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OML11: Road clears for Rivers acquisition of SPDC’s stake

The Supreme Court has cleared the road for Rivers State government acquisition of the Shell Petroleum Development Company of Nigeria Limited, SPDC’s 45 percent equity stake in OML11 and Kidney Island in Port Harcourt.

This is imperative following the apex court dismissal of the SPDC’s suit which sought the setting aside of the N17 billion judgment made against the Dutch firm in 2019, on Friday.

Recall that the Supreme Court had in January 2019, upheld the judgment of the Court of Appeal, which awarded N17 billion damages against SPDC, for a devastating oil spill that ravaged farmlands, rivers and streams in Ejama-Ebubu in Eleme Local Government Area of Rivers State in 1970s.

Shell, which was the operator of OML11 and Kidney Island in Port Harcourt, had in July 2019, filed a suit at the Supreme Court to set aside its earlier judgment on the ground that the apex court did not go into the merit of their appeal before upholding the decision of the Court of Appeal.

But, the Supreme Court in a unanimous judgment prepared by Justice Centus Nweze and delivered by Justice Samuel Oseji, asserted that the appeal filed by Shell was frivolous and lacks merit.

Justice Oseji declared that the Supreme Court cannot revisit its earlier decision on the matter. To this end, the court dismissed Shell’s appeal for being incompetent and lacking in merit.

In addition, the Supreme Court held that parties are to bear the cost of their litigation.

Rivers State Governor, Nyesom Ezenwo Wike, had in September 2019 announced the acquisition of Shell’s 45percent interest in OML11 oilfields and Kidney Island in the State.

The governor, had directed the Rivers State Ministry of Finance Incorporated to make a bid of $150,000,0900.00 supported by a Bank Guarantee and cash payment to the Deputy Sheriff in the sum of N1 billion, the later payable to the Judgement Creditors while the former is escrowed.

The Ejama community had filed a suit against Shell over un-remedied pollution that took place since 1970s as admitted by SPDC vide letters they wrote seeking to clean the spill in 2006 while the case was at the trial Court.

The suit between Shell and Ejama-Ebubu community was finally disposed in 2017. But, Shell and its parent companies took out a further appeal to the Supreme Court of Nigeria in 2017, which appeal was considered and dismissed by that Court in a judgment read by Hon. Justice B. Akaahs.

After losing at the High Court, Shell gave the successful Ejama Ebubu Plaintiffs a Bond Guarantee stipulating that First Bank of Nigerian Limited would pay them the value of the Judgment debt and interests thereon in the event that SPDC’s appeal to the Court of Appeal fails at that Court.

Having lost the matter at the Court of Appeal, the Ejama Ebubu community commenced enforcement by domiciling the judgment in the State High Court and levying execution on SPDC moveables in their Industrial Area in Port Harcourt.

Shell, had invited the community and offered them N7 billion as against the judgment debt of N194 billion, which the community refused to accept. Afterwards, the community approached the court for an order granting them leave to sell SPDC’s immovable property comprised in OML 11 and their kidney Island support base in Port Harcourt .

It was on this basis, that the Rivers State government placed advertisement of the said immovable assets for auction after the Honourable Attorney General and Commissioner for Justice of Rivers State alerted the Government of the State of the matter.

Governor Wike, had said that rather than standby and watch other persons or group purchase Shell’s 45% interest in OML 11 and further exacerbate the poverty of the people of the State, the State Government had to weigh in and bid for the purchase of SPDC interest already set down for auction.

While explaining its position on the Supreme Court judgment regarding Chief Ogbara & Ors vs SPDC Shell disclosed that “this spill was caused by third parties during the Nigerian Civil War, a challenging period which resulted in significant damage to oil and gas infrastructure in the region. While SPDC does not accept responsibility for these spills, the affected sites in the Ebubu community were fully remediated.

“The claimants have – at their own admission in court – materially miscalculated and overstated the value of the award previously sought in this case. The ruling of the Supreme Court did not decide liability or the size of the award, which remain in dispute in other ongoing court proceedings. It is our position that any attempt to enforce payment should not be permitted. It is regrettable that the legal process in this case has focused for so long on procedural issues and not the merits of the case. We have always maintained that we are ready to defend this case based on the available facts.”