Chevron Corp. (
) the second-largest U.S. oil company, will not be expelled from
Brazil for sea pollution, a government official said Monday.
Chevron has been under tight scrutiny since November, when
drilling caused 2,400 barrels of oil to leak from fissures on the
Atlantic Ocean floor.
This month, the company reported another, much smaller leak.
Regional executives face criminal charges in Brazil for their
role in the November incident.
Chevron's Brazil chief George Buck and 16 other executives,
including Transocean's (
) Brazil chief, are barred from leaving the country.
Each was ordered to post $550,000 bail, and both Chevron and
Transocean, the operator of the rig that caused the first leak,
must set aside $5.4 million to pay for future fines.
Prosecutors said the Chevron leak created "a prolonged
contamination time bomb" that will hurt the local environment,
Despite Brazil's stern response to both Chevron
spills, Energy Minister Edison Lobao said neither spill was
large enough to warrant the company's expulsion, UPI
The minister's comments came after the country's oil regulator
last week considered revoking Chevron's contract.
Chevron suspended its drilling operations following the second
leak, which the company says is contained.
Chevron said last week it would defend itself and that the
criminal charges against it are "outrageous."
"There is no technical or factual evidence demonstrating any
willful or negligent conduct by Chevron or its employees
associated with the incident," the San Ramon, Calif.-based oil
driller said. "We have sought to perform our operations in full
compliance with Brazilian laws and industry practices and to
comply with all applicable licenses and authorizations."
The country's response to Chevron's incidents prompted fears
that punishing the company will cool the industry's investments
and stifle development of Brazil's vast offshore resources.
Brazil could have as much as 100 trillion barrels of oil yet
to be discovered in offshore deposits, according to the U.S.
The large finds are fueling an energy bonanza in the country.
State-owned oil company Petrobras previously announced it was
dedicating $500 billion to offshore oil activities.
Chevron shares Monday closed up $1.48 at $107.85.