Brazil Launches Oil Spill Containment Plan

Finally, after much criticism from environmentalists, politicians and even from oil industry executives, the Brazilian government launches a comprehensive oil spill contingency plan. Ironically, the PNC (National Contingency Plan), is being launched one day after the giant Libra pre-salt field auction. It’s hard to understand why the PNC wasn’t announced before the Libra auction, especially if it was ready, as it must have been. The PNC plan, according to the biggest Brazilian newspaper O Globo, had been ready and shelved in a Brazilian State Department office for over one year. Interestingly, the plan was announced one day after this same newspaper alerted that the Libra field was going to be auctioned without any oil spill contingency plan ready.

This really looks like a serious case of negligence by the government, but as it stands, no one is taking any responsibility for this negligence and it does not look like anyone within the government ministries will even be punished for it. Go figure. The PNC announcement was made jointly by the Ministry of Mines and Energy (MME) and the Environmental Ministry (MMA) and deals with major oil spills such as the Deepwater Horizon tragedy at the Macondo field in the GoM, which was operated by BP. The PNC plan calls for the implantation of a pro-active real-time offshore oil spill monitoring system, named “Sisnóleo”, training of emergency crews and more rigorous fines in order to minimize the consequences of oil spills. It also delegates responsibilities in dealing with the spills. For the PNC to be put into action, a series of factors need to be examined, such as the amount of oil being spilt, expected environmental impacts and the sensitivity of the local environment. If the spill crosses international borders the PNC plan will immediately be put into play. The operator of the field that causes the spill will automatically be charged with the costs of the oil spill containment.

The PNC also places the MMA as the body responsible for preparing the response capability at a national level. For smaller spills, such as the Chevron operated Frade field spill in 2011, the PNC does not set specific procedures, but does specify more rigid control over the actions taken by the field operator and sets clear penalties for deviating from the approved emergency plans and actions. This limited plan exists since the year 2000, and was put in place after a Petrobras oil spill in Guanabara Bay, Rio de Janeiro. Many environmentalists are still skeptical about the PNC and it will be interesting to examine the plan in-depth and also hear what will be discussed about this during the upcoming OTC Brasil conference to take place in Rio de Janeiro next week.

Below: MMA Minister Isabela Teixeira & MME Minister Edison Lobão during the announcement of the PNC