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BP Fined Record $87 Million on Texas Refinery Safety

October 30, 2009, 12:28 pm

By Holly Rosenkrantz

Oct. 30 (Bloomberg) -- BP Plc will be fined a record $87 million by the U.S. for failing to correct safety shortfalls at a Texas refinery after a 2005 explosion that killed 15 workers, the U.S. Occupational Safety and Health Administration said.

“This administration will not tolerate disregard of our laws,” Labor Secretary Hilda Solis said today on a conference call, announcing the fines.

OSHA this month rejected BP’s request for more time to comply with a settlement over the blast, which also left hundreds injured. The London-based company is Europe’s second- largest oil producer.

“The size of the fine will draw attention to the fact that OSHA is more serious than they have been in the past about insuring compliance for safety issues,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. “Other refiners are looking at their situation and making sure they are in compliance.”

BP said in a statement earlier that it’s “disappointed” with the penalty. The Texas City refinery is the fourth-largest in the U.S. and has a capacity of 470,000 barrels a day, according to data compiled by Bloomberg.

OSHA said it has issued 270 notifications to BP for failing to correct hazards at the Texas City refinery over a four-year period after the explosion. OSHA is issuing a $56.7 million fine. OSHA also identified 439 “willful and egregious” violations of safety-controls at the refinery. That will lead to $30.7 million in additional fines.

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