CHAPTER ONE

GENERAL INTRODUCTION

1.1 Historical Background

Environmental degradation by oil dates back to 1956 when Shell Development

Company (SPDC) then, discovered oil in Oloibiri Ogba Kingdom in Rivers state. Exploitation of oil finds in other parts of Niger delta brought with it environmental degradation at a scale hitherto unknown, this called for legislation to regulate the exploitation of oil by companies in the area. Earlier legislative response in this area was directed at oil pollution arising from oil prospecting and explorative activities in the country. The response did not arrest nor reduce environmental degradation. Therefore there was a need for more direct and rapid legislative response. The direct legislative response began with the promulgation of the Petroleum Act[1]. 

The main thrust of the Petroleum Act, is that it provides a frame work for the exploration, production and refining. Subsidiary legislation passed pursuant to the

Petroleum Act to deal with oil and gas exploration, production and refining include; Nigeria National Petroleum Coporation Act[2][3][4], Oil in Navigable Water Act3,

Associated Gas Re-Injection Act4, Oil Pipeline Act[5], Oil and Gas Export Free Zone Regulation6, Hydro Carbon Oil Act[6], and The West Africa Gas Pipeline Project Act[7], National Oil Spill Response Agency Act9,(NOSDRA) etc. All these laws aim at regulation of oil and gas exploration, production and refining activities. Outside these statutory provisions, there are Customary Laws and Common Law provisions that may not be directly on oil and gas environmental degradation by oil and gas. Various communities have customary provisions that are against environmental pollution by noxious substances. Oil and gas being noxious substances if spilled into the environment such spillage will contravene such customary legal provisions and as such they may be used to redress the environmental pollution. The Common Rule in Rylands v. Fletcher10 which imposes strict liability on any one who allows a dangerous substance to escape from his premises to damage the property of another may be extended to cover of oil and gas and therefore form part of the legal framework for the prevention of environmental degradation by oil and gas.   

      The above legal framework for the prevention of environmental degradation by oil and gas particularly its statutory aspect has generated an institutional framework for the prevention of oil and gas environmental degradation. These institutions include; the Nigeria National Petroleum Corporation (NNPC), Department of Petroleum Resource (DPR), National Oil Spill Detection and Response Agency, (NOSDRA),

Niger Delta Development Commission (NDDC), Niger Delta Ministry, and National Environmental Standard and Regulations Enforcement Agency (NESREA), Ministry of environment. 

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10   (1886) L.R. 1Exch.265 

1.3       Statement of the Problem

Arising from the literature review in 1.2 above are the following problems which this dissertation seek to address. 

1.3.1 Ineffective Legislation in Arresting Environmental Degradation.

There are collections of laws which seek to protect the environment from degradation by oil and gas companies. But due to the fact that the laws are ineffective, they are not seen to be living to the yarning of the people. Hence, the environment still suffers degradation in the hands of oil and gas companies. For example, the Oil in Navigable Water Act[8], aspires to protect the sea waters from oil pollution. In a bid to this, it provides measures such as oil discharge records and oil transfer records as checks. It imposes punishment for violator yet, and these measures proved to be ineffective as oil is being discharged into sea water, resulting to degradation of the sea environment. 

Another legislation which aims at protecting the environment is the Hydrocarbon Oil Refineries Act[9]. The Act out rightly prohibits refining of any hydrocarbon oil except in licensed refinery.

This law is not been heeded to, hence hydrocarbon oil is been refined outside refineries as against the spirits of the Act. This law also prove to be ineffective in arresting environmental degradation by oil Companies in Nigeria. In addition to the above mentioned laws, others include, Minerals Oil Safety Regulation Act[10], Nigerian Oil Pipeline Act[11], Associated Re – Injection Act71, Environmental

Impact Assessment Act[12], Harmful Waste (Special Criminal Provisions) Act[13], Mining Act[14], and West African Gas Pipeline Project Act[15]. These laws were enacted with the sole aim of protecting the environment from degradation by oil companies. Despite the existence of these laws, environmental degradation by oil companies is still the order of the day. This may not be far from the fact that the laws are in effective. In addition, to the foregoing, there are many regulations that also seek to protect the environment from degradation. They include the Petroleum (Drilling and Production) Regulation[16], the Petroleum (Refining) Regulation[17] etc. Despite the presence of these laws and regulations environmental, degradation by oil and gas companies in Nigeria still persist. The problem is: these identified laws and regulations are grossly ineffective to arrest environmental, degradation by oil companies in Nigeria.

1.3.2 Inadequate Implementation and Enforcement of the Laws by the

Institutions.

Closely related to the first identified problem above, is the problem of inadequate implementation and enforcement of laws that are meant to protect the environment from degradation by oil and gas companies in Nigeria. The laws are very adequate. In fact, there are not less than 20 laws which seek to protect the environment from degradation, but the wherewithal to enforce these laws are not available.[18] Thus, agencies such as NESREA, and NOSDRA have failed woefully to enforce the laws that are meant to protect the environment. There are adequate punishment provided by the law for any offender .In fact, punishment for any offender is as high as One Million Naira (N1, 000, 000.00), yet the environment is still being polluted by oil and gas companies. If the enforcement agencies perform their duties as expected of them, environmental degradation by oil companies, would have been eradicated, or drastically reduced to a bearable level. The problem is not far from the fact that the agencies are not bold enough to enforce the law as they ought to. In other words, NOSDRA, NESREA NDDC, lack courageous leaders and technical knowhow to enforce the laws that protect the environment from being polluted by oil and gas companies in Nigeria.

1.3.3 Dispel Nature of the Legal Regime of Environmental Degradation  by Oil and Gas Companies in Nigeria.

Another problem which this research has identified is the dispel nature of the legal regime of environmental degradation by oil and gas companies in Nigeria. The laws and the regulations in this aspect of environmental law are scattered in different legislation and other legal sources. Most of these laws are limited in scope. They are repetitions here and there, and they also conflict with one another. For example, there are over twenty laws and regulations dealing on environmental protection by oil and gas companies in Nigeria. These laws and regulations, in one way or the other attempt to protect the environment from degradation by oil and gas companies in Nigeria. In their bid to protect the environment, they overlap, conflict, and are limited in scope especially in terms of penalties. The punishment does not go beyond fines. 

1.3.4 Lack of Specialized, Dedicated and Courageous Enforcement Officers  

It is very clear that there are significant laws and regulations accompanied by penalties. It is, however, sad to note that there are no specialized, dedicated and courageous officers to enforce these laws on the violators. For example on the 13th

January, 2010[19] NOSDRA ordered Pipelines and Products Marketing Company (PPMC) to pay a sum of N 1 million as a fine for failure to respond quickly to an oil spill incident which occurred in Ugbodede community in Okere, Warri, Delta State. It is very unfortunate that PPMC failed, refused and or neglected to comply with the order. If the agency has courageous enforcement officers they would not take no for an answer.

1.3.5 Procedural Obstacles in Environmental Litigation against Oil and Gas Companies in Environmental Degradation Matters 

When an aggrieved party wants to access the court to seek redress as a result of environmental degradation caused by oil and gas companies, they are usually faced with some difficulties. Some of these difficulties include issue such as, pre-action notice, jurisdiction, limitations of time, proof of environmental harm and standard of proof. As regards proof of environmental harm,the rule implies that an individual or group of persons instituting an action must show  that there is harm to the environment this may be difficult because when there is an oil spill harm to the environment does not manifest immediately. If a litigation rush to court immediately after an oil spill, he will find it difficult to proof any harm to the environment. Here lies a problem.

A pre – action notice is a notice that an aggrieved party or an intending plaintiff is expected to formally serve on the other party before the commencement of his action[20]. A plaintiff who wants to seek for an injunction against a defendant will be precluded because of the requirement of pre – action notice. Here lies yet another problem. 

Jurisdiction is yet another problem which occurs in procedural issues in environmental litigation for environmental degradation by oil and gas company. It is only the Federal High Courts that has original jurisdiction to entertain matters of this nature. If an action is instituted in a State High Court, even if the plaintiff has good cause, he will not be heard because of lack of jurisdiction. This was the position in Shell Petroleum Development Co. (Nig) Ltd. v Maxon[21]. In this case, the respondents filed an action in the Rivers State High Court against the appellant claiming compensation for damages and loss of income for oil spillage from the appellant‟s oil pipeline at Buguma Rivers State. They admitted the spill but claimed nonetheless that a timely containment measures was put in place to limit the extent of the consequent pollution and damage.

Upon being served with the writ of summons and the statement of claims, the appellant filed a statement of defence wherein it gave a notice of preliminary objection to the suit on the ground, inter alia, that, having regard to certain statutory and constitutional provisions specified, the High Court lacked the jurisdiction to entertain it. Arguments on both sides centered on the provisions of section 1(i) (e) of the Admiralty Jurisdiction Decree No.59 of 1991, section 7 of the Federal High Court Act as amended by Decree No.60 of 1991 and section 230 of the 1979 Constitution as amended by Decree 107 of 1993. While it was the appellant‟s contention that the respondents‟ action involved a cause or matter which, by those statutory and constitutional provisions, were within the exclusive original jurisdiction of the Federal High Court, the respondents maintained that it did not.

The appellant urged the court to follow the decision of the Court of Appeal in Barry v. Eric[22] where it was held that the seismic activities of oil prospecting defendant caused the migration of bees in the plaintiff‟s bee farm, could only be entertained by the Federal High Court. The respondents urged the court instead to follow the earlier decision of the Court of Appeal in Shell

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