Oil Companies Are Failing to Comply With Refining Safety Rules, OSHA Says

U.S. oil companies are failing to comply with federal standards for workers’ safety at refineries, a federal regulator told a Senate hearing called in response to the explosion of a Gulf of Mexico drilling rig leased by BP Plc.

“Time and again, our inspectors are finding the same violations in multiple refineries,” Jordan Barab, deputy assistant labor secretary for Occupational Health and Safety Administration, said in testimony prepared for a Senate Health Committee hearing today. “In the nation’s energy producing industry, the status quo is not working.”

U.S. lawmakers led by Senator Patty Murray, a Washington Democrat, are investigating conditions in the oil-and-gas industry after an April 20 blast killed 11 workers and triggered the biggest U.S. oil spill. “This is not a safe industry,” Murray said.

OSHA, which oversees workplace safety, faulted BP’s refinery operations and without discussing the company’s role on the Deepwater Horizon drilling rig it leased. In an interview yesterday, OSHA chief David Michaels said the agency is monitoring BP’s cleanup of oil along the Gulf shore to prevent “sloppiness” that would expose workers to health threats.

“We are prepared to issue citations if we see a hazards,” Michaels said in a telephone interview from Houma, Louisiana, while touring the region.

BP’s U.S. refineries have been a target of OSHA enforcement. The agency fined the company a record $87.4 million in October for failing to correct deficiencies at a Texas refinery after a 2005 explosion killed 15 workers.

Safety Incentive

The U.S. energy industry has every incentive to keep workers safe, Charlie Drevna, president of the Petrochemical and Refiners Association, told lawmakers in prepared testimony.

“There is simply no situation where lax safety procedures will create any sort of benefit,” he said. “The financial and business costs of workplace incidents are so heavy that it makes good business sense to keep our facilities as safe and reliable as possible.”

Barab said OSHA inspectors found “systemic safety and health problems in the entire petrochemical industry.” The oil and gas industry, he said, “must learn from its mistakes.”

The workplace safety regulator drew complaints from Kim Nibarger, a health and safety specialist at the United Steelworkers union, for failing to improve safety.

“We hear many complaints about OSHA not doing enough,” Nibarger said in prepared testimony. “OSHA needs to exert more control over the standards for health and safety in the oil industry.”

Contest Citations

OSHA’s citations require a limited response, which hinders enforcement, Nibarger said. An inspection program for oil refineries has led companies to contest the citations after penalties are assessed. “This means that the company is not required to take any action,” he said.

Nibarger said OSHA should tighten standards for assessing a company’s safety record. The agency relies on logs showing personal injuries such as slips, trips and falls and isn’t a reflection of the safety record for the energy industry.

The government and companies would benefit from greater public reporting of the industry’s safety record, he said. “When the public is aware of how you operate, they can help pressure you to be better,” Nibarger said.

To contact the reporter on this story: Holly Rosenkrantz in Washington at hrosenkrantz@bloomberg.net

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