Brazil judge denies injunction against Chevron

AP News
Posted: Feb 29, 2012 3:13 PM
Brazil judge denies injunction against Chevron

A Brazilian judge has turned down a request by federal prosecutors to halt all activities in Brazil of U.S.-based Chevron Corp. and drilling contractor Transocean Ltd., according to court records posted online Wednesday.

The Feb. 24 ruling came 2 1/2 months after prosecutors filed an injunction against Chevron and Transocean because of environmental harm caused by an oil leak off the coast of Rio de Janeiro state in November.

The injunction request, filed late last year by federal prosecutor Eduardo Santos de Oliveira, was part of a civil lawsuit that sought 20 billion reals ($11.7 billion) in damages.

An official at the prosecutor's office said the court must still decide if Chevron and Transocean must pay the multibillion dollar fine. He spoke on condition of anonymity because he was not authorized to comment on the case.

Federal Judge Raffaele Felice Pirro said in his ruling that he saw no evidence that the activities of the two companies represented "real and imminent danger to society," as the prosecutor had argued.

He also said the injunction would punish the two companies before they could defend themselves in court.

It was unclear if prosecutor Oliveira will appeal the judge's ruling.

Pirro said the denial of the injunction was temporary and could be reversed after the two companies are heard and if evidence emerges backing the prosecutor's request.

In an emailed statement, Chevron said it was "pleased with the court's decision."

"Chevron is confident that at all times it acted diligently and appropriately, and in accordance with the best practices in the oil industry," the company said. "Continuous monitoring shows no discernible environmental impact to marine life or human health."

Transocean said in a statement: "We welcome the judge's decision to deny an injunction and we continue to cooperate with the authorities."

Oil started leaking at the site of a Chevron appraisal well Nov. 7, about 230 miles (370 kilometers) off the northeastern coast of Rio de Janeiro state.

Chevron has said the spill occurred because it underestimated the pressure in an underwater reservoir.

That caused crude oil to rush up a borehole and escape into the surrounding seabed.

Nearly 3,000 barrels of crude oil leaked out through at least seven narrow fissures on the ocean floor, all within 160 feet (50 meters) of the wellhead.