Violations and accidents
Citing conditions similar to those that resulted in the 2005 Texas City Refinery explosion, on 25 April 2006, the U.S. Department of Labor's Occupational Safety and Health Administration (OSHA) fined BP more than $2.4 million for unsafe operations at the company's Oregon, Ohio refinery. An OSHA inspection resulted in 32 per-instance willful citations including locating people in vulnerable buildings among the processing units, failing to correct depressurization deficiencies and deficiencies with gas monitors, and failing to prevent the use of non-approved electrical equipment in locations in which hazardous concentrations of flammable gases or vapors may exist. BP was further fined for neglecting to develop shutdown procedures and designate responsibilities and to establish a system to promptly address and resolve recommendations made after an incident when a large feed pump failed three years prior to 2006. Penalties were also issued for five serious violations, including failure to develop operating procedures for a unit that removes sulfur compound; failure to ensure that operating procedures reflect current operating practice in the Isocracker Unit; failure to resolve process hazard analysis recommendations; failure to resolve process safety management compliance audit items in a timely manner; and failure to periodically inspect pressure piping systems.
In 2008, BP and several other major oil refiners agreed to pay $422 million to settle a class-action lawsuit stemming from water contamination tied to the gasoline additive MTBE, a chemical that was once a key gasoline ingredient. Leaked from storage tanks, MTBE has been found in several water systems across the United States. The plaintiffs maintain that the industry knew about the environmental dangers but that they used it instead of other possible alternatives because it was less expensive. The companies will also be required to pay 70% of cleanup costs for any wells newly affected at any time over the next 30 years.
BP has one of the worst safety records of any major oil company that operates in the United States. Between 2007 and 2010, BP refineries in Ohio and Texas accounted for 97% of "egregious, willful" violations handed out by the U.S. Occupational Safety and Health Administration (OSHA). BP had 760 "egregious, willful" violations during that period, while Sunoco and Conoco-Phillips each had eight, Citgo two and Exxon had one. The deputy assistant secretary of labour at OSHA, said "The only thing you can conclude is that BP has a serious, systemic safety problem in their company."
A report in ProPublica, published in The Washington Post'' in 2010, found that over a decade of internal investigations of BP's Alaska operations during the 2000s warned senior BP managers that the company repeatedly disregarded safety and environmental rules and risked a serious accident if it did not change its ways. ProPublica found that "Taken together, these documents portray a company that systemically ignored its own safety policies across its North American operations – from Alaska to the Gulf of Mexico to California and Texas. Executives were not held accountable for the failures, and some were promoted despite them."
The Project On Government Oversight, an independent non-profit organization in the United States which investigates and seeks to expose corruption and other misconduct, lists BP as number one on their listing of the 100 worst corporations based on instances of misconduct.
1965 Sea Gem offshore oil rig disasteredit
In December 1965, Britain's first oil rig, Sea Gem, capsized when two of the legs collapsed during an operation to move it to a new location. The oil rig had been hastily converted in an effort to quickly start drilling operations after the North Sea was opened for exploration. Thirteen crew members were killed. No hydrocarbons were released in the accident.
Texas City Refinery explosion and leaksedit
The former Amoco oil refinery at Texas City, Texas, was beset by environmental issues, including chemical leaks and a 2005 explosion that killed 15 people and injured hundreds. Bloomberg News described the incident, which led to a guilty plea by BP to a felony Clean Air Act charge, as "one of the deadliest U.S. industrial accidents in 20 years." The refinery was sold to Marathon Petroleum in October 2012.
2005 explosionedit
In March 2005, the Texas City Refinery, one of the largest refineries owned then by BP, exploded causing 15 deaths, injuring 180 people and forcing thousands of nearby residents to remain sheltered in their homes. A 20-foot (6.1 m) column filled with hydrocarbon overflowed to form a vapour cloud, which ignited. The explosion caused all the casualties and substantial damage to the rest of the plant. The incident came as the culmination of a series of less serious accidents at the refinery, and the engineering problems were not addressed by the management. Maintenance and safety at the plant had been cut as a cost-saving measure, the responsibility ultimately resting with executives in London.
The fallout from the accident clouded BP's corporate image because of the mismanagement at the plant. There had been several investigations of the disaster, the most recent being that from the US Chemical Safety and Hazard Investigation Board which "offered a scathing assessment of the company." OSHA found "organizational and safety deficiencies at all levels of the BP Corporation" and said management failures could be traced from Texas to London. The company pleaded guilty to a felony violation of the Clean Air Act, was fined $50 million, the largest ever assessed under the Clean Air Act, and sentenced to three years probation.
On 30 October 2009, the US Occupational Safety and Health Administration (OSHA) fined BP an additional $87 million, the largest fine in OSHA history, for failing to correct safety hazards documented in the 2005 explosion. Inspectors found 270 safety violations that had been cited but not fixed and 439 new violations. BP appealed the fine. In July 2012, the company agreed to pay $13 million to settle the new violations. At that time OSHA found "no imminent dangers" at the Texas plant. Thirty violations remained under discussion. In March 2012, US Department of Justice officials said the company had met all of its obligations and subsequently ended the probationary period. In November 2011, BP agreed to pay the state of Texas $50 million for violating state emissions standards at its Texas City refinery during and after the 2005 explosion at the refinery. The state Attorney General said BP was responsible for 72 separate pollutant emissions that have been occurring every few months since March 2005. It was the largest fine ever imposed under the Texas Clean Air Act.
2007 toxic substance releaseedit
In 2007, 143 workers at the Texas City refinery claimed that they were injured when a toxic substance was released at the plant. In December 2009, after a three-week trial, a federal jury in Galveston awarded ten of those workers $10 million each in punitive damages, in addition to smaller damages for medical expenses and pain and suffering. The plant had a history of chemical releases. In March 2010, the federal judge hearing the case reduced the jury's award to less than $500,000. U.S. District Judge Kenneth M. Hoyt said the plaintiffs failed to prove BP was grossly negligent.
2010 chemical leakedit
In August 2010, the Texas Attorney General charged BP with illegally emitting harmful air pollutants from its Texas City refinery for more than a month. BP has admitted that malfunctioning equipment led to the release of over 530,000 pounds (240,000 kg) of chemicals into the air of Texas City and surrounding areas from 6 April to 16 May 2010. The leak included 17,000 pounds (7,700 kg) of benzene, 37,000 pounds (17,000 kg) of nitrogen oxides, and 186,000 pounds (84,000 kg) of carbon monoxide. The State's investigation showed that BP's failure to properly maintain its equipment caused the malfunction. When the equipment malfunctioned and caught fire, BP workers shut it down and routed escaping gases to flares. Rather than shut down associated units while compressor repairs were made, BP chose to keep operating those other units, which led to unlawful release of contaminants for almost 40 days. The Attorney General is seeking civil penalties of no less than $50 nor greater than $25,000 per day of each violation of state air quality laws, as well as attorneys' fees and investigative costs.
In June 2012, over 50,000 Texas City residents joined a class-action suit against BP, alleging they became sick in 2010 as a result of the emissions release from the refinery. BP said the release harmed no one. In October 2013, a trial designed as a test for a larger suit that includes 45,000 people found that BP was negligent in the case, but due to the lack of substantial evidence linking illness to the emissions, decided the company would be absolved of any wrongdoing.
Prudhoe Bayedit
In March 2006, corrosion of a BP Exploration Alaska (BPXA) oil transit pipeline in Prudhoe Bay transporting oil to the Trans-Alaska Pipeline led to a five-day leak and the largest oil spill on Alaska's North Slope. According to the Alaska Department of Environmental Conservation (ADEC), a total of 212,252 US gallons (5,053.6 bbl; 803.46 m3) of oil was spilled, covering 2 acres (0.81 ha) of the North Slope. BP admitted that cost-cutting measures had resulted in a lapse in monitoring and maintenance of the pipeline and the consequent leak. At the moment of the leak, pipeline inspection gauges (known as "pigs") had not been run through the pipeline since 1998. BP completed the clean-up of the spill by May 2006, including removal of contaminated gravel and vegetation, which was replaced with new material from the Arctic tundra.
Following the spill, the company was ordered by regulators to inspect the 35 kilometres (22 mi) of pipelines in Prudhoe Bay using "smart pigs". In late July 2006, the "smart pigs" monitoring the pipelines found 16 places where corrosion had thinned pipeline walls. A BP crew sent to inspect the pipe in early August discovered a leak and small spill, following which, BP announced that the eastern portion of the Alaskan field would be shut down for repairs on the pipeline, with approval from the Department of Transportation. The shutdown resulted in a reduction of 200,000 barrels per day (32,000 m3/d) until work began to bring the eastern field to full production on 2 October 2006. In total, 23 barrels (3.7 m3) of oil were spilled and 176 barrels (28.0 m3) were "contained and recovered", according to ADEC. The spill was cleaned up and there was no impact upon wildlife.
After the shutdown, BP pledged to replace 26 kilometres (16 mi) of its Alaskan oil transit pipelines and the company completed work on the 16 miles (26 km) of new pipeline by the end of 2008. In November 2007, BP Exploration, Alaska pleaded guilty to negligent discharge of oil, a misdemeanor under the federal Clean Water Act and was fined US$20 million. There was no charge brought for the smaller spill in August 2006 due to BP's quick response and clean-up. On 16 October 2007, ADEC officials reported a "toxic spill" from a BP pipeline in Prudhoe Bay comprising 2,000 US gallons (7,600 l; 1,700 imp gal) of primarily methanol (methyl alcohol) mixed with crude oil and water, which spilled onto a gravel pad and frozen tundra pond.
In the settlement of a civil suit, in July 2011 investigators from the U.S. Department of Transportation's Pipeline and Hazardous Materials Safety Administration determined that the 2006 spills were a result of BPXA's failure to properly inspect and maintain the pipeline to prevent corrosion. The government issued a Corrective Action Order to BP XA that addressed the pipeline's risks and ordered pipeline repair or replacement. The U.S. Environmental Protection Agency had investigated the extent of the oil spills and oversaw BPXA's cleanup. When BP XA did not fully comply with the terms of the corrective action, a complaint was filed in March 2009 alleging violations of the Clean Water Act, the Clean Air Act and the Pipeline Safety Act. In July 2011, the U.S. District Court for the District of Alaska entered a consent decree between the United States and BPXA resolving the government's claims. Under the consent decree, BPXA paid a $25 million civil penalty, the largest per-barrel penalty at that time for an oil spill, and agreed to take measures to significantly improve inspection and maintenance of its pipeline infrastructure on the North Slope to reduce the threat of additional oil spills.
2008 Caspian Sea gas leakedit
On 17 September 2008, a small gas leak was discovered and one gas-injection well broached to surface in the area of the Central Azeri platform at the Azeri oilfield, a part of the Azeri–Chirag–Guneshli (ACG) project, in the Azerbaijan sector of Caspian Sea. The platform was shut down and the staff was evacuated. As the West Azeri Platform was being powered by a cable from the Central Azeri Platform, it was also shut down. Production at the West Azeri Platform resumed on 9 October 2008 and at the Central Azeri Platform in December 2008. According to leaked US Embassy cables, BP had been "exceptionally circumspect in disseminating information" and showed that BP thought the cause for the blowout was a bad cement job. The cables further said that some of BP's ACG partners complained that the company was so secretive that it was withholding information even from them.
California storage tanksedit
Santa Barbara County District Attorney sued BP West Coast Products LLC, BP Products North America, Inc., and Atlantic Richfield Company over allegations that the companies violated state laws regarding operating and maintaining motor vehicle fuel underground storage tank laws. BP settled a lawsuit for $14 million. The complaint alleged that BP failed to properly inspect and maintain underground tanks used to store gasoline for retail sale at approximately 780 gas stations in California over a period of ten years and violated other hazardous material and hazardous waste laws. The case settled in November 2016 and was the result of collaboration among the California Attorney General's Office and several district attorney's offices across the state.
Deepwater Horizon explosion and oil spilledit
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 Frontline: The Spill (54:25), Frontline on PBS |
The Deepwater Horizon oil spill was a major industrial accident on the Gulf of Mexico, which killed 11 people and injured 16 others, leaked about 4.9 million barrels (210 million US gal; 780,000 m3) of oil with plus or minus 10% uncertainty, which makes it the largest accidental marine oil spill in the history of the petroleum industry, and cost to the company more than $65 billion of cleanup costs, charges and penalties. On 20 April 2010, the semi-submersible exploratory offshore drilling rig Deepwater Horizon located in the Macondo Prospect in the Gulf of Mexico exploded after a blowout. After burning for two days, the rig sank. The well was finally capped on 15 July 2010. Of 4.9 million barrels (210 million US gal; 780,000 m3) of leaked oil 810,000 barrels (34 million US gal; 129,000 m3) was collected or burned while 4.1 million barrels (170 million US gal; 650,000 m3) entered the Gulf waters. 1.8 million US gallons (6,800 m3) of Corexit dispersant was applied.
The spill had a strong economic impact on the Gulf Coast's economy sectors such as fishing and tourism.
Environmental impactedit
Oil spill caused damages across a range of species and habitats in the Gulf. Researchers say the oil and dispersant mixture, including PAHs, permeated the food chain through zooplankton. Toxicological effects have been documented in benthic and pelagic fish, estuarine communities, mammals, birds and turtles, deep-water corals, plankton, foraminifera, and microbial communities. Effects on different populations consist of increased mortality or as sub-lethal impairment on the organisms' ability to forage, reproduce and avoid predators. In 2013, it was reported that dolphins and other marine life continued to die in record numbers with infant dolphins dying at six times the normal rate, and half the dolphins examined in a December 2013 study were seriously ill or dying. BP said the report was "inconclusive as to any causation associated with the spill."
Studies in 2013 suggested that as much as one-third of the released oil remains in the gulf. Further research suggested that the oil on the bottom of the seafloor was not degrading. Oil in affected coastal areas increased erosion due to the death of mangrove trees and marsh grass.
Researchers looking at sediment, seawater, biota, and seafood found toxic compounds in high concentrations that they said was due to the added oil and dispersants. Although Gulf fisheries recovered in 2011, a 2014 study of the effects of the oil spill on bluefin tuna by researchers at Stanford University and the National Oceanic and Atmospheric Administration, published in the journal Science, found that toxins released by the oil spill sent fish into cardiac arrest. The study found that even very low concentrations of crude oil can slow the pace of fish heartbeats. BP disputed the study, which was conducted as part of the federal Natural Resource Damage Assessment process required by the Oil Pollution Act. The study also found that oil already broken down by wave action and chemical dispersants was more toxic than fresh oil. Another peer-reviewed study, released in March 2014 and conducted by 17 scientists from the United States and Australia and published in Proceedings of the National Academy of Sciences, found that tuna and amberjack that were exposed to oil from the spill developed deformities of the heart and other organs. BP responded that the concentrations of oil in the study were a level rarely seen in the Gulf, but The New York Times reported that the BP statement was contradicted by the study.
Effects on human healthedit
Research discussed at a 2013 conference included preliminary results of an ongoing study being done by the National Institute for Environmental Health Sciences indicating that oil spill cleanup workers carry biomarkers of chemicals contained in the spilled oil and the dispersants used. A separate study is following the health issues of women and children affected by the spill. Several studies found that a "significant percentage" of Gulf residents reported mental health problems such as anxiety, depression and PTSD. According to a Columbia University study investigating the health effects among children living less than 10 miles from the coast, more than a third of the parents report physical or mental health symptoms among their children.
Australia's 60 Minutes reported that people living along the gulf coast were becoming sick from the mixture of Corexit and oil. Susan Shaw, of the Deepwater Horizon oil spill Strategic Sciences Working Group, says "BP told the public that Corexit was 'as harmless as Dawn dishwashing liquid'...But BP and the EPA clearly knew about the toxicity of the Corexit long before this spill." According to Shaw, BP's own safety sheet on Corexit says that there are "high and immediate human health hazards". Cleanup workers were not provided safety equipment by the company, and the safety manuals were "rarely if ever" followed, or distributed to workers, according to a Newsweek investigation. The safety manuals read: "Avoid breathing vapor" and "Wear suitable protective clothing." Oil clean up workers reported that they were not allowed to use respirators, and that their jobs were threatened if they did.
A peer-reviewed study published in The American Journal of Medicine reported significantly altered blood profiles of individuals exposed to the spilled oil and dispersants that put them at increased risk of developing liver cancer, leukemia and other disorders. BP disputed its methodology and said other studies supported its position that dispersants did not create a danger to health.
In 2014, a study was published in Proceedings of the National Academy of Sciences which found heart deformities in fish exposed to oil from the spill. The researchers said that their results probably apply to humans as well as fish.
Civil and criminal suitsedit
On 15 December 2010, the Department of Justice filed a civil and criminal suit against BP and other defendants for violations under the Clean Water Act in the U.S. District Court for the Eastern District of Louisiana.:70 The case was consolidated with about 200 others, including those brought by state governments, individuals, and companies under Multi-District Litigation docket MDL No. 2179, before U.S. District Judge Carl Barbier.
In November 2012, BP and the Department of Justice reached a $4 billion settlement of all federal criminal charges related to the explosion and spill. Under the settlement, BP agreed to plead guilty to 11 felony counts of manslaughter, two misdemeanors, and a felony count of lying to Congress and agreed to four years of government monitoring of its safety practices and ethics. BP also paid $525 million to settle civil charges by the Securities and Exchange Commission that it misled investors about the flow rate of oil from the well. At the same time, the US government filed criminal charges against three BP employees; two site managers were charged with manslaughter and negligence, and one former vice president with obstruction.
Judge Barbier ruled in the first phase of the case that BP had committed gross negligence and that "its employees took risks that led to the largest environmental disaster in U.S. history." He apportioned fault at 67% for BP, 30% for Transocean and 3% for Halliburton. Barbier ruled that BP was "reckless" and had acted with "conscious disregard of known risks."
Claims settlementedit
In June 2010, after a meeting in the White House between President Barack Obama and BP executives, the president announced that BP would pay $20 billion into a trust fund that will be used to compensate victims of the oil spill. BP also set aside $100 million to compensate oil workers who lost their jobs because of the spill.
On 2 March 2012, BP and businesses and residents affected by the spill reached a settlement of roughly 100,000 suits claiming economic losses. BP estimated that the settlement cost more than $9.2 billion.
In 2015, BP and five states agreed an $18.5 billion settlement to be used for Clean Water Act penalties and various claims.
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