Record BP Settlement

A $50.6 million dollar fine will be paid by BP as part of an Aug. 12 agreement with the Occupational Safety & Health Administration to resolve workplace safety violations at BP's Texas City, Texas, refinery. It is the largest fine in OSHA's history.

The record settlement springs from an OSHA investigation of a 2005 accident at the refinery that killed 15 workers and injured 170 others. In 2007, OSHA fined the company a then-record $21 million because of the accident and ordered BP to take several corrective actions to improve safety. A follow-up investigation in 2009 found the company had failed to correct deficiencies identified during the earlier investigation and this resulted in the Aug. 12 fine and settlement.

The agreement, said Labor Secretary Hilda L. Solis, who oversees OSHA as part of her department, is intended to ensure that BP makes "critical safety upgrades" as quickly as possible. "The size of the penalty rightly reflects BP's disregard for workplace safety," she added in a statement.

The company has also agreed to spend $500 million by 2016 to correct problems identified by OSHA at the plant and to have the work monitored and verified by independent experts.

BP noted in a statement that the company had already spent some $1 billion to improve workplace safety, and it will accelerate an ongoing multiyear program to overhaul process safety practices. However, since the 2005 accident, there have been several more accidents at the Texas City refinery and four deaths (C&EN, Nov. 9, 2009, page 12).

As part of the settlement, BP will also improve safety corporation-wide by establishing a liaison between OSHA and its North American and London boards of directors, which, according to OSHA, will allow safety and compliance issues to be raised to the highest levels in the company.

Remaining outstanding are some $30 million in proposed OSHA fines for 439 new "willful violations" at the Texas refinery, which were identified by the 2009 OSHA investigation. These proposed fines have yet to be resolved and are not affected by the  nearly $51 million settlement.