08:00 am, Wednesday 12 September, 2007
Source: Bloomberg
BP ELIMINATED safety equipment including first-aid kits and fire-smothering blankets to cut operating costs, according to documents shown to jurors in the first trial over a fatal explosion at its Texas refinery in 2005.
“This is a prime example of putting money over the safety of our people here,” Sam Mancuso, a health and safety supervisor at BP’s Texas City complex, said in an email to the plant’s fire chief six weeks before the explosion, which killed 15 and injured hundreds.
The explosion at BP’s refinery in Texas City, Texas, spurred more than 3000 lawsuits, a record $US21 million fine by the US Occupational Safety and Health Administration and a finding by the US Chemical Safety Board that the company endangered workers by cutting costs. BP, Europe’s second-largest oil company, has said it did not intentionally endanger workers.
A jury of four men and eight women in Galveston, Texas, has begun hearing the claims of Nara and David Wilson, both 44, Scott Kilbert, 48, and Rolando Bocardo, 41. The workers suffered back injuries, hearing loss and post-traumatic stress syndrome, lawyers said.
The four were working at the refinery on March 23, 2005, when an octane-boosting unit overflowed during restart. Petrol vapours spilled into an antiquated vent system and ignited in an explosion that broke windows as far away as eight kilometres.
The Mancuso email shown to Texas jurors on Friday was written in response to a management order that workers call for emergency responders if someone caught fire, instead of keeping a supply of fire-smothering blankets on hand at the units. Mr Mancuso worked in the petrochemical plant on the other side of the Texas City complex from the unit that exploded and was subject to the same cost-cutting directives.
“Do these people that make these types of decisions realise that by the time an [emergency medical technician] gets to the unit, the person will be burnt to death,” Mr Mancuso wrote on February 10, 2005. “And that if we had fire blankets, we could probably save a life.”
Don Parus, BP’s former manager of the Texas City refinery, told jurors that refinery workers were particularly upset by cost-cutting measures ordered at the plant in early 2005 because they had complained about safety at the site in a company-sponsored survey a few months earlier.
A lawyer for the plaintiffs, Brent Coon, questioned Mr Parus about employee comments from the survey, conducted by the Telos Group, a consulting firm. Texas City workers said refinery policy was to under-report or ignore job-related injuries to keep the company’s safety record high.
One worker said he was told his injury “couldn’t have happened on the job, and suddenly it didn’t”, the report said. Another worker complained he had been punished and ridiculed by management for reporting an on-the-job injury. Others complained that safety needs were under-financed.
“It seems it all comes down to money,” one worker said. “We tell them we need it; they tell us they don’t have the money. As soon as it blows up or someone gets hurt there’s all sorts of money.”
Mr Coon asked Mr Parus for his reaction to the workers’ complaints. “Those were the raw comments, somebody’s perception,” he said in evidence.
“I can’t dispute that.”
Mr Parus said he was unaware of the deteriorated conditions of the operating unit that exploded in March 2005 until it blew up. Before that, he was focused on repairing the refinery’s corroded piping, section-by-section, he said.
Mr Parus testified last week that he told executives in BP’s Chicago and London offices in the month before the explosion of the safety study’s warnings, in which some workers said they “feared for their lives” at the refinery. The plant’s operations and maintenance budgets were slashed by 25 per cent weeks before the blast, he said.
“Why were you making $1 billion a year and having to negotiate with the people in London to get the money you needed to get your plant back where it needs to be?” Mr Coon asked Mr Parus, referring to the Texas City refinery’s 2004 profit. “That’s a question you’d have to ask people who made that decision,” Mr Parus replied.
Susan Criss, the Texas state judge overseeing almost all the blast cases, ordered BP’s former chief executive officer John Browne to testify about his knowledge of safety and budgeting at the plant. BP is fighting the order, and the Texas Supreme Court will hear arguments on the matter next month. Lord Browne resigned in May, three months earlier than planned, after admitting he lied to the London High Court about details of a relationship with a former boyfriend.
BP avoided a trial until now by settling about 1,350 explosion-related claims, using a $1.6 billion fund created for that purpose. The company has denied that budget cuts ordered by senior management in London were connected to the explosion. It acknowledged safety shortcomings at the plant, its largest.
BP’s American depositary receipts, each representing six ordinary shares, fell US15c to $68.21 in New York Stock Exchange composite trading.
BP is Europe’s largest oil company after Royal Dutch Shell plc.
Bloomberg
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