Chevron Corporation (CVX) on Thursday said it has asked
Brazilian authorities to allow a temporary shutdown of production
from its Frade oil field off the coast of Brazil after a new oil
seep was detected.
"The decision to request the temporary shut-in of production is
a precautionary measure," Chevron said in a statement. "Chevron has
identified a small new seep in the field and subsidence in the
area."
The drilling accident at Frade on Nov. 7 caused an oil spill at
Frade, which lies in deep Atlantic waters off the coast of Rio de
Janeiro state. An estimated 2,400 to 3,000 barrels of crude oil to
seep into the sea from cracks in the seabed.
Chevron was ordered to stop new drilling at the site, and
Brazilian authorities have levelled a number of fines.
Additionally, Chevron and rig operator Transocean Ltd. (RIG,
RIGN.VX) also face a 20 billion Brazilian reais ($11.8 billion)
civil suit.
The Frade field currently produces about 60,000 barrels per day,
the company said. Following an order from the oil regulator, the
ANP, in December, Chevron suspended water reinjection in four wells
in the field.
Chevron said it will conduct a technical study and prepare a
complementary study to better understand the geological features of
the area, working with its partners and seeking necessary approvals
from the oil regulator, the ANP.
Chevron has a 52% operating interest in Frade, while Brazil's
Petroleo Brasileiro SA owns 30% and Japao Petroleo Ltda., a
joint-venture company of INPEX, Sojitz and JOGMEC, owns the
remaining 18%.
-By Diana Kinch and Matthew Cowley, Dow Jones Newswires; +55 11
3544 7082; brazil@dowjones.com