Shell May Re-evaluate Oil Operations Onshore Nigeria

Persistent issues with theft and sabotage in the Niger Delta could prompt Shell to take a hard look at its operations onshore Nigeria, the supermajor’s chief executive Ben van Beurden said this week.

“Our onshore oil position, despite all the efforts we put in against theft and sabotage, is under challenge,” van Beurden told reporters, as carried by Reuters, after Shell reported another set of weak Big Oil results affected by the pandemic. 

“But developments like we are still seeing at the moment mean that we have to take another hard look at our position in onshore oil in Nigeria,” Shell’s top executive added.

Shell has been flagging for years problems with crude oil theft on its pipeline network onshore Nigeria.

Last week, The Hague Court of Appeal ordered Shell to compensate Nigerian farmers for two oil spills in the country 13 years ago, in the first lawsuit in which a company has been held liable in the Netherlands for its actions abroad.

The ruling of the Dutch court is setting a precedent for future lawsuits brought against oil firms in the countries where they are based, instead of the countries where oil spills or oil pollution has allegedly taken place.

Shell, for its part, continues to say that the spills were the result of sabotage, which has been frequent in the Niger Delta in Nigeria.

“We continue to believe that the spills in Oruma and Goi were the result of sabotage. We are therefore disappointed that this court has made a different finding on the cause of these spills and in its finding that” the Nigerian unit of Shell is liable, the Anglo-Dutch major said in a statement, as carried by Bloomberg.

“Sabotage, crude oil theft and illegal refining are a major challenge in the Niger Delta,” Shell noted.

By OPC Markets

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