Chevron Fined Nearly $1 Million for Refinery Fire

SAN FRANCISCO (AP) — Chevron was fined nearly $1 million by the state on Wednesday in connection with a fire at the company’s San Francisco Bay area refinery last year that sent a cloud of gas and black smoke over residential areas.

The California Division of Occupation Safety and Health said investigators found “willful violations” in Chevron Corp.’s response before, during and after the Aug. 6 fire in Richmond caused by an old, leaky pipe in one of the facility’s crude units.

“Our … investigation showed that Chevron had repeated warnings and recommendations from its own metallurgists and pipe inspectors about the condition of this pipe,” said Ellen Widess, the agency’s chief.

“Chevron was in a unique position to really know the hazards that they deal with from their dynamic technologies and processes, many of which are proprietary. They alone were in position to have addressed these hazards.”

The agency filed 25 citations against oil giant, and said the $963,200 in fines were the largest allowed by state law. The company said it planned to appeal some of the violations.

Among the findings, the agency said the company didn’t follow recommendations of its own inspectors and scientists made in 2002 to replace the corroded pipe that ultimately ruptured and caused the fire.

“Chevron had pervasive violations in its leak repair procedures throughout the refinery,” the agency found. “Investigators identified leaks in pipes that Chevron had clamped as a temporary fix. In some cases the clamps remained in place for years, rather than replacing the pipes themselves.”

Cal-OSHA also cited Chevron for not following its own emergency shutdown procedures when the leak was first spotted, and said the company exposed workers to harm by not ensuring they wore proper safety equipment when going back into the burnt out crude unit following the blaze.

No workers were seriously injured in the incident.

Eleven of the violations have been classified as “willful” because investigators found that Chevron had not taken actions to eliminate dangerous conditions for employees, including replacement of the pipe that ruptured.

The investigation also cited the company for failing to file in writing its mandated “thorough review” of a new type of pipe that it wants to use in replacement of the old one that failed.

Company spokesman Sean Comey said Chevron disagreed with some of the violations.

“Although we acknowledge that we failed to live up to our own expectations in this incident, we do not agree with several of the (Cal-OSHA) findings and its characterization of some of the alleged violations as ‘willful,'” he said in an email. “Chevron intends to appeal”

Smoke and gas from the fire prompted thousands of people to seek medical treatment, with many complaining of eye irritation and breathing problems.

The fire was caused by a decades-old pipe that the company had neglected to replace, even after inspecting areas near the segment that failed less than a year earlier.

Chevron has paid $10 million in connection to nearly 24,000 claims from residents and to nearby hospitals and local government agencies in Richmond and Contra Costa County, the company said in a report filed earlier this week.

Most of that money went to the hospitals to pay for medical exams and treatments following the incident.

While the fines may not be a major deterrent for a company that earned an estimated $25 billion in 2012, the agency said industry is often more sensitive to a violations classification, such as “willful,” than monetary penalties.

“There’s a huge stigma to willful violations with all industries,” Erika Monterroza, a Cal-OSHA spokeswoman.

Chevron’s El Segundo refinery and its oilfield near Bakersfield are also under investigation by Cal-OSHA.