BP agrees to record fine over refinery blast

BP has agreed to pay a record $50.6 (£32) million fine for health and safety violations at its Texas City refinery and an immediate £320 million towards ongoing safety provision at the plant.

The embattled firm also said it would pay out a further $500 (£320) million immediately to safeguard the safety of workers at the refinery, five years after a blast at the plant killed three and injured 170.

The firm faces a glimmer of hope however on the two relief wells it  is drilling to completely seal off the Macondo Well after managing to stem the flow from the blown well on 15 July.

The firm had managed to complete its 'static kill' -injecting the well with mud and cement , but has been drilling two relief wells over the last three months.

Pressure tests carried out on the well have indicated that the static kill may have alleviated the need to plug the well from below, although Thad Allen, the US official in charge of the rescue operation, said he was still likely to require the well to be plugged from below.

In a conference call last night, he said: 'I wouldn't rule anything out at this point,' although he said the recovery operation was likely to require the relief well drilling to continue.

The Texas fine was levied by the US Occupational Safety and Health Administration (Osha) which has levied fines totalling $380 million over the past three years on BP for issues relating to the refinery, trading frauds and pipeline leaks.

Responding to the fine in a staement to the London Stock Exchange this morning, Iain Conn, BP's global head of refining & marketing, said: 'BP and OSHA are jointly committed to workplace safety and a strong relationship with OSHA is of great importance to BP. We respect OSHA's concerns and have addressed them in this agreement. BP has a stated goal to become a leader in process safety and we look forward to working collaboratively with OSHA to achieve an injury-free workplace in our operations.'