Royalties: Kalabari King Gives Shell Ultimatum

The chiefs and people of Kalabari kingdom in Rivers State, have vowed to resist plans by oil giant, Shell Petroleum Development Company (SPDC) to reduce royalties accruing to the area due to rising incidents of crude oil theft in the Niger Delta.

The kingdom, which comprises, Asari-Toru, Akuku-Toru and Degema local government areas, said any slash in their royalties  will amount to a breach of the agreement signed with the people.

Managing Director of SPDC, Mr Mutiu Sunmonu, had in a news briefing in Port Harcourt, on March 1, 2013, said the firm may be compelled to shut down its Nembe-Creek Trunkline (NCTL), following the upsurge in crude oil theft and illegal refining activities, particularly in Cawthorne Channel and Kakrama, in Kalabariland and Awoba in Ogba/Egbema/Ndoni Local Government Area.

Sunmonu, disclosed that 60,000 barrels of crude oil were being stolen everyday, out of the company’s 150,000 barrels daily oil supply to the trunk line, while bemoaning the huge loss of revenue to the government and the devastation such illicit activities were causing to the environment.

The company, in keeping to that threat, had five days later shut down the pipeline and declared force majeure on crude supply to Bonny Export Terminal.

SPDC’s spokesman, Mr Precious Okolobo, also said recently that the company may look in the way of slashing the funds to the communities within the NCTL, if nothing was done to stop the ugly trend.

But the Amayanabo of Kalabari kingdom, Professor Theophilus J.T. Princewill, last weekend faulted the move by Shell, reminding the firm of its promise to increase the mandate annually by 10 per cent, saying the planned reduction will be collectively resisted by the people.

The monarch, who was answering questions from newsmen shortly after a special service at the African Church, Buguma City in Asari-Toru Local Government Area of the State, to mark his 11th Anniversary on the throne as Amayanabo of Kalabari Kingdom, noted that the funds were part of extant agreement between Shell and the kingdom to assist the development of the area.

King Princewill explains: “Shell keeps mentioning that they were going to shut down their trunkline. For the last six years or so, they gave us some money which we used in providing projects.

Now that they are coming to the second phase of that agreement, on the Global Memorandum of Understanding (GMoU, instead of increasing the lot (they call it mandate) that is due to us (the Kalabari people), they want to reduce it by more than half, whereas in the last five years, there was a promise to have 10 per cent increase annually.

“Instead of finding it necessary to review it upwards now that they are going to enter into a new agreement, they want to slash it down by more than a half. Of course, the Kalabaris will not agree.

”Although they said because of crude oil theft, their production in the Kalabari area dropped, but we did not believe that, that has happened. But if we go by that, there are other areas where there is no production whatsoever, but they have increased their funds allocation to them.

”So, if they want to insist on reducing what mandate they gave us, we will say no, we will not accept it. You either increase it or you don’t operate in our area,” he posited.

He further said that the Kalabari Council of Chiefs had met severally with Shell where the latter was told that whatever is in the territory belongs to the people and that the firm was only allowed to go and exploit the crude.

”If what they are doing is to make us suffer for it, we ask them (Shell) to pack up their things (facilities) and go, because we will not beg them to come and do it. If they don’t do it, there are other companies that will come in to do it. For many years now in Ogoni area, Shell is not operating, yet Ogonis have not died.

“If we stop Shell from operating in our territory, we will not die and Nigeria will not collapse and that is our position. They say they are going to close down their operation, we say not only closing down, pack your things and go. That is what we have said to them (Shell),” he said.

Prof. Princewill, however, said that if youths in the area were found culpable over allegations of crude theft, the Kalabari Council of Chiefs would intervene, but noted that crude oil and the control of the resource was essentially the business of the government.

”I and the Kalabari chiefs do not have any control over crude oil production or exploitation. The only thing we can do if our children are doing it is to talk to them, but the full control of such issue is in the hands of government,” he added