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Chevron Could Restart Output from Brazil Spill Field Soon

Source: Reuters 7/17/2012, Location: South America

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Brazilian regulator ANP said U.S. oil company Chevron Corp should soon be able to resume production in a field off the coast of Rio de Janeiro state that the company shut down after detecting an oil seep following a November spill.

ANP said earlier this week the No. 2 U.S. oil company had committed 25 safety violations related to the November 2011 spill at its Frade field, for which it would be fined less than 50 million reais ($25 million). The regulator is due to release the final report on the accident later this week. The final report on the accident could have a bearing on criminal charges and civil suits seeking nearly $20 billion in damages and jail time for 17 company executives of Chevron and its drilling contractor Transocean.

"They voluntarily stopped production. It was Chevron that asked to stop and we have nothing against their returning to production in principle," ANP Director General Magda Chambriard told Reuters. "However, drilling and injecting water into wells continues to be suspended."

A November pressure kick during the drilling of a well in Frade, the only field Chevron operates in Brazil, is believed to have caused the initial spill that released around 2,400 barrels of oil into the ocean.

In March of this year Chevron suspended production entirely at Frade after some seepage was discovered along the ocean floor in the area of the Frade wells. But the company said there was no relation between the November spill and the March seepage. Before the November spill, Frade produced around 64,000 barrels of crude a day.

The ANP is also investigating the possible causes of the March seep, specifically if the injection of water into the Frade reservoir might be contributing to seepage. This report is ongoing and separate from the initial report on the November accident.

"Chevron Brasil is working with the ANP on all issues related to the Frade field, including restarting production," the company's spokesman, Kurt Glaubitz, wrote Reuters in an email. Chevron and Transocean are still banned from drilling in Frade by the ANP.

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Related Categories: Ecological & Environmental  Emissions Measuring  Environment Management, Consultancy  Environmental Services  General  Hazardous Waste Management  Oil Spill & Emergency Response  Safety Services  Waste Disposal 

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