Shell PR will be scrambling this morning over the story in today’s FT describing how the the Nigerian arm of the oil multinational has hired two companies linked to ethnic insurgents as subcontractors.
Ten years ago, Shell Nigeria relied on the Nigerian military to beat back the non-violent Ogani movement led by Ken Saro-Wiwa. The fallout from this resulted in Shell adopting a new corporate code of conduct and pledging to commit more resources to helping local communities in the Niger Delta.
Contracting with local companies that have strong ties to the armed militant Ijaw activists that have been the scourge of companies like Chevron and brought oil operations in the Delta to a near standstill earlier this year is certainly is one way of fostering community relations.
Whether you can call it a smart investment in bettering the lot of local Delta residents, or whether these deals smack of the same type of divisive pay-off tactics oil companies have long indulged in developing nations is a question that should keep Shell spinning for quite a while.