Brazil's petroleum regulator ANP has appealed to
a court seeking an order that would revoke the ban placed on Transocean
(NYSE:RIG ) and Chevron (NYSE:CVX) from operating in Brazil. ANP chief Magda
Chambriard feels that oil exploration would suffer immensely due to the ban.
Another issue is that the ban, which might be
valid in less than a month, will not allow state-led oil company Petrobras to
drill 8 new wells in the huge Marlim field northeast of Rio de Janeiro . Chambriard stated that
drilling and exploration of oil will be drastically reduced if the ban takes
effect.
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A civil lawsuit was snapped on Chevron and its
drilling contractor Transocean, by independent federal prosecutors. They are
demanding about $20 billion in damages due to a 3,600 barrel oil spill in the
offshore Frade field in November. The ban has resulted because of the lawsuit.
13% of Brazil ’s
total deep-water drill rigs are by Transocean out of which, 7 are under
contract to Petrobras.
A Brazilian government oil official has bared his
opinion that the ban and the amount being demanded as damages are unjust and
without sufficient grounds and will only result in grave consequences. The ANP
has only fined Chevron US $17.3 million for the spill as it feels that
Transocean had no hand in it and it wants the ban on both firms removed.
ANP, Chevron and Transocean have previously
appealed in courts in Rio de Janeiro
but their motions were denied. This time they have filed their request ban to Brazil 's
Supreme Justice Tribunal, a federal appeals court one step below the Supreme
Court.
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Petrobras chief executive officer Maria das
Gracas Foster is worried about the production decline in spite of a $237
billion five-year investment plan and discoveries of new reserves. She feels it
is due to the reduction of drill rigs. Petrobras accounts for 90% of the
Brazilian output and has rig leases with BP Plc Vanco, a privately held U.S.
oil company.
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