By Ejekwu Chidiebere
Only in 2024, Shell Plc said it remitted $5.34 billion in taxes and other sundry charges to the Nigerian government thereby marking the highest payment ever made to any country where it operates.
“While Shell’s activities boosted GDP and government revenue, much of the wealth was concentrated in federal coffers and elite hands. Local communities in the Niger Delta saw little of the benefits despite being the production base.”
The UN Special Rapporteurs’ letter to Shell states that, “The repeated oil spills in the Niger Delta over a span of decades severely affected the right to life, the right to a clean, healthy and sustainable environment that is free from toxic substances, the right to the highest attainable standard of health, the right to safe drinking water, the right to an adequate standard of living, the right to food, the right to housing, cultural rights, the right [of] access to information and the right [of] access to remedy.”
“The UN Special Rapporteurs have concurred with our finding,” says Amnesty International (Nigeria’s Director) Isa Sanusi, “that the repeated oil spills in the Niger Delta amount to violations of human rights. For every right violation, there must be a remedy. Shell and other companies responsible for oil spills in the region must therefore clean up affected areas and compensate local communities for the decades of harm caused by those violations…”
“We call on Shell and other oil companies to responsibly divest themselves of assets and operations in a way that respects human rights and the environment. Just because Shell recently sold its Nigerian subsidiary, it does not absolve the company of responsibility for its past actions.”
In its response to “Isa Sanusi, Amnesty International Nigeria’s Director, leading a UN Special Rapporteurs on Human Rights, reference No. AL OTH 61/2025”, Shell said:
“Shell has been active in Nigeria since 1937, and over that time, has invested in multiple companies involved in the development and production of oil, gas, liquefied natural gas (LNG) and other energy products, often in a pioneering role and at the forefront of the development of Nigeria’s energy sector.”
Shell went ahead: “Over this time, Shell Companies in Nigeria made substantial economic and social contributions to the Nigerian economy, contributing to Nigeria’s GDP growth through the procurement of goods and services and the employment of a large workforce. Furthermore, the Shell Companies in Nigeria actively developed the technical capability of their Nigerian staff and made other contributions to Nigerian society, especially in education and other social sectors.”
On the allegation that Shell’s divestment was evasive, a cover-up and smart attempt to get off the hooks, the Dutch firm said: “The divestment was designed to preserve the full range of operating capabilities of the operator of the joint venture, including the technical expertise of its staff, and the management systems and processes that Renaissance uses. Renaissance will continue to be accountable for its share of commitments within the joint venture which includes conducting any clean-up and remediation where spills may have occurred in the joint venture’s operations.” Besides, “The divestment also aligns with Shell’s global strategy and its intent to focus future disciplined investment in Nigeria in its offshore deep-water and integrated gas businesses.”
“Our internal acquisition and divestment processes are described in the 2024 Annual Results and Accounts. Furthermore, the divestment was subject to approval by the Federal Government of Nigeria. The Government conducted its own due diligence and probed various aspects of the buyer and the transaction. Upon completion of its extensive review, it granted its approval in 2024 in accordance with the applicable regulations. Of course “Our approach is informed by the UN Guiding Principles on business and human rights.”
It then averred: “Shell sees significant overlap between the information you (referring to Isa Sanusi and his team) “have received and allegations made in a case that Shell plc and Renaissance are currently defending in the English Courts. We dispute the accuracy of the facts and circumstances set out in your letter. We also disagree with the letter’s incomplete and out-of-context description of the preliminary issues judgment handed down by the English Court in June 2025.
“The Court has not yet made any ruling on the merits of the case, and the trial is scheduled to take place in 2027, so you will appreciate that we are unable to comment further on the matters which are before the Court,” Shell said.
Information sources provide that the country referred to as “Nigeria” has a total area of approximately 923, 769 square kilometers (or 356, 669 square miles), making it the largest country in West Africa and the 14th largest in Africa.
It was considered a promising economy in the continent in the 50s and early 60s in view of its “manageable level of external debt”, complemented with “some degree of balanced regional economic contributions”. Findings from intelligent sources revealed that as at the end of 1952, the country had recorded approximately £21.24 million as debt, also reported as procurement made for infrastructure development purpose. Rail and port systems reportedly worked efficiently, serving effectively as agricultural and mineral export channels. “The economy was more diversified, stable and highly rated.” Mention was also made of its strong export-driven base, “proving itself in terms of strength in rural livelihoods and regional economic specialization.” That was Nigeria prior to the discovery of crude oil in the Niger Delta in 1956.
Oloibiri was described as the “beacon of Nigeria’s progress” following the discovery and export of crude oil by Shell in 1956 and 1958. Thus, from an agro-based economy Nigeria moved on to an oil-based economy, boasting the country’s GDP and exports, as well as government revenues, that by the late 1970s, oil was already accounting for over 80% of government revenues, much of which came from Shell-operated fields. To as many Nigerians then as were aware of the huge socioeconomic and infrastructure development implications of finding large volume of oil like Shell did, Nigeria was not only supposed to lend to countries money and ideas, but could also have built credible legacies, as the “giant” of Africa, to support upcoming countries in a continent where meritocracy has been sacrificed on the altar of political mediocrity.
General Yakubu Gowon, Nigeria’s Military Head of State (1966–1975) may have spoken out of excitement when he was reported to have publicly told the world that, (quote): “Money is not our (Nigeria’s) problem but how to spend it” (unquote). Incredibly naive though the utterance may have suggested, and reported as coming from the General in the 70s on the heels of the first oil discovery at Oloibiri by The Royal Dutch (Shell D’ Archy as it then was), it probably may not be argued that the ‘unbridled’ excitement and ‘unguided’ claim could possibly have set the tone of socioeconomic and political malady that now characterize the Nigerian political space on the current trajectory. Gowon’s regime was not just reportedly known for legalizing the centralization of oil revenue, it was also criticized for its failure to regulate environmental impacts, while ensuring that equity was given its own fair consideration.
Post Shell Era
Period by period account had shown that Shell’s contributions to Nigeria’s infrastructure development and economic growth since it began oil exploration and production in the country — dating back to 1937 (exploration) and notably 1956/1958 (discovery and production in Oloibiri) were unarguably monumental.
In 1958 when the first commercial crude oil was exported by Shell, Nigeria was reported to have earned £48,000 which also, according to analysts, represented a meagre 0.06% of total federal government revenue. Energy Window International (Media) understood that throughout 1958–1968, crude oil only made a negligible, marginal impact of about 5% on the average, and rising to about 15.9% in revenue between 1969 and 1970. In 1972, revenue soared, accounting for over 50% of federal collections.
Through taxes, royalties, and joint venture payments, Shell became one of Nigeria’s largest revenue sources, making contributions toward national development. Energy Window International (Media) gathered that between 2010 and 2020, Shell made contribution of over $40 billion in payments to enable the Nigerian government finance its national budgets, address various infrastructure deficit, as well as strengthen corporate social engagement programs within the host communities.
Economic indicators had shown that Shell’s post 1956 period saw Nigeria’s GDP growth while accelerating dependence on oil, that by 1980, it was already accounting for about 30% of the country’s GDP, also seen by analysts as a significant increase from less than 3% in 1969. Oil exports surged, reaching $25 billion in 1980 and constituting 96% of total exports. Per capita income equally rose from $130 in 1969 to over $1,100 by 1980, according to intelligent sources. EWI Publishers gathered that the boom which eventually led to increased government spending also impacted public expenditure growth that GDP rose from an average of 13% during 1970–1973 to 25% in 1974–1980.
It doesn’t need any further emphasis that throwing away “the child with the dirty water” is a fundamental error. As a catalyst for industrialization, Shell’s operations were widely reported to have triggered the influx of other multinational oil companies which also metamorphosed into an energy cluster, stimulating foreign investment and setting up different levels of infrastructure and creating employment opportunities. It won’t go without emphasizing that Nigeria’s early credibility in OPEC as a crude oil exporter, its foothold in the global oil market, were all established through the instrumentality of Shell.
Recall that crude oil has contributed over 80% of Nigeria’s foreign exchange over the years, with all indicators pointing at Shell as one of the largest producers. It’s on record that between 2010 and 2020 alone, Shell’s upstream operations contributed over $43 billion to the Nigerian government in taxes and royalties. Statistics also showed that in 2022, Shell paid over $1.2 billion to the Nigerian government, employed thousands of Nigerians in direct and indirect jobs in SPDC and its affiliates – SNEPCo as well as Shell Nigeria Gas amongst others. There’s no need also reiterating that Shell’s contribution on the country’s local content development has been significant. Shell for instance developed capacities in welding and fabrication, and provided financial and infrastructure backups for Nigeria’s geosciences and offshore engineering development and growth. It also built, as well as operated over 6,000km of pipelines, 50+ flow stations, and gas facilities across the Niger Delta. It has equally pioneered deep offshore production through the Bonga field (2005), regarded as the first of its kind in Nigeria.
Shell’s record on community projects (CSR & GMOU programs) for which it has received multiple national CSR awards, including “Best in Sustainability Innovation” by SERAs in 2015 and 2017, has never been surpassed, not even in the recent years. Records also show that since 2006, Shell has implemented numerous projects via the Global Memorandum of Understanding (GMoU) with host communities, including investment of over $250 million on projects such as construction of health centres, roads and bridges, school buildings and water boreholes, as well as provision of rural electrification and award of scholarships.
Thus between 2006 and 2017, Shell said it invested, through its SPDC JV, N41.10 billion (US$228 million) across 37 GMoU clusters—covering Rivers, Delta, Bayelsa, and Abia States. It was disclosed that Bayelsa alone received N21.71 bn (52%) in 2017, while Rivers got N14.86 bn by the end of 2017. Only in 2019, Bayelsa’s GMoU pay from Shell hit N23 bn (US $60 million), out of a total N44.36 bn across Niger Delta. And don’t forget that these figures were mere fractions from what these individual governors in the States of the Niger Delta have received over time.
At the University of Benin, Shell established what it called, “Centre of Excellence in Geosciences”, sponsored technical training programs for youths in the Niger Delta, initiated and effectively ran “Shell Nigeria University Scholarship” (for secondary, undergraduate, and postgraduate students) – all of which are laudable programmes put in place to help students especially across the Niger Delta achieve their ambition academically and economically while making meaningful contributions in advancing the country’s energy industry.
On health-related matters, Shell has not relented, and so has been able to build, as well as equip hospitals and maternity centres, spent millions of dollars on environmental cleanup projects, since the year 2000.
In 2015 Shell Group said it spent US $195.5 million on social investment, including US $50.4 million via SPDC/SNEPCo and US $145.1 million remitted to NDDC, reported contribution of US $29 billion to federal revenue in 2017, alongside US $1.8 billion to NDDC to cover for 2012 to 2016.
Let’s just recall that between 1999 and 2016, Nigeria was reported to have recorded gross earnings of ₦77.35 trillion, of which roughly ₦41.04 trillion was net revenue after deductions. From 1999 to 2020 (21 years), total oil and gas revenue amounted to approximately $741.5 billion, complemented by ₦635.3 billion from solid minerals.
According to NEITI, 2010–2019, oil and gas revenue totaled $418.54 billion, with the highest ($68.4 billion) recorded only in 2011, and the lowest in 2016 to the tune of $17.05 billion. From Jan 2023 to Sep 2024, crude oil export earnings hit ₦73 trillion, with revenues surging nearly 200%, growing from just over ₦5 trillion in Q1 2023 to ₦15 trillion in Q1 2024.
Therefore in an attempt to criticize, let it borne in mind that the foundation of economic exploitation and environmental pollution began with the leadership styles of the various regimes in Nigeria – from late Tafawa Balewa’s First Republic (1960–1966) until date. Available statistics showed that though Nigeria’s reliance on oil deepened, there were no clear oil exploration and production, as well as environmental protection laws or community safeguards in place. Weak institutional oversights, exacerbated by the obvious lack of control over oil operations by the state authorities didn’t help matters. Even when oil became Nigeria’s primary income source during the 1970s oil boom, the Petroleum Act of 1969 (as it then was) still allowed full control of resources by the government at the Centre who also worked hand in hand with the expatriate companies in displacing and emasculating the oil producing communities even as economic mismanagement and corruption under late Shehu Shagari reportedly became more prevalent, fuelling continued negligence and abysmal lack in transparency and community engagement
Therefore, in seeking justice for the ‘depraved’ in the Niger Delta, there’s need for more critical questions, not just on the failures of Shell and others to “clean up” spills, but also about the roles, failures and complicity of successive regimes in Nigeria which made the enactment and or enforcement of the enabling environmental laws in Nigeria practically impossible.