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THE PRICE OF OIL

Corporate Responsibility and Human Rights Violations in

Nigeria’s Oil Producing Communities

Human Rights Watch

New York · Washington · London · Brussels

Copyright © January 1999 by Human Rights Watch.

All rights reserved.

Printed in the United States of America.

ISBN: 156432-225-4

Library of Congress Catalog Card Number: 99-60123

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Human Rights Watch conducts regular, systematic investigations of human rights abuses in some seventy countries around the world. Our reputation for timely, reliable disclosures has made us an essential source of information for those concerned with human rights. We address the human rights practices of governments of all political stripes, of all geopolitical alignments, and of all ethnic and religious persuasions. Human Rights Watch defends freedom of thought and expression, due process and equal protection of the law, and a vigorous civil society; we document and denounce murders, disappearances, torture, arbitrary imprisonment, discrimination, and other abuses of internationally recognized human rights. Our goal is to hold governments accountable if they transgress the rights of their people.

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The staff includes Kenneth Roth, executive director; Michele Alexander, development director; Reed Brody, advocacy director; Carroll Bogert, communications director;Cynthia Brown,program director; Barbara Guglielmo, finance and administration director; Jeri Laber special advisor; Lotte Leicht, Brussels office director; Patrick Minges, publications director; Susan Osnos, associate director; Jemera Rone, counsel; Wilder Tayler, general counsel; and Joanna Weschler, United Nations representative. Jonathan Fanton is the chair of the board. Robert L. Bernstein is the founding chair.

The regional directors of Human Rights Watch are Peter Takirambudde, Africa; José Miguel Vivanco, Americas; Sidney Jones, Asia; Holly Cartner, Europe and Central Asia; and Hanny Megally, Middle East and North Africa. The thematic division directors are Joost R. Hiltermann, arms; Lois Whitman, children’s; and Regan Ralph, women’s.

The members of the board of directors are Jonathan Fanton, chair; Lisa Anderson, Robert L. Bernstein, William Carmichael, Dorothy Cullman, Gina Despres, Irene Diamond, Adrian W. DeWind, Fiona Druckenmiller, Edith Everett, James C. Goodale, Vartan Gregorian, Alice H. Henkin, Stephen L. Kass, Marina Pinto Kaufman, Bruce Klatsky, Alexander MacGregor, Josh Mailman, Samuel K. Murumba, Andrew Nathan, Jane Olson, Peter Osnos, Kathleen Peratis, Bruce Rabb, Sigrid Rausing, Anita Roddick, Orville Schell, Sid Sheinberg, Gary G. Sick, Malcolm Smith, Domna Stanton, and Maya Wiley. Robert L. Bernstein is the founding chair of Human Rights Watch.

ACKNOWLEDGMENTS

This report was written by Bronwen Manby, researcher in the Africa Division of Human Rights Watch, based on research in the Niger Delta in July 1997, subsequent correspondence with the major oil companies operating in the region, and information provided by Nigerian human rights and environmental activists. The report was edited by Peter Takirambudde, executive director of the Africa Division; Mike McClintock, deputy program director; and Wilder Tayler, general counsel. Elizabeth Thapliyal, Associate in the Africa Division, prepared the report for production.

Human Rights Watch would like to thank its NGO partners who contributed to the report by assisting our research and providing additional information. In particular, we wish to thank the committed and courageous activists of Environmental Rights Action, without whom the report could not have been written. We would also like to thank all those who agreed to meet with us and be interviewed for the report, especially the many residents of oil producing communities of the Niger Delta.

TABLE OF CONTENTS

ACKNOWLEDGMENTS

I. SUMMARY

The Role and Responsibilities of the International Oil Companies

The Oil Industry and the Oil Producing Communities

Protest and Repression in the Oil Producing Communities

The Role of Shell in the Ogoni Crisis

Attempts to Import Weapons

Threats to Community Members

Oil Company Failure to Monitor or Protest Abuses

Shell’s Internal Review Since 1995

Conclusion

II. RECOMMENDATIONS

To the Nigerian Government

To the International Oil Companies Operating in Nigeria

To the International Community

III. OIL AND NATURAL GAS IN NIGERIA

Crude Oil

The Structure of Oil Company Agreements with the Nigerian Government

Natural Gas

The Downstream Sector

IV. OIL WEALTH AND THE NIGERIAN CONSTITUTION

State Creation and Revenue Allocation

V. THE ENVIRONMENT

The Framework of Nigerian Law on Oil and the Environment

The Impact of Oil Operations on the Environment

Oil Spills and Hydrocarbon Pollution

Infrastructure Development

Gas Flaring

Compensation for Land Expropriation

Compensation for Oil Spills

Sabotage

The Niger Delta Environmental Survey

VI. OIL COMPANIES AND THE OIL PRODUCING COMMUNITIES

Minorities in the Oil Producing Regions

Social and Economic Conditions in the Oil Producing Communities Today

Oil Company Relations with the Oil Producing Communities

Employment

Development Projects

The Effect of the Oil Economy on Community Politics

The Warri Crisis

VII. SECURITY

Security Arrangements for Oil Facilities

Special Task Forces

VIII. PROTEST AND REPRESSION IN THE NIGER DELTA

Umuechem

The Ogoni Crisis

Attempts to Duplicate the MOSOP Protests

Targeting of Community Leaders and Environmental Whistle-blowers

Day-to-day Protest and Repression in the Oil Producing Communities

Suppression of Demands for Compensation:

Damages, Development Projects, and Employment

Other Abuses Resulting from Oil Company Security

Litigation

IX. THE ROLE AND RESPONSIBILITIES

OF THE INTERNATIONAL OIL COMPANIES

Corporate Responsibility in Nigeria

The Role of Shell in the Ogoni Crisis

Attempts to Import Weapons

Threats to Communities

Oil Company Calls for Security Force Assistance

Oil Company Failure to Monitor and Protest Abuses

Shell’s Internal Review Since 1995

X. INTERNATIONAL LAW

XI. THE ROLE OF THE INTERNATIONAL COMMUNITY

The Commonwealth

The United Nations and International Labour Organization

The African Commission

The European Union and its Member States

The United States

Codes of Conduct for Business

XII. CONCLUSION

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