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Rivers acquires Shell’s 45 per cent stake in OML 11 oilfields

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Rivers State Governor Nyesom Wike


Governor Nyesom Wike yesterday disclosed that the Rivers State Government had acquired 45 per cent of Shell Petroleum Development Company’s (SPDC) stake in Oil Mining Lease (OML) 11 oilfields.

The governor said he had directed the state Ministry of Finance Incorporated to bid for the facility with $150 million supported by a bank guarantee and cash payment of N1 billion to the Deputy Sheriff, the later payable to the judgment creditors and the former escrowed.The oilfields are situated at Ejama Ebubu community in Eleme council area, Ogoni and other communities in the state.

Ejama settlement had sued Shell over failure to clean up its polluted environment since 1970, as SPDC admitted vide letters seeking to remedy the situation in 2006 while the case was in court.In a statewide broadcast yesterday, Wike said the acquisition of OML 11, emanated from a court judgment, which has been registered in the United Kingdom and Nigeria for enforcement.

His words: “The fresh case commenced in 2001 and passed through four different justices of the court due to manipulations associated with opposing litigations, until it was disposed of in June 2010 by Justice Buba J.

“SPDC and its parent companies challenged the judgment on appeal in 2010, which again suffered setbacks as it passed through six panels comprising three justices between 2010 and 2017 before it was dismissed by the panel of the court led by Gumel J.C.A. of the Port Harcourt Division.

“SPDC and its parent companies further appealed the case at the Supreme Court in 2017, which was considered and dismissed in the lead judgment by Justice B. Akaahs JSC via a unanimous decision.

“After losing at the High Court, SPDC gave the Ejama Ebubu plaintiffs a bond guarantee stipulating that the First Bank of Nigeria would pay them the value of the judgment debt and interest in the event that SPDC’s application at the Court of Appeal fails. The original bank guarantee is still with the community.

“When SPDC’s appeal failed at the Court of Appeal, Shell instructed the bank to dishonour the guarantee, which gave rise to six different litigations in various courts against First Bank and the Central Bank of Nigeria (CBN).”

The Dutch oil major explained that it had appealed the case at the Supreme Court, while the enforcement cases traversed Owerri, Abuja and Lagos, among others in six different suits, but Shell’s appeal was dismissed at the Supreme Court on January 11, 2019.

According to the governor, the judgments of the High Court, Court of Appeal and Supreme Court were registered in the United Kingdom for enforcement against SPDC’s parent companies domiciled outside the country.He explained that the Ejama Ebubu community commenced enforcement by domiciling the judgment in the State High Court and levying execution on SPDC’s moveables at their Industrial Area in Port Harcourt.

Wike pointed out that Shell offered the community N7 billion as against the judgment debt of N194 billion, which it declined and went to court for an order granting the community leave to sell SPDC’s immovable property comprising OML 11 and its Kidney Island support base in Port Harcourt.

The governor said upon the advertisement of the said immovable assets for auction, the Attorney General and Commissioner for Justice alerted the state government of the cause of a spill that occurred in 1970.
He continued: “That these phenomenal degradation and impoverishment had continued with the decline of revenue and inflation, lack of employment for educated Rivers State youths, idleness and restiveness arising from want.

“That SPDC paid $2 million for the renewal of its operatorship and interest in the said OML 11 to the Federal Ministry of Petroleum Resources.” Wike stressed that in the past 25 years, the oil potentials of OML 11 have remained untapped following the killing of Ogoni writer and environmental activist, Ken Saro-Wiwa, the Ogoni Nine as well as the lynching of four Ogoni citizens, one of whom was Secretary to the State Government and a Commissioner under Lt.-Col. Dauda Musa Komo military administration.

He added: “A lot of revenue accruable from Federal Government’s 55 per cent stake in OML 11 was lost due to non-production of 250,000 barrels per day (bpd) of its crude oil potentials amounting to one sixth of the country’s total daily output, among others.”


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Nyesom WikeSPDC
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