BP 2007 Annual Report Download - page 31

BP ANNUAL REPORT AND ACCOUNTS 2007 29
Other regulatory actions
OSHA
In January 2007, OSHA began a new inspection at the Texas City refinery
focusing on relief valves, flare capacity and other process safety issues at
one of the catalytic cracking units. OSHA issued citations in July 2007
with a total penalty of $92,000. Separately, OSHA has questioned
whether the process safety management expert (AcuTech), appointed in
connection with the September 2005 settlement agreement with OSHA,
adequately reviewed equipment pressure relief valve issues. BP has
entered into negotiations to resolve the cracking unit citations and, in the
interim, has agreed to the assignment of this case to a settlement judge.
On 16 January 2008, BP addressed OSHA’s concerns regarding the
September 2005 settlement agreement by agreeing to retain an expert
relief system consultant to audit individual hydrocarbon relief devices and
flare systems on two units and to share the consultant’s findings with
OSHA.
In September 2007, BP and OSHA entered into a settlement
agreement related to citations stemming from OSHA’s inspection of the
Toledo refinery in 2005. OSHA granted final approval of the settlement in
November 2007.
BP is attempting to negotiate a settlement relating to citations, with a
total penalty of $384,000, stemming from Indiana OSHA’s inspection of
the Whiting refinery in 2006, but the case is still pending. In August
2007, Indiana OSHA initiated a separate inspection relating to an April
2007 incident that resulted in a crude unit shutdown and the release of
40,000 pounds of hydrocarbons. On 30 January 2008, OSHA issued a
safety order that alleges two violations, for a total penalty of $10,000.
OSHA conducted an inspection related to the death of a contract diver
at the Cherry Point refinery in August 2007. OSHA concluded its
investigation in October 2007 and informed BP that no citations would be
issued to it.
In January 2008, an employee died at Texas City refinery. This incident
is currently being investigated by BP, OSHA and the CSB.
EPA
The EPA has asked the DOJ to file a civil lawsuit based on inspections it
conducted at the Whiting, Toledo, Cherry Point and Carson refineries
following the March 2005 Texas City incident. BP Products and the EPA/
DOJ have begun settlement negotiations in an effort to avoid litigation of
the matter.
Refining
The group’s global refining strategy is to own and operate strategically
advantaged refineries that benefit from vertical integration with our
marketing and trading operations, as well as horizontal integration with
other parts of the group’s business. Refining’s focus is to maintain and
improve its competitive position through sustainable, safe, reliable and
efficient operations of the refining system and disciplined investment for
growth.
For BP, the strategic advantage of a refinery relates to its location,
scale and configuration to produce fuels from lower-cost feedstocks in
line with the demand of the region. Strategic investments in our
refineries are focused on securing the safety and reliability of our assets
while improving our competitive position. In addition, we continue to
invest to develop the capability to produce the cleaner fuels that meet
the requirements of our customers and their communities.