Chevron Corp. (NYSE:CVX) has paid 35.1 million real ($17.3 million) to Brazil’s National Petroleum Agency (ANP) in penalties related to two oil spills in the Frade Field off the coast of Brazil. A total of around 3,600 barrels of oil were spilled during the incidents, leaving 168 square kilometers of the ocean surface covered in oil slick. [1]
See our full analysis for Chevron
The company has received a 30% discount on the fine for prompt payment and, because it did not challenge 24 violations found by the regulator, this will reduce its bill to 24.6 million real ($12.1 million). The company’s cooperation indicates that it intends to swiftly resolve any discrepancies related to the spill and resume operations in the country as soon as possible.
The fine takes Chevron’s total Brazilian oil-spill related penalties to over $50 million. Last year, the company was fined $33.4 million by Brazilian environmental protection agency Ibama.
However, Chevron, along with Frade drilling contractor Transocean, could still face a total of $22 billion after a federal prosecutor launched two civil lawsuits against the companies related to the spills. In relation to these lawsuits, the companies’ operations in the country have been banned until further notice.
According to the ANP, the spills caused no discernible damage to the environment and did not reach the Brazilian coastline.
We currently have a Trefis price estimate of $115 for Chevron, which is in-line with the market price.
Understand How a Company’s Products Impact its Stock Price at Trefis
Notes:- Chevron pays $17.3 million Brazil fine for November spill, Reuters, September 2012 [↩]
