A CRITICAL APPRAISAL OF THE OIL SPILLAGES AND ITS ENVIRONMENTAL IMPACTS IN THE NIGER DELTA.

My Dissertation

Submitted to the Postgraduate Faculty of Kent Law School at the University of Kent

Requirements of LLM Environmental Law and Policy

By SABRINA WIGWE-CHIZINDU

Elliot College, 2014

Supervisor: Bill Howarth

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TABLE of CONTENTS

Chapter 1 Introduction 3

Chapter 2 History of Oil and its surrounding environmental issues 42.1 History of Oil 52.2 Nigeria’s oil reserves 62.3 Environmental effects of oil spillages 62.4 Technical Causes of oil spillages 72.5 Global environmental harm of oil spillages 82.6 Ethical consideration 92.7 Research concerns 10

Chapter 3 Assessing the Environmental Legal Framework in Nigeria 113.1 Introduction 113.2 Historical background 123.3 Mineral Oil (Safety) Regulations 133.4 Water Pollution Act 143.5 Petroleum Regulations 14 3.6 The Petroleum Decree (Act) 163.7 Offshore Regulations 20 3.8 Pipelines and its regulations 203.9 Gas flaring and its regulations 233.10 Institutional Framework 253.11 The inadequacies of the litigation process 283.12 International Legal Frameworks operating in Nigeria 29

Chapter 4 A Critical Analysis of why Environmental Statutes are not Enforced 314.1 Introduction 314.2 Petroleum contracts 314.3 Multinational oil company perspective on the enforcement of the Nigerian environmental statutes 35 4.4 Service Contracts 37

Chapter 5 Comparative analysis of environmental statutes regulating oil spillages in the USA 395.1 Environmental impacts of oil spillages in the USA 395.2 American environmental legal framework 39

Chapter 6 Conclusion 44

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Chapter 1

INTRODUCTION

The conceptual nature of environmental pollution and degradation over the years has been a subject of concern both nationally and internationally. One cannot dispute the significance of oil in man’s daily activities. However, the adverse effect of such activities (specifically oil exploration and production) on the environment is an argument that in its entirety has not comprehensively been appreciated. ‘Oil is the mainstay of Nigeria’s economy drawing in well over 60% of the government revenue and provides roughly 96% of Nigeria’s dollar receipts’.1 ‘Oil accounts for over 75 per cent of her foreign exchange earnings2 and over 85 per cent of her gross domestic product (GDP)3. More specifically, in Nigeria, the Niger Delta Region (NDR) holds the vast concentration of the country’s oil and gas resources for instance, an estimated US$600 billion is said to have been generated through oil and gas in Nigeria since the commercial discovery of oil and gas in the NDR’.4

In the light of such wealth, it has brought environmental degradation and social injustice to the country of which host communities are adversely affected. From pollution of water bodies in riverine areas where fishing is the primary occupation of the natives, to destruction of vast farm lands by oil spillage, and pollution of the air from gas flaring’. 5 Amnesty International found that “more than 60 per cent of people in the region depend on the natural environment for their livelihood,” said Audrey Gaughran “yet, pollution by the oil industry is destroying the vital resource on which they depend on.”6 The writer ponders over the extent to which the Nigerian government has impacted into remedying environmental degradation arising from oil spillages. How effective and efficient are the laws regulating environmental degradation? Without doubt, oil spillage is not uncommon in other parts of the world for instance oil tanker Exxon-Valdez oil spill off in Alaska occurred in 1989 and ‘well-blowouts’ by Mexico’s Ixtoc spilled an estimated 3 million barrels of oil into the Gulf of Mexico in 1979’.7 ‘The Gulf oil spill 2010 is recognized as the worst oil spill in U.S. history by Shell-BP’.8 The most important from all this incidence is remediation of the environment. The environmental quality standards put in place by these developed countries makes it look as if oil

1 Jedrzej George Frynas, ‘Oil in Nigeria: Conflict and Litigation Between Oil Companies and Village Communities’ (LIT Verlag Munster, 2000) 1.2 Sylvester Oscar Nliam, ‘International Oil and Gas Environmental Legal Framework and the Precautionary Principle: The Implications for the Niger Delta’ (2014) 22 African Journal of International and Comparative Law 1, 23. 3 M.O. Ameh, ‘Too Much Hype about Nigeria’s Oil’ available at http://www.hollerafirca.com/showArticle.php?artld=157&catd=2&page=3 > accessed 19 July 2014; Nliam (n2)23.4 Dr. S.O. Aghalino, ‘Oil and Cultural Crisis: The Case of the Niger Delta’ (2011) 5 Africana Special Issue: The Niger Delta 1, 1. 5 P.O. Itsueli, ‘Environmental pollution in Nigeria: an appraisal of corporate social responsibility for victims of Oil pollution in Nigeria’ in Festus Emiri and Gowon Deinduomo (edition) ‘Law and Petroleum Industry in Nigeria: current challenges. Essays in honour of Justice Kate Abiri Malthouse law books’ (African Books Collective, 2009)107.6 Amnesty International, ‘Oil industry has brought poverty and pollution to Niger Delta’ (Amnesty International, 2009) available at http://www.amnesty.org/en/news-and-updates/news/oil-industry-has-brought-poverty-and-pollution-to-niger-delta-20090630 > accessed 17 July 2014.7 Volkmar Lauber, ‘Oil Pollution’ in John Barry and E. Gene Frankland (edition) ‘International Encyclopaedia of Environmental Politics Dekker Mechanical Engineering’ (Routledge, 2014) 361.8 The Ocean Portal Team, ‘Gulf Oil Spill’ http://ocean.si.edu/gulf-oil-spill > accessed 18 July 2014.

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spillages have not occurred, however, the critical import is that the environment has been damaged. Therefore, are the Nigerian laws in place well-suited with international standard on preventing oil spillages? How can one quantify the Nigerian approach on dealing with environmental pollution to get the most out of the environment? Having this in mind, one of the prominent disturbing issues as regards the continuance of oil spillages in the NDR is poor and weak regulatory system in the oil sector. As succinctly argued by commentator, “oil companies have been exploiting Nigeria’s weak regulatory system for too long…they do not adequately prevent environmental damage and they frequently fail to properly address the devastating impact that their bad practice has on people’s lives”.9

On a critical framework this paper will appraise the environmental impact oil spillages have had on the Niger Delta region of Nigeria, by comparatively looking at the methods and procedures of curtailing such degradation by the Nigerian government with that of developed countries like the United States of America have dealt with and curtailed such environmental degradation. Firstly, the paper will enquire into the historical background of oil exploration and spillages in the NDR, the surrounding issues as regards to the environment and how legislation has developed. Furthermore, the piece will identify the legal frameworks for oil pollution in Nigeria and assess the effectiveness of such regulatory provisions. The writer’s puzzling questions have been: why Nigerian policies on environmental issues specifically as regards its quality are considered weak and poor in managing oil spillages in the Niger Delta and what mechanisms have been put in place in enforcing legal standards on multinational companies? In addition, the paper will explore by examining why environmental provisions are not enforceable in Nigeria whereby environmental sustainability is not as apparent. Fourthly, this paper will examine the environmental standards in Nigeria by comparatively analyzing the oil spillages provisions in the United States. The questions of whether or not there should be a need and the necessity of Nigeria upgrading to an international standard of controlling and preventing oil spillages will be dealt with. In terms of legal infrastructure and enforceability, is there a difference between a developed country asserting environmental principles and a non-developing country? But still the question is, what positive and urgent attitude does and have the Nigeria government displayed in handling such environmental matters and what quality standards have been put in place.

CHAPTER 2

9 Amnesty International (n6)

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The History of Oil and the surrounding environmental issues

2.1 History of Oil

‘Environmental pollution has become a matter of grave concern all over the world. Oil was first discovered in 1908 at Oloibiri, which is presently situated in Bayelsa State however the outbreak of the World War I ceased this exploration, which unfortunately permitted the Nigerian German Bitumen Company10 to cease its operations.11 ‘The next concession was given to Shell D’Arcy Petroleum Development Company in 1938 whereby it attained an oil exploration license covering the entire mainland of Nigeria (375,000 square miles) – its monolithic position enabled them to leisurely explore and select choice acreage until 1957, by which time it retained 15,000 square miles of the original concession area’12 creating room for other oil corporations particularly Chevron, Mobil, Agip, Elf and Texaco13 and the Nigeria State to enter the industry.14 Still, Shell controlled most petroleum reserves hence in 1995; it attained 20 billion barrels of oil excluding the untapped areas. In addition to such monopoly over oil, Shell reserves for natural gas are of a similar magnitude.15

2.2 Nigeria’s oil reserves

Most of the oil exploration activities are carried out under joint ventures16 of which 60% is controlled by Nigerian National Petroleum Corporation (NNPC) except the ones owned by Shell in which it upholds 55%, Mobil, Chevron and Elf attain 40%, Agip, Texaco and Phillips 20%.17 Multi-national oil companies (MNCs) ‘are very rich in all ramifications because of the profit they make in Nigeria mainly because Nigeria is one of the largest producers of oil in the world which accounts for over 80% of her income. Considering the fact that oil feeds the economy, MNCs who make enormous profit from the industry effectively control it.18 Ameh also concurred on how powerful MNCs are for instance, it claimed that Nigeria accounts for about 95% of her foreign exchange earnings.19 Irrespectively, section 44 (3) of the currently used 1999 Nigerian Constitution asserts authority to the Federal Government to be in ‘control of all minerals, mineral oils and natural gas in, under or upon any land in Nigeria, its territorial waters, and exclusive economic zone’. Petroleum shall ‘vest in the Government of the Federation and shall be managed in such manner as may be prescribed by the

10 German Company11 Itsueli (n5) 108. 12 Yinka Omorogbe, ‘Oil and Gas Law in Nigeria simplified’ (Malthouse Press Limited, 2003) 16-17. 13 Manfred Loimeier, ‘Zum Beispiel Ken Saro-Wiiwa, Die Hinrichtung des Umweltschützers und Schriftstellers Ken Saro-Wiwa und weiterer Oppositioneller, der Kampf des Ogoni-Volkes gegen Shell und die Lage in Nigeria’ in Tobias Haller (edition) ‘Fossil Fuels, Oil Companies, and Indigenous Peoples: Strategies of Multinational Oil Companies, States, and Ethnic Minorities: Impact on Environment, Livelihoods, and Cultural Change’ 1 (LIT Verlag Münster Action Anthropology Aktionsethnologie, 2007) 67.14 C. Obi, ‘Oil, Environmental and conflict in the Niger-Delta’ in Augustine Ikelegbe (edition) ‘Oil, Environment and Resource Conflicts in Nigeria’ 7 Politics and Economics in Africa (LIT Verlag Münster, 2013).15 Shell [1995:2) in Tobias Haller ‘Fossil Fuels, Oil Companies, and Indigenous Peoples: Strategies of Multinational Oil Companies, States, and Ethnic Minorities: Impact on Environment, Livelihoods, and Cultural Change’ 1 (LIT Verlag Münster Action, 2007) 67.16 Oil Revenue, ‘Nigeria’s Oil Industry Communicating the Basics’ (Oil Revenue Tracking Initiative, 2013) http://oilrevenueng.org/Campaign_Reports/Report1.pdf > accessed 15 August 201417 Madaki O Ameh, Ownership and Control of Mineral Resources: Can The Brazilian Model be used to Douse Resource Control Agitation in Nigeria’s Oil Producing States?’ unknown 10 CEPMLP 3.18 Aworom Annang, ‘Multi-National Corporations and Development in Nigeria’ (2011) 1 African Journal of Culture, Philosophy and Society 1, 2. 19 Ameh (n14) 2.

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National Assembly’. This includes activities consisting of exportation, incorporation and regulation of corporate bodies, mines and minerals (including oil fields, oil mining, geological surveys and natural gas) and taxation of incomes, profits and capital gains’.20 Hence, the ‘federal government negotiates the terms of oil production with international oil companies, and takes a proportion of the revenue generated’.21

Okereke and Ekpe (2002) bring to light issues which are mystifying to the writer when it states that MNCs are ‘powerful conglomerates’ whose resources can weaken and challenge indigenous entrepreneurs, overlap local economies and ‘their domination is hardly ever challenged’.22 One cannot dispute how influential MNCs are however, the writer is puzzled as to what environmental laws in Nigeria allow her to assert authority when dealing with MNCs and how effectively is it enforced.

2.3 Environmental effects of oil spillages

The affluence oil industry has brought in Nigeria cannot be overestimated however, the environmental harm it has brought is too severe to ignore particularly for host communities causing many other commentators like Emmanuel Nnadozie to describe Nigeria’s natural resources, ‘oil [as] a curse which means only poverty, hunger, disease and exploitation’.23 The consequences of environmental damage arising from oil spillages bring a lot of troubling issues for instance; civilians have lost their lives from fire disasters emanating from burst pipelines.24 Civilians are at war with themselves in example, ‘kidnappings and murder of expatriates and other persons is on the increase…because the host communities to these exploration activities are saying, their means of livelihood have been destroyed whether as fishermen or farmers, yet the companies carrying out these exploration activities and the government have not adequately compensated them and not provided an alternative means of survival for them. So in other words, social responsibility from the government and oil companies to cushion the effects of the degradation of their environment [of host communities] is either non-existent or insufficient’. 25

The extent of the environmental impact of spillages severely affects host communities. In example, offshore spills taint coastal environments in the NDR, causing drop in local fishing production, 7,700 km of rainforest has disappeared, approximately 5-10% of Nigerian mangrove ecosystems have been wiped out by oil due to acidification of oil hindering cellular respiration and starving roots of oxygen.26 As a result, the environmental impact adversely affected socio-economic development i.e. loss of business profits and subsistence rights for commercial fishing, shrimp and oyster industries, rental property owners and hotel owners; forced displacements and loss of property, 200, 000 Niger Deltans have been forcefully displaced from their homes due to oil spills; the health issues consist of asthma, breathing difficulties, headaches, nausea, bronchitis due to the exposure of dangerous

20 Wumi Iledare and Rotimi Suberu, ‘Framework Paper: Oil and Gas in the Federal Republic of Nigeria’ (2010) Conference on Oil and Gas in Federal Systems, 2. 21 Bronwen Manby, ‘The Price of Oil: Corporate Responsibility and Human Rights Violations in Nigeria’s Oil Producing Communities’ (1999) 2156 Human Rights Watch, 27. 22 Annang (n15) 2.23 Emmanuel Nnadozie, ‘Oil and Socioeconomic Crisis in Nigeria’ (Mellon University Press, 1995) 75.24 Itsueli (n5) 107.25 Itsueli (n5) 108.26 Damilola S. Olawuyi, ‘Legal and Sustainable Development Impacts of Major Oil Spills’ (2012) 9 Consilience: The Journal of Sustainable Development 1, 6.

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substances and chemicals as illustrated in Abiola v Ijeoma (1970) 2 ANLR. The right to health is an imperative aspect in many international treaties such as the UDR which asserts everyone the ‘right to a standard of living adequate for health and well-being of himself and of his family’. Oil workers and local people have lost their lives due to the oil spill.27 Studies reported that ‘a year’s supply of food is often destroyed by only a minor leak of oil’28 so what remedies are available to them that protect them from oil spillages? The writer questions how effectively and appropriately are the environmental laws placed in Nigeria that offer remediation to civilians suffering from the environmental impacts of oil spillages?

2.4 Technical Causes of oil spillages

In more detail, understanding where environmental degradation stems from is another area of concern that clouds the writer’s conception on Nigeria’s efforts to combat such pollution. ‘‘The largest contributor to oil spillages is corrosion of pipelines and tanks where the rupturing or leaking of production infrastructures are described as “very old and lack regular inspection and maintenance’29 Many of the pipelines Nigeria uses are as old as twenty to twenty-five years.30 Pipelines are a prerequisite element of transportation, storage and marketing petroleum products covering over 3,000 km in Nigeria of which run across the rivers, creeks, swamps and farmland in the NDR.31 ‘Pipelines have an estimate life span of fifteen years, are old and susceptible to corrosion. Supplemented by Shell, ‘most of the facilities were constructed between the 1960s and early 1980s to the then prevailing standards’.32 Essentially, the writer questions if there are any environmental laws in Nigeria that ensure proficient mechanical standards when oil exploration takes place to prevent environmental harm?

In addition to poor refineries and management of oil exploration, sabotage (which is known as bunkering) involves illegally tapping into a pipeline to extract oil, in the process the pipeline is damaged or destroyed – oil is then sold under a black market. Sabotage cases are regarded as ‘minor’ therefore is under-reported.33 This detrimental to the environment because according to the World Bank ‘the true quantity of oil spilled into the environment could be as much as ten times the officially claimed amount’.34 The writer ponders if there are any environmental laws in Nigeria that hold civilians accountable of the pollution caused and what further precautionary regulations have taken place to keep an eye on minor oil spillages.

Another detrimental issue arising from oil spillages is gas flaring. According to Nliam, ‘more gas is flared in Nigerian than anywhere else in the world.35 Nigeria currently flares 75 per cent of the gas it produces. According to Cedigaz, Nigeria accounted for 19.79 per cent of global flaring in 2001, more 27 Olawuyi (n19) 6-11.28 Olawuyi (n19) 4. 29 Usa Ibp Usa, ‘Nigerian Oil and Gas Exploration Laws and Regulations Handbook’ (Int’l Business Publications, 2014) 73. 30 Usa (n20) 74.31 K.N. Agbaeze, ‘Petroleum Pipeline Leakages in PPMC Report for Chief Officers Mandatory Course 026’ [Land A.O. Olomola, ‘Nigerian Environmental Law: A Critical Review of main Principles, Policy and Practice’ in Friday Adejoh Ogwu (edition) ‘Challenges of Oil and Gas Pipeline Network and the role of Physical Planners in Nigeria’ (2011) 10 International Journal of Post graduate studies 1, 42.32 Usa (n20) 74. 33 Usa (n20) 74.34 Usa (n20) 74.35 Nliam (n2) 25.

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than the second (Iran) and third (Indonesia) countries combined.36Also, the UNDP/World Bank in 2004 estimated Nigeria’s flaring at close to 2.5 billion cubic feet daily (over 70 million cubic meters daily), amounting to 70 million cubic tons of carbon dioxide yearly.37 Gas-flaring emissions (which are toxic as they involve sulphur dioxide, nitrogen dioxides and hydrogen oxides38) contribute significantly to global warming because the extra gases burned off are released into the atmosphere during the oil-drilling process. Also, high volumes of methane and Co2 are released into the atmosphere39 all of which are significant contributors to global warming and climate change.40 Gas flaring also contributes to numerous health diseases among residents such as respiratory problems, cancer, blood disorders and skin diseases (or death) which as a result ‘life expectancy in the NDR is markedly lower [in comparison to other parts of Nigeria]…[the average age of death in the NDR] is about 40 years’. 41 A former deputy governor, Mr Ebere Udeagu said that ‘gas flaring…has terribly devastated a substantial portion of farmlands leaving streams extremely polluted’ disrupting fishing and farming.42 How sensitive are the environmental laws in Nigeria in regards to gas flaring and what remediation is available to compensate civilians?

2.5 Global environmental harm of oil spillages

Considering the fact that ‘Nigeria is one of the highest emitter of greenhouse gases in Africa and among the highest in the world’43, one cannot dispute the urgency of implementing effective environmental laws in Nigeria that employ more use of sustainable development and other environmental measures particularly because the NDR ‘has the third largest mangrove forest in the world, the largest in Africa, one of the world’s largest wetlands’. Such mangrove serve a lot of value in sustaining local communities ‘because of the ecological functions they perform and the essential resources they provide such as soil stability, medicine, healthy fisheries, wood for fuel, shelter, tannins and dyes and critical wildlife habitats’.44 In Nigeria, what environmental regulations cover such sensitive issues because according to a commentator, gas flaring and oil spillages are too detrimental to the environment to a point where ‘it could take 25 to 30 years, with an initial investment of $1 billion just for the first five years, to clean up pollution from more than 50 years of oil operations in the Niger Delta, ranging from the “disastrous” impact on mangrove vegetation to 36 Nliam (n2) 25.37 Nliam (n2) 25.38 The Climate Justice Programme & Environmental Rights Action/Friends of the Earth Nigeria, Gas Flaring in Nigeria: A Human Rights, Environmental And Economic Monstrosity 2 available at http://www.climatelaw.org/media/cases/case-documents/nigeria/gas-flaring-in-nigeria.pdf in Eferiekose Ukala, ‘Gas Flaring in Nigeria’s Niger Delta: Failed Promises and Reviving Community Voices (2011) 2 Washington and Lee Journal of Energy, Climate, and the Environment 1, 101.39 Nnimmo Bassey, Gas Flaring: Assaulting Communities, Jeopardizing the World 9-11 available at http://www.araction.org/publications/presentations/gas-flaring-ncc-abuja.pdf in Eferiekose Ukala, ‘Gas Flaring in Nigeria’s Niger Delta: Failed Promises and Reviving Community Voices (2011) 2 Washington and Lee Journal of Energy, Climate, and the Environment 1, 101. 40 Manby (n17) 27.41 Bassey, supra note 17, at 9 in Ukala pg.102 para.442 Eugenia Okpara, Imo Deputy Governor Laments MKeanance of Gas Flaring 2003 available at http://news.biafranigeriaworld.com/archive/2003/nov/27/244.html in in Eferiekose Ukala, ‘Gas Flaring in Nigeria’s Niger Delta: Failed Promises and Reviving Community Voices (2011) 2 Washington and Lee Journal of Energy, Climate, and the Environment 1, 101-102.43 E.C. Ubani and I.M. Onyejekwe, ‘Environmental impact analyses of gas flaring in the Niger delta region of Nigeria’ (2013) American Journal of Scientific and Industrial Research, Department of Project Management, Department of Petroleum Engineering, Federal University of Technology Owerri-Nigeria 246.44 Nliam (n2) 24-25.

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the contamination of wells with potentially cancer-causing chemicals’.45 Nigeria’s global impact of greenhouse gases concerns the writer on what environmental laws in Nigeria covers the international dimension on how to curb environmental degradation arising from oil spillages?

2.6 Ethical consideration

According to Phil Eze, our environment ‘is the total surrounding of man, including air, water land, natural resources, flora and fauna and humans, including their interactions.46 It is incredibly sensitive to human activity because ‘no process, natural or human is 100% proficient’47 thus any environmental harm is regarded as anthropogenic. As succinctly put by Hardin, prises to foul our own nest’.48 Environmental degradation (especially from industrialisation i.e. oil explorative activities) such water and air pollution, deforestation, contribute to loss of biodiversity, greenhouse gases causing ozone depletion, global warming and climate change. It also poses severe consequences which are “economic, social, cultural or political thus environmental security is thus a pivotal matter for communities States and the international community”.49 As a result, the Earth Summit held in Rio de Janeiro, in 1992, a ‘strategy for sustainable development…a blueprint for how mankind must operate in order to avoid environmental devastation”’.50 In conjunction with sustainable development, the ‘polluter pays principle’ (PPP), a twin of the precautionary principle, which attaches liability to the responsible party i.e. MNCs for causing environmental damage’.51 Thus it is requisite for MNCs to consider environmental stability and sustainability when carrying out petroleum exploration and exploitation. This is achievable by ensuring corporate responsibility i.e. MNCs can advocate suitable development that meets the demands of the petroleum industry without stealing from future generations.52 The environmental degradation of oil spillages in the NDR has worsened corrupting riverine life, loss of biodiversity and coastline decline affecting the fishing and agricultural culture host communities depend on for their survival.

2.7 Research concerns

Many researchers particularly Amnesty International accuse MNCs for the majority of environmental degradation occurring yet ‘the Nigerian government can’t or won’t hold’53 them responsible. The writer questions what purpose do environmental laws serve in Nigeria if oil corporations or the Nigerian government are not accountable to environmental damage arising from oil pollution? Arguably, some commentators have acknowledged governmental efforts on regulating and holding oil companies to account however ‘exemptions to oil companies are usually granted, and fines for 45 UN News Centre, ‘Cleaning up Nigerian oil pollution could take 30 years, cost billions – UN’ [UN News Centre, unknown] http://www.un.org/apps/news/story.asp?NewsID=39232#.U8ev2qNwbcs > accessed 15 July 201446 Phill-Eze cited in, C. M. Ichite (2012) ‘Environmental Stress and State Fragility in Nigeria’ in Albert I. O. (edition) ‘A History of Social Conflicts and Conflict Management in Nigeria’ in Okolie-Osemene James and Okanume Jachin Uche, ‘Contravening Environmental Laws: Practices of Multinational Oil Companies in Niger Delta, Nigeria’ (2012) 1 A38 Journal of International Law 3, 5.47 Marquita K. Hill, (3rd edition) ‘Understanding Environmental Pollution’ [Cambridge University Press, 2010) 10.48 Elizabeth Fisher, Bettina Lange, Eloise Scotford, ‘Environmental Law: Text, Cases & Materials’ (Oxford University Press, 2013) 605.49 Onitas Das, ‘Environmental Protection, Security and Armed Conflict: Sustainable Development Perspective’ (Edward Elgar Publishing, 2013) vi.50 Hill (n28) 21.51 Das (n20) 44.52 Dr S. O. Aghalino, ‘Corporate Response to Environmental Deterioration in the oil bearing are of the Niger Delta’ in James Okolie-Osemene and Jachin Uche Okanume, ‘Contravening Environmental Laws: Practices of Multinational Oil Companies in Niger Delta, Nigeria’ (2012) 1 A38 Journal of International Law 3, 6.53 Amnesty International, ‘End Gas Flaring in the Niger Delta’ [Amnesty International, unknown] http://www.amnestyusa.org/our-work/issues/business-and-human-rights/oil-gas-and-mining-industries/end-gas-flaring-in-the-niger-delta > accessed 14 August 2014.

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flaring are criticized as being too light to act as a deterrent. In example, an oil worker in Nigeria, the fines as “so low that it doesn’t justify much investment” to stop flaring’.54 The writer will assess such inadequacies to highlight the urgency for statutory reform particularly as a developing country. A country that has acquired such wealth through the petroleum industry is accountable of the environmental degradation caused from oil spillages, scrutinising their environmental regulations exposes their attitudes towards their people which will to some extent add clarification on what solutions would be suitable and how much international efforts are needed to combat environmental harm such as air pollution, water pollution, ozone depletion and global warming all of which are associated with the effects of oil spillages.

CHAPTER 3

Assessing the Environmental Legal Framework in Nigeria

3.1 Introduction

‘The petroleum industry is the largest internationally traded commodity that shows highly visible interplay of politics and economics of which determine frameworks on investment, production, trade and pricing policies’.55 Oil being the mainstay of the Nigerian economy, the Nigerian petroleum laws specifies on ways in which business should be structured i.e. the economic sides of things,

54 IRIN, ‘NIGERIA: Gas flares still a burning issues in the Niger Delta’ (IRIN, unknown) http://www.irinnews.org/report/95034/nigeria-gas-flares-still-a-burning-issue-in-the-niger-delta > accessed 14 August 2014.55 Godwin Chukwudum Nwaobi, ‘Oil Policy in Nigeria: A Critical Assessment (1958-1992)’ (2005) EconWPA 2.

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operational procedures, responsibility of the government, consumers and Nigerians as a whole’.56 As we know, the ‘high frequency of oil spills [leave] many local communities destroyed, drinking water left contaminated, and the ecosystem and soil composition are irreversibly destroyed…and offshore spills taint coastal environments...causing a decline in the fishing production’.57 Considering how dependent host communities are on fishing and agricultural activities for survival; being forced into displacement; ‘without providing viable alternatives’58 stresses the urgency of having a well-articulated legal framework. This should not be underestimated because above all, our environment is important and essential to humans for survival and prosperity, ‘it is the capsule in which we live in, surrounding us, sustaining us, nurtures us and provides us with the basic requirements of living and amenities and pleasures associated with modern life’.59 What makes a useful statute depends on how adequately environmental problems are addressed and how effectively is it implemented.60 The extent of environmental degradation urges the writer to assess further how responsive and effective Nigerian environmental laws are to environmental degradation.

This is summary of Nigerian legislation on the environment (particularly for oil spills): The Constitution of the Federal Republic of Nigeria (199) Environmental Impact Assessment Act The Land Use Act Harmful Waste (Special Criminal Provisions) Act Hydrocarbon Oil Refineries Act Associated Gas re-Injection Act Sea Fisheries Act Exclusive Economic Zone Act Oil Pipelines Act Petroleum Act (Decree) Petroleum Products and Distribution (Management Board) Act Territorial Waters Act Endangered Species Act Water Resources Act61 Mineral Oil (Safety) Regulations Act Mineral Ordinance Act

3.2 Historical background of environmental legislation

56 Onyekachi Wisdom Ceazar Duru, ‘An appraisal of the legal framework for the regulation of Nigerian oil and gas industry, with appropriate recommendations’ (2011) Social science Research Network 1-2.57 Damilola S. Olawuyi (n19) 4.58 C.O. Okpukri and Ibaba Samuel Ibaba, ‘Oil Induced Environmental Degradation and Internal Population Displacement in the Nigeria’s Niger Delta’ (2008) 1 Fayetteville State University, Journal of Sustainable Development in Africa 10, 174.59 Janet R. Hunter, Zachary A. Smith, ‘Protecting Our Environment: Lessons from the European Union’ (SUNY Press, 2012) 1. 60 George S. Akpan, ‘The failure of environmental governance and implications for foreign investors and host states – a study of the Niger Delta region of Nigeria’ (2006) International Energy Law & Taxation Review. 61 James Okolie-Osemene and Jachin Uche Okanume, ‘Contravening Environmental Laws: Practices of Multinational Oil Companies in Niger Delta, Nigeria’ (2012) 1 A38 Journal of International Law 3, 10.

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Dating back from British ruling in the 1900s, efforts on protecting the environment was regulated under colonial by-laws62 as illustrated in the Mineral Oil Ordinance No. 17 of 1914 which consisted of the ‘right to search for, win, and work mineral oils’. This main legislation had nothing concerning environmental protection in all its 10 sections.63 It specified that ‘no lease or license shall be granted except to a British subject or to a British company registered in Great Britain…and having its principal place of business within her Majesty’s dominions’ and must be administered by ‘British subjects’.64 Again it is evident that such laws contained little or no provisional rules to preserve Nigeria’s national resources or protect and abate pollution.65 This salient feature was that to strengthened Shell-BP’s monolithic position over lands of which ‘to restrict competitive drilling’.66 Section 6(1)(b) of the Mineral Oils Ordinance 1914 provision states that the grantee of the lease or licence pay compensation to any person in lawful occupation of the land for disturbance of surface rights or as determine by the Governor of Nigeria. However, compensation principles state that asides the State attaining full ownership, civilians have no right of land even when there is damage to their land.67 This concept underpins the tone set in petroleum law, of which explains why there are difficulties when claiming compensation by host communities i.e. why host communities are not compensated for environmental damage to their land arising from oil spillages and why multinational oil companies (MNCs) are not held accountable to the environmental degradation they cause. As put forward by George Akpan, ‘the host communities never really get to benefit from the oil wealth rather, much of it is believed to have gone to the country’s elites, soldiers and oil companies’.68

The formative years of environmental legislation in Nigeria was also found to be ineffective at protecting the environment due to absence of clear scientific data and standards on toxic wastes and inexperienced knowledge on pollution levels.69 Also, one would argue that implementing laws from a country (like the UK) that has not got similar natural resources or is as endowed with resources like Nigeria is not appropriate. According to IndexMundi, Nigeria is ranked number eight for producing the most oil in the world and UK, number 19.70 The writer ponders whether Nigerian environmental law developed within time suiting the current pressures of the country?

3.3 Mineral Oil (Safety) Regulations

Section 9. of the Mineral Oil (Safety) Regulations 195271 authorized the Governor General in Council to make rules for any matter that facilitates ordinance into effect. Its aim was set to address safety issues when carrying out explorative activities at the well site. In example, Regulation 7 detailed that ‘all operations of drilling shall conform with good oil field practice’ and Regulation 18 specified that ‘no person shall accumulate or permit the accumulation of inflammable rubbish at any well’.72 This

62 Joseph Akinkugbe Adelegan, ‘The history of environmental policy ad pollution of water sources in Nigeria (1960-2004) The way forward’ (2006) Research Report NO. 72, Development Policy Center Ibadan) 2. 63 Akpan (n38) 4.64 Duru (n35) 3.65 Adelegan (n40) 2.66 Adedolapo Akinrele, ‘Nigeria’ IV Hydrocarbons: Economics, Policies and Legislation, 759. 67 Akpan (n38) 2.68 Akpan (n38) 1.69 Adelegan (n40) pg.2.70 IndexMundi, ‘Country Comparison> Oil – exports > TOP 20’ (IndexMundi, unknown) http://www.indexmundi.com/g/r.aspx?t=20&v=95 > accessed 14 August 2014.71 amended in 199772 Akpan (n38) 4.

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provision fails because the term ‘good field practice’ is vague, it gives MNCs the discretion to exercise what they think amounts to ‘good field practice’ and to underline there is still no mention of protecting the environment and/or host communities who suffer the most burden from oil spillages.

To expatiate, section 7 further enforces oil companies to respect international standards i.e. ‘these Regulations [should follow] the appropriate current Institute of Petroleum Safety codes, the American Petroleum Institute Society of Mechanical Engineers’ Codes’ during their operational activities. As a developing country, reference to international standards is plausible because according to Bell, ‘most developing countries have long established laws and formal governmental structures to address their serious environmental problems, but few have been successful in alleviating those problems’.73 Irrespective of international influence, the term ‘good field practice’ remains unclear thereby empowering MNCs with vast amount of discretion as to ‘what amounts to good field practice’.74 Similarly, the of Petroleum (Drilling and Production) Regulations75 hangs on terms such as ‘practicable precautions’, ‘up-to-date equipment’, ‘prompt steps’, ‘good refining practice’ and ‘good fields practice’, all of which say little about preventing environmental protection. The writer is sceptical about the domineering power of MNCs and whether it poses worse threats on the effectiveness of environmental laws in Nigeria?

Placing focus on how explorative activities are carried out, we can deduce that ‘the Government’s priorities regarding the oil industry [is] limited to stringent rules of collecting the royalties76 and other financial interests. With that priority in mind permitted oil companies to exercise poor levels of supervision during their explorative activities’.77 Despite being amended in 1963 and 1967, the regulation stressed further on the safety of workers, which again, does not essentially relate to environmental protection thereby rendering Nigerian environmental laws ineffective. In 1967, the establishment of the ‘Petroleum Profits Tax (amendment) Decree78 aimed at improving the financial interests for Nigeria. Still under such ruling, taxing oil companies for environmental degradation or toxic substances they cause was not acknowledged as oil became prime and more tactical towards the economy.79

3.4 Water Pollution Act

Adelegan found that there has been some evidence encouraging statutes to become more environmentally aware of the impact of oil spillages. In 1964, Federal Ministers formed a committee to formulate and pass the Water Pollution Act.80 A three-year investigation found that in the NDR the water is heavily contaminated and the underground water contains spills of more than 40 years, the community’s water is tainted with dangerous concentrations of benzene and other pollutants and hydrocarbons of more than 1,000 times the level allowed by Nigerian drinking water standards and

73 R.G. Bell and C. Russell, ‘Environmental Policy for Developing Countries, Issues in Science and Technology’ in Adelegan (n40) 1.74 Akpan (n38) 5.75 LN 69 of 1967, Cap P. 10 LFN (amended in 1963 - L.N. 45 of 1963. Cap. 150 of 1958 Laws of Nigeria; L.N. 71 of 196776 refers to ownership of a portion of the resource or revenue that is produced.77 Amu (1983) in Nwaobi (n34) 3.78 Petroleum Profits Tax (Amendement) Decree No.30, 1999 79 Nwaobi (n34) 3.80 Adelegan, pg.2.para.3.

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there is failure by Shell and other MNCs to meet minimum Nigerian or (their/MNCs) own standards.81 One cannot ignore the grave consequences this has on human health thereby emphasising the importance of our environment hence international instruments stress that ‘the human right to water and sanitation…are essential to the realisation of all human rights’.82 The writer ponders on what efforts have to put in place to address remediation for civilians? Are there any mechanisms authorised by environmental laws that enforce clean-up strategies to improve the water quality in the Niger Delta? Lastly, does Nigeria hold MNCS to account for the environmental degradation they incur on civilians and how enforceable is it? Unfortunately, even though environmental awareness is a pressing agenda, Adelegan found that ‘no positive steps’ have really made an impact on abating the environmental degradation caused from oil spillages therefore, reiterating how poor environmental laws are in Nigeria.

3.5 Petroleum Regulations

The shortcomings of the Mineral Oil (Safety) Regulations advanced to the Petroleum Regulations 196783 of which environmental protection is upheld. For instance, Regulation 25 states that “the licensee or lessee shall adopt all practicable precautions of up-to-date equipment approved by the Director of Petroleum Resources, to prevent the pollution of inland waters, rivers, water courses, the territorial waters of Nigeria or the high seas by oil….and other fluids or substances which might contaminate the water, banks or shore line..[and]…cause harm or destruction to fresh water or marine life, and where any such pollution occurs or has occurred, shall take prompt steps to control and, if possible, end it”. Even though there is specific mention to environmental protection, ‘the effectiveness of this Act fails due to the provision that the Director of Petroleum Resources has discretion to dismiss or permit this requirement’.84 This same direction is also found in Regulation 17(1)(a) which precludes entry to land or object that is considered sacred85 and 35 which vests power to the Director of Petroleum who ‘must in writing approve of the abandonment programme whereby every borehole or existing well must be securely plugged to prevent water entering and as for regards to offshore drilling, it is controlled under Regulation 1886’. 87

Some argue that surely as host communities are the most affected, they have more experience and are more equipped with knowledge of the land therefore are best candidates on deciding what works best. Hence, P.O Oviasuyi and Jim Uwadiae , ‘the laws put in place by the federal government of Nigeria for the exploitation of petroleum in the Niger-Delta by the MNCs do not take host communities into consideration as oil companies and their workers have been living in affluence whilst the locals have been subjected to extreme poverty and penury’.88 Removing host

81 The Guardian, ‘Niger delta oil spills clean-up will take 30 years, says the UN’ [John Vidal, 4 August 2011] <http://www.theguardian.com/environment/2011/aug/04/niger-delta-oil-spill-clean-up-un> (last accessed 14 Aug 2014) 82 UN Water, ‘The human right to water and sanitation’ [UN Water, 2014] <http://www.un.org/waterforlifedecade/human_right_to_water.shtml> (last accessed 12 Aug 2014)83 a subsidiary of the Petroleum Act 196984 Akpan pg.5.para.4.85 ibid, pg.5.para.4.86 Akpan, pg.5.para.4.87 which prohibits licensee from destroying anything or object that is valuable.88 P.O. Oviasuyi and Jim Uwadiae, ‘The Dilemma of Niger-Delta Region as Oil Producing States of Nigeria’ [Journal of Peace, Conflict and Development, Issue 16, 2010 <http://info.brad.ac.uk/ssis/peace-conflict-and-development/issue-16/dilemanigerdelta.pdf> (last accessed 14 Aug 2014) pg.116.para.2-3.

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communities from the equation, we can deduce that more time can effectively be spent on economic interest. This ‘defies the current global drive for planetary protection, human rights and is a failure of corporate responsibility of the oil companies and the government’.89 It is fair to say that environmental laws in Nigeria do not protect the environment from oil spillages.

Furthermore, Regulation 13 contains compensatory provisions for environmental degradation provided that ‘the licensee’s right interferes with fishing rights’. The problem is that MNCs and the government fail to take responsibility of the environmental degradation caused from oil spillages. As discovered by earthrights.org, many MNCs particularly Shell and Chevron, “have claimed for years that the vast majority of oil spills in Nigeria have been caused by sabotage rather than their own poor record of maintenance, but have failed to produce evidence to back up their assertions”.90 Amnesty International “has accused major oil spills, including Shell of failing to report the true picture of oil spills” thus Nigeria fails to protect civilians from environmental degradation due to “under-resourced regulatory agencies [who] have little oversight or control of the process and are dependent on the oil companies to carry out investigations”. 91 Irrespective of the law vesting power to the ‘Governor of Nigeria’ of petroleum activities under s.6(1)(b) of the Mineral Oils Ordinance 1914, it is difficult to attest Nigeria’s sovereignty of her natural resources and its considerations towards environmental protection. This is because the government does not enforce MNCs to take responsibility even though it is prerequisite under the Universal Declaration of Human Rights ‘to protect and provide for their people’.92

3.6 The Petroleum Decree and its subsidiaries

The Federal Military Government put forward the Petroleum Decree Act93 1969 to ‘sustain the pressure and demands of the oil industry’94 and readdress environmental protection for host communities. However, the law was undermined because yet again, s.9 (1) vested power to the Minister to pass laws and govern petroleum operations, which consisted of ‘safe working, conservation of petroleum resources and prevention of pollution of water courses and the

89 G.J. Frynas, ‘The False Developmental Promise of Corporate Social Responsibility: Evidence from Multinational Oil Companies [International Affairs 81, 8, 2005], P. Higgins, ‘Eradicating Ecocide: Laws and Governance to Prevent the Destruction of our Planet’ [Shepheard-Walwyn, 2010] in Mekonen M Kennet, J.M. Felton, A. Winchester, ‘Denying Oil Exploitation and Corruption in the Niger Delta’ [Green Economics: Voices of Africa: Green Economic: A Beacon of Hope for Africa: Green Economics Institute Handbook, Reading, 2011] <https://www.academia.edu/2448706/Denying_Oil_Exploitation_and_Corruption_in_the_Niger_Delta> (last accessed 14 Aug 2014) pg.3.para.1.90 Jonathan Kauffman, ‘Stop Oil Companies from Denying, Delaying and Derailing Local Justice’ [EarthRghts International, 2010] <http://www.earthrights.org/es/blog/stop-oil-companies-denying-delaying-and-derailing-local-justice> (last accessed 14 Aug 2014] para.5.91 BBC News Africa, ‘Nigeria oil firms ‘deflect blame for spills, says Amnesty’ [BBC News Africa, 2013] <http://www.bbc.co.uk/news/world-africa-24839324> (last accessed 14 Aug 2014) pg.1.para.1.92 Jennifer Otitigbe, ‘Chapter 1: Oil, Politics & Ethics’ in Ayodele Embry, Jennifer Otitigbe, Celeste Thomas, ‘The Price of Oil’ [Stanford University, unknown] <http://web.stanford.edu/class/e297c/trade_environment/energy/hpetroleum.html> (last accessed 14 Aug 2014] pg.1.para.293 which is also known as the Petroleum Act 1969 this is because under the 1979 Nigerian Constitution, all Military Decrees were regarded as Acts. It was further amended in 1988.94 Duru et al. pg.5.para.2.

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atmosphere’.95 Upholding the Mineral Ordinance96, section 1 (1) of the Petroleum Decree97 vests the “entire ownership and control of all petroleum’ to the State which is also entrenched in the Nigerian Constitution. Hence, in Attorney General of the Federation (AGF) vs. Attorney General of Abia State, “the court confirmed the vesting of ownership of petroleum resources in the Federal Government” i.e. “powers over the maritime belt or territorial waters, exclusive economic zones and that such powers could not be exercised by ‘littoral states’.98 Laws that ostracise certain groups of society is discriminate and depriving the most affected victims of oil spills is the height of ineffective response to environmental degradation. Okolie-Osemene et al. found that human rights violations to a healthy environment, clean water, shelter and food is a common feature in the NDR and has been closely linked to state repression and state policy.99

The same direction is also seen in s. 2(1) of the Exclusive Economic Zone Act 1978 which states that ‘sovereign and exclusive rights with respect to the exploration and exploitation of the natural resources of the sea bed, sub-oil…. shall vest in the Federal Republic of Nigeria and such rights shall be exercised by the Federal Government’.100 This is reiterated in many other legislative frameworks such as the Petroleum Profits Act (1959), Land Use Act (1976) 101, Oil Pipelines Act (1978) and Oil in Navigable Waters Act (1979)102. The Revenue Decree No.9 of 1971 explicitly ‘revokes ownership powers from Regions or States’.103Sections 2(1), (3) and (4) of the Petroleum act specified that only the Minister must permit any petroleum activity and they are allowed to ‘alter the prices of oil when being sold’.104 The federal government acquiring such power can be justified to some extent i.e. ownership and control of petroleum has been an important political symbol, the question of whether government or authority to whom oil revenues should be paid and the affluence and resources it has generated has stirred a Nigerian civil war coercing the government to claim that right solely. Duru also found that oil involves foreign transactions and it is more logical if the federal government represented the country collectively and professionally. The petroleum industry demands a lot of expertise, technology transfer and compel compliance and only the government has the capacity to operate it. Private ownership will enrich certain individuals intensifying the class division.105 Paradoxically, the petroleum industry has done just that, Nwaobi found that ‘General Babaginda accounts ‘topped the list’ siphoning £6.6 billion in the UK, US$7.42 in Switzerland, US$2 billion in USA and DM 3 billion in Germany106 thus Duru argued that ‘provisions regarding accountability are non-existent as it does not create a transparent process for petroleum explorative

95 Akpan, pg.4.para.2-3.96 s.3(1) of the Minerals Ordinance 194697 amended in 198898 Coalitions For Change, ‘Existing Laws and Policies in the Nigerian Extractive Industries’ [Coalitions for Change, 2010] <http://www.nigerdeltabudget.org/Laws%20and%20Policies%20in%20Nigeria's%20Extractive%20Industries.pd> (last accessed 14 Aug 2014) pg.1-2.99 Okolie-Osemene and Okanume ( ) 9.100 Duru Ibid.pg.9.para.2.101 1976 (and amended in 1978 and 2004).102 Iledare et al., pg.2.para.7.103 Ibid.pg.9-10104 Section 15 of Petroleum Act, Duru et al. pg.10.para.2.105 Duru pg.14.106 G. C Nwaobi ‘Corruption and Bribery in the Nigerian Economy: Empirical Analysis’ (2004) Quantitative Economic Research Bureau in Grimot Nane, ‘Denying Oil Exploitation and Corruption in the Niger Delta’ in Kennet M Mekonen, M. Felton, A & A Winchester (edition) (2011) Green Economics: Voices of Africa: Green Economics: A Beacon of Hope for Africa: Green Economics Institute Handbook 2.

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activities.107 With Nigeria being Africa’s leading oil producer and at global levels ranks among top 10 oil producers108 and oil resources give the Nigerian government about US$20 million a day109 it seems almost irrational to place it in the hands of a distrustful government. Irrespectively, all this has nothing to do with environmental protection or affirming civilians’ rights to clean water and air, food and shelter. More so, there has been no attempt by MNCs or the government to abate the environmental damages of spills.

To dispute, Shell claimed that ‘some communities denied [them] access to spill sites restricting our ability to respond and clean up spills in good time’ and to corroborate, Bar-Karap Moi, spokesman for the Movement for the Survival of the Ogoni People said that the local contractors often hire unqualified and ill-equipped youth to do the work’.110 However, a local argued that “they do not behave irresponsibly but they...operate in a unique environment where security and lawlessness are major problems”.111 Oluduro and Oluduro reasoned that the government and MNCs are scrutinised for claiming to stop the environmental damage emanating from oil spills rather, they are blamed for eliciting “violence…in the form of kidnapping, hostage taking, bunkering and oil theft, pipeline vandalisation, bombings, sabotage, [property damage] and killings” in pursuance of survival.112 Much efforts need to address the poverty residing in the NDR to facilitate peace and cooperation between civilians to fortify socio-economic development. Also, the Niger Deltans “believe that they have no substantial benefit to show for their sacrifices, despite being the ‘goose that laid the golden egg’ – i.e. the economic success that underpins the unity of the Nigerian state”113 thus it is only fair and appropriate that the Government enacts laws that provides them with environmental protection and essential resources such as education to fortify development and prosperity. Considering the fact that Nigeria is a developing country, the pressure to advance the welfare and living standards of host communities must be overwhelming114 to the Government who only gained their independence from British control in 1960.115 However, when looking at the development of Dubai that “went from desert backwater to the Manhattan of the Middle East in just 50 years”116 of which just like Nigeria, is notable for its oil reserves that was discovered in the late 1960s “bringing a soaring economy and an army of traders” leaves the writer puzzled on why the Nigerian Government has not formulated laws that values the environment enough to facilitate better living standards and economic growth.

107 Duru 1-2.108 F. Olokesui, ‘Environmental Impact Analysis and the Challenge of Sustainable development in the Oil Producing Communities [NITP, 2005] in, pg.41.para.2109 Oviasuyi et al. pg111.para.2.110 IRIN, ‘NIGERIA: Poor oil spill clean-up methods affect Niger Delta communities’ [IRIN, unknown] <http://www.irinnews.org/report/76635/nigeria-poor-oil-spill-clean-up-methods-affect-niger-delta-communities> (last accessed 14 Aug 2014]111 Adam Nossiter, ‘Far From Gulf, A Spill Scourge 5 Decades Old’ [The New York Times, 2010] <http://www.nytimes.com/2010/06/17/world/africa/17nigeria.html?_r=1&> (last accessed 15 Aug 2014)112 Okolie-Osemene and Okanume ( ) 12.113 Oviasuyi et al., pg.111.para.3.114 Adelegan, pg.8.para.2.115 J.F. Ade Ajayi, ‘Nigeria: Independent Nigeria’ [Encyclopaedia Britannica, 2014] <http://www.britannica.com/EBchecked/topic/414840/Nigeria/55320/Independent-Nigeria> (last accessed 14 Aug 2014)116 Kerry Mcqueeney, ‘Dubai before the boom: Staggering pictures show how emirate went from desert backwater to the Manhattan of the Middle East in just 50 years’ [DailyMail, 2012] <http://www.dailymail.co.uk/news/article-2144613/Pictures-Dubai-1960s-1970s-city-fishing-settlement.html> (last accessed 14 Aug 2014)

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A salient quality of the Petroleum Decree 1969 was that its establishment of ‘fair and adequate compensation’ for damage (to land) from oil operations to ensure environmental protection. Similarly its subsidiary, the Petroleum (Drilling and Production) Regulations 1969 consists of laws safeguarding host communities’ entitlements to compensation for any ‘disturbance’ i.e. damage to land, that could force displacement loss of value to the land, increased or other expenses and loss of profits’.117 To accentuate the protection of host communities from/and the impact environmental degradation, it was entrenched in the 1979 Nigerian Constitution that adequate compensation become a constitutional right therefore surpassing the Petroleum Decree.118 Even though this is right was preserved by the Constitution, it was successfully upheld by the African Charter on Human and People’s Rights in Fawehinmi v. Abacha119. An international body enforcing environmental protection over Nigerian legislation further highlights key features i.e. Nigeria being a member of the African Charter on Human Rights shows its genuine efforts to human rights but also highlights that ‘Nigeria has no comprehensive or effective legislation dealing with the issue of compensation’.120

The term ‘adequate compensation’ is also flawed because its vagueness and subjectivity therefore illuminating the disadvantages host communities suffer when claiming compensation. Recently, in a ground breaking ruling the London High Court held that Shell Nigeria…was liable for illegal bunkering of its pipelines’121 in the Bodo Community. ‘Shell’s Nigerian subsidiary, SPDC, accepted responsibility...offered £30m to compensate nearly 15,000 people who had claimed damages [but] was rejected by community leaders as [being] inadequate. According to Shell, the communities claimed damages of around £300m122 but it was declared that ‘Shell offered £51million in compensation for two oil spills which was well below the community’s offer’.123 Nigeria has the third largest mangrove forest in the world, the largest in Africa and one of the world’s largest wetlands and the site of most of Nigeria’s biodiversity thus demands a lot of financial aid. Thus, seeking environmental remediation for oil spillages are ineffective because the amount agreed by oil companies is usually insufficient. Based on UNEP’s recommendations, Nnimmo Bassey124 found that ideally, ‘environmental restoration fund for Ogoniland [should aim towards a]…sum of $1bn…but [a] larger fund for the Niger delta’.125 Nigeria’s stupendous wealth in oil should invest also on environmental restoration.

Consequently, the Coalitions for Change also criticised the Petroleum (Drilling and Production) Regulation126 as being just a mere directive because it ‘lacks proper enforcement mechanisms [and]

117 found by Omotola (1990) in Frynas pg.95.para.1118 Frynas pg.95.para3.119 (1996) 9 NWLR (Pt. 475) 710 in ibid, pg.95.para.4120 Idbid, pg.95.para.5121 Leigh Day, ‘London High Court rules that Shell Nigeria could be legally liable bunkering’ [Leigh Day, 2014] <http://www.leighday.co.uk/News/2014/June-2014/London-High-Court-rules-that-Shell-Nigeria-could-b> (last accessed 14 Aug 2014] para.1.122 John Vidal, ‘Shell faces payouts in Nigerian oil spill case’ [The Guardian, 2014] <http://www.theguardian.com/environment/2014/jun/20/shell-faces-payouts-nigerian-oil-spill-case> (last accessed 14 Aug 2014] para.5.123 THIS DAY LIVE, ‘Finally, Shell Offers $51m Compensation to Bodo Community for Oil Spills’ [THIS DAY LIVE, 2014] <http://www.thisdaylive.com/articles/finally-shell-offers-51m-compensation-to-bodo-community-for-oil-spills/181509/> (last accessed 14 Aug 2014) para.1.124 Chair of Friends of the Earth International and director of Environment Rights Action in Nigeria125 Vidal, para.8.126 1969, amended in 1973, 1979, 1995 and 1996 in Coalition for Change, pg.2.4.

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the regulation [was] amended to mirror current economic purposes in terms of fees, rents and royalties’. Hence, in South Atlantic Petroleum Company vs. Minster of Petroleum Resources127 and Federal Government of Nigeria vs. Zebra Energy128 the judiciary held that provisions created by the Government are statutory and the government is bound to comply with the statutory provision’. Also, it is worth noting that ‘information supplied by the licensees or lessees are to be treated as confidential129 making transparency non-existing thus, it is fair to say that there are no efficient laws governing the environment in Nigeria.

The Petroleum Refining Regulations130 also has compensatory elements for failing to dispose ‘residue, sludge, rusts’ in ‘good refining practices’.131 Similarly, the provision fails on two grounds; if the polluter fails to comply with the directive, they are liable to only N100 (US$0.625) or six months’ imprisonment and secondly it requires the approval by the ‘Director of Petroleum Resources’. Even though the polluter is held into account, Chemain reasoned that the PPP is ‘imprecise and difficult to practically implement at times because of the confusion surrounding the costs to be charged to the polluter’ i.e. problems of pinpointing the polluter (particularly in cases of sabotage) and complexity in calculating the costs of environmental damage (weak insurance coverage of complication of State).132 No intelligence is required to appreciate that US$0.25 is an inadequate remediation to contribute to effective environmental restoration. Under the Sea Fisheries Act133, the ‘offender will be liable on a conviction to a term of two years imprisonment or to a fine of N50, 000 (US$312.5)...[if]…toxic substances are released into the marine environment. The PPP could be justified if the compensatory element was adequate but attaching criminal penalties has little or nothing to do with the environment. Worse, most polluters i.e. MNCs fail to take responsibility of their actions. Therefore, penalties imposed by legislative bodies are deemed immensely incompetent at remedying environmental protection.134

3.7 Offshore regulations

Asides having weak compensatory provisions, the Oil Navigable Act 1954135 also known as OILPOL136 the defences available to the polluters almost make it impossible for to hold them accountable. For instance, criminal liability does not arise if discharges of oil into Nigerian waters or a prohibited sea area if; it was to secure safety of any vessel or preventing damage to vessel or cargo or saving a life137, if it was accidental caused by damage to the vessel or leakage and that reasonable care was

127 unreported Suit No. FHC/L/CS/361/2006 in Coalitions for Change, pg.3.para.3.128 (2002) 18 N.W.L.R. Part 798 page 162 in ibid, pg.3.para.4.129 Regulation 58 in ibid,, pg.3.para.2.130 LN 45 of 1974., amended Cap P.10 LFN 2004131 Uchenna Jerome Orji, ‘An appraisal of the legal frameworks for the control of environmental pollution in Nigeria’ [Commonwealth Law Bulletin, Vol 38, Issue 2 2012] <http://www.tandfonline.com.chain.kent.ac.uk/doi/full/10.1080/03050718.2012.674735#.VACQOYCwIeU> (last accessed 14 Aug 2014) 132 R. Chemain, ‘The “Polluter Pays” Principle’ in K. Parlet and others (edition), ‘The Law of International Responsibility’ in Das ( ) 45.133 Cap 54 LFN 2004 which is similar to Inland Fisheries Act [Cap I 10 LFN 2004] in, Orji, pg134 Orji, para.20.135 amended in 1968, 1979 in ibid., 136 Herbert Smith, ‘Environmental Risks for Major Projects: European Lawyer Reference’ [Sweet & Maxwell, 2012] pg.200.para.3.137 S.4(1) in Orji, pg.

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taken to the end of the discharge’.138 Section 3 also provides many other defences that exempts PPP i.e. if he/she proves that the ‘discharge was caused by the act of trespasser139, or that it was not reasonably practicable to dispose of the effluent by any other means other than by discharging it into the water140 and all reasonable practical steps had been taken to eliminate oil from the effluent’.141 Essentially, the PPP not being enforced shows how “environmental protection has not been given its deserved integral consideration in the country’s policies”142 thereby rendering environmental statutes weak at preventing/remedying the dangers of oil spillages. It is worth mentioning that OILPOL is ‘the only law in Nigeria’s statute books by which has been out-dated by the International Convention for the Prevention of Pollution from Ships known as MARPOL which is yet to be ratified. Arguably, the OILPOL still being used is flawed and ineffective for environmental protection because it is ‘out-dated and of no use in the current international framework for pollution prevention’143 thus highlighting how poor laws are when governing oil spillages in Nigeria.

3.8 Pipelines and its regulations

A major contributor to oil spillages are pipelines thus implementing a strong regulatory framework cannot be underestimated. Pipelines encompass the core infrastructure of petroleum as they are used to transport petroleum products from oil refineries and import-receiving jetties to storage depots.144 Most pipelines in Nigeria are old (up twenty-five years old), ‘there is usually no periodic monitoring’ therefore making them susceptible to leakages which effectively results to oil spills.145 Such pipelines have stirred a lot of havoc in the NDR for instance, it has killed thousands and thousands of people; the Daily Mail found that ‘105 dead in Nigeria fuel pipe blast’146 and severely damaged the environment; ‘the unique biodiversity of the region has changed drastically and many important species have been lost’.147 The leakages i.e. ‘deathtraps’148 are attributed to ‘sabotage’ and ‘bunkering’ which involves thieves tapping into pipelines and steal which is then sold on the black market as occurred in Jesse, (oil-rich Niger Delta).149 Sabotage is criminalised under Petroleum Production and Distribution (Anti-Sabotage) Act and the Special Tribunal (Miscellaneous) offences Act whereby death penalty is enacted. Evidently, the victims of pollution arising from pipeline blast are not compensated for whatever damage they undergo irrespective of how severe it is.150 Worse still, victims of the blast ‘refuse medical help for fear of being blamed for the disaster’.151 Most members of host communities that are affected by the spill are more concerned with collecting and

138 S.4(2)(a) (b) & (3) in ibid, pg.139 S4(4) in ibid, 140 S4(5)(a) in ibid, 141 S4(5)(c) in ibid, 142 George Okojie, ‘Nigeria: Tackling Environmental Challenges of Oil Pollution in Nigeria’ [allAfrica.com, 2013] <http://allafrica.com/stories/201309110340.html?viewall=1> (last accessed 14 Aug 2014) pg.1.para.3.143 H. Smith, pg.200.para.3. 144 Agbaeze [2002] and Olomola [2005] in Ogwu, pg.42.para.4.145 Ogwu, pg.43.para.1.146 DailyMail, ‘105 dead in Nigeria fuel pipe blast’ [DailyMail, unknown] <http://www.dailymail.co.uk/news/article-185648/105-dead-Nigeria-fuel-pipe-blast.html> (last accessed 14 Aug 2014)147 Ogwu, pg.43.para.4148 Duru, pg. 18.para.2.149 IRIN, ‘Nigeria: Over 100 killed in oil pipeline explosion and fire’ [IRIN, 2003] <http://www.irinnews.org/report/44471/nigeria-over-100-killed-in-oil-pipeline-explosion-and-fire> (last accessed 14 Aug 2014) pg.1.para.10.150 s.11(5)© of the Oil Pipeline Act 1965 in Duru, pg.18.para.1.

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selling oil due to their impoverished condition. By this, it becomes incredibly difficult and challenging to prove that the pipelines were not deliberately sabotages by them or a third party. 152 Still legislative efforts to protect the environment fail not only because there is barely any mention on how to prevent or protect civilians/environment from pipeline blast but the fact that civilians cannot freely assert or invoke their rights against physical harm.

The Oil Pipelines Act153 provides host communities and the environment protection from damage/harm. For instance s.28 requires pipelines to be removed ‘upon the expiration or termination of a licence and the licensee is under a duty to make good any damage done to the land…and ss.19 and 20 is given power to umpire disputes regarding compensation’.154 Ogwu confirmed that the environment is on the agenda on all tiers of government I.e., local, regional and national but host communities feel cheated and complain of injustice because they directly undergo such as loss of biodiversity of which is the essence of their survival.155As reasoned in the Rio de Janeiro Conference on Environment and Development, ‘a man’s productivity depends on the quality of the environment so development cannot subsist upon a deteriorating environmental resource base’.156

The Oil Pipeline Act fails on many stances of which adversely affect host communities and the environment. Section 11(5)(d) states that host communities affected by oil spillages from an oil pipeline will be entitled to compensation except where the pollution caused by his own default or by the malicious act of a third part such as sabotage. As shown in Atubin v Shell Petroleum Development Company157 (SPDC), the court squashed the claim on the basis that the oil spill emanated from vandalism of which damaged the pipeline therefore the defendants could not be held accountable ‘for the acts of third parties not directly under their control’.158 Exempting MNCs from taking responsibility of the environmental damage they caused reinstates how weak regulatory bodies and highlights the government’s lack of concern and respect for the environment. As reasoned by Goodpaster and Van Marrewijk, ‘corporate responsibility involves corporate environmental responsibility, corporate economic responsibility and corporate social responsibility’.159

Similarly, in SPDC v Amarchee160, the Court of Appeal held that the plaintiff could not claim N10 million for damages for the escape of crude oil from the defendant’s pipelines because it involved sabotage when oil was being installed. The act wanted to prevent criminals from benefiting from their own act however, the poverty plaguing the NDR is immense, hence ’70 per cent of Nigerians live below the poverty line, some [have] to resort to siphoning and selling oil from the region’s 3,125 mile network of pipelines’.161 Inspired by Aristotle, Ikejiaku found that ‘when the poor are in the

151 Carly Gillis, ‘Nigeria’s Oil: a Brief History’ [counterspill, 2011] <http://www.counterspill.org/article/nigerias-oil-brief-history> (last accessed 14 Aug 2014) pg.1.para.4.152 Orji, pg. 153 1956 amended in 1965.154 Amended to Oil Pipeline Act Cap.337, LFN, 1990 in Akpan, pg.6.para.4.155 Ogwu, pg.41.para.2.156 (1992) in Opukri, pg.179.para.1.157 (Unreported) Suit no UAC/48/73 of 12 November 1973 cited in Ehighelua (n 10) at 14 in Orji, 158 Orji, 159 Okolie-Osemene and Okanume ( ) 6.160 (2002) FWLR (Pt 130) 1654 in Orji,161 Gills, pg.1.para.4.

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majority and have no prospect of reducing their condition, they are bound to be restless and seek restitution through violence’.162 Criminalising the polluter does not affect the environment but the fact that local people, who are succumbed into poverty and are held liable but MNCs (key perpetrators of environmental degradation) are not, is unjust. In other words, Ajakaiye clarified that host communities ‘are most vulnerable, conversely, the winners [multinational companies] tend to be less vulnerable and possess the economic and privileges power to influence institutions and the decision making process’.163 Aghalino and Eylinla noted that MNCs should comply with international best practices in oil exploitation and have contemplation towards environmental protection, safety and maintenance of their facilities.164 In response to the violent kidnappings of foreign workers of MNCs, if MNCs employed a safer productive mechanism in exploration, host communities would not be compelled into desperate measures and maybe a better relationship would surface.

The entire Act seems to only cover the process of granting oil pipelines permits and licenses rather than laws refraining or limiting pipeline blast to enhance environmental protection. As shown in Nigeria AGIP Oil Company vs. Kemmer165 where the court clarifies only clarifies what oil pipelines mean and the Shell Petroleum Development Company vs. Burutu Local Government Council166 focuses on exempting NNPC (Nigerian National Petroleum Company) from any responsibility caused by ‘hereditaments or tenements to be valued for rating purposes’.167 This illustrates why there are gaps of environmental protection in Nigerian law. Like other statutes, power is vested to the Department of Petroleum Resources (DPR/regulatory agency) to carry out surveys on pipelines and new projects with an environmental impact assessment attached to it.168 Nigeria became a member of the Convention on Biological Diversity (CBD) and has incorporated documents such as Agenda 21 that work towards environmental management.169 Environmental law still fails because irrespective of the Convention, Ogwu found that ‘not much has been done by way of enforcing environmental impact assessment of pipelines in Nigeria.’ Factors such as a biased government, unattainable MNCs and a controversial right to the environment’170 explains why Nigerian laws are inadequate. Also, it is worth mentioning that even though such laws were implemented effectively does not change the fact that the refineries are old therefore monitoring would inevitably be difficult to attain.

Poor management of oil refineries has facilitated more spills, which has worsened the extent of environmental damage in the NDR. The DPR/regulatory agrees that about 88 per cent of oil spill incidence is traceable to equipment failure’.171 Akpan found that ‘between 1995-2000, about 367,621.78 barrels of crude oil were spilled and only 17,041.13 was recovered. Worse, such statistics may not even represent the actual estimate of oil spills as the estimations from the Ministry of

162 V.B., ‘The Relationship between Poverty, Conflict and Development’ [Journal of Sustainable Development Vol.2 No.1, 2009] in Oviasuyi et al., pg.112.para.3.163 A.B. Ajakaiye, ‘Combating Oil Spill in Nigeria: Primary role and responsibility of the National Oil Spill Detection and Response Agency (NOSDRA)” [Stakeholders’ Consultative Workshop, Calabar, Nigeria 2008] in Ogwu, pg.44.para.1.164 Okolie-Osemene and Okanume ( ) 20.165 (2001) 8 N. W. L. R. Part 716 page 506.in Coalitions for Change, pg.6.para.4-5166 (1989) 9 N. W. L. R. Part 565 page 318. In ibid.,pg.6.para.4-5167 Ibid.,pg.6.para.4-5.168 Ogwu pg.44.para.2.169 W.W. Nnah and B.O.Owei, ‘Land Use Management Imperative for Oil and Gas Pipeline Network in Nigeria’ [Abuja, 2005] in ibid.,pg.45.para.1.170 Ogwu pg.45.para.1171 South – South Express (unknown, 2002) in Opukri, pg.181.para.2.

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Petroleum are based on submissions by the oil companies of whom tend to downplay the extent of how severe or how much oil has been spilt to lessen the amount of blame they are responsible for’.172 Orji corroborated that even when oil companies are liable, they do not respond immediately to relieve the situation, which worsens the environment further hence, ‘Nigeria has become an ecological wasteland i.e. several major rivers are heavily polluted; farmlands are under acid rain and oil spills, and carbon dioxide emissions in the highest in the world’.173 Pollution crime should be taken more seriously because it involves the illegal disposal of waste into waterways, the air and the ground174 impounding environmental devastation on host communities. The oil MNCs and the government have violated this callously violated this law to sustain its profits at the expense of humanity and permitting such illegal activities and profiting from it at the same time of the latter.

One cannot dispute the urgency to invest on new technology accompanied with a robust regulatory framework to ensure environmental sustainability. MNCs from the oil industry need to obey their international standards for oil exploration however, the petroleum contracts they have with Nigeria questions the relationship they have with the federal government. In other words, what terms are specified under the contractual petroleum agreements between Nigeria and the MNCs that ineffectively carry out explorative activities?

3.9 Gas flaring and its regulations

Nigeria’s gas flaring record is her most classic example of the implication of industry inefficiency and ineffective regulation over the years,’175 recently she lost US$2.5 billion to gas flaring in 2011.176 As we know, ‘gas flaring destroys ecosystems and its biodiversity, and damages buildings through acid rain formation’.177 The Petroleum Act is the primarily law regulating petroleum activities under licenses of no later than five years after commencement of production.178 To supplement it, the Nigerian government enacted the Associated Gas Reinjection 1979179 obliging oil companies to submit a detailed plan for utilizing all gas with an ultimate goal of ending flaring by 1984.180 Section 3(1) prohibits ‘the flaring of gases produced in association with oil without the permission of the Minister of Petroleum and s.3 (2) vests power with the Minister to grant gas flaring permits as he sees fit ‘that the utilisation or re-injection of gas is inappropriate or not feasible in any particular

172 Akpan, pg. 2.para.1.173 T. Agbola and A.T. Olurin, ‘Landuse and Landcover Change in the Niger Delta’ excerpts from a research Report presented to the Centre for Democracy and Development in Oviasuyi et al., pg.116.para.5.174 Okolie-Osemene and Okanume ( ) 20.175 Tade Oyewumni, ‘The Nigerian Gas Industry Policy, Law & Regulatory Developments’ [Adepetun Caxton-Martins Agbor & Segun, unknown] <http://www.acas-law.com/cipxprobe/publications/Nigerian_Gas_Industry_-_Policy%2c_Law_Regulatory_Developments_-_February_20131.pdf> (last accessed 15 Aug 2014) pg.5.para.2.176 EIA, Country Analysis, 2011 in Oyewunmi pg.5.para.1.177 Obinna Okafor, ‘The State of Environemntal Monitoring in Nigeria and ways to Improve It: Case Study of Niger Delta’ [Wageningen University, 2011] <file:///Users/schizindu1/Downloads/FINAL_THESIS_MAJOR.pdf> (last accessed 14 Aug 2014)178 Dennis Otiotio, ‘Gas Flaring Regulation in the Oil and Gas Industry: A Comparative Analysis of Nigeria and Texas Regulations (2013) University of Tulsa College of Law 25.179 LN 45 of 1974. Cap P.10 LFN 2004 in Orji,180 Center for Constitutional Rights, ‘Factsheet: Shell’s Environmental Devastation’ [Center for Constitutional Rights, unknown] <http://ccrjustice.org/learn-more/faqs/shell%2526%2523039%3bs-environmental-devastation-Nigeria> (last accessed 15 Aug 2014) para.7.

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field’.181 Empowering the Minister renders the Act weak as gravitate towards issues of transparency, scrutiny and accountability. Despite this act, gas flaring still continues. The Associated Gas Re-Injection Act182 prescribes a fine of N10.00 (ten naira) (US$0.0625) for every cubic feet of gas flared. The compensatory element attached to this act is ‘ridiculously low’183 therefore is not punitive enough to effectively deter gas flaring. The World Bank reported that “gas flaring fines proved to be too small an incentive to induce companies to reduce flaring”.184 According to Orji, this act is weakened because when the “government set deadlines for the termination of gas flaring in 2004, the pressure from oil companies extended it to 31 December 2008 so overall, there are presently no concrete suggestions that gas flaring will discontinue in Nigeria”.185 As corroborated by many commentators such as Frynas et al., ‘multinational [oil] corporations…have captured the government of Nigeria, the influence oil companies have over the political and economic institutions in Nigeria is overwhelming’.186 In Jonah Gbemre v Shell Petroleum Development Company (SPDC) & Others187, the court held that the continuance of gas flaring grossly violated the community’s fundamental rights to life, dignity and a healthy environment which is enshrined in the Constitution. This was a landmark decision however, the act still falls short because according to Orji, it is still yet to be enforced by the Nigerian Government’.188 Shyllon commented that ‘most of the solutions…are defective…some provisions are merely directory and lack enforcement machinery”.189 Such failings should prompt the government to amend the regulatory framework by resorting to an increased economic enforcement.190 Thus reinstating how weak Nigeria is at enforcing environmental standards arising from the impact of oil spillages.

3.10 Institutional Framework

181 Orji, pg,182 Cap 26 LFN 1990; Cap A. LFN 2004 in Orji, 183 David Ukooh Ikoni, ‘The Application of the Precautionary Principle in the Proof of Environmental Offences under the Nigerian Law: Challenges and Prospects’ [Benue State University, unknown] <https://www.academia.edu/3503921/THE_APPLICATION_OF_THE_PRECAUTIONARY_PRINCIPLE_IN_THE_PROOF_OF_ENVIRONMENTAL_OFFENCES_UNDER_THE_NIGERIAN_LAW_CHALLENGES_AND_PROSPECTS> (last accessed 15 Aug 2014)184 (1995, volume II annex J) in Frynas, pg.89.para.1.185 Orji, pg,186 J.G. Frynas, P.M, K Mellahi, ‘Maintaining corporate dominance after decolonization: The ‘first mover advantage’ of Shell-BPP in Nigeria [Review of African Political Economy Vol. 27 No. 85, 2000], Akande, ‘Interview, [London, 2003] and M.A. Roy, ‘Corruption-Related Decision Making in the Multinational Business Arena, [University of Canterbury Australia, Published PhD Thesis] in Kennet et al., pg.3.187 (Unreported) Suit no FHC/3/C5/53/05 of 14 November 2005 <http://www.climatelaw.org/cases> in Orji, pg. 188 Orji, pg.189 Shyllon, pg.10.para.5.190 Otiotio ( ) 27.

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However, environmental issues were given significant prominence due the ‘dumping of toxic wastes191 of Italian origin in Koko Port, Niger Delta in 1988’.192 Folarin Shyllon commented that the policies available ‘were not well articulated’.193 This was because such ‘disasters were largely situated in remote rural areas of the country where press coverage is a rarity’ and “no effort was made to contrive an effective, comprehensive legal regime for waste generation and disposal”.194 This promulgated the Harmful Waste (Special Criminal Provision) Act 1988195 which prohibits the ‘transportation and dumping of harmful wastes’.196 However, the act was criticised for being too weak because it only consists of sanctions such as life imprisonment without the option of fine’ and it is not effectively enforced by regulatory bodies’197, which adds no value to environmental protection. This prompted the establishment of the Federal Protection Agency (FEPA) Act198, which was given the duty to control the environment and development of processes and policies in order to achieve its objectives i.e. environmental protection and restoration.199 Section 20 prohibits the discharge of harmful quantities of any hazardous substance into the air upon the land and the waters of Nigeria except where permitted’.200 Section 23 of the FEPA states that the Agency should collaborate with and support ‘from time to time’ the DPR when removing oil related pollutants discharged into the Nigerian environment’. Like other statutes, FEPA also empowers the Minster of Petroleum and authorizes the Director General of the Agency to make provisions based on the objectives of this Act recommending standards for water and air quality, effluent limitations, atmospheric protection, ozone protection, noise control and removal of hazardous substances’.201

The Act was further amended, demanding ‘all-important issues of protection of ‘biodiversity conservation and sustainable development of Nigeria’s natural resources’.202 The FEPA Act has been enacted in several pieces of the environmental provisions i.e. the Rivers State Environmental Protection Agency Law 1994 and Rivers State Pollution Compensation Tax Law 19994; Bayelsa State Environment and Development Planning Authority Law 1996 and Bayelsa State Pollution Compensation Tax Law 1998.203 Unfortunately, the FEPA Act suffers from lack of enforcement, which illustrates the inadequacy of environmental controls in Nigeria.204

191 Represents a broad category of wastes in solid liquid, or containerized gaseous form known to be harmful to humans and other species due to their ignitable, corrosive, explosive, carcinogenic, mutagenic, or teratogenic characteristics commented by Miller (2001); EPA (1996); Epstein et al., (1982); Nebel and Wright (2000) in Francis O. Adeola, ‘Hazardous Wastes, Industrial Disasters, and Environmental Health Risks: Local and Global Environmental Struggles’ [Palgrave Macmillan, 2011] pg.17.para.1.192Akinrele, pg.768.para.2.193 Folarin Shyllon, ‘The Law and the Environment in Nigeria’ [Vantage Publishers, University of Ibadan, Faculty of Law, 1989] pg.6.para.6.194 Mike Ikhariale, ‘The Koko Incident, the Environment and the Law’ in Shyllon, pg.75.para.3-4.195 No.42 (Laws of the Federation of Nigeria 1990, Cap.165) in Akinrele, pg.768.para.2.196 Orji, pg.197 ibid, pg.198 1988 No.58 and amended in 1992 No.59 in Akinrele, pg.768.para.3.199 ibid, pg.768.para.7.200 in Akpan, pg.7.para.5.201 Akinrele, pg.768.para.7.202 Akpan, pg.7.para.6.203 Akinrele, pg.769.para.1.204 Frynas, pg.87.para.1

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In conjunction with the FEPA Act, the Environmental Impact Assessment Act205 sought to encompass environmental considerations into development project planning and execution by making it obligatory for an EIA (Environmental Impact Assessment) to be conducted at an early stage on every project likely to have an adverse impact on the environment. Section 2(2), where the extent, nature or location of a proposed project or activity is such that is likely to significantly affect the environment, its environmental assessment shall be undertaken in accordance with the provisions of this Decree’.206 Section 7 of the Act encourages governmental agencies, members of the public, experts in any relevant discipline and interested groups the chance to voice their concerns on the environmental impact assessment before the Agency makes the final decision. More specifically, Section 11 directly offers host communities who are most affected by the environmental damage, the opportunity to voice out their concerns. 207 Human lives are being lost due to the unsafe explorative activities thus explaining why the government have employed such vigorous frameworks so that environmental legislation adheres to such concerns to be effective.208The Niger Delta Environmental Survey concluded that “from [their] investigation all the legislation in the NDR as regards [to] environmental pollution control are more in the interest of the industry that the community…this was because environmental legislation was generally unenforced, favoured the government and the companies or entailed implementation problems.”209 The EIA and FEPA Act are criticised as being too vague because they are applicable to all sectors of the environment but not specific to the petroleum sector thus making it difficult to enforce.210

The FEPA Act is regarded as idle because regarding oil explorative activities, Toyin Falola and Adam Paddock211 found that the law has no authority by law to penalize polluters of the environment as asserted by the Constitution, Petroleum Decree and its subsidiaries etc. are all entrusted to the Federal Government; i.e. Minister of Petroleum. There were no laws monitoring the petroleum industry so pollution control had not yet been cultivated in society, which was challenging for the Enforcement Department of FEPA.212 Many states lacked central waste infrastructures such as roads, pipe-borne water supply and electricity. Most operational activities were operating well below capacity and paid no attention to environmental problems. The economic downturn placed a massive burden on the N500 million (US$80 million) grant promised by the President to the National Policy on the Environment in 1989 and was is in debt by over 30% thus funding environmental issues became less of a reality. 213

It is important to note that the EIA was to be used for future purposes not including the past thus making it very limiting and futile when seeking for immediate remediation from the environmental degradation. Section 7 of the EIA Act is also significant for promoting public participation during the assessment process as it encourages host communities, governmental bodies, experts from relevant 205 Decree 86. 1992. In Akpan, pg.7.para.6.206 Akpan, pg.7.para.7.207 Akpan, pg.8.para.2.208 Toyin Falola, Adam Paddock, ‘Environmental and Economics in Nigeria’ [Routledge, 2012] pg.113.para.5.209 reported by Obnigwe (16, 1996) in Frynas, pg.98.para.3.210 Akpan, pg.7-8.211 Falola et al. 112-113.212 Adegoke Adegoroye, Head, Inspectorate and Enforcement, Federal Environmental Protection Agency in Nigeria213 Adegoke Adegoroye, ‘The Challenges of Environmental Enforcement in Africa: The Nigerian Experience’ [Third International Conference on Environmental Enforcement, unknown] <http://www.inece.org/3rdvol1/pdf/adegoro.pdf> (last accessed 15 Aug 2014) pg.47-48.

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disciplines and interest groups to work together on environmental issues. However, they are easily breached by MNCs i.e. Oronto Douglas v Shell Petroleum Development Company Ltd214, the court upheld that ‘the plaintiff lacked the standing to sue Shell regarding Shell’s failure to observe the provisions of the Environment Impact Assessment.

Another significant governmental body is the NNPC Act of which is the ‘prevailing policy’ that has control over the licensee’s operations and physical control over vast operations (accumulates the major percentage of oil proceeds between MNCs under joint ventures agreements).215 It vests power to the Corporation to control all petroleum activities and the Petroleum Inspectorate Department has power to enforce all regulatory measures.216 This Act fails primarily because NNPC acts as both the operator and a regulator at the same time without clearly defining their distinct roles thereby weakening objectivity and transparency. The Act is criticised for being untouchable as ‘no suit [can arise] against a member of the board or an employee of the Corporation for an Act’, which is unfair as everyone should be under the law as venerated under A.V. Dicey’s rule of law.217 This again has nothing to do with the environment.

There are other agencies that deal precisely with state i.e. State Environmental Protection Agencies (SEPAs) from 1988 of which are as criticised for being ineffective. In example, the World Bank investigated that the ineffectiveness of SEPA in Rivers State218 only had one vehicle and not a single boat knowing fully well that most explorative activities requires a boat, the agency did not have access to a laboratory therefore unable to monitor water or air quality standards. The World Bank criticised them for being too limited when it came to monitoring oil explorative activities (oil spillages and gas flaring).219 According to Ijeoma Kanu and O.K. Achi reported that ‘there are few quality studies for most Africa inland waters, in Nigeria, increased petroleum activities have distorted estuaries and inland water bodies which are key sources of drinking water in Niger’ particularly for the host communities who depend on it for survival of whom are living in such remote areas.220

Recently, the National Environmental Standards and Regulations Enforcement Agency Act 2007 (NESRA) was formulated to further ensure that policies are address protection and development of the environment such as biodiversity, conservation and sustainable development of Nigeria’s natural resources and advancing environmental technology and advocating better relationships with stakeholders and outside Nigeria to increase compliance rates’.221 Aliko Dangote (a private body) ‘signed a multi-billion dollar deal with banks to finance the building of an oil refinery in Nigeria’.222

214 Oronto Douglas v Shell Petroleum Development Company Ltd, Suit No. FHC/L/CS/573/96 [Unreported]215 Akinrele, pg.762-763.216 Coalitions for Change, pg.10.para.1.217 Albert Venn Dicey, ‘Introduction to the Study of the Law of the Constitution [LF ed., 1915]218 (1995)219 Frynas, pg.87.para.2.220 Ijeoma Kanu and O.K. Achi, ‘Industrial Effluents and their Impact on Water Quality of Receiving Rivers in Nigeria’[Journal of Applied Technology in Environmental Sanitation, Department of Environmental Engineering Sepuluh Nopember Institute of Technology, Surbaya & Indonesian Society of Sanitary and Environmental Engineers, Jakarta, 1(1), 2011] <https://www.trisanita.org/jates/atespaper2011/ates08v1n1y2011.pdf> (last accessed 15 Aug 2014) pg.76.para.2-7.221 Ikoni, pg.7.para.1.222 BBC NEWS Africa, ‘Nigeria’s Dangote signs deal to build oil refinery’ [BBC NEWS Africa, 2013] <http://www.bbc.co.uk/news/world-africa-23960843> (last accessed 15 Aug 2014) pg.1.para.1.

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This is a landmark decision because it encourages more private indigenous (Nigerians) to have more of a say in their country rather than being dominated by MNCs and Nigeria is ‘Africa’s biggest oil producer but lacks refining capacity over control of it oil wealth’. As reasoned by a commentator, ‘it is a national shame that Nigeria with all the manpower available locally an in diaspora cannot maintain and operate petroleum refineries properly and that we have had to rely on imports for the bulk of petroleum products consumed locally’.223 As Shyllon commented, ‘man has moved, changed, applied and even destroyed his environment….if nothing is done, man may reach the stage where he becomes a danger unto himself…[and] may pose a great threat to future generations’.224

3.11 The inadequacies of the litigation process

Seeking remediation is incredibly difficult in Nigeria i.e. access to resources are limited; delays and the implementation of strict locus standi, proof and over-reliance on common law torts such as trespass, nuisance and negligence’.225 Hence, in the Ejama-Ebubu case (2001), Shell “attempted to file interlocutory (interim) appeals at least 27 times so that each time the court decided a preliminary issue in favour of the plaintiffs, Shell tried to suspend the proceedings in order to appeal to a higher court”.226

Like the UK however, Onaji argued that in Nigeria, a lot problems circulate when applying the laws of torts. For instance, seeking redress under the law of nuisance regarding petroleum activities is so complicated; due to the denial and affluence vested in MNCs thus it is ‘almost inapplicable…to defend..[oneself] by legal action against the invasions of his use or enjoyment of his land’.227Also, judicial proceedings are unduly expensive and a ‘few private individuals do not have at their exposal the technical means to prove necessary causative links between interference with the enjoyment of land and the operational activities by multinational oil companies’.228

As for trespass, the claimant would need to show that the defendant obstructed their rights to enjoy the land. Like the Constitution and the Petroleum Decree etc., all land vested in the Federation of Nigeria thereby illustrating that host communities are exempt from claiming rights to land. Falola stressed that most locals are afraid to sue for clean-up and compensation because “history shows that oil companies will appeal repeatedly until the plaintiffs run of money, give up or die”. Access to justice is often denied [via the lengthy process of various torts] to “victims of human rights abuses” have to use other routes involving sabotage and/or bunkering “as their only means to obtain some form of redress”.229

3.12 International Legal Frameworks operating in Nigeria

223 Chief Phillip Asiodu, ‘Energy resource MGT in a federal system: Challenges, constraints and strategies ‘ [Special Report, 2013] <http://allafrica.com/stories/201305150347.html> (last accessed 15 Aug 2014) pg.1.para.5.224 Shyllon, pg.6.para.5-6.225 Eghosa O. Ekhator, ‘Improving Access to Environmental Justice under the African Charter on Human and People’s Rights: The roles of NGOS in Nigeria’ [African Journal of International and Comparative Law, Vol. 22, Issue 1, 2014] < http://dx.doi.org/10.3366/ajicl.2014.0080> (last accessed 15 Aug) pg.68.para.3.226 Kaufamn, pg.1.para.4227 Ir. P. B. Onaji, ‘Legislation and TecnicL Needs for River Pollution Control in Nigeria’ in Shyllon, pg.49.para.1.228 Shyllon, pg.91.para.2.229 Falola et al., pg.119.para.2.

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In 1999, Nigeria being a signatory to the African Charter on Human and People’s Rights i.e. African Charter has raised more awareness on adhering to host communities’ rights hence it is entrenched into Nigerian law under the Nigerian Constitution.230 I was a landmark revolution because it was the first constitution in Nigeria to establish environmental protection hence, section 20 of the constitution stated that ‘the state shall protect and improve the environmental and safeguard the water, air, land, forest and wildlife in Nigeria’. However, this principle is limited because there ‘are no provisions enforcing right to a clean and healthy environment’. Chapter 2 states that ‘fundamental objectives and principles of state policy cannot be invoked against the State by Nigerian civilians under section 6(6)(c) of the constitution which undermines section 13 of the constitution which obliges the State and its bodies to apply the provisions of chapter II.231 Irrespectively, host communities commonly use it in Nigeria so they can assert their human rights, which is prime under environmental justice. Despite the environmental awareness African Charter raises, it is still “very much a pipe dream in Nigeria due to the weak regulatory body in the petroleum industry, the lack of political will by the government and agencies to enforce environmental standards and the endemic corruption and judicial weaknesses within the regulatory system”.232

Ekhator also found that the litigation process for host communities is burdensome and futile because even when they win against the MNCs, decisions are appealed against or ignored as revealed in Gbemre v. Shell233 thus reinstating how ineffective environmental legislation is in Nigeria. The claimant234 used Article 4, 16 and 24 of the African Charter of Human and People’s Rights due to “gas flaring in their community was responsible for severe environmental effects i.e. air and water pollution, low crop yields, global warming and several health issues i.e. asthma other life-threatening respiratory disorders’ all of which violated their rights to ‘life, dignity and a healthy environment”.235 The court held in favour of claimants that sections of 3(2)(a) & (b) of the Associated Gas Re-Injection Act were violated and under section 1(3) of the Constitution. Despite this judgment, the regulations monitoring gas flaring ‘is till yet to be enforced by the Nigeria Government’.236

Clean up methods are seldom in combination with poor refineries and oil exploration still persists in spite of such environmental devastation is troubling. We can deduce from this that the government’s interest is more economical than environmental i.e. ‘the primary concern of the government was to provide the right climate for the smooth operation and development of the industry’.237 By assessing the contractual petroleum relationship between MNCs and the government could facilitate our understanding as to why Nigerian environmental laws are weak.

230 Ekhator, pg.63.para1.231 Ekhator, pg.66.para.1.232 Ekhator, pg.63.para.1.233 Gbmere v Shell, Suit No. FHC/B/CS/153/05 Ekhator, pg.69.para.2.234 representing himself and other members and residents of Iwherekan Community in Delta State235 Orji, pg.236 Orji, pg.237 Nwaobi, pg.3.para.4.

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CHAPTER 4

A critical analysis of why environmental statutes are not enforced.

4.1 Introduction

Fundamentally, petroleum activities are mostly operated under joint ventures agreements (JVAs) and on some instances in production sharing contracts (PSCs) between multinational oil companies and the Nigerian Government under the auspices of the National Petroleum Corporation (NNPC). 238

238 Enebeli Emmanuel Emeka, Cheng Jinhua and Wang Xiao-Lin, ‘Petroleum exploration and the oil price dynamics: A case study of Nigerian petroleum industry’ (2012) 6 African Journal of Business Management 9, 3345.

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The economic mainspring embedded into the petroleum contractual agreements has an adverse effect on the environmental principles in a legal framework. This is because most contents in such contracts fail to take consideration of the negative effects petroleum activities will have on the environment i.e. the issue of environmental sustainability is absent in most of these agreements. It is important to note that the Petroleum Decree and its subsidiaries, Water Pollution Act etc. and the Constitution have only entrenched in law a standard that petroleum exploration should be carried out in ‘good field practice’, however most of such contracts have failed to imbibe the principle of ‘good field practice’. Thus, the clear absence of environmental protection clauses in JVAs (and other petroleum contracts) is one reason why environmental degradation continues to persist in developing countries such as Nigeria.

4.2 Petroleum contracts

A joint venture agreement simply talks about the selling of petroleum in exchange of local and/or foreign currency in Peter Muchlinski’s words, ‘joint venture (JVs) involves the cooperation between two or more [parties]…..in the pursuit of a common commercial, financial or technical activity”. 239 In Nigeria, the costs and revenues are spilt on an equity basis240 the ‘government attaining 60% of equity shares in the concessions of all the oil companies’.241 Yinika Omorogbe elaborated that JVAs looks at the ‘transportation, storage, delivery and export operations and associated assets such as welfare and housing facilities’ and the ‘Working Capital’ which also involves ‘materials, stocks…debts of staff, debtors and repayments’ and the PSCs offers a high fixed tax for the profits they (MNCs made) and high risk projects for off shore drilling.242 Both types of contracts pay no attention to the environmental devastation attached to it particularly in the NDR. Many reports have reasoned that oil exploration activities has permanently alienated a tract of land by corrupting the marine life, contaminated drinking water due to discharge of toxic pollutants, severe air pollution which has posed health risks to civilians ranging from asthma, bronchitis and other life-threatening diseases.243

What seems to be a multi-faceted issue is the ‘oil price’. Enebeli et al., found that ‘over the past 25-30 years, oil prices worldwide have been highly volatile and is blamed for negatively impacting exploration businesses’.244 He surveyed and found that many governments (particularly from developing countries), struggle on whether to increase the oil price i.e. high oil prices will increase the economy in short-term but ‘rent-taking from the government will reduce’, reduce the production of oil which lessens the pressure on the industry in short-term but as a whole which can be detrimental to its host countries. However, low oil prices can reduce the tax, license fees but lower rent-taking improves ‘margins and pick-up activity’ level. Most governments struggle on finding equilibrium within oil prices.245 As oil prices are determinant factors on how industry’s

239 Peter T. Muchlinski, ‘Multinational Enterprises & the Law’ (2nd edition, Oxford University Press, 2007). 240 Enebeli et al., pg.3345.para.3.241 Omorogbe, pg.277.para.3.242 Energy Mix Report, ‘The Nigerian Production Sharing Contract: An Overview’ [Energy Mix Report, unknown] <http://energymixreport.com/the-nigerian-production-sharing-contract-an-overview/> (last accessed 16 Aug 2014) pg.1.para.1.243 Emmanuel Duru, ‘Environmental Law and Underdevelopment in the Niger Delta Region’ E-International Relations Students available at http://www.e-ir.info/2011/01/06/environment-law-and-underdevelopment-in-the-niger-delta-region/ > accessed 19 August 2014.244 Enebeli et al., pg.3343.para.1.245 Ibid., pg.3343.para.7-8.

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decisions are made246, it is clear that the oil industry is finding it hard to deal with also the immensity and complexity of the environmental degradation 247 hence that is why it is seldom in petroleum statutes such as the Petroleum Decree, Mineral Oil (Safety) Regulations etc. and why the environmental legislation available is ineffective. The environment provides the ‘natural support systems on which human beings and states depend for survival and economic mainstay’ thus, formulating environmental statutes or areas of law that can potentially threaten the environment is imperative; for ‘social harmony, economic viability, political stability and national and international security’.248

A notable feature engulfing all the petroleum contracts seems to only reaffirm Nigeria’s proprietorship of petroleum as the “undisputed owner of the natural resources to be developed”249 which has little or nothing to do with environmental protection. This is a mere reiteration of Nigeria’s constitutional framework on petroleum that “the entire property in and control of all minerals, mineral oils and natural gas in, under or upon any land in Nigeria or….the territorial waters and the Exclusive Economic Zone of Nigeria shall vest in the Government of the Federation and shall be managed in such manner as may be prescribed by the National Assembly”. This is echoed in many petroleum statutes such as the Petroleum Act250, the Nigerian Minerals and Mining Act251 and Exclusive Economic Zone Act252. Such provisions, isolate host communities from asserting their humanitarian rights to a healthy environment. As reasoned by Sagay, ostracizing host communities, ‘is the most contentious and explosive” feature in the Nigerian society because what constitutes as a just and democratic nation should offer protection and redress to all civilians. Sagay elaborated that ‘It is unlikely that [a] good government, order and peace of Nigeria (s. 4(2) of the 1999 Constitution) can be achieved, if the Federal Government, claims 100% ownership of the Niger-Delta’s natural resources”. 253 It seems that the federal government do not appreciate the importance of our environment because according to the Department for Environment Food and Rural Affairs (DEFRA), “we all depend on our environment… [as] it provides the essentials of life…[it] is central to our health, wealth…[thus] as a society we need to value these benefits, [as] by doing so, [we] can ensure

246 M. F. Michot, ‘Major influences in the International Exploration Businesses’ in G. Kronman, D. Felio, T. O’Connor, ‘International Oil and Gas Ventures: a Business Perspective’ in Enebeli, Jinhua and Xiao-Lin (n) 3343.247 James Okolie-Osemene and Jachin Uche Okanume (n39) 6.248 F. C. Onuoha, G. E. Ezirim ’Climate Change and National Security: Exploring the Conceptual and Empirical Connections in Nigeria’ (2010) 12 Journal of Sustainable Development in Africa 4, 225-269.249 Stated by S. K. Asante, ‘Restructuring transnational mineral agreements ‘ [America J.I.L, 1979] in Lawrence Atsegbua, ‘Acquisition of Oil Rights under Contractual Joint Ventures in Nigeria’ [Journal of African Law, Vol. 37 Issue 01 1993] <http://journals.cambridge.org.chain.kent.ac.uk/action/displayFulltext?type=1&fid=5251832&jid=JAL&volumeId=37&issueId=01&aid=5251824&bodyId=&membershipNumber=&societyETOCSession> (last accessed 15 Aug 2014) pg.13.para.2.250 Cap P10, LFN, 2004251 No. 20 2007, A Bill to repeal the Minerals and Mining Act, No. 34 1999252 No. 28 1978253 Commented by Itse Sagay. A General Overview of the 1999 Constitution, Paper presented at a Retreat organized for the Joint Constitutional Committee Review of the National Assembly in Minna on 16th January 2009., in Bamidele Aturu, ‘Oil and Gas Contracts: Legal Issues and Experience from Nigeria’ [Centre for Public Interest Law (CEPIL, Ghana) and the International Institute for Environment and Development (IIED, UK), Accra 2009] <http://www.energydev.net/resource/legal-issues-and-experience-ni.html> (last accessed 15 Aug 2014)

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that people…benefit now and in future”.254 We can deduce that emphasizing too much on ownership of petroleum illustrates why environmental legislation is weak and ineffective.

Non-governmental organizations (NGOs) have been proactive in litigations, publications, lobbying of the MNCs and the State and public awareness campaigns on implementing other strategies on dealing with oil spills, the environmental harm and human rights in Nigeria but have been ignored by the government. In conjunction with NGOs, the African Commission held in favor of environmental sustainability and that the federal government and MNCs are in violation of the African Charter on Human and People’s Rights however, their status carries no binding authority.255 Such ignorance explains why only the economic matters are being reflected in petroleum and environmental statues.

It is important to note that the ownership of petroleum being fully vested to the Nigerian Federal Government is to prevent other MNCs from becoming too domineering over her natural resources hence since 1936256, Shell owns 55% of oil concessions between the contractual relationship it has with Nigeria. It is understandable and mandatory that most petroleum statues reaffirm Nigeria’s proprietorship however this competitive streak has overshadowed the environmental issues emanating from oil spillages which have destroyed farmlands, and fishing grounds facilitating declines in productivity, high rates of unemployment and enforced social displacements; in 2004, approximately 6,000 people had been displaced from their homes.257 This migrates the people of the NDR into extreme poverty, and a democracy that aims to secure all civilians’ rights, the government should prioritize efforts more on abating environmental harm and its socio-economic implications and the competitive nature between MNCs, secondary.

The affirmation of asserting the State of full proprietorship has not taken effect because there is overwhelming evidence highlighting how overpowering MNCs are in the petroleum field. As Frynas careful put it, ‘multinational [oil] corporations…have captured the government of Nigeria, the influence oil companies have over the political and economic institutions in Nigeria is overwhelming’.258 The government’s concern seems fixated on Nigeria’ ownership status rather than the exploitation of her natural resources perpetrated by MNCs should not eradicate the environmental responsibilities it owes to her fellow civilians.

Environmental and petroleum statues are not adhered to by the MNCs even though many organizations and other commentators such as Amnesty International have reported that Nigeria’s

254 Department of the Environment Food and Rural Affairs, ‘Why is the natural environment important?’ ARCHIVE [Department of the Environment Food and Rural Affairs, unknown] <http://archive.defra.gov.uk/environment/policy/natural-environ/important/> (last accessed 15 Aug 2104)255 Ekhator () 72.256 Liana L. Narcisse, ‘Public Perception and the Oil Industry: An Analysis of Oil Employees’ and Nigerians’ Options Regarding Exxon Mobil and Shell Oil’s Corporative Social Responsibility Efforts’ [Spring College Hill, 2010] <http://etd.lsu.edu/docs/available/etd-04292010-122824/unrestricted/Narcisse_thesis.pdf> (last accessed 16 Aug 2014] pg.7.para.1.257 Okpukri and Ibaba (nn36) 178.258 J.G. Frynas, P.M, K Mellahi, ‘Maintaining corporate dominance after decolonization: The ‘first mover advantage’ of Shell-BPP in Nigeria [Review of African Political Economy Vol. 27 No. 85, 2000], Akande, ‘Interview, [London, 2003] and M.A. Roy, ‘Corruption-Related Decision Making in the Multinational Business Arena, [University of Canterbury Australia, Published PhD Thesis] in Kennet et al., pg.3.

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oil spill are perpetrated by “the Royal Dutch Shell and other large oil companies”.259 In their defense, they have attested to such responsibilities by carrying out their own investigations on oil spills and they found that sabotage and theft are the key perpetrators. Sabotage and oil theft are grave problems in the NDR.260 However many reports such as Accufacts found that many official investigation reports (Shell and other MNCs reported) were ‘technically incomplete’ and others ‘appear to be serving another agenda, more driven by politics…than pipeline forensic’261, ‘very subjective, misleading and downright false’.262 Such inadequacies opens room for debate over the ‘acclaimed social responsibility’ by MNCs’.263 The fact that the Nigerian government has remained idle to lack of accountability and transparency by MNCs questions its power of natural resources thus, explaining why the so-called environmental statutes are not enforced and complied with in Nigeria.

The JVs has effectively contributed to the domineering power of foreign oil companies thus leaving room for them to exploit her natural resources and the discretion to be and/or how much environmental harm they are accountable for. As big polluters of oil spills, Shell fail ‘to clean oil pollution’ making the fundamental environmental rights to clean water, air, food and shelter harder to attain264 for host communities, of which many attested that they should solely be held responsible. However, corporate responsibility is also the responsibility of the federal government hence, the main participator in the JVs is the NNPC, a nationalized state corporation and all other companies (MNCs and indigenous companies) are subject to governmental operational rules.265 Usa also found that 95% of petroleum activities under JVs, the NNPC enjoys more control over petroleum266 i.e. in a joint venture agreement (JVA) between NNPC and Chevron, is shared 60% to the former and 40% to the latter.267 Thus a country that claims its full proprietorship of her natural resources should also be accountable as to what happens to it. As succinctly stated by Peter de Wit (director of Shell Netherlands), “when it comes to issues of the safety of people and crime…. It’s the responsibility of the government. That’s not happening. But you can’t lay it on our doorstep”.268 As a contractual agreement involves two parties, logically, they two parties would both be accountable to the environmental harm or any other liability their emanating from it.

259 Konye Obaji Ori, ‘Nigeria: Oil companies blamed, amid pollution reports’ [The Africa Report, 2013] <http://www.theafricareport.com/West-Africa/nigeria-oil-companies-blamed-amid-pollution-reports.html> (last accessed 16 Aug 2014) pg.1.para.6.260 BBC News, pg.1.para.14.261 Amnesty International, ‘Shell’s false claims on Niger Delta oil spills exposed’ [Amnesty International, 2013] <http://www.amnesty.org/en/news/shell-s-false-claims-niger-delta-oil-spills-exposed-2013-11-07> (last accessed 16 Aug 2014) pg.1.para.11.262 Amnesty International, pg.1.para.4.263 Olatunde Julius Otusanya, Sarah Lauwo, Gbadegesin Babatunde Adeyeye, ‘A Critical Examination of the Multinational Companies’ Anti-Corruption Policy in Nigeria’ [Accountancy Business and Public Interest, 2012] <http://visar.csustan.edu/aaba/Otusanya2012.pdf> (last accessed 17 Aug 2014) pg.11.para.3.264 News24, ‘Shell ‘failing’ to clean oil pollution in Nigeria’ [News24, 2014] <http://www.news24.com/Green/News/Shell-failing-to-clean-oil-pollution-in-Nigeria-20140804> (last accessed 16 Aug 2014) pg.1.para.1.265 Usa, pg.112.para.5.266 Usa, pg.112.para.5.267 Ibid., pg.113.para.3.268 Carly Gillis, ‘Nigeria’s Oil: A Brief History’ [Counterspill, 2011] <http://www.counterspill.org/article/nigerias-oil-brief-history> (last accessed 16 Aug 2014) pg.1.para.17.

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Both parties should be liable because the environmental degradation inflicted against host communities is too severe of a task to blame one party. More so, “we live in an interconnected world and environment…[it] is a transnational in character…issues [such as]… biodiversity, loss of habitat, decrease freshwater supplies, energy sources and global climate change[demands] our attention, issues that require global leadership”.269 Thus, putting blame on one party is irrelevant as we need to work together to deal with environmental issues. The United Nations Environment Programme (UNEP) argued that ‘it will take probably…up to 30 years to fully clean the area’ but ‘since the last three years….the government of Nigeria and Shell have taken almost no meaningful action to implement its recommendations’270 and/or her (Nigeria) environmental statutes. Nigeria is the second largest offending country that flares the most gas estimating around 24.1 billion cubic meters (BCM) from 1996-2006.271 Our environment is not a singular entity for one state, it affects everyone thus global efforts need to come into place and address the global risks industrialization places such as global warming, climate change and ozone depletion. Within the United Nations Framework Convention on Climate Change (UNFCC), The Kyoto Protocol encourages many Parties many Parties all over world to implement environment principles such as PPP and sustainable development to abate and/or defeat global environmental threats. Even though, its salient feature recognizes that ‘developed counties are principally responsible for the current high levels of greenhouse gases (GHGs) emissions in the atmosphere due to the 150 years of industrial activity’, 272 Nigeria’s proprietorship status, its stupendous wealth and national independence should join global efforts on abating environmental harm of oil spillages.

4.3 Multinational oil perspective on enforcement of Nigerian environmental statutes

It is important to acknowledge a MNC perspective on why fail to advocate to environmental principles during oil exploration in host communities. there are several reasons why non-compliance by multinational oil companies persists. Olatunde Julius Otusanya273 expatiated on reasons why MNCs neglect responsibilities such as environmental degradation because they epitomize the socio-economic theory of capitalism which believes that ‘corporations do not owe allegiance to any nation, community or locality’.274 Their aims focus on wealth thus the side effects of oil spillages i.e. the loss of biodiversity and other ecological disasters and underdevelopment are neglected. This is concept is known as profit repatriation whereby ‘the profits made are not invested in the country (Nigeria) but are sent to the homes countries of MNCs for investment thus rendering the Niger Delta industrially underdeveloped’.275 This concept has led MNCs to participate in illegal activities such as bribery and corruption. However, many MNCs deny such and argue that their corporation complies with codes of business conduct which prohibits “direct or indirect offer, payment, soliciting or acceptance of

269 Glen Sussman, ‘The Environment as an Important Policy Issue’ [unknown, unknown] <http://ww2.odu.edu/ao/instadv/quest/Environment.html> (last accessed 16 Aug 2014) pg.3.para.3.270 News24, pg.1.para.4.271 Okolie-Osemene and Okanume (n39) 14.272 United Nations Framework Convention on Climate Change, ‘Kyoto Protocol’ available at http://unfccc.int/kyoto_protocol/items/2830.php > accessed 20 August 2014.273 Otusanya et al., pg.5.para.1.274 J. Bakan, ‘The Corporation: The Pathological Pursuit of Profit and Power’ [Constable and Robinson Ltd, London, 2004] in Otusanya et al., pg.5.para.1.275 Osuagwu Godwin Onyewuchi, Ezie Obumneke, ‘Multinational Corporations and the Nigerian Economy’ [International Journal of Academic Research in Business and Social Sciences, Vol. 3, No. 4 2013] <http://www.hrmars.com/admin/pics/1786.pdf> (last accessed 17Aug 2014) pg.364.para.3.

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bribes or facilitation payments in any form is unacceptable”.276 Others such as Kapoor277 and Martens278 have corroborated that ‘the biggest perpetrators are MNCs of which gain their profits through ‘corrupt practices in developing countries’.279 Such corruption stems from the pressure of ‘matching or exceeding’ high profits is embedded within the enterprise culture.280 Thus the ‘so-called’ investigations carried out by multinational oil companies has manifested ‘itself in hypocrisy’ because it promises ‘to act responsibly by not taken unfair advantage through manipulation [and] concealment’281 thus revealing why there is non-compliance by MNCs which effectively contributes to the ineffective environmental provisions.

It is disturbing that the inability of the Nigerian government to effectively implement and enforce environmental laws to protect host communities. Reviewing government successions, the BBC reported that “nearly $400m of illegally gained assets had been identified in the possession of a former governor of Bayelsa State”, “last year, Nigeria recovered $458m found in Swiss bank accounts linked to the military ruler Sani Abacha.282 The inability for the federal government to correctly use Nigeria’s wealth to environmentally restore the NDR affects the enforceability of environmental laws locally, regionally and nationally. The nature of petroleum contracts (JVAs and PSCs) needs to be reformed whereby the wealth coming from oil resources is pumped back into the NDR to develop operational facilities; improving monitoring systems to curb on oil spillages and also provide compensation to victims of environmental degradation.

4.4 Service Contracts

The failures of JVAs have promulgated Nigeria to invest on other types of petroleum contracts such as Service Contracts (SCs). The NNPC has 11 service contracts with Elf, Agip, Africa and Nigus Petroleum Companies whereby with the 5 year contract, the contractor (MNCs) pay all funds necessary for explorative activities i.e. developing operations and other obligations under the contract’.283 This is advantageous because by using up-to-date equipment eradicates oil spills arising from poor refineries and management (reduces environmental degradation) therefore also highlighting the important use of MNCs. As corroborated by Onyewuchi et al., multinational (oil) corporations “transfer technologies, capital and the culture of entrepreneurship [as] they increase investment levels and income in the host countries; they promote improvement in their immediate environment; create access to high quality managerial skills……; they stimulate domestic production

276 Shell’s Codes of Conudct: Bribery and Corruption, Shell, ‘Shell Code of Conduct’ [Shell, unknown] <http://s05.static-shell.com/content/dam/shell-new/local/global-content-packages/corporate/code-of-conduct-english.pdf> (last accessed 17 Aug 2014) pg.26.para.1. 277 S. Kapoor, ‘Plugging the Leaks: A Very Short Paper on Curbing Capital Flight, Tax Avoidance and Tax Evasion for International Policy Dialogue’ [Organised by INWEnt and the Federal Ministry for Economic Cooperation and Development (BMZ), 2005] <http://www.new-rules.org/docs/kapoor4.pdf> in Otusanya et al., pg.8.para.3.278 J. Martens, ‘The Precarious State of Public Finance; Tax evasion, Capital Flight and Misuse of Public Money in Developing Countries – and What can be done about it’ [Global Policy Forum, 2007] <http://www.globalpolicy.org/eu/en/publ/martens_precarious_finance_%20207.pdf> in Otusanya pg.8.para.3279 Otusanya et al., pg.8.para.3.280 Otusanya et al., pg.7.para.1.281 Ibid, pg.8.para.1.282 BBC NEWS, ‘Nigerian leaders ‘stole’ $380bn’ [BBC NEWS, 2006] <http://news.bbc.co.uk/1/hi/world/africa/6069230.stm> (last accessed 17 Aug 2014)283 Omorogbe, pg.281.para.2.

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and enhance efficiency and effectiveness in the production process”.284 Also, most of established Nigerian entrepreneurs “started by working for the multinational corporations, where they acquired…relevant skills and knowledge that gave them the impetus to launch out”.285 This is advantageous to host communities as it provides them with better materials for development in agriculture and fishing and also improve their living standards; better education facilities to fortify employment.286 This highlights the urgency to incorporate more service contracts in the petroleum industry as it offers more environmental stability than JVAs and PSCs because investments are focused mainly on using new and advanced facilities than just the selling of oil.

Despite the benefits of service contracts, some argue that MNCs are calculating at upholding their end of the bargain i.e. using up-to-date machinery to fortify growth. Onyewuchi et al., found that MNCs are the ‘worst culprits’ and ‘tricky’ as they claim “to help industrialize Nigeria by creating a branch-plant economy of small inefficient firms incapable of propelling overall development so local subsidiaries become inactive rather than engines of self-reliant growth”.287 This increases unemployment thus, worsening the socio-economic development in the NDR. Also, it is important to note that MNCs ‘both retain the control of the most advanced technology and do not transfer it to Nigeria or the rest of the developing economies at reasonable prices”.288 Hence, some developing countries argue that developed countries’ concerns for the environment, are a conspiracy to stop their economic growth’ creating a divide between them. NGOs (Kyoto Protocol, UNFCC) play an important role on infusing official negotiations between developing and developed countries so efforts can abate the environmental pollution threatening environmental sustainability. 289 Nigeria is already in debt hence in 2011, ‘the domestic debt stock had grown substantially to US$42.23 billion and her implied total debt stock of US$47.9 billion or 21% of GDP’.290 A country that is blessed with abundance natural resources should not be in debt and should use their wealth to invest on environmental sustainability to fortify the socio-economic sector in the NDR and Nigeria as a whole. The poverty in Nigeria cannot be ignored whereby the majority find life excruiating because it is difficult to attain basic needs i.e. food, clean water, education and a clean and healthy environment.291 It is clear thar the NDR must first alleviate poverty in order to begin to protect the environment.292 To make this more of a reality, developed states need to be willing to use their best practices i.e. approapriate technology with developing countries.293 On an international level, the writer ponders on how effective are other countries such as USA, when monitoring oil spillages.

284 Onyewuchi et al., pg.367.para.3.285 Ibid, pg.367.para.4.286 Oviasuyi et al., pg.120-121.287 Onyewuchi et al., pg.364.para.4.288 Ibid, pg.364.para.4.289 Phillip F. Cramer, ‘Rethinking Environmental Protection: A Natural Approach to Nature’ (Lexington Books, 2000) 74.290 Federal Ministry of Finance, ‘Clarifying Nigeria’s Debt Position’ [Federal Ministry of Finance, unknown] < http://www.fmf.gov.ng/the-media/speeches/127-clarifying-nigerias-debt-position.html> (last accessed 17 Aug 2014)291 Oviasuyi and Uwadiae (n46) 112-113.292 Cramer () 73.293 Cramer () 74.

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Chapter 5

Comparative analysis of environmental statutes regulating oil spillages in the USA

5.1 Environmental impacts of oil spills

Like Nigeria, oil is a leading source of energy in the USA of which supplies her 40% of her energy needs. There has been several major oil spills in the US of which tainted host communities and the economy i.e. the April 2010 oil spill in the Gulf of Mexico294 which led to the ‘sinking of the Deepwater Horizon oil rig’ causing 4.9 million barrels of petroleum spilled295 and the most prominent was the 1989 Exxon Valdez spill which leaked approximately 11 million gallons of crude oil into Prince William Sound, Alaska. One cannot dispute the negative environmental impact of oil spillages; the former killed 11 people, aquatic deviation such as ‘the deep sea was permanently a dark environment, which had profound effects on wildlife i.e. ‘with the naked eye: pelicans black with oil, fish belly-up in brown sludge,…and other animals people eat almost immediately…over 1000 miles of shoreline on the Gulf of Mexico, from Texas to Florida was too affected’.296 The Exxon Valdez spill 294 Jonathan L. Ramseur, ‘Oil Spills in U.S. Coastal Waters: Background and Governance’ [Congressional Research Service, 2012] <http://fas.org/sgp/crs/misc/RL33705.pdf> (last accessed 18 Aug 2014) pg.1.para.1-2.295 The Ocean Portal Team, ‘Gulf Oil Spill’ [Ocean Portal, unknown] <http://ocean.si.edu/gulf-oil-spill> (last accessed 18 Aug 2014) pg.1.para.1.296 The Ocean Portal Team, pg.6.para.1-4.

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too, produced damaging consequences ‘on marine wildlife, fisheries and the economy; more than 250,000 seabirds died in days, 1,300 miles of coastline were hit by the oil spill, four deaths all of which amounted to $300 million of economic harm to more than 32,000 people whose livelihoods depended on commercial fishing’.297 One cannot dispute the urgency to formulate laws that effectively enhance environmental principles to monitor and curb oil spillages.

5.2 The American environmental legal framework

Such spills promulgated the ‘need for strong and comprehensive oil spill legislation [thus] spurred Congress to enact the OPA’ (Oil Pollution Act 1990298).299 Under the Environmental Protection Agency (EPA), the Oil Pollution Act (OPA) ensures damages for ‘the cost of restoring, rehabilitating, replacing or acquiring the equivalent of the damaged natural resources, diminution in value of those natural resources and the reasonable cost of assessing those damages’.300 This is accompanied with the NOAA which deals with natural resource damage assessments whereby the damages are strictly compensatory and not punitive. This is plausible because criminalising a polluter will not affect the environment hence under the funding the Oil Spill Liability Trust Fund, ‘the Energy Policy Act of 2005 allowed the funds in the trust to be raised to $2.7 billion dollars…one incident is currently $1 billion’ which is the required amount to make an actual difference on environmentally restoring the Niger Delta.301 In Nigeria, most environmental and petroleum provisions such as the Petroleum Production and Distribution (Anti-Sabotage) Act, criminalises pollution with death penalty being a common sanction than adequate compensation for remediation,

Asides the OPA, the USA has other compensatory bodies to support the damaging effects of oil spillages in example, Congress enacted the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA)302 which is known as Superfund to clean up sites contaminated by hazardous waste. 303 It is another prominent statute whereby the law authorizes two types of response on remedying oil spills firstly; ‘short term removals addresses releases or potential releases requiring prompt response and second; the long-term remedial response directs efforts to permanently and significantly reduce the dangers associated with spills or potential spills that produce hazardous substances of which are life threatening’.304 In Nigeria, petroleum and environmental statutes do not offer effective response to oil spillages instead most environmental and petroleum statutes are fixated on asserting full proprietorship the federal government and using ineffective clauses like ‘good field practice’ to monitor her old refineries.

297 Oceana, ‘Exxon Valdez Oil Spill Facts’ [Oceana, unknown] <http://oceana.org/en/our-work/stop-ocean-pollution/oil-pollution/learn-act/exxon-valdez-oil-spill-facts> (last accessed 18 Aug 2014] pg.1.para.2.298 101 HR 1465, Public Law 101-380299 Florida Commission on Oil Spill Response Coordination, ‘Analysis of Current State and Federal Laws Addressing Oil Spill Planning and Response: Summary of applicable statutes, identifying strengths/weaknesses and nothing how – and by which agency – laws are implemented’ [Florida Commission on Oil Spill Response Coordination, 2012] <http://www.dep.state.fl.us/deepwaterhorizon/files2/corc/Oil_Spill_Planning_and_Response.pdf> (last accessed 18 Aug 2014) pg.12.para.1-2.300 Ramseur, pg.9.para.2.301 Law Info, ‘Environmental Laws and Oil Spills’ [Law Info, unknown] <http://resources.lawinfo.com/personal-injury/environmental-exposure/oil-spill/environmental-laws-and-oil-spills.html> (last accessed 18 Aug 2014) pg.1.para.2.302 Codified as 42 U.S.C § 9601 et seq. (1990)303 Florida Commission on Oil Spill Response Coordination, pg. 18.para.2.304 Environmental Protection Agency, ‘CERCLA Overview, unknown] <http://www.epa.gov/superfund/policy/cercla.htm> (last accessed 18 Aug 2014) pg.1.para.2.

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Additionally, reasserting the Big Oil Bailout Prevention Unlimited Act 2011 enhances ‘the PPP’; the OPA was amended to make the party more responsible for an offshore facility.305 The compensatory framework being tougher on oil spills highlights how accountable and enforceable the US system is particularly in response to the BP oil spill. “The report recommends Congress to raise the liability cap on offshore oil spills, set at $75m and oil companies to fund a safety institute as part of their fees for drilling licenses” and also allocate 80% of the funds from BP fines under the CWA to Gulf restoration.306 This is a salient feature because by increasing a cap of $75m regulates ‘private enterprises’ which is significant as it further deters MNCs who will exercise more caution when carrying out petroleum explorative activities on not leaking/exploiting oil. Unlike Nigeria, the USA draws away from capitalism that ‘corporations do not owe allegiance to any nation, community or locality’307 and ensures that all polluters are accountable to the environmental degradation they incur. In a developed country, the economic mainspring when used appropriately plays an advantageous role on ensuring remediation to victims of the environmental damage arising from oil spillages. However, Erik Milito complained that such expensive measures also place restrictions on civilians and it “does a great disservice to the thousands of men and women who work in the industry and have the highest personal and professional commitment to safety”.308 Irrespectively, in order for Nigerian environmental laws to be effective, the petroleum contracts should use its economic resources correctly by withdrawing more from capitalism and implement more democratic values highlighted under Dicey (‘s rule of law) that everyone is under the law309 thus accountable to the damages they incur.

The USA has a more professional and efficient outlook than Nigeria when cleaning up oil spills. As corroborated by Shyllon, the laws of more developed countries are so robust and effective because they do not allow any “waste generator can easily escape liability for defective disposal’ because they ‘compel cleaning of hazardous waste sites310” on MNCs. Hence, the level of clean-up needed is decided by the Federal On-Scene Coordinator (FOSC) of which uses all federal efforts to provide information and support local, state and regional response communities. There are concerns that the federal government can become too domineering however, the OPA expressly permits states to ‘maintain their own laws regarding oil spill and clean-ups’.311 It is pertinent to note that victims of oil spill can invoke their right to ‘recover damages both under the federal OPA and state laws in the jurisdiction where the action has occurred.312 The constitutional framework of the US federal system is an important feature that proves the effectiveness of holding each level of government to account and curbing their powers so they are not over-powering on another. In example, each branch has its own sphere of responsibility as highlighted by Professor S.E. Finer who described it as being “like two halve of a bank note – useless without the other”.313 Each branch is equal but separate i.e. the government (President) had the responsibility of enacting laws, the legislature, formulated laws (regions/members of Congress) and the judiciary enforced the laws.314 This ensures transparency

305 Ibid., pg. 26.para.2.306 Suzanne Goldenburg and Tim Webb, ‘US Commission on BP oil spill demands tougher regulations’ [The Guardian, 2011] < http://www.theguardian.com/environment/2011/jan/11/bp-oil-spill-usa> (last accessed 18 Aug 2014) pg.1.307 J. Bakan, ‘The Corporation: The Pathological Pursuit of Profit and Power’ [Constable and Robinson Ltd, London, 2004] in Otusanya et al., pg.5.para.1.308 Goldenburg et al., pg.2.para.6.309 Albert Venn Dicey, ‘Introduction to the Study of the Law of the Constitution [LF ed., 1915]310 EPA office of Enforcement, waste Enforcement Task Force Case Statistics as of December 1980’ [Chem. And Radiation Waste Litigation Rep, 1982] in Shyllon pg.77.para.3.311 Law Info, pg.1.para.2.312 Ibid., pg.1.para.2.313 1970 – quote from politics book314 Michael A. Genovese and Lori Cox Han, ‘Encyclopedia of American Government and Civics’ [Infobase Publishing, NY 2009] <http://www.slideshare.net/wanville/american-government-sivics>

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and accountability hence; the OPA enforces ‘federal trustees are charged with assessing damages to natural resources for water, wildlife and other natural resources’.315 Nigeria is a federal system but the priorities of the government are misplaced as they stress more on economic matters and ignore environmental principles. Under the Revenues Decree, regional states are deprived the rights to land and under laws of torts (nuisance, trespass and negligence), one must have a proprietary interest in land in order to prove that their right of enjoyment of land has been breached. As the Petroleum Decree and its subsidiaries and the Constitution affirm that only the federal government has the right to land it means that host communities cannot invoke their rights to a clean and healthy environment because under laws of torts.

Also, Nigeria’s governmental bodies do not focus on environmental restoration instead, they use her country’s natural resources to enrich their selves Alexandra Gillies reported that ‘the country’s central bank governor to the president [was] accusing the national oil company of transfer $50 billion in oil revenues to the treasury between January and July 2013’.316 Such corruption explains why environmental laws are grossly insufficient hence; one cannot stress enough the urgency to reform her statutes so they can have the capacity to effectively enforce laws. Like Nigeria, other developing countries such as Angola, the national oil company allocate for $32 billion in oil state revenue to the treasury and their international governance of oil sales remain limited.317

However, not all levels of government are satisfied by the OPA i.e. (regional) the Florida Commission on Oil Spill Response to Coordination criticized OPA for being limiting because even in localised areas, local communities ‘were not able to take part in clean-up efforts’. The DWH oil spill incident found the OPA very problematic because the OPA could not cover the magnitude of damage due to its local units thus meaning that the relief needed had to surpass jurisdictional boundaries.318

The OPA also merged many existing federal oil spills laws and modernized the federal legislative criteria for oil spills on land and sea. It also amended main sections of the CWA (Clean Water Act319) i.e. section 4201 amended 113(c) and vested power to the president to carry out clean-up reliefs immediately after using federal resources, monitor the efforts of the polluter, or aid polluter’s clean-up activities; and the National Oil and Hazardous Substances and Pollution Contingency Plan (NCP).320 This reiterates how effective and well-organised American environmental laws are in comparison to Nigeria whereby environmental protection is not embedded into petroleum laws as the Petroleum Decree and the Mineral Oil (Safety) Regulations emphasizes on empowering the Federation instead of enhancing the environment.

The USA offers a better application of sustainable development on combating oil spillages. The OPA amending NCP was also beneficial because it became ‘multi-tiered and coordinated National

(last accessed 18 Aug 2014] 315 Ibid., pg.1.para.2.316 Alexandra Gillies, ‘Is Nigeria Missing $50 billion? Some Considerations’ [National Resource Governance Institute, 2013] <http://www.resourcegovernance.org/news/blog/nigeria-missing-50-billion-some-considerations> (last accessed 18 Aug 2014) pg.1.para.1317 Asume Isaac Osuoka, ‘Oil and Gas Revenues and Development Challenges for the Niger Delta and Nigeria’ paper presented at the Expert Group Meeting on The Use of Non-Renewable Resource Revenues for Sustainable Local Development, Organised by the UN Department of Economic and Social Affairs [UN Headquarters, New York, 2007] <http://www.un.org/esa/sustdev/sdissues/institutional_arrangements/egm2007/presentations/isaacOsuoka.pdf> (last accessed 18 Aug 2014] pg.4.para.4.318 Florida Commission on Oil Spill Response Coordination, pg. 14.para.3.319 Formerly Water Pollution Control Act: 33 U.S.C. Section 1251 et seq. (2002)320 Florida Commission on Oil Spill Response Coordination, pg. 12.para.3.

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Response Strategy for addressing oil spills’.321 For instance, the OPA obliges companies to create spill scenario plans before drilling for oil322 which has to satisfy procedures and standards determined by the president323. OPA makes it obligatory for ‘new tankers to build double hulls to provide an extra layer of protection in a crash. Under petroleum contracts, OPA extended responsibilities for the oil spiller by including costs not only from the federal government but from the local and state government that suffer clean-up costs related to the spill.324 To reiterate, ‘the Revenue Decree No.9 of 1971 revokes ownership powers from Regions or States’325 and vests it to the government thus depriving local and regional communities rights from protection of oil spillages. This is implausible because local and regional communities have more experience and are more equipped with knowledge of the land therefore are best candidates on deciding what works best than the federal government. The overruling government in Nigeria underlines why environmental legislation is inadequate due to lack of experience and little or no compliance by MNCs.

To reiterate why USA laws are more effective than Nigerian environmental statutes is underlined in its ownership status. The American petroleum industry operates under private ownership as primarily exemplified in Texas, Washington and Pennsylvania. Even though the land owner is subject to the State and Federal regulatory provisions, one can create ‘diverse interests like mineral, royalty or leasehold estates that are distinct and separate from the basic land’.326 In other words, the USA’s petroleum industry operates under a dual ownership system whereby the ‘landowner owes mineral rights of onshore areas while the State and the Federal Government owns minerals in/on public lands including offshore areas.327 This is plausible because it does not exclude ordinary civilians from owning oil and it means that both parties can be liable for any damages which is not the case in Nigeria. Other developed countries such as Canada also employs the dual ownership system when regulating petroleum. However, there are distinct features in example, both levels of government (Federal and Provinces (states)) exercise different stages of control in the petroleum field. The province attains full proprietorship of petroleum resources in situ on the property within its territory i.e. she owns 80% of Alberta’s petroleum in situ of which grants leases and collects royalties and has the exclusive right to regulate petroleum production whilst the Federal Government controls the consumption and trade features.328 Due to political and economic upheavals, provinces felt it crucial to mark their territory on petroleum as exemplified in Alberta Petroleum Marketing Commission.329 Reverting rights to individuals and (local) and regional bodies and not just the Federal Government further shows how democratic and modernised developed countries are in comparison to developing countries like Nigeria oh which empowers the ruling government and weakens host communities – thus clarifying why Nigerian environmental statutes fail on controlling/preventing and restoring oil spillages.

The Clean Air Act330 is another federal law that regulates air emissions from stationary and mobile sources. To monitor air pollution, this law ‘authorises the EPA to establish National Ambient Air Quality Standards (NAAQS) to protect public health and welfare and regulate emissions of hazardous air pollutants’.331 Section 112 permits the EPA to set emissions standards that do not exceed the

321 40 CFR (Code of Federal Regulations) Section 300, subpart D322 Law Info, pg.1.para.2323 Florida Commission on Oil Spill Response Coordination, pg.13.para.2.324 Law Info, pg.1.para.2.325 Ibid.pg.9-10326 Duru, pg. 15-16 327 F. Ayodele-Akaakar, ‘Oil and Gas: The Issue of Ownership and the Nigerian Situation’ [FIDA Journal, 2FJERSB 1999] in Duru, pg.15.para.1.328 Duru, pg.16.para.2-3.329 Ibid., pg.17.para.1.330 42 U.S.C. §7401 et seq. (1970)331 Environnemental Protection Agency, pg.1.para.1.

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maximum degree reduction in emissions of hazardous air pollutants using MACT (maximum achievable control technology) to determine in any pollutant poses high risks for a source category.332 To enforce such regulations EPA carries out New Source Performance Standards (NSPA) and State Implementation Plans (SIP) which passes compliance evaluation reviews of oil companies at least once or every two years; the Acid Rain Inspection and Trading Program which sets emission standards (sulphur dioxide and nitrogen oxides) that cannot be exceeded by oil companies. In Nigeria, FEPA does not have a comprehensive framework as Falola et al. 333 found that it has no authority by law to penalize polluters of the environment as upheld by the Constitution and other petroleum contracts (Petroleum Decree etc.).

Overall, there is an obvious difference between Nigeria as a developing country and the USA as a developed country. Nigeria has environmental laws but the major problem is that they are never enforced due to the over-emphasis of full ownership of petroleum to the State, the petroleum contracts are strongly influenced by capitalism which facilitates the predomination of multinational oil companies, governmental efforts sought only to enrich themselves rather than inject money into the operational facilities to prevent oil spills to fortify socio-economic development and exclusion of host communities i.e. ostracising them from asserting their human rights to a clean and healthy environment. Developed countries are catalyst contributing to environmental degradation because their enterprise culture allows them only to focus on profits and neglect the environmental side effects arising from oil spills. Both developed and developing countries need to agree on a standard of environmental protection.334

Chapter 6

Conclusion

The problems and environmental impact of oil spillages has been a concern not only at national levels but international as well due to the global concern of global warming and climate change. This dissertation has explored the environmental impacts of oil spillages occurring in the Niger Delta. The piece has critically assessed several petroleum laws and reviewed the institutional frameworks to collectively address how effective and enforceable environmental principles are in Nigeria. It has also attempted to study the elements that weaken environmental and petroleum laws by evaluating the petroleum contracts and its relationship with multinational oil companies. In furtherance of the argument, the dissertation has examined the legal framework for environmental protection in Nigeria by comparatively assessing its standards with that of the USA.

However, it was noted that there is an absence of environmental legislation that effectively monitors or/and prevents oil spills in the Niger Delta. The inadequacy of funds to advance operational facilities such as functioning pipelines and laboratories has intensified the occurrences of more spills, furthering the environmental deterioration of which has killed and destroyed humanity; Nigeria’s endowed biodiversity reserves provides a robust agricultural and fishing base that host communities depend on for their daily bread, has now been threatened. On a wider scale, the environmental effects emanating from industrialisation has flared more gas and contributed more greenhouse gases to the Earth’s atmosphere than all other sources in sub-Saharan Africa335 and the Climate Justice Programme reported that Nigeria flares the most gas in world which is roughly about 2.5

332 Environmental Protection Agency, pg.1.para.3.333 Falola et al. 112-113.334 Phillip F. Cramer, ‘Rethinking Environmental Protection: A Natural Approach to Nature’ (Lexington Books, 2000) 74.335 Friends of the Earth, ‘Media Briefing: Gas flaring in Nigeria’ [Friends of the Earth, 2004] <http://www.foe.co.uk/sites/default/files/downloads/gasflaringinnigeria.pdf> (last accessed 18 Aug 2014) pg.1.

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billion cubic feet of gas being wasted every day.336 The petroleum/environmental statues have strictly averred Nigeria’s full proprietorship of petroleum to her State empowering the Minister of Petroleum and the President (other governmental bodies), which has little or nothing to do with environmental protection and other environmental principles such as sustainable development. The assertiveness of Nigeria’s ownership of petroleum ostracised host communities from invoking their human rights to a clean and healthy environment.

The institutional frameworks such as FEPA and EIA have also been ineffective due to lack of enforcement and incompetent facilities to maintain environmental standards. The lack of political will by governmental bodies and the judiciary fostered more incompetency of environmental legislation. Her participation with international frameworks has not attained its full potential due to Nigeria’s ownership rights of petroleum which is further emphasised under her Constitution and; the dominant multinational oil companies who refuse to take responsibility for the spills and the consequential damages they incur. From all instances, the government and multinational oil companies made little effort to clean-up the oil spills which adds more burden to the host communities and Nigeria’s ecosystems. In other words, the Niger Delta contributes massively to economic and financial development of Nigeria through oil and gas production and ecosystems services, but receives little or no tangible benefit from the oil production.

The legislative inadequacies for the environment was attributed due to the type of petroleum contracts, Joint Ventures Agreements (and Production Sharing Agreements) which primarily focuses on the sale of petroleum in exchange of local or foreign currency. The economic mainspring under a the JVA posed a pertinent issue on Nigeria’s sovereignty of petroleum resources by empowering the domination of multinational companies. The capitalist culture underlying in foreign companies encourage more focus on enhancing their wealth at any cost to maintain their competitive status. Hence, the cases of sabotage and oil theft are common excuses used by multinational oil companies from taking responsibility for the environmental damage they incur. Also, Nigeria being a developing country plays a significant role on how effectively environmental laws are enforced with poor equipment and managerial skills. However, the pressing issue was of a political nature whereby the government focused mainly on enriching their selves than remedying host communities who undergo the most environmental impacts of oil spillages.

The USA being a developed country offers a comprehensive template whereby the laws put in place are correctly used to remedy the oil spillages. Hence in the Oil Spill Liability Trust Fund, ‘the Energy Policy Act of 2005 allowed the funds in the trust to be raised to $2.7 billion dollars…one incident is currently $1 billion’. In Nigeria, the funds are allocated into personal accounts and the multinational oil companies particularly, Shell pay insufficient funds from the extent of natural resources they exploit which is illustrated in the Bodo case. The community asked for US$200-300 million dollars but were only paid US$51 million dollars. In an attempt to tackle this multi-faceted environmental degradation, the Nigerian federal government established several regulatory frameworks such as FEPA and EIA. Despite all such efforts, the extent of environmental pollution and non-compliance to the environmental laws in Nigeria still persist.

336 Peter Roderick, ‘Gas Flaring in Nigeria : A human Rights, Environmental and Economic Monstrosity’ [Friends of the Earth/Environmental Rights Action, 2005] <http://www.foe.co.uk/sites/default/files/downloads/gas_flaring_nigeria.pdf> (last accessed 18 Aug 2014) pg.4.para.1

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