Chevron faces possible ban over Brazil leak

Author: Samantha Pearson, Financial Times , Published on: 21 November 2011

Brazil said it could ban Chevron from drilling in its lucrative deepwater oilfields as well as imposing heavy fines for a leak off the coast of Rio de Janeiro, sending a warning signal to foreign companies looking to profit from the country’s oil boom. Chevron’s drilling contractor, Transocean, which operated the drill that caused the huge Gulf of Mexico oil spill last year, will be banned from operating in Rio and possibly in the rest of Brazil, the state government said...Almost 3,000 barrels of oil have leaked from Chevron’s Frade project, 230 miles northeast of Rio, since last week after the company underestimated the pressure in one of its underwater reservoirs when drilling. ANP, Brazil’s oil and gas regulator, is still investigating the incident but said that Chevron, which ranks as Brazil’s third-largest oil producer, could lose its status as a “class A” operator, denying it access to some of the country’s most lucrative fields...Chevron said it “continues to fully inform and work with Brazilian government agencies and industry partners”. Transocean said it was fully co-operating with Chevron, the operator of the well and the Brazilian authorities.

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Related companies: Transocean