Chevron, Transocean Charged For Oil Spill

Chevron and Transocean have been charged by a Brazilian federal prosecutor for oil spill in November which may retard offshore oil boom of Brazil.

The prosecutor also charged employees and executives of Chevron and Transocean. George Buck, a U.S. citizen in charge of Chevron’s operations in Brazil is among the defendants.

The charges include: Violation of licenses, failure to stop leakage of 3,000 barrel oil off the coastline of Rio de Janeiro state and failure to take effective measures to stop the drilling. Both Transocean and Chevron have denied the charges. Chevron (CVX) said the leak was stopped within four days. No oil that leaked into the Atlantic or interrupted with marine life.

An $11 billion lawsuit was filed by the same prosecutor over the leak in November. Oil and environmental regulators have already fined Chevron for $110 million.

The criminal charges might desist foreign companies to invest in Brazil and consequently retard the growth of Brazil’s offshore oil industry.

Brazil is facing shortage of engineers, trained workers and equipment that has increased costs. In Ecuador Chevron is facing an $18 billion environmental verdict. Chevron’s problems in Brazil might compel it to think twice before investing in Latin America.

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Leo Pierson

About Leo Pierson

Former partner in a real estate management firm, Leo, has been active in the market for the last 8 years. Ex-blogger on penny stocks, now focused on long term growth stocks, Leo provides valuable market snapshots each day as part of our editorial team.

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