Oil seeps at Chevron’s Frade field nearly a year ago have led Brazilian regulator ANP to assess millions in fines against Chevron and ultimately halted output at the troubled Campos Basin field. In November 2011, Chevron P&A’d an appraisal well after oil seeps were found in the Frade area in 1200m (3800ft) of water. According to Chevron, there was never any oil flow from the wellhead but rather about 2400 barrels of oil had come from nearby seep lines on the ocean floor. ANP has pegged the number at more like 3700 barrels.
During the seep incident, Chevron maintained full production activities at Frade with output of about 79,000boe/d. Later, however, ANP ordered Chevron to shut in one of the 11 Frade producers and four water injectors. Chevron also suspended all drilling operations offshore Brazil indefinitely.
The Brazilian federal government filed a $10.7 billion civil lawsuit against Chevron and its partners. In addition to the civil lawsuit, the companies involved face penalty fines. The ANP’s report on the incident found Chevron culpable on 25 infractions, and the company can be fined nearly $1 million per incident.
In its report on the leak, the ANP said Chevron missed an underwater blowout and that its failure to properly manage pressure during drilling led to the kick, causing heavy seeps. The report cleared Transocean’s Sedco 706 semi, which was drilling on the field, of responsibility.
While the immediate leak was halted within days of the 9 November 2011 incident, a secondary leak became evident in March this year, prompting Chevron to ask for a temporary suspension of production at the field. At that time, output was at 60,000b/d. ANP told Chevron in July that the company could resume production but not water injection or any new drilling. Chevron operates Frade, which began production in 2Q 2009, with 51.7% interest on behalf of partners Petrobras (30%) and Frade Japão Petróleo, a JV of Inpex, Sojitz and Jogmec (18.3%). OE
Subscribe
