Chevron Brazil spill report expected next week: regulator

Reuters News
Posted: Jul 11, 2012 3:17 PM
Chevron Brazil spill report expected next week: regulator

By Leonardo Goy

BRASILIA (Reuters) - Brazil's oil regulator said on Wednesday it expects to release a report next week on the causes of a November oil spill in an offshore field operated by Chevron Corp, an accident that led to criminal charges and civil suits seeking nearly $20 billion in damages.

The report from the ANP, as the regulator is known, is expected to provide the official government explanation of the accident, which spilled about 3,000 barrels of oil into the Atlantic Ocean northeast of Rio de Janeiro.

The report may influence civil and criminal proceedings against Chevron, the second-largest U.S. oil company, its drilling contractor, Transocean, and 17 of their employees.

The report may also form the basis of new fines against the two companies. Chevron and Transocean have already been hit with citations that could result in more than $50 million in fines from the ANP, Brazil's environment protection agency Ibama, and other government bodies.

The ANP is considering raising its fine schedule as a result of the Chevron spill, though any changes would not apply to the current case, the oil regulator's director general, Magda Chambriard, told senators at hearings in Brasilia.

The agency wants to raise maximum fines for some oil drilling and production rule violations to 30 million reais ($14.7 million) per violation from 2 million reais, she said. With the addition of proposed aggravating factors, the top fine could rise to 150 million reais, she added.

"We are confident that (Transocean) acted responsibly and quickly, following the highest industry standards," said Guy Cantwell, Transocean's communications chief in Houston.

Chevron's head of communications, Kurt Glaubitz, said protecting the environment is "a core Chevron value."

"Continuous monitoring of the incident area shows no discernible environmental impact to marine life or human health," Glaubitz said in an e-mail.

Brazil's O Globo and Folha de S. Paulo daily newspapers reported on Wednesday that the Federal Police lab in Rio de Janeiro had found that the spill did not kill or harm marine life.

The lab report, completed in April but never made public, was obtained by O Globo and Folha this week, the newspapers said, without explaining how they got the information.

Brazilian courts and police typically do not allow the public access to criminal investigations and court proceedings until a verdict is reached.

Despite the sealed proceedings, prosecutors and police often leak information to the media in high-profile cases. Nearly all Brazilian legal proceedings are conducted in writing rather than through open testimony in court.

Some of the spilled oil could have been absorbed into the ocean floor, Folha reported, citing Rosemari de Oliveira Almeida and Emiliano Santos Rodrigues, the authors of the lab report.

Federal prosecutor Eduardo Santos de Oliveira, who launched the criminal and civil cases against Chevron, Transocean and the 17 employees and executives, called the report "a farce," O Globo said.

The report does not invalidate conflicting studies from Brazil's environmental and oil agencies about the spill's impact on marine life, the newspapers said.

The ANP and Brazil's environmental protection agency Ibama have said there was damage, Folha reported.

But Silvio Jablonski, a senior ANP official, told a Brazilian Senate hearing in March that Chevron was "not negligent" and that the spill "caused no discernible damage to the environment." [ID:nL1E8EM89I]

Santos de Oliveira is seeking 40 billion reais ($19.6 billion) in civil damages from Chevron and Transocean. He has described the spill as one of the worst ecological disasters in Brazil's history.

Globo and Folha said the Federal Police officer in charge of the case, Fabio Scliar, declined to comment on the police lab report.

($1 = 2.0353 Brazilian reais) (Reporting by Leonardo Goy in Brasilia; Writing by Jeb Blount in Rio de Janeiro Reese Ewing in Sao Paulo; Editing by John Wallace)