Chevron, Transocean charged in Brazilian oil spill

RIO DE JANEIRO/NEW YORK,  (Reuters) – A Brazilian federal prosecutor filed criminal charges yesterday against Chevron and drill-rig operator Transocean for a November oil spill, raising the stakes in a legal saga that has added to Chevron’s woes in Latin America and could slow Brazil’s offshore oil boom.

Eduardo Santos de Oliveira

Prosecutor Eduardo Santos de Oliveira also filed criminal charges against 17 local executives and employees at Chevron  and Transocean, owner of the world’s largest oil rig fleet. Among the defendants is George Buck, 46, a U.S. national in charge of Chevron’s operations in Brazil, the prosecutor’s office said in a statement.

“The spilling of oil affected the entire maritime ecosystem, possibly pushing some species to extinction, and caused impacts on economic activity in the region,” Santos de Oliveira, a prosecutor in the oil district of Campos de Goytacazes, said in the filing. “The employees of Chevron and Transocean caused a contamination time bomb of prolonged effect.”

The charges stem from a 3,000-barrel leak in the Frade field, about 120 km (75 miles) off the coast of Rio de Janeiro state. They include: failure to realize protocols to contain the leak; failure to take steps to kill the well and stop the drilling process; breach of licenses, legal norms and regulation, including altering documents; and failure to meet legal and contractual duties.

Chevron and Transocean strongly disputed the charges.

“These charges are outrageous and without merit,” Chevron said in a statement. “Once all the facts are fully examined, they will demonstrate that Chevron and its employees responded appropriately and responsibly to the incident.”

Transocean “strongly disagrees with the indictments,” said spokesman Guy Cantwell.

Chevron said it stopped the leak in four days. None of the oil that leaked into the Atlantic reached shore or interfered with marine life, it said.

In November, the same prosecutor filed an $11 billion civil lawsuit over the spill, the largest environmental suit in Brazil’s history. Chevron has already been fined around 200 million reais in fines ($110 million) for the spill by environmental and oil regulators.

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