The Impact of Shell Inc on Nigeria: Case Study
Introduction
Background to the case
Over the past few decades, concerns over the practices of Shell Inc, one of the world’s leading oil producers has increased in the Nigeria Delta, especially in relation to human rights violations, environmental degradation and lack of corporate social responsibility. The close association between the company and former dictatorial regimes in Nigeria brought massive violation of human rights as the government sought to protect the company. According to Manby (2012), the company has been funding successive Nigerian regimes to gain access to more oil fields and cover up its environmentally destructive practices in the area. Following massive demonstrations by the local Ogoni people in the Niger Delta since early 1990s, the company sought government protection. With effect, the Nigerian military government, then under general Sani Abacha, involved the police force, which in turn violently cracked down and terrorized the local Ogoni people. Several people were arrested, while others killed or displaced (Olukesusi, 2008). In 1995, the government of Nigeria, then under military dictator Sani Abacha, manipulated the court system to execute Ogoni activists who were against the malpractices by Shell Inc and other companies in the Delta region (Frynas, 2011). Consequently, Ken Saro-Wiwa, a renowned author and activists, was executed alongside eight other Ogoni leaders in October the same year after a sham court proceeding. According to Downing (2010), this event marked the beginning of a series of court proceedings at the international and local courts to seek justice for the Ogoni people. The purpose of this paper is to review a case study on the impact of oil exploration and production in the Niger Delta, with special reference to environmental degradation and its consequent violations of human rights in the region (Idemudia, 2010). Studies have yielded substantial evidence to show that Shell Inc Nigeria is and its activities in the region remains an environmental and security threat. In fact, the company has acknowledged and accepted that some of its activities in the region are harmful to the environment. However, it is evident that it is doing little, if anything, to take responsibility and reverse its impacts on the environment. For instance, the company is yet to inject any significant resources towards coping up with the environmental challenges in the region or even attempt to reverse the impacts its actions have had on the environment. Instead, Shell Inc has evidently used substantial amount of its resources to cover up its malpractices, especially in covering its historical and current collaboration with local leaders and security institutions in violating the rights of the local Ijaw and Ogoni communities (Frynas, 2011).
History of Shell Inc. and damages to the environment in Niger Delta
Formerly, known as the Royal Dutch Shell Plc, Shell is a multinational explorer and producer of oil and natural gas with its headquarters in The Hague, Netherlands. According to the company website, most of its operations and business are conducted from its offices in London (Frynas, 2011). Despite being one of the most prestigious corporations in the world it is equally one of the most controversial. This company is whose respect to environmental conservation and human rights has been questioned. Specifically, the company’s practices kin southeastern Nigeria is a case example of its poor corporate social responsibility, human rights violation and damage to the environment (Idemudia, 2010).
The company began its oil exploration and production in the Niger Delta after traces of oil were discovered in the area in 1958. This was actually an agreement between the British colonial government in Lagos and the company. The role of the British government was to provide protection and support to the company, while company would provide the government with taxes in return. It is worth noting that the local community was not involved in the deal.
With the coming of independence in early 1960s, the new Nigerian government under Nnamdi Azikiwe did not terminate the deal; neither did it try to consider the plight of local Ogoni and Ijaw peoples living in the area. Throughout 1960s and 1970s, there were massive oil explorations in the area, which gave Shell Inc the advantage to enhance its oil production and exportation. Massive oil pipelines were established to transport the products to the coast, especially to the Calabar Coast and Port Harcourt. This came with massive oil spills, gas flaring and removal of vegetation cover as well as people and animals was evident over the next decades.
From late 1980s, a number of individuals and groups raised concern over Shell’s malpractices in the region. However, the government, led by successive military dictators, acted quickly in protecting the company. Ken-Saro Wiwa and other environmental and human rights enthusiasts and activists took a number of steps, including mobilizing the local Ogoni people to press the government and the company to end the environmental degradation and compensate the local community (Olukesusi, 2008). However, the company was not willing to take responsibility; neither was it willing to stop the damages. The results were that the demonstrations turned violent, with the government troops entering the area at the request of the company to quell down the opposition between 1990 and 1995. The arrest, detention and trial of Ken Saro-Wiwa and 8 other Ogoni leaders/activist raised an international outcry over the human rights violation by the government and the company. The trial and subsequent execution of the 9 Ogoni leaders, popularly known as the “Ogoni 9” in September 1995 brought into limelight the situation in the region, exposing the company’s long history of malpractices and human rights violation.
Since then, a number of cases have been filed in the United States, Netherlands and Nigeria to force the company reconsiders its practices, compensate the locals and give back to the community through effective corporate social responsibility programs. These are discussed in the following section.
The current issues
Currently, Shell Corporation has more than 90 oil fields in the Niger delta, which are spread over an area of approximately 30,000 km2. In addition, it operates more than 1,000 oil wells, over 70 flow stations, more than 10 gas plants and at least 2 major oil terminals at the Nigerian coast. In total, Shell’s networks of flowlines in Nigeria cover more than 6,000 km. it is worth noting, however, that the presence of shell in Nigeria is actually a joint venture between Shell plc, Total TEPGN, Agip and Nigerian national petroleum company. The collaboration between these companies and the government is significant to the history of this case.
Currently, a number of issues revolve around the struggle between the company and the locals to resolve the impacts of the company on the environment and the locals. First, environmental devastation, which began immediately the company entered the delta in 1958, is the major cause of conflict between the company and the local Ogoni and Ijaw groups. Massive use of land for oil exploration, mining, production, transport and waste disposal has seen a loss of massive tracks of useful land. According to Manby (2012), the company has destroyed the land to an extent that the entire ecosystem has been interfered with, making it impossible for human, animal and plant existence, despite the fact that the delta is among the most important wetlands and marine ecosystems in the modern world. The impact of shell’s practices in the region affects the lives of more than 26 million people living in the region and relying on the delta for food, housing, clothing, economy and trade. In fact, the assigning of massive tracts of land for oil exploration and production to the company by the government displaced millions of the inhabitants, impoverishing them and forcing them to live in crowded shanties in towns and villages. In addition, the government’s crackdown on the 1990-1995 protests in the Ogoni land has left thousands of people displaced, most of them now exiled in Benin and other makeshift camps in southeastern Nigeria. According to reports, these people are still leading miserable lives.
Secondly, the company’s method of waste disposal such as remnants of refinery affects the environment. For instance, gas flaring and spillage of semisolid waste materials on the land affects the environment and the living things around. According to Manby (2012), gas flaring, a method used by the company and other of its kind to dispose off some gaseous by-product of oil drilling, affects lives more than any other product. This is because the gas is burnt through flaring, which emits large number of chemicals and materials in the air and land. In fact, it has been shown that gas flares contain a number of toxic and carcinogenic chemicals such as benzene, carbon and lead. According to biomedical studies, carcinogens like benzene have a high potential to cause mutations in chromosomal genes and their protein products in both plants and animals, causing several genetic diseases and cancer. It is worth noting that Nigeria is only second after Russia in terms of gas flaring, producing more than 20 billion m3 of burned gas per annum. Despite the fact that this gas can be reused to produce energy for the less energy efficient West African region, the company opts to burn it to avoid the cost of disposing it in any other way. Moreover, the company opts to pay an annual fine rather then dispose the gas in a better manner.
Oil spills are also evident in various parts of the Nile Delta. Since 1958, it has been estimated that shell and other companies have spilled more than 1.5 million tons of oil on the land and water in the delta. This has greatly affected human and wildlife in the region. In fact, oil spills, in addition to land degradation, have reduced flora and fauna as well as the amount of available land for economic and social use.
Ethical issues
Apart from environmental degradation, Shell Inc has repeatedly violated human rights through funding previous dictatorial regimes that killed detained and displaced people in the region, especially the Ogoni and the Ijaw people. Despite its record as a perpetrator of human rights violations and environmental destruction, the company has run various advertisements and initiatives to cover up its malpractices by portraying itself as a “green company”. In fact, it has been said to be involved in “Greenwashing”, a practice in which the company uses advertisements to cover up its dirty record.
References
Downing, D. H. (2010). Encyclopedia of Social Movement Media. London, UK: Sage Publications
Frynas, J. G. (2011). Oil in Nigeria: Conflict and Litigation Between Oil Companies and Village communities. London, Li Verlag
Idemudia, U. (2010). Community Perceptions and Expectations: Reinventing the Wheels of Corporate Social Responsibility Practices in the Nigerian Oil Industry. Business and Society Review, 112(3), 369–405
Manby, B. (2012). The Price of Oil: Corporate Responsibility and Human Rights Violations in Nigeria’s Oil Producing Communities. New York: Human rights watch.
Olukesusi, F. (2008). Legal and institutional framework of environmental impact assessment in Nigeria: an initial assessment. Environmental Impact Assessment Review, 18(2), 159–174
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