Shell Secures Legal Victory in US Over $58M Nigeria Lawsuit

Shell plc SHEL has achieved a notable legal victory as the U.S. District Court for the Southern District of New York dismissed a $58 million lawsuit filed by Nigerian contractor Forstech Technical Nigeria Limited against The Shell Petroleum Development Company of Nigeria Limited (“SPDC”), now operating as Renaissance Africa Energy Company.

Although SHEL has a great operational strength, the rising risks related to macroeconomic conditions, geopolitical scenarios, and regulatory and legal pressure can have a long-lasting impact on its consumer and industrial activity. Thus, the dismissal of the court proceedings and its victory in the legal battle bolster its industrial outlook and boost investor confidence.

U.S. Court Upholds Jurisdictional Integrity

Filed under the Alien Tort Claims Act, the lawsuit alleged that SPDC owed processing fees from a contract between Forstech and the Bayelsa State government in Nigeria. However, the court concluded that it lacked personal jurisdiction over the case, as all alleged conduct occurred in Nigeria and had no sufficient nexus to New York.

Haynes Boone’s Strong Legal Defense for SHEL

Law firm Haynes Boone successfully defended SPDC, urging the U.S. district court to take the decisive motion to dismiss. The case was led by a strong panel of litigation partners under the law firm Haynes Boone.

The litigation partners emphasized that the case should be analyzed under important jurisdictional boundaries, preventing U.S. courts from becoming a forum for every international business dispute.

This decision underscores the importance of maintaining jurisdictional boundaries in cross-border commercial litigation and serves as an example for similar cases in the future.

SHEL’s Zacks Rank & Key Picks

London-based Shell is one of the primary oil supermajors — a group of the U.S. and Europe-based big energy multinationals with operations that span almost every corner of the globe. Currently, SHEL has a Zacks Rank #4 (Sell).

Investors interested in the energy sector might look at some better-ranked stocks like Prairie Operating Co. PROP, Global Partners LP GLP and RPC, Inc. RES. While Prairie Operating and Global Partners currently sport a Zacks Rank #1 (Strong Buy) each, RPC carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Houston-based Prairie Operating is an independent energy company engaged in the development and acquisition of proven, producing oil and natural gas resources principally in the United States. The Zacks Consensus Estimate for PROP’s 2025 earnings indicates 389.05% year-over-year growth.

Global Partners is a Delaware limited partnership formed by affiliates of the Slifka family. Global Partners owns, controls or has access to one of the largest terminal networks of refined petroleum products in New England. The Zacks Consensus Estimate for GLP’s 2025 earnings indicates 17.84% year-over-year growth.

Atlanta, GA-based RPC is an oilfield service provider in almost all of the prospective plays, like the Rocky Mountain regions, Appalachian area, Gulf of Mexico and other resources in the United States. The Zacks Consensus Estimate for RES’ next quarter earnings indicates 33.33% growth.

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This article originally published on Zacks Investment Research (zacks.com).

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