Tuesday, October 31, 2006

US Agency Says Cost Cutting, Ignored Warnings Caused BP Explosion that Killed 15

How did a giant refinery with the lowest injury rate in its history -- nearly one-third the oil refinery sector average -- sustain the worst U.S. industrial accident in more than a decade? In a few words, they were measuring the wrong safety indicators, they were cutting the safety and maintenance budget while ignoring major warning signs.

Much more of the story is being told this week. After a devastating CBS "60 Minutes" report Sunday night where Chemical Safety Board Chair Carolyn Merritt told reporter Ed Bradley that BP management knew enough about Texas City's safety problems to have prevented the March 23, 2005 explosion that killed 15 workers and injured 170, the CSB has issued an even more disturbing interim report. The report has even more impact considering that the CSB is an independent federal agency charged with investigating industrial chemical accidents, and that the five Board members were appointed by President Bush.
In preliminary findings released today, the U.S. Chemical Safety Board (CSB) stated that internal BP documents prepared between 2002 and 2005 revealed knowledge of significant safety problems at the Texas City refinery and at 34 other BP business units around the world – months or years prior to the March 2005 explosion that killed 15 workers, injured 180 others, and was the worst U.S. industrial accident in more than a decade.

Last October, the CSB released a preliminary report stating that The isomerization unit, the gasoline octane booster that exploded, should not have been started up on March 23, because of a history of problems and a malfunctioning level indicator, level alarm, and a control valve. In addition, the raffinate splitter tower that overflowed on March 23 had a history of abnormal startups that included recurrent high liquid levels and pressures. BP management was aware of these incidents and malfunctioning equipment, but had never acted on that knowledge.

But it turns out the situation was even worse, according to CSB lead investigator Don Holmstrom:
Mr. Holmstrom said that his team has now documented the occurrence of eight previous instances where flammable hydrocarbon vapors were discharged from the same blowdown drum between 1994 and 2004. In two of these incidents the blowdown system caught on fire. The eight incidents were not properly investigated, and appropriate corrective actions were not implemented. The investigation of a 1994 incident resulted in an action item to analyze the adequacy of the blowdown drum. The area superintendent was responsible for the completion of this item. However, the item was never finished, and management officials did not follow up to assure completion.

The explosion on March 23, 2005, was not the only major accident the Texas City refinery had experienced, CSB investigators said. The history of major accidents and fatalities at the plant was summarized in a meeting held in November 2004 by the refinery manager for 100 supervisors. He gave a sobering presentation entitled “Safety Reality” on the 23 deaths at the plant in the previous 30 years; on average, one worker had died every 16 months.
Measuring The Wrong Things

There are also important safety lessons to be learned from BP's safety program at the time of the incident. Basically, BP management was measuring the wrong things to determine whether or not the plant was "safe"
In 2004, BP Texas City had the lowest injury rate in its history, nearly one-third the oil refinery sector average. However, the injury rate does not take account of catastrophic hazards or distinguish between injuries and fatalities. That year, the refinery experienced three major accidents that resulted in a total of three fatalities. One of these accidents was a major process-related fire. In late 2004, following these major accidents and other near misses, the Texas City leadership was attempting to improve the refinery’s safety performance. Several years of audits and reports had identified serious safety system deficiencies. However, the safety initiatives that were undertaken focused largely on improving personnel safety – such as slips, trips and falls – rather than management systems, equipment design, and preventative maintenance programs to help prevent the growing risk of major process accidents.”
Of course, this might cause one to question OSHA's inspection targeting process, which is based on those same injury and illness statistics that failed to predict the possiblity of a major catastrophe.

Budget Cuts

The other problem, according to Merritt, was that BP's budget cuts compromised safety and workers' lives:.
Chairman Merritt stated that stringent budget cuts throughout the BP system caused a progressive deterioration of safety at the Texas City refinery. BP implemented a 25% cut on fixed costs from 1998 to 2000 that adversely impacted maintenance expenditures and infrastructure at the refinery,” she said. Maintenance spending fell throughout the 1990’s at the then-Amoco refinery, and following the merger with BP further cuts were imposed. “Every successful corporation must contain its costs. But at an aging facility like Texas City, it is not responsible to cut budgets related to safety and maintenance without thoroughly examining the impact on the risk of a catastrophic accident.

By 2002, an internal BP report had identified the cost reductions as contributing to a decline of infrastructure in Texas City that would require significant investment to correct. These findings were corroborated in a survey of the refinery’s safety culture in 2005 just prior to the accident, known as the Telos study. The survey interview with the Texas City refinery manager identified a history of decapitalization and a culture of “things not getting fixed.”

“The refinery manager was not alone in this candid assessment,” Chairman Merritt said. “Large majorities of the survey respondents reported significant maintenance backlogs that were harming safety. Disturbingly, most employees agreed that ‘production and budget compliance gets recognized and rewarded before anything else at Texas City.’”

Meanwhile, to top off the day, the Board issued new safety recommendations calling on the U.S. oil industry to improve safety practices for refinery pressure relief systems, eliminating the type of atmospheric vent that caused the hydrocarbon release and explosions.
The first recommendation calls on the American Petroleum Institute (API), a leading oil industry trade association that develops widely used safety practices, to change its Recommended Practice 521, Guide for Pressure Relieving and Depressuring Systems. The revised guidance should warn against using blowdown drums similar to those in Texas City, urge the use of inherently safer flare systems, and ensure companies plan effectively for large-scale flammable liquid releases from process equipment.

Further recommendations call on the U.S. Occupational Safety and Health Administration (OSHA) to establish a national emphasis program promoting the elimination of unsafe blowdown systems in favor of safer alternatives such as flare systems. OSHA should also emphasize the need for companies to conduct accurate relief valves studies and use appropriate equipment for containing liquid releases, the Board said. A national emphasis program results in a concerted inspection and enforcement effort around a specific safety hazard.
OSHA had cited the Texas City refinery in 1992 for unsafe blowdown drums, but Amoco (which then owned the refinery) argued successfully that the blodown drums were in compliance with the API standard. If the API complies with the CSB recommendations, the standard would explicity warn against the use of blowdown drums.

BP was not in agreement with the CSB's findings. Although the company has "taken responsiblity for the explosion, a BP report blamed it on workers' failure to follow procedures and fired six workers shortly after the accident. According to the Wall St. Journal:
Ronnie Chappell, a BP spokesman, yesterday said the company stood by its findings. BP investigators "didn't find evidence of budgetary decisions which were an immediate cause or critical factor in this terrible tragedy," he said.

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