Shell said yesterday it had contained oil leaked from a failed pump within a flow station in Nembe Creek though local residents disputed this, saying it had spread to mangrove swamps.

?There was no oil spill, and there was no impact on the environment,? said Precious Okolobo, spokesman for Shell Petroleum Development Corporation (SPDC), a joint venture majority owned by the state oil firm.

?The pump was immediately shut down. However, some oil escaped from the seal into the saver pit in the flow station, with some sheen observed,? he said.

A Reuters reporter on the scene saw spilled oil, some of it lapping against the roots of mangroves, but Nigerian Naval officers barred access to an area behind the flowstation where locals reported a large oil slick.

?We observed a crude oil slick and sheen along the creek and, it continued into the Brass River,? said Alabo Nengi James, an official in the Ewelesuo community of the Nembe Kingdom.

?Shell has not done any containment; no such signs at all.?

Oil spills from equipment failures or loading accidents are common in the swampy Niger Delta region of Africa?s top energy producer.

The Anglo-Dutch oil major said locals sometimes exaggerate the impact in the hope of boosting their compensation claims.

Armed gangs also tamper with pipelines to steal crude and Shell?s Nembe Creek trunk line has been subject of numerous spills in recent years, many due to sabotage.

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