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Chevron accused of 'environmental crime' in Brazil
by Staff Writers
Rio De Janeiro (AFP) March 21, 2012

Federal prosecutors in Rio de Janeiro on Wednesday accused US oil giant Chevron and 17 executives of "environmental crime" in connection with a major spill off southeastern Brazil last November.

The country's national oil regulator estimates that 2,400 barrels of crude were spilled in the accident, which led authorities to suspend all of Chevron's drilling operations and to deny the company access to huge new offshore fields.

The US firm rejected Wednesday's charges as "outrageous and without merit" and vowed to defend itself and its employees.

The prosecutors said in a statement that it was charging "Chevron, oil drilling contractor Transocean and 17 executives with environmental crime and damage in connection with the oil spill."

George Buck, the president of Chevron's Brazil unit, and three other company officials "sought to frustrate the work of the prosecution by presenting a misleading emergency plan," and by "altering documents shown to the authorities," it is alleged.

Prosecutors called for a "freeze on all assets of the accused, including 11 senior officials and employees from Chevron and five from Transocean," and an environmental expert. A judge will decide if the executives are to face trial.

"The charges are based on conclusions of the police investigation into the November 7 2011 accident which occurred because the accused did not respect safety procedures," state prosecutor Eduardo Santos de Oliveira told reporters.

The oil spill "affected the entire maritime ecosystem, which could lead to the extinction of species, as well as the region's economic activities, in addition to damage caused to the state," he added.

The prosecutors called for payment of bail of $550,000 for each person accused and $5.5 million for each company.

"These measures aim to ensure that the accused, most of them foreigners, do not leave the country. The sum for the fines will not be returned and will be used to pay for the damage caused," said de Oliveira.

The prosecutor said the sentences sought "include up to 31 years and 10 months" for five of the 17 accused, including Buck.

"These charges are outrageous and without merit," Chevron said in a rebuttal.

"Once all the facts are fully examined, they will demonstrate that Chevron and its employees responded appropriately and responsibly to the incident. Chevron will vigorously defend the company and its employees."

Chevron said it has collaborated "transparently and completely with all the appropriate Brazilian government authorities."

It provided "relevant information" and "timely transportation to the incident site for several National Petroleum Agency officials, federal police officers and other authorities."

"There is no technical or factual evidence demonstrating any willful or negligent conduct by Chevron or its employees associated with the incident," the US firm added.

Earlier Wednesday, Carlos Minc, the environment secretary, accused Chevron of "unprofessional conduct" and said he favored barring the oil company from operating in Brazil until it pays for recent spills at the Frade field it operates off the Rio de Janeiro coast, including a minor one earlier this month.

He said there would be "no impunity" for foreign oil companies operating in Brazil and "we must set an example with Chevron."

"If (foreign) firms have the best technology, take all the precautions, they will be welcome, if not they won't be," he told reporters.

To date, the US oil giant has not paid "a single cent" for two fines totaling $54 million imposed after the November spill, Minc said, announcing new measures requiring companies to disclose the main conclusions of their geological studies.

Brazilian President Dilma Rousseff, meanwhile, stressed the "importance of oil" for this booming South American country, which is already the world's sixth largest economy.

"Companies which will come to operate and those already here must know, without exception, that existing safety procedures are meant to be respected," she warned in Rio during the inauguration of the new head of the National Petroleum Agency.

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