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Chevron appeals Brazil drilling ban – update

17th August 2012

Chevron appeals drilling ban by Brazil as it seeks to restart output in the country

Chevron appeals Brazil drilling ban – update
An estimated 3,700 barrels of oil were leaked in a Chevron well 120 km off the coast of Rio de Janeiro in November last year

Chevron has filed an appeal against a Brazilian ruling issued on 1 August which bars the firm from operating in the country until charges over a November oil spill are judged, the US oil giant said on Thursday.

Chevron seeks to restart production at the Frade offshore field northeast of Rio de Janeiro, the firm told Reuters.

The incident occurred at the Frade field, in Chevron’s SEDCO 706 platform operated by Transocean Ltd in the 9-FR-50DP-RJS well. An estimated 3,700 barrels of oil were leaked 120 km off the coast of Rio de Janeiro in November last year.

The spill was caused by a pre-salt drilling accident when an artificial pressure increase fractured the rock surrounding the well, according to ANP finds. The field was closed in March after more oil was found in surrounding waters.

The agency may levy a fine of as much as USD 25m on Chevron.

Transocean has 10 offshore oil drill rigs in Brazil which earn the firm USD 3.5m per day, according to the firm's latest fleet report.

“We are confident that at all times during the Frade incident we acted appropriately and responsibly, consistent with the industry best practices, and within the Plan of Development approved by ANP,” Chevron told OGT last month.

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