Brazil Judge Denies Ban of Chevron, Transocean Operations

A Brazilian federal judge denied a request from a prosecutor seeking to ban Chevron Corp. (CVX) and Transocean Ltd (RIG). from operating in the country after two oil spills.

Prosecutor Eduardo Santos de Oliveira sought to halt Chevron and Transocean’s operations in Brazil as part of a 20 billion reais ($11 billion) lawsuit for environmental damage after an oil spill last month at its Frade field, according to an e-mailed statement from the court today.

The legal action against Chevron comes as Brazil increases scrutiny of offshore oil production following the 2010 Macondo spill in the U.S. Gulf of Mexico. Chevron is also battling a separate lawsuit by the country’s main oil union to ban it and Transocean from operating in the country.

“Chevron Brasil is confident that at all times it acted diligently and appropriately, and in accordance with the best practices in the oil industry,” the company said in an e-mailed statement.

The decision refers to the second lawsuit targeting San Ramon, California-based Chevron and Transocean for oil spills in Brazil. Prosecutors filed the first lawsuit, also seeking 20 billion reais in damages, in November last year after a 3,000- barrel spill that same month.

To contact the reporter on this story: Adriana Brasileiro in Rio de Janeiro at abrasileiro@bloomberg.net

To contact the editor responsible for this story: Helder Marinho in Sao Paulo at hmarinho@bloomberg.net