Second Time Around for Chevron, Transocean Brazilian Lawsuit

A Brazilian federal prosecutor recently launched his second $10.9 billion lawsuit against Chevron and driller Transocean.  This new lawsuit is related to an oil leak discovered on March 4 in Chevron’s Frade field, just Northeast of Rio de Janeiro.  This suit also seeks to prevent Chevron and Transocean from operating in Brazil.

This leak may have damaged the Frade reservoir, making it impossible to produce from the field, denying Brazil its right to royalties on a natural, public resource.  However, Chevron claims the damage is minute, 0.1% of BP’S spill in the Gulf of Mexico.  Furthermore, politicians in Brazil are now worried that this prosecutor will deter oil companies to do business with them.  This industry is vital to their economy as it makes up 10% of GDP.  The monetary damages sought between the two cases are $2 billion more than BP set aside to pay damages for its spill.