Oil Spill Compensation Claims in Nigeria: Principles, Guidelines and Criteria

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Abstract
In recent times, compensation arising from oil spills has assumed a significant role in the Nigerian oil industry. The significance stems from the fact that, with petroleum operations spillage is inevitable. Oil spills have various effects on the health of the populace as well as the economic and scenic value of the environment. Thus there is the need to minimise the effect of the occurrence of oil spill. One way of achieving this objective is through compensation. The essence of compensation is to make amends for the loss suffered by the victims. In making these amends, the loss experienced by the victim must be recompensed otherwise the compensation cannot be said to be adequate or equivalent to the compulsory sacrifice. Victims of oil spill have claimed that the compensation paid to them is unreasonable and cannot be said to be recompense for their loss. Oil companies on the other hand claim that the compensation paid to the victims is adequate and that they operate within the parameter approved by the Inspectorate Division of the Nigerian National Petroleum Corporation or the State Ministry of Lands. Apart from this, many claims made by the communities are not honoured by the oil companies on the grounds that they are spurious and speculative. Even when the claims are genuine the oil companies may not pay if the spillage occurred as a result of acts of sabotage.

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