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Daily Telegraph: BP attacked over ‘unsafe culture’

By Russell Hotten, Industry Editor
Last Updated: 3:20am GMT 20/03/2007

Oil company BP operated an unsafe culture at a Texas refinery where 15 died in an explosion and management should have spotted the warning signs years ago, according to a damning report being published today.
The US Chemical Safety Board (CSB), which spent two years investigating the blast in March 2005, says that cost-cutting at the plant in Houston was a contributory factor because ageing equipment needed upgrading.

The report is the most critical so far into the Texas City refinery explosion, which also severely injured 180 people and led to an avalanche of writs against BP. Full details of the report will be released in the US later today, although CSB chairman Carolyn Merritt has already indicated some of its conclusions.

Speaking at an oil conference in Texas yesterday Ms Merritt said the poor safety standards at Texas City were shocking. “As the investigation unfolded, we were absolutely terrified that such a culture could exist at BP,” Ms Merritt told the conference. Last year, an interim report by the CSB spoke of BP having a “cheque book” mentality towards safety.

The Texas City blast, America’s worst industrial accident in more than a decade, has damaged BP’s reputation and was a factor in chief executive Lord Browne’s decision to retire early. The company has set aside $1.6bn (£820m) for legal claims, of which 1,000 have been settled.

In September 2005 BP received a $21m fine from the Occupational Safety and Health Administration for safety violations. In January this year an independent investigation led by James Baker, the former US Secretary of State, accused BP of complacency and being obsessed with personal safety (wearing hard-hats and trips) rather than the safety of plant and machinery (process safety). But the Baker Report found no evidence that safety funding had deliberately been cut or that any one individual was to blame.

The CSB report is expected to say all levels of BP management were at fault, including the board.

Ms Merritt told the National Petrochemical and Refiners Association conference that executive management and BP’s corporate board “either did not get or failed to respond to process safety audits and risk information”.

Since the explosion BP has created an advisory board to oversee its US operations, and has introduced better lines of communication to keep the executives informed about safety issues. A BP spokesman said: “Our own internal report found serious problems with the safety culture at Texas City and also identified the critical factors leading to the terrible tragedy that occurred there. We are addressing the safety culture issues across BP.”;jsessionid=42TF44O4MYXRPQFIQMGSFF4AVCBQWIV0?xml=/money/2007/03/20/cnbp20.xml

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