Date filed
16 May 2019
Keywords
Countries of harm
Current status
No resolution
Sector
NCP

Allegations

On 16 May 2019 a specific instance was filed by the Uwema Aminigboko Community, Council of Chiefs and Elders and Community Development Committee, Emughan Clan, in the Abua/Odual Local Government Area of Rivers State, Nigeria against the Shell Petroleum Development Company of Nigeria Limited (SPDC). The complaint concerns activities of Shell in the Enwhe Field Development Project – Gbaran Phase 3 of OML 22, located in the Aminigboko Community.

SPDC has been operating in this area since the 1960s, and has been drilling and transporting oil through the pipeline since the early 1970s. Mobilization and construction of the Enwhe Field Development – Gbaran Phase 3 commenced in October 2017. The proposed project includes construction of two gas plants, drilling of over twenty oil/gas wells, building additional roads, and construction of 35km of pipeline.

The complainants allege that SPDC violated the OECD Guidelines by declining to disclose to the public the Project’s Environmental Impact Assessment Final Report, not implementing the Freedom to Operate Agreement, and declining to approve appointment of a community-recommended Community Liaison Officer for the project, instead appointing and imposing external representatives onto the Aminigboko Community. The complainants also allege that SPDC declined to approve a Rivers State government interface representative, instead establishing a parallel leadership structure. SPDC allegedly declined to provide social and sustainable intervention following devastating oil pollution in 2010, and also forcefully entered onto the community‘s land with military protection and without engagement or consent. Furthermore, SPCD refused to grant an audience request for community engagement and their correspondence platform failed to attend to the complaints raised in respect to the project.

The complainants are seeking mediation from the Dutch NCP to facilitate dialogue and help resolve the ongoing crisis in the Aminigboko Community.

Relevant OECD Guidelines

Outcome

On 3 June 2021, NCP Netherlands accepted the specific instance for further examination. The NCP offered its good offices to the parties involved. However, SPDC declined the mediation offer on the basis that it did not have the mandate of the SPDC joint venture to do so.

On 10 February 2023, NCP Netherlands published its final statement. The NCP studied information provided by the parties and also gathered general information (about risks associated with the oil and gas sector, and the operating context in Nigeria) and information specifically related to the complaint. The NCP was unable to conclude based on the provided documentation whether there existed parallel leadership, whether oil pollution was duly remediated, and whether forced entry took place. The NCP’s examination focused on whether SPDC had acted in accordance with the Guidelines concerning the issues raised.

The NCP assessed that SPDC had failed to demonstrate that it had acted in line with the OECD Guidelines in several respects. However, due to SPDC’s failure to respond to the NCP’s requests for further information, NCP Netherlands was unable to establish whether the company had complied with the Guidelines.

NCP Netherlands made several recommendations to SPDC, including:

  • To align its conduct with the OECD Guidelines.
  • To cooperate in good faith and more meaningfully with any legitimate remediation mechanisms, including non-judicial mechanisms such as the NCP procedure.
  • To exercise its leverage on the SPDC joint venture to cooperate with remediation mechanisms, and to seek to build its leverage if its leverage has been exercised to the fullest extent. In the event of failed attempts of exercising leverage, to disengage from the SPDC joint venture. “Should the enterprise decide to remain in the relationship it should be prepared to account for its ongoing risk mitigation efforts and be aware of the reputational, financial or legal risks of the continuing connection.”
  • To engage more directly and meaningfully with stakeholders, including local communities affected by its operations.

The NCP stated that it would follow up on the specific instance in one year to evaluate the recommendations made.

According to the NCP, following SPDC’s refusal to participate in good offices, “the enterprise chose to respond in a non-meaningful manner to the questions the NCP posed in the examination phase…” According to the NCP, SPDC should have “exercised their leverage on the other partners of the JV to ensure they participate in the NCP procedure”. Furthermore, the NCP stated:

“While the enterprise displayed a certain cooperative stance throughout the procedure in terms of providing some basic information, it is the NCP’s assessment, given the lack of information related to the possibilities of exercising leverage towards the SPDC JV, the non-acceptance of the good offices and the lack of a meaningful response to the questions the NCP posed in the examination phase, that the enterprise has not acted as could have been expected from it under step six of the due diligence process as described in the OECD Due Diligence Guidance for Responsible Business Conduct, i.e. to “provide for or cooperate with legitimate remediation mechanisms through which impacted stakeholders and rightsholders can raise complaints and seek to have them addressed with the enterprise”. ”, based on Chapter II General Policies, para A.10 and A.12 of the Guidelines.

Furthermore, as outlined in the Guidelines’ Commentary on the Procedural Guidance for NCPs, paragraph 21, the effectiveness of the specific instance procedure depends on good faith behaviour of all parties involved in the procedures. Good faith behaviour in this context means responding in a timely fashion and genuinely engaging in the procedures with a view to finding a solution to the issues raised in accordance with the Guidelines. The lack of cooperation in the NCP procedures by the enterprise therefore means it also has not acted as could have been expected from it under paragraph 21 of the Commentary on the Procedural Guidance.”

The complainants commended the NCP for its final statement.

More details

Defendant
Company in violation
Other companies involved
Complainants
Affected people
Date rejected / concluded
10 February 2023

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