A Dutch court has rejected most of a landmark case brought by Nigerian farmers and environmental pressure group Friends of the Earth against Royal Dutch Shell for poisoning their fish ponds and farmland with leaking pipelines.
In its ruling Wednesday, the Hague Civil Court saying the leaking pipelines were was caused by saboteurs, not Shell negligence.
However, in one case the judges ordered a subsidiary, Shell Nigeria, to compensate a farmer for breach of duty of care by making it too easy for saboteurs to open an oil well head that leaked on to his land.
It was believed to be the first time a Dutch court has held a multinational's foreign subsidiary liable for environmental damage and ordered it to pay damages.
Shell hailed the judgment as a victory.
"We are very pleased by the ruling of the court today," said Allard Castelain of Shell. "It's clear that both the parent company, Royal Dutch Shell, as well as the local venture ... has been proven right."
The Dutch arm of Friends of the Earth, which represented the Nigerian farmers, welcomed the compensation order for one village, but said it was "stunned" by its defeats in other villages.
The level of damages in that case will be established at a later hearing, but that could be held up as Friends of the Earth said it plans to appeal.
Only one of the Nigerian plaintiffs, Eric Barizaadooh, was in court Wednesday and his claim was rejected by the court, but he said he was happy for the village that won compensation.
"For my colleagues who succeeded, that is victory," Barizaadooh said outside court. ""Shell is brought to book. I believe this is a revolutionary case."
Shell's local subsidiary is the top foreign oil producer in the Niger Delta, an oil-rich region of mangroves and swamps about the size of Portugal. Its production forms the backbone of crude production in Nigeria, a top supplier to the gasoline-thirsty U.S.
Shell, which discovered and started the country's oil well in the late 1950s, has been heavily criticized by activists and local communities over oil spills and close ties to government security forces. Some Shell pipelines that crisscross the delta are decades old and can fail, causing massive pollution.
The company has begun an effort to improve its standing with local communities in the last decade by building clinics, roads and even natural gas power plants. It blames most spills now on thieves who tap into crude oil pipelines to steal oil.
"The complexity lies in the fact that the theft and the sabotage is part of an organized crime ... that siphons away a billion dollars a month," from Nigeria, Castelain said.
"This is organized crime," he added.