NEW YORK -- Shares of Transocean Ltd. rose Monday after a Brazilian judge said that the company will be allowed to continue to operate drilling rigs in most fields off the shores of Brazil.
THE SPARK: The judge, Felix Fischer of the Brazilian Superior Court of Justice, on Friday partially suspended a preliminary injunction that would require Transocean to stop operating rigs in Brazil within 30 days. The judge is allowing Transocean to continue to drill where it has rigs under contract with the exception of a Chevron Corp. field where two oil spills have occurred.
THE BIG PICTURE: Transocean, which is based in Zug, Switzerland, and Chevron were ordered last week to suspend operations in Brazil until investigations have been completed into two oil spills off Rio de Janeiro's coast.
Thousands of gallons of oil seeped from cracks in the ocean floor in November at the site of a Chevron appraisal well. The National Petroleum Agency said the seepage was under control two weeks later but oil started leaking again in March. Chevron voluntarily suspended production in the field.
Chevron paid a $17.3 million fine last week for 24 of 25 irregularities detected at the site of the spills. The types of irregularities were not specified. The San Ramon, Calif., company said continuous monitoring of the area has shown no discernible environmental impact to marine life or human health.
Transocean has 10 rigs under contract off Brazil's shores. Nine are leased to other customers, including Brazil's state-run oil company, Petroleo Brasileiro SA, also known as Petrobras.
The judge's partial lifting of the suspension came in a lawsuit filed by Petrobras. It said that the suspension would hurt its exploration activities because it uses seven Transocean rigs.
THE SHARES: In morning trading, shares of Transocean rose $1.86, or 4.2 percent, to $46.76. In the past 52 weeks, the price has ranged from $38.21 to $60.09 per share.
Chevron's shares rose $1.30 to $117.86. Its shares have ranged from $86.68 to $118.53 in the past 52 weeks.