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EPA Slams Chevron in Refinery Blast

Monday, January 6, 2014

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Already shouldering $963,200 in state fines, oil giant Chevron is now facing $37,500 a day in federal penalties from a corrosion-related blast that endangered 19 workers and sent 15,000 people to California hospitals in 2012.

The U.S. Environmental Protection Agency notified Chevron of the fines Dec. 17 along with 62 regulatory violations the agency cited in connection with the explosion and fire at the Richmond, CA, refinery Aug. 6, 2012.

Chevron Refinery Fire

The fire Aug. 6, 2012, sent more than 15,000 area residents to hospitals with respiratory and other complaints.

The citations were the first federal regulatory action stemming from the fire.

Independently, but concurrently, the U.S. Chemical Safety Board urged the state of California to overhaul the way it regulates its refineries, in the wake of the same accident.

1 Year, 2 Fires

The actions stem from the fire that began after a severely corroded pipe in Chevron's #4 Crude Unit began leaking. California's investigators eventually found that Chevron "did not follow the recommendations of its own inspectors and metallurgical scientists to replace the corroded pipe that ultimately ruptured and caused the fire."

That investigation led the state to issue nearly $1 million in fines in February 2013.

Other investigations determined that the failed pipe had not been inspected during regular maintenance in 2011, and that employees had complained about unchecked corrosion after a fire in October 2011 at the 110-year-old facility. The Richmond refinery became the world's third largest when it was completed in 1902.

CSB investigators

The U.S. Chemical Safety Board has released the second of three reports stemming from its investigation of the Chevron fire.

Investigators from the U.S. Chemical Safety Board discovered that corrosion had eroded 80 percent of the carbon-steel pipe wall’s thickness—well above the level at which Chevron’s policies call for replacement.

Criminal Violations

In December, the EPA sent a letter to refinery General Manager Kory Judd, declaring that Chevron had violated federal laws and regulations as well as the company's own procedures governing the prevention of chemical accidents and the reporting of chemical releases.

"EPA's primary concern is that Chevron repeatedly failed to follow its own practices, plans, and recommendations intended to minimize the chemical safety risks consistent with federal law," the letter said.

The agency's accompanying Finding of Violations identified 49 failures in Chevron's implementation of its EPA-mandated Risk Management Program (RMP). For example, EPA said, Chevron failed to:

  • Keep accurate information on the "sidecut" pipe that failed;
  • Maintain, inspect, test and operate the pipe;
  • Asseess the consquences of a failure of the pipe;
  • Correct deficiencies its own compliance audit had identified; and
  • Implement the company's own emergency response plant when the pipe failed.
Chevron Richmond refinery

Completed in 1902, Chevron's vast Richmond, CA, refinery now includes a wildlife habitat.

Combined, the violations "increased the probability" that the pipe would fail with "significant consquences," EPA said.

In all, the violations paint a picture of "an overarching failure to implement an effective management system to oversee the program," EPA wrote.

Reporting Lapses

The Finding of Violations also identifies 13 lapses in release reporting after the accident.

The Finding requires that Chevron correct deficient release reports, submit documentation of remedial or corrective actions, and detail the company's plans to improve safety at the refinery.

"Upon review of such information, EPA intends to identify remaining gaps in risk management and to seek a federally enforceable agreement to ensure full compliance," the agency warned.

Chevron was given 30 days to respond. The company did not release a statement.

Regulation Overhaul Urged

Chevron is not the only entity blamed in the accident. The Chemical Safety Board, an independent agency, took regulators to task in the second of three reports on its investigation into the fire.

Richmond Refinery archive

In 1938, the Richmond Refinery built the first large-scale plant in the United States to make 100-octane gasoline for U.S. bombers.

"Regulatory Report: Chevron Richmond Refinery Pipe Rupture and Fire" calls on California "to replace the current patchwork of largely reactive and activity-based regulations with a more rigorous, performance-based regulatory regime ... known as the 'safety case' system."

The approach arose after the UK's Piper Alpha offshore explosion of 1988, which killed 167 workers. CSB says the safety case regime "requires companies to demonstrate to refinery industry regulators – through a written 'safety case report' – how major hazards are to be controlled and risks reduced to 'as low as reasonably practicable,' or ALARP."

More than a written document, the safety case "represents a fundamental change by shifting the responsibility for continuous reductions in major accident risks from regulators to the company."

Rigorous Review

The report is then "rigorously reviewed, audited and enforced by highly trained regulatory inspectors," CSB said.

The Safety Board said the safety case system had been "successfully adopted" in the United Kingdom, Norway, and Australia.

"Refinery safety rules need to focus on driving down risk to the lowest practicable level, rather than completing required paperwork," said Dr. Rafael Moure-Eraso, CSB chairperson. "Companies, workers, and communities will all benefit from a rigorous system like the safety case.

"I believe California could serve as a model for the nation by adopting this system."

The public comment period for the CSB's draft report closed Friday (Jan. 3). A public meeting and vote on the draft are set for Jan. 15.


Tagged categories: Corrosion; Enforcement; Environmental Protection Agency (EPA); Maintenance programs; Oil and Gas; Pipeline

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