Shell is to pay $US15.5 million to settle a lawsuit accusing it of complicity in human rights abuses by the former military government in Nigeria.
Lawyers for the plaintiffs say they have reached a settlement in New York with the Royal Dutch Petroleum Company.
The case centres around the execution in 1995 of a Nigerian writer and environmental activist, Ken Saro-Wiwa, and eight Ogoni tribal leaders from the Niger Delta.
Protests led by Mr Saro-Wiwa forced Shell to abandon its oil fields in Ogoniland, in the Niger Delta, in 1993.
Lawyer Paul Hoffman said that $US5 million would go into a trust for the benefit of the Ogoni people. The rest would go to lawyers' fees and compensation for the families.
The case was due to go to trial in the US District Court in Manhattan. The original lawsuits were brought under the Alien Tort Claims Act, 1789.
Shell has denied all accusations of complicity. The company has been extracting oil from the delta since 1958 and has about 90 fields there.