Bayelsa, Delta Youths Move to Cut Shell's 200,000bpd Oil Output over Non-payment of Surface Rents

We made a one-time all-inclusive compensation, oil giant insists

Amid a landmark deal by the Shell Group to sell its Nigerian onshore assets operated by Shell Petroleum Development Company (SPDC), some host communities in Delta and Bayelsa states have threatened to shut down the company’s four flow stations and cut the production of 200,000 barrels of crude oil per day (bpd) over the company’s alleged non- payment of surface rents for its operations.

The threat by the host communities is coming as the company has insisted that it made a one-time all-inclusive compensation to the affected communities for the loss of use of surface and other rights for the parcels of land in the affected areas.

Shell had agreed to sell its Nigerian onshore oil assets to Renaissance, a consortium of four Nigerian firms and one foreign company, for $2.4 billion.

But THISDAY gathered that the youths of Ojobo Federated Communities in Burutu Local Government Area (LGA) of Delta State and Ogbotobo in Ekeremor LGA of Bayelsa State are mobilising others from neighbouring communities to shut down Benisede, Ogbotobo, Opukusu and Tunu flow stations operated by SPDC.

Investigation revealed that the average combined capacity of the four flow stations is about 200, 000 barrels of crude oil per day.

In a statement issued yesterday by the Youth President of Ojobo Federated Communities, Atimapre Tesufa, and two coordinators of the youths, Julius Pabor and Laye Kalu, the communities said they were taking their destiny in their hands to avoid a repeat of the fate that befell Oloibiri, a community in Bayelsa State where oil was first discovered in Nigeria.

Part of the statement read, “We will close down the flow stations because Shell has taken us for granted for too long, since 1972. We are challenging Shell to point to a single development or anything they had done for the people of Ojobo, Ogbotobo or neighboring communities in the 52 years of their operations in our land that has destroyed all our alternative sources of our livelihood.

“For all portions of Ojobo Federated Communities land measuring approximately 1, 500 hectares and 579.28 hectares at Beniseide and Oil Fields in which Shell operates her OML 36 oil wells among other facilities, Shell had only paid nine shillings, less than one dollar at the time it commenced operations and now claimed it is reasonable and adequate for the people.”

The youths argued that “the laws of Nigeria concerning land rent must be respected. Otherwise, our flow stations henceforth won't form part of Shell's assets. Enough is enough.”

They accused SPDC of deploying double standards and taking advantage of the locals.

“SPDC has the same entry documents to most of the communities in Delta and Bayelsa, paying some communities while others are shortchanged by paying little and in the case of Ojobo, it’s nothing,” the statement added.

The youths cited several attempts by the communities to ensure that Shell paid the statutory surface rents, including correspondence to the oil company by their legal representatives, which yielded no positive result.

The law firm of Roland A. Akpe and Co, based in Effurun, Delta State, had in October 23, 2023, written a letter on behalf of the communities to the managing director of SPDC, requesting “payment of surface rents for 50 years for each of the Beniseide and Osuopele oil field to the Ojobo Federated Communities for loss of use of the expanses of land by way of loss of fishing rights, farming rights, hunting rights, etc”.

But in swift response, Shell had in a letter dated November 17, 2023 and referenced, SPDC-202311-00000069, said it had made a one-time all-inclusive compensation for the loss of use of surface and other rights for the various parcels of land in question.

Shell’s response, which was signed by Corporate Lands Manager, Corporate Relations Nigeria, SPDC, Trevor Akpomughe, insisted that: “Consequent to the said payment, the land ceased to attract any further compensation from SPDC.

“SPDC therefore, does not owe your client or any person any form of compensation or rent in respect of the said parcels of land and cannot accede to your demand”, the letter added.

The aggrieved communities have also petitioned the federal government, threatening that SPDC’s stance was capable of igniting dire consequences.

The law firm of Roland A. Ekpe & Co, in a letter addressed to the Minister of Petroleum Resources (Oil), and dated 15th January, 2024, told the minister that: “SPDC’s stance is totally inimical to the attainment of President Bola Ahmed Tinubu’s objective of increasing oil production to 2.6 million barrels per day. SPDC conduct is capable of provoking unwarranted disruptions of production in and around our client’s Federated Communities housing SPDC’s installations and properties.

“There is a limit to which our clients can rein in the youths, hence this passionate plea of our clients to the Hon. Minister of Petroleum Resources (Oil)…If the youths should carry out their threats, our clients cannot be held responsible for their actions”