The Flaring Fiasco: Fear, Fault and Faith

Shell’s involvement in the Niger Delta region of Nigeria has provoked much discussion and controversy over the past years.  But what exactly is happening, who is responsible and what should our perspective be?  This article examines observable unethical practices, relations with government and environmental responsibility with respect to Shell’s activities in the Niger Delta region of Nigeria.

The story of the Niger Delta also exemplifies the way that corruption permeates every level of society: companies, local militia, government – all are involved.  All are profiting from the vast natural resources of a developing country, while ordinary citizens see little benefit from its God-given materials.  This can be seen in many countries around the world, such as the problems the Democratic Republic of Congo has had with its mining industry^[1], or the land grabs seen in places such as Cambodia, where companies want to increase their farming and mining capabilities.^[2]

Previous scholarship has established obvious links between business, poverty and corruption in the Nigerian oil industry: the victims of violence, pollution and loss of livelihood are the poorest members of society.^[3]

Gas Flaring: An Introduction

Gas flaring has been long used as a way to eliminate waste gases from oil pipelines.  They’re released by pressure release valves and are supposedly a safe way of getting rid of unwanted resources.  However, the system is fraught with problems.  Not only does oil get illegally siphoned off by gangs, but gas flaring has multiple detrimental environmental effects, which negatively impact local communities.  It also wastes valuable non-renewable resources, as well as causing health problems for local residents.

From an environmental point of view, the gas released into the atmosphere pollutes the local environment.  It kills off crops such as cassava, a food staple in many African nations, which becomes malformed and rotten.^[4] The water systems also become polluted and the fish die off.  These effects are not only harmful for the environment, but impact on the communities who farm and eat these fish.  Many farmers have lost their livelihoods, and communities are suffering from lack of food, because of the impacts of these gases.^[5]

Furthermore, the health of the local citizens is impacted.  Cancers, asthma, chronic bronchitis, numerous heart and lung complaints and a high infant mortality rate are all common side-effects of living in close proximity to a gas valve.^[6]

Gas flaring has technically been illegal in Nigeria since 1984 but continues seemingly unabated. ^[7] Gas flaring has multifaceted impact on the socio-economic and health of the residents of Niger Delta. Perhaps the epileptic power supply in the Niger Delta region might be alleviated if the flared gas are used to source power supply, such an initiative might improve access to power and would provide some of the benefits  of the hydrocarbon economy to the poorer communities.

Focus on Shell in the Niger Delta

The Niger Delta is the area of Nigeria with the largest oil deposits – 2 million barrels are extracted daily.  Consequently, it has been mined by many large companies, most notably Shell.  (It is worth pointing out that other large companies have also been accused of unethical conduct in the Niger Delta, but for the purpose of this report we will focus on Shell’s activities.)

Shell has long used gas flares as a means of siphoning off waste gases.  In 2008, it came to light that the company had yet to remove some 50 illegal valves from its pipelines.  These primarily led to a plant at Bonny Island LNG.  The financial losses accrued through gas flares from these valves were valued at $1.4 Billion annually. This is equivalent to 30% of UK North Sea oil production each year.^[8] However, Shell insists that it is working to stop the flaring, with a reduction of more than half from 2002 to 2010, and that the problems are due to vandalism and gang warfare^[9].

Security of the pipelines is a major issue.  Due to gangs wanting to illegally siphon off oil and destroy the offending gas valves, Shell and other oil companies depend on government forces that they cannot control.^[10] Shell has hired over 1,300 armed guards. However, against this background security deteriorates. Heavily armed and well-organised gangs shut down operations, kidnap staff and sabotage pipelines.  It is estimated that on average two oil and gas workers are kidnapped every week.  Militant groups have emerged, financed in part by the theft of crude oil and condensate on an industrial scale. They cause massive pollution in the process by damaging wellheads and other facilities. That has created major environmental problems from oil spills, increasing community resentment of oil companies still further.  More alarmingly, the security forces are often to blame for human rights abuses, such as killings and torture.  Due to this, Shell provides “human rights training” for its employees; however, the problems continue. ^[11]

Shell's contracting practices incentivise violence. Shell routinely awards “security contracts‟ to groups who pose the greatest threat to its operations. These contracts are distributed without any apparent safeguards. The manner in which Shell distributes these “benefits‟ has contributed to inter-communal conflict, armed rivalry and major disruption.^[12]

Shell has a Shell Petroleum Development Company (SPDC) which is designed to offer a range of economic benefits to local communities, including employment and training, contracts for local companies and tax payments to government.  It also has social investment programmes for communities.  However, these communities claim to have received very few benefits from the SPDC or other similar projects.^[13]

Shell refused for many years to take any responsibility for the consequences of its actions in the Niger Delta.  In fact, only the appearance of a report by Amnesty International,^[14] which brought international attention to the issue, prompted them into action.  The report, which highlighted two huge spills in the Bodo region of the Niger Delta in 2008, urged Shell to pay $1billion for an initial clean-up and compensation, as well as launching further investigations.  It also called on the Nigerian government for action.

Shell’s initial offer had been just 50 bags of rice, beans, sugar and tomatoes as relief for a disaster about 20% the size of the Gulf Oil Spill in America.   When one considers that the company reported profits of US$ 7.2bn billion for July-September 2011, it is unsurprising that this outraged local populations.  Positively, after legal proceedings were commenced in 2011 Shell finally accepted liability and agreed to pay for a clean-up operation.^[15] However, at the time of writing this report in April 2012, it is unclear whether Shell has actually paid any money.^[16]

Shell claims that its involvement in the Niger Delta is benefiting local communities.  Firstly, it contributes to the economy through the vast taxes and royalties it pays to the government.^[17] Furthermore, the SPDC runs social initiative projects, which have contributed over  $161 million to the Niger Delta Development Commission.^[18] They have projects which focus on HIV/AIDs, women and empowerment, and youth. But Shell’s money for the community is wasted by mismanagement and corruption. Local populations claim to have seen little benefit and cite ongoing health problems such as eye irritations, and long-term environmental impacts, such as the decimation of fish stocks in the Bodi region.^[19]

It is important to point out that the Nigerian government is not faultless in this catastrophe.  A 2001 investigation by the African Commission found them guilty of multiple human rights abuses. The report stated that “Contrary to its Charter obligations and despite such internationally established principles, the Nigerian Government has given the green light to private actors, and the oil Companies in particular, to devastatingly affect the well-being of the [local populations].” ^[20] Ten years on, the Nigerian government is still being accused by local populations of embezzlement.  Furthermore, government ministers are not being punished or imprisoned for their corruption, even when it is made public.^[21]

Moreover, despite the Nigerian Constitution obliging its government to provide citizens with sufficient jobs, health care, food and information, they have failed to deliver these basics in the Niger Delta.  Not only is government spending of the money it receives covered up so that local communities cannot access it, but also the government itself provides no social security schemes such as the ones run by Shell’s SPDC.^[22] Even the right to clean water is not being protected, due to the pollution of the rivers.  This is despite the fact that the SPDC has contributed about $38 billion to the government between 2007-2011.^[23] Shell paid the Nigerian government $6.07 billion in taxes in 2011,^[24] and in total the country earned $196 billion from oil and gas exports between 2007 and 2010.^[25] Its oil revenue in 2011 alone constituted $15 billion.  The 2012 central government budget prioritises security, infrastructure, agriculture, education and health; these represent 30% of the predicted expenditure.^[26] However, local governments often refuse to publish the budget for their allocated money; in the rare cases where the initial budget is published, whether or not the money is actually spent is often unclear.^[27] Furthermore, there remains once again a large discrepancy between the allocated budget and the comments of the communities, who often see little improvement in their living standards.^[28]

Many NGOs and campaigns, such as Publish What You Pay^[29], are calling for the publication of payments by the extractive industry to governments so that both business and government can be held to account.  In some places this is a legal necessity: laws such as the Dodd Frank Act^[30] oblige American companies to do so.  The UN Guiding Principles on Business and Human Rights^[31] also set transparency obligations for states and governments, and promote adherence to the Ethical Industries Transparency Initiative (EITI).^[32] Despite these measures, however, it remains difficult to access such information, particularly with regards to specific spending.  Additionally, the communities of the Niger Delta have little public voice to lend power to their requests for information access, which causes another roadblock to business and governmental transparency.

The Nigerian Constitution obliges the government to hold businesses to account for their proceedings.  However, if the government itself does not respect its human rights commitments, it is unlikely to force foreign companies which are contributing huge amounts of tax and other payments, to do so.  The problem therefore is not that the laws are absent from the Constitution, but that they are being systematically and purposefully overlooked, by both the government and the mining companies.

Into this governance void step militia groups, gangs and tribal chiefs who are all too willing to act on the edges of the law in pursuing their interests at the expense of disempowered local communities.

A Christian Response

Shell’s actions (and those of other multinationals) are clearly unethical, and it is easy to denounce them.  However, it is worth asking the question whether we really expect Shell, or other large companies, to act any differently? Do we expect them to respect human rights in all environments, or does Nigeria’s instability mean that we turn a blind eye to proceedings?^[33] It is easy to view such corruption as happening only in states such as Nigeria, where there is government unrest and insecurity.  Yet corruption is a global web, and as this case demonstrates that the actions of a foreign company can harm all aspects of local life.  And it must be remembered that Shell’s drive for oil is of course the result of western consumers’ demands for oil – for our cars, transport and energy.

In the absence of legally binding mechanisms on corruption and transparency companies sometimes argue that they should not be expected to take the initiative on these issues if it affects their competitiveness? However the UN Framework for Business and Human Rights states that companies have a duty to avoid human rights violations regardless of challenging "external environments". Also Biblical standards of right and wrong call for right behaviour regardless of what others may do.

Nigeria is fast becoming the epic centre of Christianity in the global south with the growth of Pentecostalism. In view of the proliferation of Pentecostal churches in the country, it is important that churches should be more engaging in terms of their prophetic role to their communities.

We have a God-given mandate to look after the earth and its resources.^[34] So from a purely environmental point of view, we are obligated to try to end gas flaring and its detrimental effects.  We are also called to care for the poor and needy,^[35] which gives us a responsibility to help the poor communities in countries such as Nigeria who are suffering from human rights abuses.  Particularly in an age where we are privileged enough to have such a global perspective, and to know what is going on in the rest of the world, surely this urges us to action on behalf of the poor?  Finally, our response should also be guided by our personal integrity: we want to walk humbly before God.^[36] If we are acting with honesty and humility then we will know that watching communities suffer without action is wrong.  We will be driven to take action by love, mercy and justice.

So what can we practically do to help the situation?  The two most obvious responses are prayer and advocacy.  As we seek to promote justice in our world, let’s concentrate on these two areas:

Prayer

• Pray for the local communities, that their voice is heard and they receive just treatment
• Pray for Shell and other large companies, that they act ethically and take responsibility for their actions
• Ask God to raise up workers in these companies who will act with integrity and compassion
• Ask God to prompt Christians to act on behalf of the poor and needy in these situations
• Pray for Nigerian churches, that they are able to support their countrymen, and that they find ways to speak out on their behalf

Advocacy

• Write to companies such as Shell, urging them to pay the compensation they have promised
• Write to your local MP, asking for the creation of a legally binding mechanism for transparency of payments made by companies in the extractive industry
• Support efforts to make company payments transparent and traceable – such as Publish What You Pay, Unearth the Truth (Tearfund), or EXPOSED

• Support campaigns such as Amnesty International’s Bodo campaign, in order to speak up for justice.  Amnesty’s corporate accountability campaign is called ‘Demand Dignity’; find more details here
• Raise awareness by profiling Nigeria’s situation at your church
• Keep up to date with what is going on by staying abreast of news developments etc.

Gas flaring represents just one area where justice is obscured and large corporations are taking advantage of the power they have over local communities.  However, we hope that this document has helped you to think about the global situation, and our Christian response to environmental and human rights injustices.   If you have other reflections on how we should act ethically as Christians, and what part we should play when faced with such cases of corruption and injustice, please do comment below and let us know your thoughts.

Written by Esther Thomas for Micah Challenge International

We appreciate the contributions of Babatunde Adedibu, Policy and Research Officer of the Redeemed Church of God, UK, to this research.

Further Information

• This short film from Amnesty International details the situation in the Bodo region:
• Amnesty’s International’s report, ‘Nigeria: the True ‘Tragedy’: Delays and Failures in Tackling Oil Spills in the Niger Delta’
• Shell’s official viewpoint on the Niger Delta region
• Shell’s briefing notes on its operations in the Niger Delta
• A 2 minute film showing the environmental impacts of gas flaring (by Shell; it primarily blames gang warfare for the flaring)
• This short video from Shell details their involvement in Nigeria over the last 10 years.  It’s a very useful summary of the situation and their stance on their public commitments and social responsibilities.  The final 2 minutes talk about gas flaring and their commitment to stopping the process.
• Poison Fire, a half-hour documentary following a team of local activists collecting “video testimonies” from communities impacted by gas flaring
• Sweet Crude is an award-winning documentary film telling the story of the Niger Delta
• ‘Counting the Cost: Corporations and Human Rights Abuses in the Niger Delta’, is a report by Platform, an umbrella organisation of campaigning groups passionate about environmental justice