BP Pays $13M to Settle Texas Refinery Safety Probe

By Erwin Seba | July 12, 2012

BP Plc on Thursday agreed to pay $13 million to settle safety violations at its Texas City, Texas, refinery, paving the way for a sale of the refinery by the London-based energy company.

The settlement struck with the U.S. Occupational Safety and Health Administration clears most violations safety inspectors found in 2009 in a follow-up inspection after a deadly 2005 explosion at the refinery, which killed 15 workers and injured 170 others.

The settlement also removes a major impediment in BP’s plan to sell the 400,780-barrel-per-day refinery, the sixth largest in the United States, by the end of the year.

“We want the men and women who work at Texas City to go home at the end of the day,” U.S. Labor Secretary Hilda Solis said a conference call to announce the settlement, which she said would abate “hundreds of serious hazards” at the refinery, which is located about 40 miles (64 km) southeast of Houston. The deal clears 409 outstanding safety citations, with 30 citations still under discussion, OSHA officials said.

The March 23, 2005, explosion happened when a cloud of volatile hydrocarbon vapor ignited around portable work trailers after being released by an octane-boosting unit during a restart.

In 2009, OSHA announced it was seeking $87.4 million in fines from BP for alleged safety violations at the Texas City refinery.

In 2010, as it was battling the gigantic Macondo oil spill in the Gulf of Mexico, BP agreed to pay a settlement of $50.6 million for violations. BP on Thursday agreed to settle most of the outstanding violations for a $13 million fine.

“BP is committed to workplace safety,” said Iain Conn, BP’s global head of refining and marketing. “Our aim is to be a leader in process safety, and we look forward to continuing our cooperation with OSHA to create an even safer workplace in BP and in our industry as a whole.”

BP has accepted responsibility for the blast and set aside more than $2 billion to settle lawsuits. It spent more than $1 billion from 2005 to 2009 on safety improvements and agreed to spend another $500 million in its 2010 deal with OSHA.

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