Shell Nigeria is the colloquial name for Royal Dutch Shell's Nigerian operations carried out through four subsidiaries—primarily through Shell Petroleum Development Company of Nigeria Limited (SPDC). Royal Dutch Shell accounts for more than 40% of Nigeria's total petroleum production (899,000 barrels per day (142,900 m3/d) (bpd) in 1997) from more than eighty fields.
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Shell started business in Nigeria in 1937 as Shell D’Arcy. In 1938, the company was granted an exploration license. In 1956, Shell Nigeria discovered the first commercial oil field at Oloibiri in the Niger Delta and started oil exports in 1958.
Shell Petroleum Development Company (SPDC) is the largest fossil fuel company in Nigeria, which operates over 6,000 kilometres (3,700 mi) of pipelines and flowlines, 87 flowstations, 8 natural gas plants and more than 1,000 producing wells. SPDC's role in the Shell Nigeria family is typically confined to the physical production and extraction of petroleum. It is an operator of the joint venture, which composed of Nigerian National Petroleum Corporation (55%), Shell (30%), Total S.A. (10%) and Eni (5%). Until relatively recently. it operated largely onshore on dry land or in the mangrove swamp.
Shell Nigeria Exploration and Production Company (SNEPCO) was established in 1993. It operates two offshore licenses, including for the Bonga Field.
Shell Nigeria Gas (SNG) was established in 1998 for Shell Nigeria natural gas activities and natural gas transmission system operation.
Shell Nigeria Oil Products (SNOP) was incorporated in 2000 for developing the market for Shell branded products and services, such as fuels, chemicals and lubricants.
Nigeria LNG (NLNG) is a joint venture for liquefied natural gas production. Shell has a share of 25.6% in this company and is also its technical adviser. Other partners are Nigerian National Petroleum Corporation (49%), Total (15%) and Eni (10.4%).
In the 1990s tensions arose between the native Ogoni people of the Niger Delta and Shell. The concerns of the locals were that very little of the money earned from oil on their land was getting to the people who live there, and the environmental damages caused by Shell's practices.[1] In 1993 the Movement for the Survival of the Ogoni People (MOSOP) organized large protests against Shell and the government, often occupying the refineries. Shell withdrew its operations from the Ogoni areas. The Nigerian government raided their villages and arrested some of the protest leaders. Some of these arrested protesters, Ken Saro-Wiwa being the most prominent, were later executed, against widespread international opposition from the Commonwealth of Nations and human rights organisations.[2]
Shell maintained that it asked the Nigerian government for clemency towards those found guilty but that its request was refused. A 2001 Greenpeace report claimed that "two witnesses that accused them later admitted that Shell and the military had bribed them with promises of money and jobs at Shell. Shell admitted having given money to the Nigerian military...".[3] Shell denied these accusations and claimed that MOSOP was an extortionary movement that advocated violence and secession.[4]
In December 2003, Shell Nigeria acknowledged that the conflict in the Niger Delta makes it difficult to operate safely and with integrity and that "we sometimes feed conflict by the way we award contracts, gain access to land, and deal with community representatives",[5] and that it intends to improve on its practices.[6] In 2009, Shell offered to settle the Ken Saro-Wiwa case with US$15.5 million while denying any wrongdoings and calling the settlement a humanitarian gesture. According to the New York Times and the journalist Michael D. Goldhaber the settlement came days before the start of a trial in New York that was expected to reveal extensive details of Shell's and MOSOP's activities in the Niger Delta.[4][7]
Rebels occasionally attack Shell Oil pipelines causing oil spills.[8] On early 2011 Amnesty International and Friends of the Earth International contested the claims by Shell that up to 98% of all oil spills in Nigeria were due to sabotage.[9] The two groups filed a complaint against the company in the OECD. Under Nigerian law, Shell has no liabillity when spills are classified as result of sabotage.[10] Soon after, Shell grilled by the Dutch Parliament and revised its estimates from 98% to 70%. It was the second time the company did such a large revision to its oil spill statistics.[11]
In 1970 an oil spill occurred that affected 255 hectares and the Ejama-Ebubu community in the Rivers State.[12] In July 2010 the Federal High Court of Nigeria set damages against Shell Petroleum Development Company of Nigeria Limited, SPDC, at 15.4 billion Nigerian naira[12][13] (about 100 million US dollars).
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