analysisBy Lagun Akinloye
A new Amnesty report claims that firms have been misrepresenting oil spills to avoid paying compensation. But this is just the tip of the iceberg of Nigeria's oil problems.
A new report from Amnesty International accuses oil companies, in particular Royal Dutch Shell, of failing to report the true nature of oil spills in the resource-rich Niger Delta.
The 80-page report, entitled 'Bad Information: Oil Spill Investigations in the Niger Delta', suggests that Shell has misrepresented the severity of spills and challenges the claim made by the oil major that the "vast majority" of spills that occur in the region are caused by sabotage and oil bunkering.
Instead, Amnesty insists that corroded pipelines, equipment failure and poorly-maintained infrastructure are to blame in many instances and claims that the process for recording and investigating spills is fundamentally flawed.
Oil companies themselves are amongst the primary investigators when there is a spill, and if the cause of the incident is deemed to be theft or sabotage, oil firms are not required to pay compensation.
Every year, hundreds of oil spills in the Niger Delta cause significant environmental damage, endanger local communities' health, and devastate local livelihoods, and Amnesty suggests that Shell may have misreported the causes and sizes of spills in order to avoid paying compensation and to protect its reputation.
"Shell is being disingenuous about the devastation caused by its Niger Delta operations. This new evidence shows that Shell's claims about the oil spills cannot be trusted," states Audrey Gaughran, Amnesty's Director of Global Issues, in a press statement. Shell's official investigation reports, she says, can be "very subjective, misleading and downright false".
Shell has responded to the report, saying it "firmly rejects unsubstantiated assertions," adding, "We seek to bring greater transparency and independent oversight to the issue of oil spills, and will continue to find ways to enhance this."
The Niger Delta region is one of the most diverse ecosystems on the planet, yet years of spills and gas flaring have devastated the environment and continues to put the lives of 31 million people at risk.
"The impact of oil spills on human health is enormous," says Nnimo Bassey, executive director of Environmental Rights Action in Nigeria, listing the possible effects as including "cancers, nervous problems, birth defects, breathing disorders, skin diseases and more."
"Damage to the land and water also impact agriculture and fisheries thereby harming the livelihoods of the people and the overall economy," he adds.
According to Amnesty's report, Shell has been responsible for 1,427 of these oil spills since 2007. The report also looks at the Nigerian Agip Oil Company, a subsidiary of the Italian company ENI, which, it claims, has been another persistent culprit. From the start of 2013 to the end of September, Agip recorded 471 spills compared to Shell's 138, though the volume of Shell's spills far exceeded Agip's at 16,000 barrels compared to Agip's 4,000.
Both companies attributed the vast majority of their spills to sabotage, but although Amnesty credits Shell with making its investigation reports into spills available online since 2011 - unlike Agip which provides "absolutely no information" to support its claims - the report points to gaping holes in the review process.
When there is a spill, a so-called Joint Investigation Visit (JIV) is conducted whereby members of the local community and government officials are supposed to examine the spill alongside oil company staff. However, Amnesty claims that government representatives often have little involvement leaving oil companies to be "judge and jury."
"This is a system that is wide open to abuse - and abuse happens," says Gaughran. "There is no one to challenge the oil companies and almost no way to independently verify what they say. In effect it's 'trust us - we're big oil."
Amnesty also worked with the US oil pipeline specialists Accufacts, who found cases in which spills attributed to sabotage were more likely to have been a result of pipeline corrosion, and who claim that a vast number of reports were "technically incomplete" while others "appear to be serving another agenda, more driven by politics... than pipeline forensic science."
Nigeria's oil sector accounts for approximately 80% of government revenue and 12.5% of the country's GDP. And in this industry, Shell is the biggest player, accounting for over 20% of the country's total petroleum production. This is despite the fact it has been a source of scandal and controversy for decades.
Shell's operations in the Niger Delta began in 1958, and the company has a long history of working closely with the Nigerian government to quell popular opposition to its presence. This culminated in 1995, under the regime of General Sani Abacha, when the so-called Ogoni Nine were executed by the state.
This group, led by Ken Saro-Wiwa, had been members of the Movement for the Survival of Ogoni People, an organisation protesting the environmental damage caused by oil extraction in the Niger Delta. On what are widely believed to have been trumped up charges, the nine were accused of the murders of four former leaders of the Movement.
They were tried in a military tribunal, found guilty and sentenced to death. The case is generally believed to have been politically-motivated, and Shell had close relations with Abacha's regime.
"Shell helped to propagate the suppression of communities against its malpractices and found the military regime of the day more than an able and willing partner," M. M. Yusif, a senior lecturer in political science at Bayero University, Kano, told Think Africa Press.
However, while Nigeria now has an electoral system of governance and although oil companies are under more international scrutiny today than 20 years ago, there is evidence to suggest that Shell's tentacles continue to permeate Nigeria's political scene.
A leaked cable from 2009, for example, revealed that Shell's vice-president for sub-Saharan Africa had told a US ambassador that the oil major had inserted personnel in all Nigeria's relevant ministries, giving it access to the government's every move.
Meanwhile, some believe there could be a conflict of interest in the fact that the current minister of petroleum, Diezani Alison-Madueke, cut her teeth at Shell in a decade-long career that saw her rise to become the company's first female executive director in Nigeria.
"As long as legislators and politicians continue to be compromised and controlled," says Yusif, "I foresee no real change in the oil sector."
Indeed, the Amnesty report is just the tip of the iceberg when it comes to challenges facing Nigeria's oil sector. Corruption at the highest echelons of power and amongst local chiefs is believed to be rife; oil is being stolen on a massive scale, with some estimates suggesting that oil bunkering costs Nigeria $8 billion a year; and the government's response to these endemic problems has typically been toothless.
Noo Saro-Wiwa, daughter of the best-known of the Ogoni Nine and author of Looking for Transwonderland: Travels in Nigeria, believes there has been some progress since 1995, but not a lot.
"Since 1995, Shell has had to take corporate social responsibility more seriously, and its recent acceptance of liability for the Bodo oil spill [an incident in 2008 for which the company was eventually taken to court] proves that corporate impunity has been slightly dented over the last 20 years," she told Think Africa Press, adding that the Senate is "making some effort" to develop legislation that would beef up the National Oil Spill Detection Response Agency (NOSDRA).
However, while Nigeria may have made some progress over the two decades since nine environmental activists were executed, there is still painfully far to go.
Oil companies have proven themselves highly adept at passing the buck, and the government has historically been ineffective in its attempts to better regulate the sector. But many are holding out hope for now that the tide is ever so slowly turning and that this latest report could become a document for action rather than resignation.
Lagun Akinloye, a British Nigerian, studied Sociology and Social Policy at the University of Leeds. He is particularly interested in the history and politics of West Africa, specifically Nigeria.
In addition to his role at Think Africa Press, Lagun is an executive member of the Central Association of Nigerians in the the(CANUK)Email: firstname.lastname@example.org. Follow him on twitter @L_Akinloye.