BP to pay $21 million in Texas City refinery settlement

Oct. 10, 2005
BP Products North America Inc. has agreed to pay $21,361,500 in penalties under a settlement agreement with the US Occupational Safety and Health Administration for violations connected with the Mar. 23 explosion at BP's 446,500 b/cd Texas City, Tex., refinery.

By OGJ editors
HOUSTON, Oct. 10 -- BP Products North America Inc. has agreed to pay $21,361,500 in penalties under a settlement agreement with the US Occupational Safety and Health Administration for violations connected with the Mar. 23 explosion at BP's 446,500 b/cd Texas City, Tex., refinery. The blast killed 15 workers and injured more than 170 others.

"This citation and penalty—nearly double the next largest fine in OSHA history—sends a strong message to all employers about the need to protect workers and to make health and safety a core value," said Solicitor of Labor Howard M. Radzely. "BP will pay the full fine, abate all the hazards, and significantly improve their safety measures."

The agreement, announced Sept. 22, settles citations issued against BP Products following the explosion that occurred when a cloud of hydrocarbon vapors ignited during the start up of an isomerization (isom) unit. The settlement also addresses "other ongoing investigations" at the Texas City refinery and requires BP Products to address process safety management (PSM) plant-wide, said OSHA officials.

In addition to paying the fines and abating all cited hazards, BP also agreed to:

-- Complete a review of the isom unit to determine how it can be operated safely and alert OSHA if and when a decision is made to start up the unit in the future.

-- Retain a firm with expertise in PSM for a refinery-wide audit and analysis of BP Products' PSM systems.

-- Hire an expert to assess and report on communication among management, supervisors, and employee representatives, as well as the impact of communication on implementation of safety practices and procedures.

-- Submit to OSHA and authorized employee representatives company logs of occupational injuries and illnesses and all incident reports related to PSM issues every 6 months for 3 years.

-- Notify OSHA of any incident or injury at the Texas City facility resulting in the loss of one or more employee workdays during the same 3-year period.

BP officials said they would submit plans for implementation of corrective measures to OSHA in coming weeks. "The agreement resolves more than 300 separate alleged violations of OSHA safety regulations in the areas of process safety management, maintenance, training, procedures and facility siting put forward by the agency" after its investigation of the Mar. 23 accident, the company said. BP does not admit the alleged violations or agree with the way OSHA has characterized them, however.

"We fully endorse the corrective actions required by the settlement," said Ross Pillari, president of BP Products North America. "We will apply the learnings from this and other investigations to make the Texas City Refinery a safer place." The company said it has begun to implement a number of safety enhancements and corrective actions at the refinery.

The company set aside $700 million to compensate victims of the explosion and has worked to resolve claims arising from the incident. Settlements have been achieved with the families of most of the workers who died and with many workers who suffered serious injuries.

Investigation findings
In its May 17 interim investigation report, the BP incident investigation team concluded that:

-- Failure to evacuate workers from temporary office trailers near a blowdown stack prior to startup of the raffinate splitter tower and failure to warn those workers of a major process upset and loss of containment during the startup greatly increased the number of people killed and injured by the explosion.

-- The use of a pressure relief system routed to a flare or closed relief system would have reduced the severity of the incident.

-- The explosion and fire occurred because established procedures were not followed in the restart of the raffinate splitter tower, and it was filled beyond its operational limits. The fluid level in the tower just prior to the explosion was 20 times higher than it should have been.

BP has appointed a new refinery manager; a new health, safety, security, and environment manager; and a new maintenance manager. The company has prohibited the occupancy of office trailers within 500 ft of blowdown stacks and flares and has leased a 100,000-sq ft building in downtown Texas City to provide offices for employees whose work does not require their presence at the refinery.

On a longer-term basis, the company will halt the venting of heavier-than-air hydrocarbon vapors from blowdown systems in the refinery.

In a separate agreement, BP also settled violations alleged by OSHA stemming from a September 2004 accident that killed two workers and seriously injured a third at the refinery. The company will pay a $102,500 fine as part of that settlement. BP Products North America is part of BP PLC. The Texas City refinery is BP's largest oil refinery with thirty process units spread over 1,200 acres.