A Review of the Nigerian Energy Industry

Shell pays Nigeria military, police $65m to guard oil facilities

20 August 2012, Sweetcrude, LAGOS – THE Royal Dutch Shell paid Nigeria’s military and police $65 million over two years to secure company facilities, an oil industry watchdog said on Monday, alleging the firm had bankrolled forces widely accused of rights abuses.

Citing leaked company documents, London-based Platform said Shell spent a total of $383 million (310 million euros) on security in Nigeria between 2007 and 2009, when a rebel insurgency in the oil-rich Delta region was at its peak.

Those funds partly paid for the Anglo-Dutch company’s own 1,200-member force as well as the protection provided by some 1,300 government forces who guarded Shell’s facilities, Platform said.

An estimated $127 million was spent on unexplained category marked “other,” the documents show.

A spokesperson at Shell’s Nigeria subsidiary did not comment on Platform’s figures, saying only that protecting company staff and assets is “Shell’s highest priority.”

“Shell’s total support for government forces in Nigeria reached an estimated $65 million.
This is a staggering transfer of company funds and resources into the hands of soldiers and police known for routine rights abuses,” Platform charged.

The group’s Nigeria researcher Ben Amunwa told AFP those payments were “a stunning failure of due diligence,” as Shell was well aware that Nigeria’s security forces had long been accused of brutality by international and domestic rights groups.

Amunwa said the report was based on documents given to Platform by a source closely familiar with Shell’s security budget who approached the watchdog independently.

The largest category in Shell’s security spending over the two-year period was labelled as “Other,” Platform said.

“There is evidence that indicates Shell used this ‘other’ budget for a variety of questionable purposes,” the report said.

US diplomatic cables published by Wikileaks indicated some of the company’s funds were channelled to militant groups in the Delta, according to Platform’s report.

“All our staff and contractors are expected to adhere to the highest levels of personal and corporate ethics,” Shell said in the statement sent to AFP.

“We have always acknowledged the difficulties of working in countries like Nigeria. In the period that this report refers to, the armed militancy in the Niger Delta was at its height, requiring a relatively high level of security spending there,” it added, referring to the Platform report.

A 2009 amnesty deal sharply reduced unrest in the Delta and production, which had been curbed by the violence, has rebounded.

Earlier this month, Nigeria, Africa’s top oil producer, said output had reached at all time high at 2.7 million barrels per day.

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