The Nigerian government is being urged by civil society organizations, spearheaded by Amnesty International, to thwart Shell Plc’s intention to divest its onshore oil operations in Nigeria.
SHThe $1.3 billion agreement with Nigerian-owned Renaissance Africa Energy was reached in January 2024 and intends to enable Shell to achieve its long-term objective of ceasing operations in the difficult Niger Delta. The organizations contend, however, that the transaction shouldn’t take place unless sufficient protections for human rights are guaranteed.
Forty organizations, including Amnesty International, detailed a number of requirements that need to be fulfilled in a report released on Monday in order for the sale to be authorized.
These prerequisites included community consultation, a pledge of funding for cleanup operations, and an evaluation of the level of environmental contamination surrounding the assets. The groups underlined how crucial it is to safeguard the environment and human rights throughout these kinds of transactions.
Amnesty International’s Director for Nigeria, Isa Sanusi, said: “There is now a significant chance Shell will profit billions of dollars from the sale of this company, leaving those who have already suffered from mistreatment and health risks without recourse. Before this transaction is approved, assurances and monetary protections must be in place to stop the contamination that is already there as soon as possible and to shield people from danger in the future. It is imperative that Shell fulfills its obligations to address and mitigate the substantial pollution legacy it has left behind in the region.”
According to Amnesty International, the agreement “seems to fall far short of several regulatory and legal requirements. Among these are the seeming absence of an environmental assessment to determine the necessary cleanup efforts and an assessment to guarantee adequate funding is allocated for the possible decommissioning of oil infrastructure, which is expected to take many billions of US dollars. It also pointed out that there was no inventory of the tangible assets up for sale, which is concerning since it might be a sign of the pipeline and infrastructure being in a condition of degradation, which is where many leaks have originated.”
There are frequently negative effects of leaks on the health and welfare of the surrounding communities. They stated that everyone has a right to a clean, healthy, and sustainable environment.
The deal’s regulatory approval delay is indicative of larger issues facing Nigeria’s oil industry. Major businesses including Equinor ASA, Eni SpA, and Exxon Mobil Corp. are also awaiting approval for sales of comparable assets. Although there was initial hope that President Bola Tinubu would be elected in 2023, the sector has not advanced much, with multiple deals on hold.
The Waltersmith Group, the Petrolin Group, ND Western Limited, Aradel Holdings Plc, First Exploration and Petroleum Development Company Limited, and the Aradel Group are the members of the Renaissance consortium that is prepared to purchase Shell’s assets. The Nigerian government’s response to the requests for stronger protections and regulatory approval, however, will determine whether or not the deal goes through.
