Transocean Spills Again: 17 Americans Detained in Brazil

Econintersect: On Friday, March 16, 2012 a Brazilian judge by the name of Vlamir Costa Magalhães, issued the confiscation of 17 American passports after both officials from the American oil company Chevron and the Brazilian navy noticed a new oil sheen appearing off the site of where an earlier oil spill occurred.

Some will remember Transocean (operator of the Deepwater Horizon, which released nearly 5 million barrels of crude into the Gulf of Mexico).   This time they are the drilling contractors to Chevron, and this new Brazilian spill is estimated at 3,000 barrels.

Criminal files have not even been filed yet. No one has mentioned or determined who is clearly at fault. The Americans’ passports have only been confiscated on the grounds that those individuals may be found guilty and they will definitely flee the country before their trial begins. According to Brazilportal:

The ruling by Judge Vlamir Costa Magalhães, issued late Friday night, adds to Chevron’s woes in Brazil, which began last November when oil was found to be leaking from an offshore field controlled by Chevron. Prosecutors have already filed a civil lawsuit seeking damages of 20 billion reais, or about $11.2 billion, from the company.

There are always give and takes when dealing in business internationally. Many countries adopt completely different economic policies and uphold opposing business practices. These disparities have the ability to become particularly sticky when high economic or environmental stakes are involved.

Brazil’s recent actions have made it clear that it takes issues of environmental responsibility seriously.

Brazil gains to benefit greatly from the deals it has formed with Chevron as well as other American companies. By 2020, Brazil stands to join the world’s largest oil producers and perhaps even surpass the producing nations, Iran and Venuzuela. However, there are always costs to engaging in offshore drilling.

“We cannot allow one leak, no matter how small,” said Maria das Graças Foster, Petrobras’s chief executive, in an interview here this month. Ms. Foster said she had created a working group in her office that will report to her directly about leaks or spills of any volume. “We are working to have zero leaks, none at all.”

The American taxpayers are preparing to give Petrobras up to $10 billion to develop their technology.

The U.S. government is preparing to provide up to $10 billion in loans to finance the development of massive hydrocarbon reserves off Brazil’s coast thought to contain 80 billion barrels of high-quality crude, an amount that could lead to a six-fold increase in Brazil’s current proven reserves and transform that nation into one of the world’s 10 largest oil producers.

Jillian Friesen

Sources: Office of the United Nations High Commissioner for Human Rights, Latin American Herald Tribune : U.S. Government to Loan Brazil’s Petrobras $10 Billion, The Citizen News : Remember that Brazilian oil deal that was going to provide cheap oil to us?, International Business Times : Brazil Report Another Oil Spill Near Rio de Janiero