of Shell's Oil Rights in Ogoni: Matters Arising
President Umaru Musa Yar’Adua is obviously a very
interesting man and this clearly manifests in his kind of policies and
choice of venues to announce them. It may not be apt to think that
something may be wrong with the President’s style however, his recent
announcement in South Africa on the loss of all oil rights in
Ogoniland by Shell Petroleum Development Company of Nigeria (SPDC)
heavily supports the notion that either the President or his handlers
may need a second look at the administration’s style of announcing
Cape Town South Africa to
announce such a sensitive policy decision, President Yar’Adua in what
seemed like government’s ultimate solution to the over 15 years of
anti-Shell protest by the Ogonis said, within the next six months,
Shell would divest all its operations in Ogoniland for a new firm to
come in. The company’s operating license in Ogoniland would be revoked
and new operator (s) would take over the company’s oilfields and
facilities in the area.
very interestingly, Yar’Adua also said that agreements have been
reached on the compensation to be paid by Shell for the environmental
damages arising from the spillage of crude oil as a result of its
operations in the area.
President explained that since there is a total loss of confidence
between the Ogoni people and Shell, government believes it would be
wise to allow another operator acceptable to the Ogonis to take over
exploitation activities in the area.
words: “There is a total loss of confidence between Shell and the
Ogoni people”, and so “another operator acceptable to the Ogonis will
take over. Nobody is gaining from the conflict and stalemate, so this
is the best solution.”
except the federal government reverses itself, as has been the case in
its oil and gas policy-like pronouncements, Shell will in the next six
months forfeit all its oil fields and investments in Ogoni area of
Rivers State .
company has 98 oil wells in about seven oilfields in Ogoniland and
five flow stations in Bodo West, Bomu , Yorla, Korokoro and Ebubu
before its expulsion from the area in 1993. Daily output from the
area, according to Shell statistics, was at about 28, 000 barrels per
day before the shut-in in 1993.
Although it does not matter much now but could the federal government
have taken a decision on the eviction of Shell from Ogoniland without
putting the company on notice? This is the puzzle as Shell claimed it
was yet to be formally informed about the federal government’s
decision. This is just an aside.
are serious hidden issues in the President’s Cape Town declaration.
First, if the federal government has ordered Shell to relinquish its
operational rights in Ogoni oil fields to a new operator, how is the
government going to get Shell to pay the compensation for alleged
environmental irresponsibility in the area? Secondly, is the new
operator going to inherit only the assets of Shell without the
accompanying liabilities or both? There is something not very clear in
the President’s declaration concerning compensation for damages.
Another serious issue borders on the choice of the new operator (s).
The question now is: Which of the oil companies would be acceptable to
the Ogoni people and who are the real Ogoni people- the few select
elite group; the emerging middle level power brokers or the grassroot
Ogonis? These are very sensitive issues that need to be address even
before a new entrant ventures into the area to avert a repeat of what
led to the Shell crisis.
issue of the acceptable definition of the “Ogoni people” is very
crucial because needless to say that many interest groups have sprung
up in the area since the death of the “Ogoni- 13”. And whether well or
evil-intended, it is only appropriate to carry everybody along in the
ongoing reconciliation and reorganisation exercise if the peace and
reconciliation is to be total. This may also help in the new era to
avoid sabotage or opposition from certain quarters of Ogoni society.
choice of acceptable company, Shell operated in Ogoniland with a joint
venture conscription comprising the French Total/Elf, Italy ’s Agip
and the Nigerian National Petroleum Corporation (NNPC).
Shell, Total, and Agip were critical parts of the joint venture that
has been declared persona non grata in Ogoniland, the
likelihood that one of them could be singled out as a good boy to
operate in the area is completely ruled out.
also follows that any existing or proposed oil company that is in a
joint venture partnership with one of the culprit Ogoni operators- the
completely or rather should be completely ruled out of the Ogoni
above scenario rules out ExxonMobil and Chevron as likely acceptable
partners in the Ogoni acquisition.
rightly pointed out by an analyst, Addax Petroleum seems to be the
only current operator with a clean bill as pertains to community and
social relationships. However, whether the Ogoni people would want to
gamble again with a player that has been on the local scene for
sometime is a matter only the Ogonis can decide.
Another option for the Ogoni people is to look eastward towards the
new Chinese, Russian and Korean brides that have indicated interests
in the Nigerian oil and gas arena.
President Yar’Adua’s Cape Town declaration has left the Ogoni people
with the power for a decent choice. They now need a proper debate on
the available options.
Earlier in an analysis I had maintained that the Movement for the
Survival of Ogoni People (MOSOP) as a frontline umbrella Ogoni
people’s assembly would have been better off today if it had since the
beginning of the conflict incorporated an oil exploration and
exploitation and refining company. If MOSOP had done that, it would
have easily been discussing a joint venture relationship with company
(s) of its choice for the Ogoni restart operation. This would have
provided a credible platform for them to bargain on companies to work
with or rather work in the area.
still not too late especially now that the federal government has
mustered enough will power to ask Shell to relinquish its oil rights
in Ogoniland. This is the only option that can completely eliminate
the Shell-like behaviour by a new operator in the area- that is if any
new operator would actually come to Ogoni. This is because if it
happens, that singular action by government would change the entire
face of the ongoing Niger Delta militant struggle for resource
IZEZE IS AN ABUJA-BASED CONSULTANT ON POLITICAL STRATEGY AND GRASSROOT