OSHA Says BP Texas Refinery Has Failed to Improve Safety Since Blast

September 23, 2009

British oil giant BP Plc has failed to carry out promised safety improvements after an explosion that killed 15 workers at its refinery in Texas in 2005, the U.S. Occupational Safety and Health Administration said in letter sent to the company last month.

The complaint by the federal regulator is bad news for BP, which has already spent more than $2 billion in the wake of the blast settling lawsuits and criminal charges and seen its reputation in the U.S. tarnished.

“We believe that the failure to correct the issues addressed in this letter … by Sept. 23, 2009, would constitute a failure to comply with the terms of the 2005 agreement and/or a failure to abate,” OSHA wrote to BP’s Texas City refinery manager, according to a copy of the letter seen by Reuters.

BP promised the changes and paid a $21.4 million fine to settle federal safety rule violations OSHA found at the refinery after the March 23, 2005, blast.

Adherence to the terms of the OSHA agreement was a part of BP’s plea deal reached earlier this year with the U.S. Justice Department to settle criminal charges stemming from the explosion.

BP paid a $50 million fine to settle the criminal charges and also spent more than $2.1 billion to settle hundreds of lawsuits stemming from the explosion.

A BP spokesman said the company was working with OSHA.

“We are in contact with OSHA and we are working with them to resolve the issue,” said BP spokesman Scott Dean. “That’s going to continue.”

An OSHA spokeswoman declined to discuss the letter because the BP Texas City case remains open.

The eight-page letter listed multiple tasks that the refinery needs to perform.

Included in a list of “overdue inspections and preventative maintenance tasks” are 138 “pipeline thickness activities” that were overdue as of March 31 on Pipestill 3A, a 240,000-barrel-per-day (bpd) crude distillation unit at the refinery.

Pipeline thickness activities are checks of pipes to assure the pipe wall is thick enough to maintain integrity.

Crude distillation units perform the initial refining of oil. Pipestill 3A accounts for over half of the refining capacity at the 455,790 bpd refinery, the third largest in the United States.

One of the refinery’s gasoline-producing fluid catalytic cracking units is also overdue for two “pipeline thickness activities.”

Piping failures have been cited as the cause of refinery fires in Delaware and Texas this year as well as a Texas refinery fire in 2007.

The U.S. Chemical Safety Board found in its investigation of the 2005 explosion that instrumentation problems at the refinery prevented operators from seeing the developing problem that led to the explosion.

BP is negotiating with Texas Attorney General to settle a state lawsuit for environmental violations at the refinery between 2005 and 2008.

The Chemical Safety Board also found in its two-year investigation that cost-cutting contributed to a broken safety culture at BP which allowed managers to overlook warning signs prior to the 2005 blast.

(Editing by Christian Wiessner)

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