Abstract
This study examines causes of discrepancies in valuers’ opinion when determining monetary compensation payable to claimants for oil spill related damages in the Niger Delta, Nigeria. The study elicited data on factors responsible for differences in opinion of compensation values from valuers in practicing firms in Niger Delta using survey questionnaire. Eighty-three (83) Estate Surveying and Valuation (ESV) firms participated in the survey. The sample was selected from the total population of 190 ESV firms in the region based on the evidence of their experience with oil spill compensation valuation. Weighted mean score and factor analysis were employed in the data analysis. Results indicated that the factors causing discrepancies are: weak standards/codes of practice, inadequate legal frameworks, gaps in valuers’ knowledge, and professional misconduct. It was recommended that a specific code of practice for compensation for oil spill damage be developed by the Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON) in collaboration with the Nigerian Institution of Estate Surveyors and Valuers (NIESV) to guide valuers when undertaking valuation for compensation for damages arising from oil spills.
Highlights
The oil spill threat resulting from the extraction, transportation and processing of crude or refined oil requires an assessment so as to determine the compensation due to those who have suffered loss or impaired interests (Olukolajo, 2017a)
This study examines causes of discrepancies in valuers’ opinion when determining monetary compensation payable to claimants for oil spill related damages in the Niger Delta, Nigeria
In Nigeria, many host communities to Multinational Oil Companies (MNOCs) engage in incessant conflict over the quantum of monetary compensation offered for oil spill damage (Falode, Ogedengbe & Bickersteth, 2006; Emuedo & Abam, 2015; Gbenemene & Eric, 2017)
Summary
The oil spill threat resulting from the extraction, transportation and processing of crude or refined oil requires an assessment so as to determine the compensation due to those who have suffered loss or impaired interests (Olukolajo, 2017a). Thébaud et al (2005) noted that three categories of estimates (compensation) are usually produced in practice when determining the monetary cost of oil spills. These are estimates of damages determined by experts, claims submitted for compensation by the claimant, and the compensation paid to the claimant. The operations of oil producing companies have been disrupted, equipment vandalized and installations destroyed, in response to dissatisfaction with degradation of the natural environment and meager compensation offered for the impaired interests (Bello & Olukolajo, 2016a; Njoku, 2016)
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