A Review of the Nigerian Energy Industry

Brazil court orders halt to Chevron production

02 August 2012, Sweetcrude, RIO DE JANEIRO – HOPES by US supermajor, Chevron Corporation for a restart of its Brazilian Frade field has been dashed by a court ruling, ordering the company and its drilling contractor, Transocean, to put a hold to all oil production and transport operations in Brazil within 30 days.

The ruling, following from last year’s oil spill at the Frade field, came just days after talks appeared to pave a way towards reopening the field.

The public prosecutor’s office said failure to comply with the injunction, issued on Tuesday, carries penalties of up to 500 million reais ($245 million) a day, according to a Reuters report.

The injunction was issued by the Specialised Bench of Brazil’s 2nd Region Federal Court, and was based on a request by the public prosecutor’s office after the spill at the field northeast of Rio de Janeiro.

The prosecutor’s office had appealed a decision by a Brazilian judge who refused to issue an injunction in April.

According to Brazil regulators, the November incident saw 3700 barrels of oil seep through the seafloor after a drilling job. There were no reports of injuries or the oil reaching land.

Investigation of the incident from the country’s oil regulator, the National Petroleum Agency, laid blame on the supermajor and assessed hefty fines, but left the door open for restarting the field.

A Dow Jones report Friday said that Chevron was scheduled to meet with the ANP this week on the topic.

Chevron said it plans to appeal the court’s decision and repeated its assertion that the spill’s reported impacts were minimal.

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  • That’s a country where apparently, the system works and there is respect for it. But in Nigeria the minister of environment would visit the scene of the spill and give the oil company a clean bill of health even before anybody can say Jack Robinson. Worst still, even when a fine is imposed, the IOC would boldly issue a statement saying it is not culpable.