Devendra Kumar
As Shell’s proposed sale of its onshore assets in Nigeria’s Niger Delta region to Renaissance Africa Energy Company approaches, concerns are escalating among local activists and international environmental groups. The deal, worth $2.4 billion, is expected to divest Shell’s subsidiary Shell Petroleum Development Company, which operates its onshore assets in the delta. However, activists are urging the Nigerian government to delay the approval process until environmental concerns are addressed.
The Centre for Research on Multinational Corporations, a Dutch non-profit group, recently released a report highlighting Shell’s poor environmental track record in the region. The report cites a wellhead blowout in the Santa Barbara River in 2021, which spewed crude oil and associated gas for 38 days, killing fish and devastating riverside farms. Local residents, who have been severely impacted by oil spills and waste, are demanding that Shell restore their land and clean their water before any divestment.
Lezina Mgbar, a 54-year-old healthcare worker and farmer, described the devastating effects of oil spills on her community in Ogoniland. “Children and women have to travel far to get water, and farm yields are poor,” she said. Activists argue that Shell has a history of poor divestment in the region, citing a lack of accountability and resolution of environmental and social concerns. The report also documents other cases of environmental pollution not addressed by Shell before past divestments, with two communities taking the company to court to address past environmental concerns.
Environmental consultant Richard Steiner said the blowout highlights the risk of Shell and other oil majors transferring assets to new local firms without resolving legacy environmental and social concerns first. Critics argue that many purchasing companies do not have the technical or financial capacity to manage oil and gas operations safely. The Nigerian government, which will ultimately decide the fate of the Shell-Renaissance transaction, has yet to comment on the deal.
The controversy surrounding the sale has sparked concerns around the potential environmental impact of the deal. Nigeria’s law requires companies to clean up environmental pollution regardless of the cause, but Shell and other oil companies often blame third-party interference for spills. The deal is the latest move by Shell to limit its onshore operations in Nigeria while focusing on deepwater operations. Other companies, including Chevron, ExxonMobil, and TotalEnergies, have taken similar steps, but without the scale of protests Shell has faced.
As the controversy continues to unfold, it remains to be seen if the Nigerian government will address the concerns of local activists and environmental groups before approving the deal. The sale of Shell’s assets in Nigeria’s Niger Delta region is a critical test of the Nigerian government’s commitment to environmental protection and accountability.