The settlement which was reached on the eve of the trial in a federal court in New York, was one of the largest payouts agreed by a multinational corporation charged with human rights violations.
The scale of the payment was being seen by experts in human rights law as a step towards international businesses being made accountable for their environmental and social actions.
A lawyer with the Center for Constitutional Rights, Jennie Green, who initiated the lawsuit in 1996, said:
The deal follows three weeks of intensive negotiation between the 10 plaintiffs, mainly drawn from relatives of the executed Ogoni nine, and Shell. The oil giant, and its Nigerian subsidiary Shell Petroleum Development Company, continue to dismiss all the claims made against them, saying they played no part in the violence that swept southern Nigeria in the 1990s.
Malcolm Brinded, a Shell director, said the company was making the payment in recognition of the tragic turn of events in Ogoni land.
The settlement marks the end of a 14-year personal journey for Ken Wiwa Jr, son of the executed leader.
Out of the $15.5m settlement, $5m will be used to set up a trust called Kiisi – meaning
in the Ogoni Gokana language, to support educational and other initiatives in the Niger delta.