The Sunken Icon of Reform.(Brazilian oil rig sinks)(Brief Article)

During five long days last month, millions of Brazilians saw the tragedy unfold. On March 15 a series of explosions racked the world's largest oil rig, 120 kilometers off the coast. Half stunned, half in horror, they watched on live television as salvage crews in ships and helicopters struggled to rescue the crippled rig, and wept when they failed. On March 20, P36 sank, dragging with it the bodies of nine oil workers. In the end two more workers succumbed to injuries, raising the death toll to 11. Five days later the world's largest floating oil rig was a mile deep on the Atlantic floor.

Now only questions linger, like the spreading oil stain on the ocean. What happened to P36? How could such a formidable piece of equipment have failed? Worse, had Petrobras, an icon of the modernizing Brazilian economy, thrown aside caution to meet production targets? Hardly a day goes by without one TV network or another replaying the final minutes of the rig disappearing with a gurgle in the Atlantic. Driven since its colonial days by the quest to harness its vast natural resources, the race for energy self-sufficiency has inspired Brazilian leaders for more than half a century. The rig called P36 was supposed to put them well on the path.

So much sank with P36. Known worldwide for its technological prowess, Petrobras practically created the industry standard for deep-water drilling equipment. Loyalists feared for its survival when Congress ended its monopoly in 1997, but Petrobras flourished. It shed tens of thousands of workers, retrained the rest, and by last year was posting a phenomenal $5 billion in revenues for 2000 when it announced plans to move into even deeper waters with P36. Brazilians celebrated in awe: the rig cost $480 million, stood 40 stories and could fill an entire city block. At full capacity, 180,000 barrels a day, it would provide a tenth of the nation's energy consumption--from 2,000 meters below sea level. What better symbol for the debut of Petrobras as a modern enterprise?

Petrobras president Henri Phillipe Reichstul became a hero. Now he is roasted in Congress, vilified as a cold profiteer by oil workers and brutally caricatured as a incompetent in the press. Oil unions have revealed that gas leaks had been detected three days before the explosion on P36. Repairing the ...