Shell’s presence in Nigeria will remain significant. Credit: Jethro Carullo via Unsplash.

Nigerian communities are seeking N505bn ($310m) in compensation from Shell, alleging that the company violated an existing court order by reaching an agreement to offload its onshore assets in the Niger Delta.  

Shell, one of the largest oil majors, is preparing to depart from Nigeria’s onshore oil and gas sector after consenting to sell its operations to five predominantly local companies for $2.4bn (£1.83bn) in January. 

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However, more than 1,200 representatives of Ilaje communities in the Niger Delta approached Abuja’s Federal High Court to prevent the transaction, according to several local media sources, citing court documents.  

They claim that Shell is defying a ruling from December 2023 that put on hold any asset sale until a lawsuit for compensation was resolved. 

The case pertains to a reported $2.8bn divestment deal between Shell Petroleum Development Company and a coalition of Nigerian entities. 

The local communities are challenging the transaction, contending that it contravenes an existing Mareva injunction from September 2023. 

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This injunction prohibited Shell from disposing of its Nigerian assets until the case was settled, and the communities claimed that the recent deal between Shell and Renaissance constitutes a clear breach of this order. 

The community said Shell must be penalised for proceeding with the asset sale “when the plaintiffs and the host of their community members have remained in perpetual suffering over the failure of the defendants to obey the preservative orders of a competent court”, as reported by a US media outlet. 

In January, Shell reached a divestment agreement worth $1.3bn, with an additional $1.1bn in potential payments linked to receivables and cash balances. The deal involves Renaissance, a group consisting of ND Western, Aradel Energy, First E&P, Waltersmith and Petrolin.