Transocean and Chevron Face Criminal Charges Over Brazilian Oil Spill – ValueWalk Premium

Transocean and Chevron Face Criminal Charges Over Brazilian Oil Spill

Transocean and Chevron Face Criminal Charges Over Brazilian Oil Spill

Brazilian authorities have filed criminal charges against US based oil company Chevron Corporation (NYSE:CVX) and drill operator Transocean LTD (NYSE:RIG) for an oil spill off the coast of Rio de Janeiro back in November. Eduardo Santos de Oliveira, the prosecutor has also filed criminal charges against executives and employees of Chevron and Transocean. Among those charged was George Buck a US citizen that is in charge of Chevron’s business operations in Brazil. Buck is not the only one charges by Brazilian authorities, the prosecutors have also charged five other Americans, five Brazilians, two Frenchmen, two Australians, a Canadian and a Briton.

Those that have been charges were told to turn in their passports last Saturday and remain in the country until further notice. Brazilian officials told the charged persons that they will be required to pay a bail of 1 million reais ($550,000) and both Chevron and Transocean will be forced to pay 10 miilion reais to ensure payment of future fines that come.

The unfortunate news continues for the employees that are being held in Brazil. The government issued a statement saying that prison sentences could reach up to 31 years on those accused of the oil spill.

The criminal action comes after a civil lawsuit was filed back in November which included a fine of 20 billion reais ($11 billion). This is the largest ecological fine in Brazilian history.

With all these tough penalties and potential of life in prison, this oil spill must have been huge, right? Wrong. Although the oil spill did allow 3,000 barrels of oil into the ocean surrounding Rio de Janeiro, that is less than 0.1% of the size of the BP oil spill off the Gulf of Mexico back in 2010. The BP  oil spill released 4 million barrels of oil into the Gulf of Mexico.

This raises the question, are the Brazilians going too far? Yes, Chevron and Transocean absolutely should pay hefty fines and for the clean up process but 31 years in prison for people being held in Brazil is way over the top. I can appreciate sending a strong message to oil companies operating in Brazil but filing criminal charges and giving harsher punishment to an oil spill that was less than 0.1% of the BP spill is absolutely ridiculous. There is absolutely no reason that the employees should be charged criminally for the oil spill, there is nothing they have done that was criminal. They were operating under Chevron and Transocean’s authority, therefore the companies are the ones that should be paying for it through fines and clean up.


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