Chevron to pay $41.8m to settle oil spill lawsuits in Brazil

16 September 2013 19:00  [Source: ICIS news]

MEDELLIN, Colombia (ICIS)--US energy giant Chevron has struck a deal with Brazilian authorities to settle unresolved lawsuits relating to oil spills off the coast of Rio de Janeiro in 2011 and 2012, Brazil’s National Petroleum Agency (ANP) said on Monday.

Under the adjustment of conduct accord, Chevron has agreed to pay compensatory costs of Brazilian reais (R) 95.2m ($41.8m, €20.9m), a fraction of the estimated $20bn that Brazilian prosecutors were seeking in a civil lawsuit.

In the agreement with the ANP, Brazil’s Public Ministry in Rio de Janeiro (MPF/RJ) and Brazil’s Institute of Environment and Natural Resources (IBAMA), Chevron also agreed to adopt a series of “unprecedented measures of precaution and prevention” relating to future activities.

Transocean, Chevron’s drilling partner at the time of accident and also subject to the civil lawsuit, would not be fined for its role in the accident, the ANP said.

The accord will now be sent to a federal judge for approval, the agency said.

Chevron didn’t immediately respond to a request for comment.

In November 2011, a pressure spike caused an estimated 3,700 bbls of crude oil to escape from the Frade offshore field northeast of Rio de Janeiro. Chevron and Transocean voluntarily suspended activities as a precautionary measure after another seepage was detected in March 2012.

Chevron was ordered to pay initial fines totalling R68.5m, despite a 2012 report stating that the spill had caused no apparent environmental damage. Criminal charges against the two companies were dropped in February this year.

Chevron owns a 51.7% stake in Frade, while Brazil’s state-run oil company Petrobras and Japanese partnership Frade Japao own 30% and 18.3%, respectively.

Chevron is currently producing an average 15,000 to 16,000 bbl/day from the site, according to a report on Friday by Reuters.

($1 = R2.28, $1 = €0.75)


By: Simon West
713-525-2653



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