…OML 11 accounts for one-sixth of Nigeria’s daily oil production
Rivers State Government of Nigeria has acquired Shell’s 45% stake in Oil Mining Lease (OML) 11 oilfields located at Ejama Ebubu community in Eleme council area, Ogoni and other communities in the state.
Violent protests that trailed oil spill from OML11, and the consequent environmental degradation led to the death by hanging of playwright and activist, Ken Saro Wiwa and nine other Ogoni patriots 25 years ago. Shell was forced to withdraw from the oil field
The state government, through its Ministry of Finance Incorporated said yesterday that it bided for the facility with $150 million, supported by a bank guarantee and a cash payment of N1billion to the deputy Sheriff, the later payable to the judgment creditors and the former escrowed.
Confirming the acquisition in a national television broadcast, the state governor, Nyesom Wike, said the acquisition of OML 11 by Rivers state was the outcome of a lingering crisis which consumed distinguished sons of the state, and prolonged litigation which cost Nigeria a lot of revenue accruable from its 55% stake in OML 11.
Wike said the revenues were lost due to non-production of 250,000 barrels per day (bpd) of its crude oil potentials, which accounts for one-sixth of Nigeria’s total daily output, among others. The governor said the acquisition of OML 11, emanated from a court judgment, which has been registered in the United Kingdom and Nigeria for enforcement.
Giving a background to the crises, Wike stated that the Ejama community had sued Shell over failure to clean up its polluted environment since 1970, as the Shell Petroleum Development Company (SPDC) admitted vide letters seeking to remedy the situation in 2006 while the case was in court.
“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 governor narrated
Shell had appealed at the Supreme Court, while the enforcement cases reportedly traversed Abuja, Owerri and Lagos, in the six different suits. In the end, Shell’s appeal was dismissed at the Supreme Court in January this year.
He said 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 also pointed out 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.
Shell was said to have offered the community N7 billion as against the judgment debt of N194 billion, of which the communities turned down and approached the court for an order granting them leave to dispose of SPDC’s immovable property comprising OML 11 and its Kidney Island support base in Port Harcourt.
The state government moved in upon the advertisement of the said immovable assets for auction, Wike said. That SPDC had paid $2 million for the renewal of its operatorship and interest in the said OML 11 to the Federal Ministry of Petroleum Resources.
Chibisi Ohakah
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