- Associated Press - Monday, November 21, 2011

SAO PAULO | Brazil is expected to fine Chevron Corp. nearly $28 million for an ongoing offshore oil spill, Rio de Janeiro state’s environment secretary said Monday.

Carlos Minc said the national government also will ask Chevron to pay for damages caused by the Atlantic spill.

“We believe the accident could’ve been avoided. There was an environmental crime,” Mr. Minc told Globo TV and other Brazilian media. “They hid information and their emergency team took almost 10 days to start acting.”

Chevron officials have accepted responsibility for the spill but reject accusations they did not notify local authorities quickly enough or properly manage cleanup operations.


Mr. Minc said he considers the fine lenient, but it’s the maximum allowed under current Brazilian law.

The fine has not been officially announced because the government was still waiting for a final report by local investigators.

Mr. Minc said officials also would analyze imposing further fines on Chevron based on state laws in Rio de Janeiro, and that Brazil’s National Petroleum Agency could even consider banning the company from operating in Brazil for a limited time.

“There was negligence,” Mr. Minc said. “Rio will not allow any kind of environmental impunity.”

He said Chevron, based in San Ramon, Calif., will be expected to pay about $5.6 million in reparation for the damage to the environment.

“We are still calculating the costs,” he said. “Part of that money we want to use to increase the monitoring of our ocean.”

Brazilian President Dilma Rousseff was expected to meet with the national environmental minister and the mines and energy minister later Monday to discuss the oil spill and determine the government’s actions.

The National Petroleum Agency said more than 110,000 gallons of crude oil may have reached the ocean floor since the leak began on Nov. 7.

George Buck, chief operating officer for Chevron’s Brazilian division, said Sunday the spill occurred because Chevron underestimated the pressure in an underwater reservoir.

Chevron was drilling an appraisal well about 230 miles off the northeastern coast of Rio de Janeiro when the leak started as crude rushed upward and eventually escaped into the surrounding seabed.

The oil has leaked through at least seven narrow fissures, all within 160 feet of the well head on the ocean floor.

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