Under the terms of the agreement, the Shell Petroleum Development Company of Nigeria (SPDC), a Shell subsidiary, will pay £2,000 to the each fishermen in the Bodo region of the Niger delta. The remaining of the compensation package will be provided to the community, reports Financial Times.

The agreement follows three years of legal battle between Shell and 15,600 Nigerians from Ogoniland, in a London court.

SPDC managing director Mutiu Sunmonu said: "From the outset, we’ve accepted responsibility for the two deeply regrettable operational spills in Bodo.

"We’ve always wanted to compensate the community fairly and we are pleased to have reached agreement."

BBC cited Lawyer Martyn Day, who represents the claimants, as saying that it is "deeply disappointing that Shell took six years to take this case seriously and to recognise the true extent of the damage these spills caused to the environment and to those who rely on it for their livelihood."

The two oil spills came from the Shell-operated same pipeline, the Trans Niger Pipeline.

The Trans Niger Pipeline carries approximately 180,000 barrels of oil per day from its fields to the export terminal at Bonny on the coast.