BP fined $50.6 million to resolve Texas refinery penalties

OSHA recently announced that BP Products North America Inc. will pay a record penalty of $50.6 million stemming from a March 2005 explosion at its refinery in Texas City, Texas, that killed 15 workers and injured 170 others.

Officials said the agreement resolves failure to abate citations issued after a 2009 follow-up investigation. In addition, BP has agreed to allocate a minimum of $500 million to protect employees now working at the refinery.

"This agreement achieves our goal of protecting workers at the refinery and ensuring that critical safety upgrades are made as quickly as possible," said Hilda L. Solis, secretary of labor. "The size of the penalty rightly reflects BP's disregard for workplace safety and shows that we will enforce the law so workers can return home safe at the end of their day."

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In September 2005, OSHA cited BP a then-record $21 million for the fatal explosion. Upon issuance of the citations, the parties entered into an agreement that required the company to identify and correct deficiencies. In the 2009 follow-up investigation, OSHA found that although the company made many changes related to safety, it failed to live up to several terms of that agreement. As a result, OSHA cited BP for failure to abate violations with penalties totaling a record $50.6 million. OSHA also identified 439 new willful violations and assessed more than $30 million in penalties. Officials said litigation before the Occupational Safety and Health Review Commission regarding those violations and penalties is ongoing and is not impacted by today's settlement.

Under the agreement, BP will immediately begin performing safety reviews of the refinery equipment according to set schedules and make permanent corrections. Solis said the agreement also identifies many items in need of immediate attention. The company has agreed to address those concerns quickly and to hire independent experts to monitor its efforts. Additionally, the agreement provides greater oversight of BP's safety program, including regular meetings with OSHA, frequent site inspections, and the submission of quarterly reports for the agency's review. BP also agreed to establish a liaison between OSHA and its boards of directors in North America and England, which Solis said will allow the agency to raise compliance problems at the highest level.

Read more at the WorkersComp Forum homepage.

September 27, 2010

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