is the first time a compensation will be paid directly to the individuals of a community in Nigeria.
5 Things You Should Know About The Bodo Community And Their $83 Million Shell Compensation
Previous oil spill and Niger Delta related compensations have often gone through community chiefs. These have often created quarrels and allegations of embezzlement by the people who often claim the money does not get to them. The community’s lawyer Martyn Day told Reuters the money will go directly to the bank accounts of the 15,000 plus individuals, hopes it will be a model for future claims.

Shell Does Not Produce Oil in Bodo Community
Shell, as the SPDC, started operations in Ogoni land in 1958 as is the operator of a joint venture between government-owned Nigerian National Petroleum Corporation – NNPC (55%), SPDC (30%), Total E&P Nigeria Limited (10%) and Nigerian Agip Oil Company (5%).
5 Things You Should Know About The Bodo Community And Their $83 Million Shell Compensation
But in 1993, Shell stopped oil and gas exploration and production operations in Bodo and Ogoniland as a whole citing a rise in violence, threats to staff and attacks on facilities. Since then, the company has not produced any oil or gas in the area and claims that even its access to the infrastructures it owns there has been limited. However, one of the Niger Delta’s main pipelines – the Trans-Niger Pipeline (TNP) – passes through Ogoniland, and Bodo community.

In the claims filed against Shell, the Bodo community states that oil pipelines operated by Shell “traverse” its land, creek and waterways. It said the pipelines transport oil to the Bonny Crude Oil Export Terminal on Bonny Island which the company operates. The community blames leakages from rusted and corroded pipelines for the high vulnerability of the land to oil spills. Shell affirms it has five non-producing fields and a network of about 100 wells and associated infrastructure in the region.

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