BP Settles Most Texas City PSM Citations

The $13 million settlement involves 409 of 439 willful violations of the process safety management standard OSHA filed against BP Products North America Inc. in October 2009.

The Labor Department on July 12 announced BP Products North America Inc. has agreed to pay $13,027,000 in penalties and to abate all existing violations at its Texas City, Texas refinery by the end of 2012. (BP has announced that it plans to sell the refinery this year.)

OSHA and the company have resolved 409 of the 439 willful violations of the process safety management standard for which OSHA cited it in October 2009. The 439 violations, including failing to follow industry-accepted engineering practices for pressure relief safety systems, carried total proposed penalties of $30.7 million.

These are separate from OSHA's citation and $21 million in penalties issued in September 2005 in connection with the explosion six months earlier at this refinery that killed 15 workers. While BP agreed then to identify and correct deficiencies, OSHA made a 2009 follow-up investigation and issued 270 failure-to-abate notices. BP settled those in 2010 by agreeing to pay a penalty of $50.6 million.

"Protecting workers and saving lives is the ultimate goal of this agreement," said Labor Secretary Hilda Solis. "For the workers at BP's Texas City refinery, this settlement will help establish a culture of safety. The workers who help keep our nation's oil and gas industries running deserve to go to work each day without fear of losing their lives."

DOL gave this breakdown of the new citation settlement: BP accepted 57 willful and 31 serious citations as issued; 61 original willful citations have been grouped as 34 repeat citations; 150 willful citations have been grouped as 92 unclassified citations; 110 citations have been withdrawn by OSHA; and 30 unresolved citations have been grouped as 22 unresolved citations and remain under contest. These 30 will be litigated or settled in the future, according to the DOL news release.

It says the 110 citations were withdrawn "because BP provided additional documentation after the citations were issued, showing several pieces of equipment originally cited were not covered by the PSM standard, were out of service at the time of the inspection or met the applicable Recognized and Generally Accepted Good Engineering Practices requirements. BP's documentation was reviewed and verified by OSHA and independent third-party experts."

"Make no mistake, the scope of this agreement should send a clear signal that OSHA is committed to ensuring BP takes seriously the safety and health of America's most important natural resource: its workers," said OSHA Assistant Secretary Dr. David Michaels.

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