British Petroleum's (BP) troubles are not just limited to its Gulf of Mexico operations, where a deadly blast aboard a drilling rig two weeks ago ruptured an oil well 5,000 feet below the sea's surface and triggered a massive oil leak that is now the size of a small country.
The oil conglomerate is also facing serious charges from the Labor Department's Occupational Safety and Health Administration (OSHA) that it “willfully” failed to implement safety measures at its Texas City refinery following an explosion that killed 15 employees and injured 170 others five years ago.
The refinery is the third largest in the country and has a capacity to refine 475,000 barrels of crude oil per day. OSHA found BP to be in violation of more than 300 health and safety regulations and, in 2005, fined the company $21.4 million, at the time the largest in the agency's history. In 2007, BP paid a $50 million fine and pleaded guilty to a felony for not having written guidelines in place at the refinery and for exposing employees to toxic emissions. BP, which earned $19 billion in 2005, settled with the victims' families for $1.6 billion.
Get our free emails
BP was placed on three years probation and the Department of Justice agreed not to pursue additional criminal charges against the company as long as BP agreed to undertake a series of corrective safety measures at the refinery ordered by OSHA.
Several investigations launched in the aftermath of the refinery explosion concluded that BP's aggressive cost-cutting efforts in the area of safety, the use of outdated refinery equipment and overworked employees contributed to the blast, which, according to John Bresland, the chairman of the independent US Chemical Safety Board (CSB), was caused “when a distillation tower flooded with hydrocarbons and was over-pressurized, causing a geyser-like release from the vent stack. The hydrocarbons found an ignition source [a truck that backfired] and exploded.”
Bresland, whose organization spent two years probing the circumstances behind the explosion, said in March that CSB's investigation “found organizational and safety deficiencies at all levels of the BP Corporation.”
“It was the most comprehensive and detailed investigation the CSB has ever done,” Bresland said March 24, marking the fifth anniversary of the refinery explosion. “Our investigation team turned up extensive evidence showing a catastrophe waiting to happen. That cost-cutting had affected safety programs and critical maintenance; production pressures resulted in costly mistakes made by workers likely fatigued by working long hours; internal audits and safety studies brought problems to the attention of BP's board in London, but they were not sufficiently acted upon. Yet the company was proud of its record on personnel safety.”
According to OSHA, BP has not only failed to comply with the terms of its settlement agreement, it has knowingly committed hundreds of new violations that continue to endanger the lives of its refinery workers.
“When BP signed the OSHA settlement from the March 2005 explosion, it agreed to take comprehensive action to protect employees,” Secretary of Labor Hilda Solis said in a statement last October. “Instead of living up to that commitment, BP has allowed hundreds of potential hazards to continue unabated.”
“BP was given four years to correct the safety issues identified pursuant to the settlement agreement, yet OSHA has found hundreds of violations of the agreement and hundreds of new violations. BP still has a great deal of work to do to assure the safety and health of the employees who work at this refinery,” added acting Assistant Secretary of Labor for OSHA Jordan Barab, whose agency conducted a six-month review of BP's Texas City refinery operations to determine if the oil company complied with provisions of the settlement. “The fact that there are so many still outstanding life-threatening problems at this plant indicates that they still have a systemic safety problem in this refinery.”
Specifically, OSHA said it found 439 new “willful” violations by BP related to “failures to follow industry-accepted controls on the pressure relief safety systems and other process safety management violations.”
According to OSHA regulations, “a willful violation exists where an employer has knowledge of a violation and demonstrates either an intentional disregard for the requirements of the Occupational Safety and Health (OSH) Act of 1970, or shows plain indifference to employee safety and health.”
OSHA imposed a record $87 million fine against the company, surpassing its previous record in 2005, which was also leveled against BP. A Justice Department spokesperson did not respond to questions as to whether BP's alleged failure to comply with its settlement agreement would expose the company to further criminal charges.
Last October, however, Angela Dodge, a spokeswoman for the US attorney's office in Houston, said DOJ “will take all appropriate actions to ensure the plea agreement is not violated and cannot comment further at this time.”
Some of the new violations BP for which was cited, according to OSHA, have already resulted in additional fatalities at the refinery.
On July 22, 2006, OSHA said a contractor was crushed between a “scissor lift and a pipe rack.” On June 5, 2007, another contractor was electrocuted “on a light circuit in the [refinery's] process area.” On January 14, 2008, an employee was killed when the top head of a pressure vessel blew off. BP received four citations from OSHA regarding continued violations over process safety management. And on October 9, 2008, a contractor, who was hit by a front-end loader and pinned between a guard rail and the bucket of the loader, died from his injuries.
BP has vehemently denied the charges alleged by OSHA and has formally contested the proposed penalties.
“We continue to believe we are in full compliance with the Settlement Agreement … we strongly disagree with OSHA's conclusions,” said Texas City Refinery Manager Keith Casey on October 30, 2009, the day OSHA announced that BP continued to skirt safety regulations. “We believe our efforts at the Texas City refinery to improve process safety performance have been among the most strenuous and comprehensive that the refining industry has ever seen.”
BP, which says it invested $1 billion on safety and operational improvements at the refinery, claims that a vast majority of OSHA's allegations against the company are not true violations, but, instead, are related to a misunderstanding over the timing of its compliance under the terms of its settlement agreement, according to an October 5, 2009, letter BP attorney Thomas Wilson sent to Mark Briggs, an official with OSHA's Houston branch.
BP “pursued the actions plans as outlined in the [agreement it entered into with OSHA], including actions plans related to four recommendations that have completion dates beyond September 22, 2009,” Wilson wrote. “It was not until a meeting in late 2008 that OSHA expressed verbally a differing interpretation of the date for completion of auditor recommendations and it was only in the OSHA letter of August 3, 2009 that BP Products first received written indication that OSHA expected all action plans to be complete by September 23, 2009.”
BP may end up fighting the charges in federal court.
Widespread Safety Issues at US Refineries
Still, as highlighted in a January 2007 report issued by a panel chaired by former Secretary of State James Baker III, systemic issues related to process safety were not limited to the firm's Texas City refinery. In fact, they were widespread.
And that continues to be the case, as evidenced by a separate set of charges OSHA leveled against BP in March for even more “willful” violations that took place at its Husky refinery in Toledo, Ohio, “including 39 on a per-instance basis, and 20 alleged serious violations for exposing workers to a variety of hazards including failure to provide adequate pressure relief for process units,” issues that appear to be identical to those that lead up to the refinery explosion in 2005.
The Husky refinery is a 50-50 joint venture between BP and Canadian-based Husky Energy, Inc.
“OSHA has found that BP often ignored or severely delayed fixing known hazards in its refineries,” Solis said. “There is no excuse for taking chances with people's lives. BP must fix the hazards now.”
BP entered in a similar settlement with OSHA in 2007 over safety issues at Husky. Last September, during an inspection to determine if BP was in compliance with the terms of the agreement, OSHA found BP was compliant. However, OSHA found “numerous violations at the plant not previously covered” by the settlement.
“The inspection revealed that workers were exposed to serious injury and death in the event of a release of flammable and explosive materials in the refinery because of numerous conditions constituting violations of OSHA's process safety management standard,” OSHA said in a March 8 news release. “OSHA has issued willful citations for numerous failures to provide adequate pressure relief for process units, failures to provide safeguards to prevent the hazardous accumulation of fuel in process heaters, and exposing workers to injury and death from collapse of or damage, in the event of a fire, to nine buildings in the refinery. Additional willful citations allege various other violations of OSHA's standard addressing process safety management.”
What's notable about the nearly two dozen of the alleged violations at Husky, is that one matches allegations first leveled against BP a year ago by a whistleblower who said the company had been operating its Gulf Coast drilling platform Atlantis, the world's largest and deepest semi-submersible oil and natural gas platform, located about 200 miles south of New Orleans, without a majority of the necessary engineering and design documents, a violation of federal law.
As Truthout reported last week, the whistleblower said BP risked a catastrophic oil spill, far worse than the one that began two weeks ago after the Deepwater Horizon explosion, because BP did not have updated or complete Piping and Instrument Diagrams (P&IDs) for the Atlantis subsea components. P&IDs documents form the foundation of a hazards analysis BP is required to undertake as part of its Safety and Environmental Management Program related to its offshore drilling operations. P&IDs drawings provide the schematic details of the project's piping and process flows, valves and safety-critical instrumentation.
In OSHA's list of alleged violations at Husky, the agency said BP failed to “assure the accuracy of P&IDs … and proper documentation of pressure relief design information.”