Letters from UN Experts on Niger Delta divestments heightens legal risk for companies
By Sophie Marjanac
Guest blog, Director of Legal Strategy, Polluter Pays Project
Oil pollution in a river in Nigeria – credit Temitayo Agbaje / Unsplash
This weekend, the United Nations Working Group on Business and Human Rights and 6 other United Nations Special Rapporteurs – holders of officially mandated duties under international law, and appointed by the Human Rights Council of the United Nations – published letters written to four oil and gas companies (Shell, TotalEnergies, Exxon and Eni) that have recently sold their onshore Nigerian assets, expressing "grave concern" that these sales violate international human rights by avoiding clean up of pollution from oil extraction in the Niger Delta. The letters were also sent to Nigeria, the UK, the US, France, Italy and the Netherlands, where the group head of each entity is (and has been historically) domiciled, importantly noting that the host states also have obligations under human rights law to exercise reasonable due diligence regarding the extraterritorial activities of companies causing or contributing to "ecological disasters" abroad.
This is significant from a legal perspective for a number of reasons, with implications for investors, as litigation risk may rise. Given this intervention was brought on behalf of an unprecedented number of UN mandate holders, it could support claims of human rights violations in both Nigerian and host state courts.
Specifically, the letters say they relate to the divestment of “onshore operations without effectively cleaning up the pollution for which they are responsible, affecting a range of human rights.” Under the UNGPs, companies must "avoid causing or contributing to adverse human rights impacts" through their own activities, and to address impacts that do occur.” They must also prevent or mitigate adverse human rights impacts that are directly linked to their operations, products or services by their business relationships, and use their leverage to prevent human rights abuses, including where such impacts may occur by way of a business transaction or asset/share sale.
This is important because Shell is currently facing a number of lawsuits, initiated by impacted Nigerian communities. Some of these cases, including those in the UK High Court, are class action proceedings, brought on behalf of several thousand victims. In June 2025, the more than 13,000 claimants in the Billie and Ogale proceedings won an important victory, with the English judge finding that the parent company, Shell plc, could be held liable for historic oil spills and ordering the case to trial in 2027. In 2021, a Dutch Court ordered Shell to pay compensation of $15 million to just four villages for oil spills occurring between 2004 and 2007.
In its 2024 Annual Report, Shell acknowledged “the aggregate amount of these judgements could be seen as material,” but said management believed the outcome of these cases would be favorable to Shell. The company also said in its response to the UN mandate holders that it disputes the facts presented in the letters, which are the same as presented in ongoing litigation. However, the letters give credence to communities’ claims and to future litigants seeking compensation for historic pollution, and will be particularly important if the judges find that international human rights law is relevant to the standard of conduct expected in these cases. This type of interpretation giving indirect “horizontal effect” to human rights standards was adopted by a Dutch Court in a case brought by Milieudefensie against Shell plc for its greenhouse gas emissions.
The UN experts also highlight that the financial mechanisms used by international oil companies to divest assets in Nigeria (by way of share sale) are novel, and warn that Nigeria may be a test case for companies trying to offload assets without paying for clean-up. This section in the letters is worth noting (emphasis my own):
“The mechanisms being used to achieve such divestments in Nigeria are novel, involving a sale of shares in the operating companies rather than divestment of individual licenses.
In that respect, Nigeria is being used as an experiment for divestment without clean-up. As the global economy transitions away from fossil fuels, divestment of oil and gas assets may become more common. It is therefore of considerable importance that human rights abuses arising from the form of divestment now being used by oil companies are fully addressed and effectively remediated and compensated.”
If other countries around the world take steps to avoid this “pollute and run” approach adopted in Nigeria and implement laws that keep historic polluters on the hook, known as “trailing liability” laws – this will mean that decommissioning and remediation obligations for companies in the resources sector could be even more significant than they are currently.
Finally, the experts warn the host governments – the UK, Netherlands, Italy, US and France – that they have legal responsibility over the activities of companies’ activities in other jurisdictions. Host governments should urgently intervene with each company to ensure that appropriate due diligence was followed and sufficient funds have been provided to Nigerian authorities and purchasing entities to ensure that historic liabilities can be met and communities offered access to remedy.
The UN human rights system remains the conscience of our world and the interpreter of international law. This intervention by an overwhelming number of mandate holders sends a clear signal to governments to block future oil and gas asset sales unless clear plans are in place to rectify the damage companies have caused or contributed to.
References
1 – In a recent case, the Norwegian OECD National Contact Point found that Aker BP had failed to consider impacts of an oil and gas asset purchase on the right to remedy of victims of the vendor. https://www.doughtystreet.co.uk/news/norwegian-ncp-finds-aker-bp-failed-meet-human-rights-due-diligence-standards-lundin-asset
