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Chevron (CVX) 102.80 -3.30 tanking on oil spill news. BP redux?

14:29 RIG Transocean moving lower with CVX… BusinessInsider report on CVX spill suggests CVX’s troubled well was being drilled by one of RIG’s drilling rigs (47.10 -2.62) –
14:18 CVX Chevron showing weakness in recent trading on increased volume; latest pullback is attributed to BusinessInsider story suggesting spill could be larger than previously thought (105.22 -0.96) -Update-
We’d also note that there was a Reuters story out suggesting progress was being made as the flow of oil had ceased.


Chevron’s Oil Spill Off Brazil Could Be 10 Times Bigger Than Official Estimates Based on Brazilian government data showing the locations of active drill rigs, provided to us by some of our very helpful followers on Twitter, we conclude that Chevron’s well was being drilled by the SEDCO 706 semisubmersible drill rig operated by – wait for it – Transocean. Yes, the same company that operated the doomed Deepwater Horizon rig for BP.

The MODIS/Aqua satellite image from NASA, above, was taken three days ago. It shows an apparent oil slick originating from the drilling location and extending over 2,379 square kilometers (the south end of the slick gets entrained in an interesting clockwise eddy in the ocean currents). At 1 micron thickness, that’s a volume of 628,000 gallons (14,954 barrels) of oil.

Assuming the spill began midday on November 8 (24 hours before we first observe it on satellite imagery), we estimate a spill rate of at least 157,000 gallons (3,738 barrels) per day. That’s more than 10 times larger than Chevron’s estimate of 330 barrels per day.

source: http://www.businessi…timates-2011-11

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