An oil-spill and ongoing fire in the troubled Niger delta region of Nigeria indicates how badly relations between international oil-companies like Shell and oil-producing communities have deteriorated.

Members of the Elikpokwuodu community in Rukpokwu in Obio/Akpor Local Government Area of Rivers State, say a rupture in a high-pressure, 28-inch pipeline operated by SPDC (Shell's Nigeria affiliate) in December caused the initial oil-spill. The problem with the pipe dates back to 1963, according to the community.

Rukpokwu is about a 5-10 minute drive from the Port Harcourt airport. The oil-spill is on the fringe of a swampy area, 2km along a dirt road, immediately off the airport road on the outer fringes of the oil-city of Port Harcourt proper. Port Harcourt is Shell's operational base in Rivers State. In other words, the spill is on Shell's doorstep but the company has still to put out the fire and clean up the spill.

According to Nigeria's Vanguard newspaper, Chairman of Elikpokwuodu's Community Development Committee Mr. Clifford Walter said "more than three streams from which we fish are affected. Fishing implements were destroyed and SPDC has not responded to this disaster."

"Our only source of drinking water, fishing stream and farm-lands covering over 300 hectares of land with aquatic lives, fishing nets and traps, farm crops and animals," Nigeria's THISDAY reported the Paramount ruler and Chairman of Mgbuchi Community - Chief Clifford E Enyinda and Azunda Aaron respectively - as saying. "Trees worth several billions of naira are completely destroyed by the spillage and was made worst by the three separate fires that broke out of the spill site."

At the time of Stakeholder Democracy Network's (SDN) visit to the site on January 7th, there was a fire at the centre of the spill that was still burning. This was despite several attempts by Shell staff to put this out. The fire was restricted to an area no larger than approximately 20 metres by 20 metres. Surrounding bush and vegetation was charred and destroyed. No visible measures were in place to prevent the further spread of oil downstream, despite obvious risks from rainfall.

There appears to be a continuing underground fire at the spill-site that is periodically re-igniting on the surface, but the causes of this re-ignition are unclear: it could be that the underground fire is spreading back to the surface, but deliberate sabotage cannot be discounted. Shell has been unwilling - or has felt unable - to post someone at the site to monitor the fire, which would make sabotage less likely.

Shell and the affected community are giving conflicting accounts of what has happened. However, one uncontested fact is that - while the initial spill occurred on December 3rd 2003, and was reported to Shell on December 4th - on January 7th Shell was still negotiating 'relief materials' with the Elikpokwuodu community, i.e.: how many bags of rice and temporary water supplies to supply.

According to members of the community SDN spoke to, when Shell staff and contractors visited, they came with an armed mobile-police escort, firing shots into the air. Shell staff excavated the pipeline, acknowledged that the problem was due to corrosion and sought to place a covering clamp over the pipeline. However, Shell workers found the 'clamp' they had brought was not long enough, so they departed without taking further action.

According to Shell press statements, the community denied Shell access to the site of the spill. Shell alleges that "miscreants" set fire to the spill initially, and have re-lit the fire on several subsequent occasions.

Members of the community seized a Shell vehicle that was being used to fight the fire last week. There are indications the vehicle may be released this week, following three-way discussions between the community, the local authorities and Shell.

Roseline Konya, the Rivers State commissioner for environment, had previously made public criticisms of Shell over the Rukpokwu spill. The government would insist on Shell paying adequate compensation to the community, she said. "We also see negligence, delay and lack of good-will from Shell on this matter," Konya told reporters in Port Harcourt according to Dow Jones on January 9th.

This incident is the latest indication that the 'system' for dealing with spill-response is broken. From the perspective of communities and local human rights groups, this is seen as further evidence of Shell's overall attitude to dealing with these incidents: at their own convenience. There is a perceived double standard. Would Shell respond this way to a spill in Scotland or in Texas?

The incident comes at a time when Nigeria is becoming an increasingly important test of the claims of oil companies like Shell to transparency and Corporate Social Responsibility (or CSR, to give it the acronym favoured by policy wonks in Europe and America.) Shell's senior management is coming under pressure from its shareholders to sort out its Nigerian operations.

Shell announced in mid-January 2004 that 3.9 billion barrels of oil and gas, or one-fifth of its reserves, were no longer 'proved' - meaning they can't be retrieved as quickly as thought - much of which are in Nigeria, which is crucial to Shell's over-all operations. Shell's shares have dropped from 401p to 359p following the announcement.

Shell has so-far failed to explain the sudden re-grading of its reserves to angry shareholders, but shut-downs, spills and community conflicts are likely to be one major factor making it difficult for Shell to guarantee its supplies in the delta. Is this a failure of corporate governance generally, or of Shell's approach to "CSR" and community-relations in places like the Niger delta? Shell investors must wait for a presentation on 5th February for an explanation by chairman Sir Philip Watts, but they had earlier called for the resignation of the man who used to run Shell's Nigeria operations.

The debate on the merits of Shell's CSR claims rages on in developed countries, but in Nigeria the standard responses from all sides - oil companies like Shell, and oil-producer communities - involved in a spill like Rukpokwu seems to be producing the perverse outcome of delaying spill-containment.

There are also good reasons to question whether third-parties to spills, like clean-up operators - the main financial beneficiaries of oil-spills in the short run outside of the affected communities - share an interest with community leaders and activists in minimising the impacts of a spill on the environment, and public health and safety.

For its part, Shell's knee-jerk response to 'sabotage' - which has the effect of delaying spill-responses - is fuelling a lack of trust and sense of general grievance in oil-producing communities.

There is growing concern that the frustration felt by oil-producing communities at the failure of the oil-industry to deal with spills quickly and adequately is combining with general political instability in the region, with possibly calamitous results.

"Ethnic conflicts" rage over land in the oil-producing Warri region - to the north of Port Harcourt - which in reality are also part of a wider war between criminal groups and factions in the army, navy and government for control of black-market oil and a host of other related issues.

Following elections in 2003 that were criticised by international observers as unfair, resentment is simmering in the delta. The oil industry extracts billions of dollars-worth of oil from the impoverished region, but the Nigerian government returns a tiny fraction of this to the producer-communities. Much of this disappears through bribery of government officials. Groups like Transparency International routinely rate Nigeria as one of the world's most corrupt countries.

In the Niger delta, local conflicts are combining with a general sense of political and economic disenfranchisement to make a highly combustible mixture. The oil companies must share part of the blame for creating this volatile situation, through their environmental management. The creeks and inlets of the Niger delta are threaded with a network of pipelines, many of which pre-date Shell and other companies' operations in the 1970s. The age and general state of deterioration of pipelines will become a significant issue in the delta more widely, if oil-producing communities' frustration over continuing spills like Rukpokwu build up.

* Tim Concannon is with the Stakeholder Democracy Network

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