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 Court orders Mobil, NNPC to pay N81.9 billion to communities over oil spillage

Court orders Mobil, NNPC to pay N81.9 billion to communities over oil spillage


A Federal High Court in Abuja has ordered Mobil Producing Nigeria Unlimited and the Nigerian National Petroleum Corporation (NNPC) to pay the sum of N81.9 billion as cumulative damages to the oil communities in Ibeno Local Government Area of Akwa Ibom over oil spillage within 14 days.

This follows the case filed against the two oil firms for economic losses suffered by members of the communities from oil spillages due to their exploration activities.

Justice Taiwo Taiwo, in a judgment debt, said that failure to pay within the stipulated time would attract an accruable interest of 8% on the principal sum annually.

While delivering judgment on Monday in a joint case filed against the two defendants by the aggrieved oil-producing communities, Justice Taiwo held that the American oil company and NNPC were negligent in the way and manner they handled oil spills that caused environmental degradation in the communities.

Taiwo, in the judgement, particularly took a swipe at the NNPC for being interested in the revenue generations from the oil exploration at the expense of the lives of the people in the communities.

He said that he believed the oral and documentary evidence by the plaintiffs to support their claims that lives were made miserable for them when their water and land were polluted through crude oil leakages from old oil pipelines.

While acknowledging the claims of Mobil that it did clean up exercise, Justice Taiwo, however, held that the oil giant failed to address the compensation that would have mitigated the economic losses of the people said to be mainly fishermen and farmers.

He held that the oral and documentary evidence produced by Mobil Company were not in any way helpful to the court as they were targeted at serving predetermined interest.

Going further, the federal high court judge held that both Mobil and NNPC were negligent by their failure to visit places of the leakages of the crude oil that led to the contamination of rivers and creeks.

Justice Taiwo rejected the claims of the Mobile joint venture partner, NNPC, that the suit was statute-barred in 2012 when it was filed by the aggrieved plaintiffs, adding that the suit had to do with fundamental rights that cannot be rendered impotent by the statute of limitations.

He stated further that Section 11, Subsection 5 of the Oil Pipeline Act made it mandatory for oil companies to monitor and repair their pipelines to avoid spillages and environmental degradation.

Justice Taiwo consequently awarded the sum of N42.8 billion as damages for intangible losses, N21.9 billion for special damages as annotated and N10 billion as general damages.

What you should know

It can be recalled that Ibeno communities led by Obong Effiong Archianga and 9 others had through their lawyers, Chief Lucius Nwosu, SAN, instituted a legal action against NNPC, Mobil Producing Nigeria Unlimited and ExxonMobil Corporation.

They had sought for about N100 billion compensation for economic losses suffered from oil spillages caused by the defendants during exploration.

The 3rd defendant was however deleted from the court action when the court established that there was no cause of action against it.

Multinational oil exploration and production companies have been in constant conflict with host communities over oil spillages and subsequent environmental degradation.

It can be recalled that a Dutch appeals court ruled that the Nigerian branch of oil giant, Shell, is responsible for damage caused by leaks in the Niger Delta and therefore ordered Shell Nigeria to pay compensation to Nigerian farmers, while the subsidiary and its Anglo-Dutch parent company were told to install equipment to prevent future damage.

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