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Brazil fines Chevron $17.5-million over spill

An aerial view shows oil that seeped from a well operated by Chevron at Frade, in Campos Basin, Rio de Janeiro state Nov. 18, 2011.

HANDOUT/REUTERS

Brazilian authorities said Monday they were slapping a $17.5-million (U.S.) fine on U.S. oil firm Chevron Corp. in connection with a major spill off Rio de Janeiro state last year.

Magda Chambriard, director general of the National Petroleum Agency (ANP), told a press conference that the new fine covered 24 infractions.

"There is one (missing fine) related to the abandonment of the well. The maximum limit is one million reais under the law," Ms. Chambriard said, adding that it would be imposed "in the next two months."

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And Chevron could be hit with an additional fine of $50,000 for "other items."

Brazil's national oil regulator estimated that 2,400 barrels of crude were spilled in the November accident.

A report by ANP released in July accused Chevron of negligence and said the company could have avoided the spill which occurred in the Frade field, located 370 kilometres northwest of Rio.

In August, a Brazilian court ordered Chevron and its driller Transocean to stop their oil drilling and shipping activities within 30 days.

Ms. Chambriard said ANP would appeal the court decision on the suspension of Chevron's operations "so as not to hurt oil production in Brazil," the state Agencia Brasil reported.

Brazil's state-owned oil giant Petrobras needs Chevron's assistance for its own operations.

Earlier this month, a court official said the head of Chevron's Brazil unit would be allowed to leave the country after posting bail of $245,000 in connection with the November spill.

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The official said judge Marcelo Luzio Marques Araujo set the bail amount to make sure George Buck returns to Brazil to stand trial "each time he is summoned."

Brazilian authorities had confiscated the passports of Mr. Buck and 16 other people linked to Chevron and Transocean following the November spill.

State prosecutors had filed legal action against Chevron and Transocean over the November incident, seeking $11-billion for what they have called "immeasurable" environmental damage.

In March, another oil spill was detected at a depth of 1,300 metres in the Frade field, in which Petrobras has a 30-per-cent stake, not far from the site of the bigger spill in November.

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