Bloomberg News

Chevron Says Brazil Oil Spill Reduced to ‘Residual’ Seepage

November 30, 2011

(Updates with quote from Chevron’s head of Brazil in third paragraph, Transocean in sixth paragraph.)

Nov. 20 (Bloomberg) -- Chevron Corp., the second-largest U.S. energy company, said it is reducing the amount of oil leaking from a project off the coast of Brazil after plugging the source of the spill on Nov. 13.

The amount of oil leaking from fissures on the ocean floor is less than the “hundreds of barrels” that gushed during the first days after a drilling incident on Nov. 7, said George Buck, the head of Chevron’s operations in Brazil. More than ten barrels a day of “residual oil” in the rocks around the well is still leaking, and the rate continues to decline, Buck said.

“The majority of this event has been over for several days,” Buck told reporters in Rio de Janeiro. “We know we stopped the flow at the reservoir.”

Foreign oil companies including Chevron, Exxon Mobil Corp. and Royal Dutch Shell Plc are waiting for Brazil to auction new exploration areas in deep waters of the Atlantic Ocean. Buck said Chevron will study the spill to prevent similar incidents in Brazil and other oil producing regions. Chevron is producing about 80,000 barrels a day at the Frade project and didn’t halt production during the spill, which was caused by an appraisal well, Buck said.

Pressure Kick

Chevron underestimated the amount of pressure at a reservoir at the project about 230 miles (370 kilometers) northeast of Rio, Buck said. The well suffered a “kick” of pressure when it reached the reservoir, causing oil to leak to fissures on the ocean floor. Chevron cemented shut the section of well above the reservoir and continues to work on sealing it, Buck said.

Transocean Ltd., the world’s biggest offshore-oil driller, supplied Chevron with the Sedco 706 rig. The Vernier, Switzerland-based company shut the well properly, Buck said. Chevron “takes full responsibility” for the spill and is cooperating with the Brazilian government to investigate the causes, Buck said.

Buck declined to estimate the cleanup costs or potential fines. Brazil’s oil regulator said Nov. 18 that as many as 2,640 barrels of oil spilled during the first eight days after the incident. Buck said the regulator’s estimates are “a good number.”

--Editor: Stephen Kleege

To contact the reporter on this story: Peter Millard in Rio de Janeiro at

To contact the editor responsible for this story: Dale Crofts at

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