Shell’s divestments in Nigeria help the company meet its green goals. But villagers and watchdogs say conditions have worsened after the sales.
NEMBE, Nigeria — When Lambert Ogbari learned that the oil giant Shell was selling its local operations to a Nigerian firm, he said he felt hopeful his living conditions would finally improve. But he quickly noticed that maintenance on the oil wells surrounding his village had declined.
The international companies began a first wave of divestments around 2010, according to Etienne Kolly, associate director at S&P Global Commodity Insights. Oil theft by gangs and militants was proving a massive headache, and Nigeria’s government was pushing for more local ownership in the industry.and other major firms embarked on a more recent wave of sales, Kolly said, amid corporate pledges to reduce their emissions and eventually reach net zero by 2050.
Executives at Shell and other major companies said their divestments have been prompted mainly by unrest and oil theft in Nigeria, where government regulators report that hundreds of thousands of barrels are stolen each day. In, Shell’s CEO at the time, Ben van Beurden, said the company’s remaining assets “continue to be subject to sabotage and theft despite our efforts to limit and respond to illegal activity.
Shell’s divestment of its remaining onshore Nigeria assets is currently on hold; the Nigerian Supreme Court has said the company must wait for the outcome of a lawsuit alleging it was responsible for an oil spill in 2019. A lower court ordered Shell to pay $1.95 billion to local communities. The company, which says it did not cause the spill, is appealing.The well explosion in Nembe did not surprise local villagers.
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