An oil site operated by Royal Dutch Shell’s (RDS.A, RDS.B) Nigerian unit has been seized by a state government in a dispute over an oil spill that occurred decades ago.
The government of Rivers state in the Niger Delta sealed off the Kidney Island base located in the Port Harcourt oil hub, saying the facility and Shell’s 30% stake in nearby Oil Mining Lease 11 were “lawfully purchased through public auction ordered by the court.”
Shell says the state government’s statement is “premature and prejudicial,” as the transfer of the oil license requires the approval of Nigeria’s federal minister of petroleum resources, which has not been granted.
Shell has been involved in a long-running legal battle with a local community in Rivers state which has successfully sued the company for millions of dollars in damages for allegedly polluting its land during a civil war in the late 1960s.
Nigeria’s federal government also has been involved in a dispute with Shell over damages related to alleged corruption linked to the company’s 2011 purchase of the OPL 245 offshore oilfield.