Nigeria: Shell & Exxon to Pay Billions?

More bad news for Shell in Nigeria. Nigerian President Umaru Yar’Adua has ordered the state-run oil firm NNPC to recover payment arrears of some $2 billion from Shell and ExxonMobil.

The sum supposedly represents outstanding payments on the Production Sharing Contracts (PSC) on the Bonga and Erha oilfields, accounting for about 20 percent of Nigeria’s total oil production.

The government announcement follows recommendations by a panel set up by Yar’Adua to determine whether Nigeria was losing money in Production Sharing Agreements (PSAs) costs in the deep offshore oilfields.

People have been saying for years that these PSAs were unfair in favour of the oil majors, so now the Nigeria government is striking back…