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Reps committee wants Shell to pay $3.6bn damages

By on November 28, 2014

The House of Representatives Committee on Environment on Wednesday recommended that Shell Nigeria Exploration and Production Company should pay $3.6bn (about N604.8bn) as damages for losses incurred by coastal communities in Bayelsa State during the 2011 Bonga Oil Spill.

Equipment failure was identified as the major cause of the spill, which reportedly affected 350 communities and satellite towns.

The committee, which is chaired by Mrs. Uche Ekwunife, is investigating the oil spill.

Ekwunife presided over a hearing of the committee in Abuja on Wednesday where she spoke on the findings of the committee.

The committee broke down the damages into N63.6bn as direct or “irreversible damages”; N103.1bn as loss of income; N85.7bn for provision of water and another N27.3bn as forestry losses.

Under “indirect losses”, the committee recommended N14.3bn as health hazard damages and N8.089million for “injurious affection.”

Punitive damages attracted a separate N302.4bn.

She spoke further on the findings, “The damage assessment report showed that the natural resources damage and loss of income amounted to $1,800,095,603.

“There are also punitive damages of the same amount in line with international best practices.

“Since all efforts made by the House Committee on Environment were tactically rebuffed by SNEPCO, the committee has decided to adopt the damage assessment report submitted by the National Oil Spill Detection Response Agency as the lead agency in all oil spill management.

“All the administrative costs and fees of the consultants engaged to carry out the assessment being 10 per cent of the assessed damage respectively shall be borne by SNEPCO.”

NOSDRA’s Director-General, Mr. Peter Idabor, earlier complained that SNEPCO frustrated efforts it made to hold a “multi-stakeholders” meeting on the spill and its consequences.

Both the committee and NOSDRA claimed that SNEPCO avoided several meetings called on the issue.

It was also not present at Wednesday’s session.

However, in a presentation the company made to the committee before now, it only admitted “to an oil spill estimated at 40,000 barrels into the marine environment in Bonga on December 2011.”

SNEPCO had attributed the spill to “snapped loading hose under water.”

 

[Punch]